The U.S. Occupational Safety and Health Administration (OSHA) has been actively working this summer to address chemical facility safety and security as part of President Obama's Executive Order (EO) 13650 initiative to improve Chemical Facility Safety and Security. Recently, OSHA released three memoranda addressing process safety management (PSM) reforms, and is in the process of convening the Small Business Advocacy Review (SBAR) panel on PSM this fall.
A number of ACA members are impacted by the PSM Standard (29 CFR 1910.119), which contains requirements for the management of hazards associated with processes using highly hazardous chemicals. This standard establishes a comprehensive management program that integrates technologies, procedures, and management practices.
On Aug. 1, 2013, President Obama signed EO 13650 in response to the explosion at the fertilizer plant in West, Texas in April of that year that killed 15 people and wounded 226. The President called upon many federal agencies, including the U.S. Environmental Protection Agency (EPA), OSHA, Department of Homeland Security (DHS) and Department of Justice (DOJ), to establish a working group tasked with carrying out the EO. The EO directs federal agencies to improve operational coordination with state and local partners; enhance federal agency coordination and information sharing; modernize policies, regulations, and standards; and work with stakeholders to identify best practices.
OSHA's three policy enforcement memoranda sent to regional inspectors make important changes in interpretation to the PSM regulations with regard to:
- The concentration of a chemical that must be present in a process for the purpose of determining whether the chemical is at or above the threshold quantity listed in Appendix A Highly Hazardous Chemicals (click here for memo),
- The interpretation of recognized and generally accepted good engineering practices ("RAGAGEP") (click here for memo), and
- The retail exemption policy (click here for memo).
OSHA Memo on Appendix A Chemicals
On June 5, OSHA released a memorandum for regional administrators and state plan designees, effective immediately, regarding changes to its enforcement policy on "the concentration of a chemical that must be present in a process for the purpose of determining whether the chemical is at or above the threshold quantity listed in Appendix A Highly Hazardous Chemicals (HHC) of PSM." Appendix A of the PSM regulations gives the threshold quantity in pounds for each of the 137 chemicals on the list of HHC. Of the 137 chemicals, 126 are listed without reference to a minimum concentration.
In the past, OSHA's policy was that chemicals listed in Appendix A without minimum concentrations are covered at "commercial grade" concentrations (generally 99 percent or higher). However, the new policy establishes that:
In determining whether a process involves a chemical (whether pure or in a mixture) at or above the specified threshold quantities listed in Appendix A, the employer shall calculate:
(a) the total weight of any chemical in the process at a concentration that meets or exceeds the concentration listed for that chemical in Appendix A, and
(b)with respect to chemicals for which no concentration is specified in Appendix A, the total weight of the chemical in the process at a concentration of one percent or greater. However, the employer need not include the weight of such chemicals in any portion of the process in which the partial pressure of the chemical in the vapor space under handling or storage conditions is less than 10 millimeters of mercury (mm Hg). The employer shall document this partial pressure determination.
In determining the weight of a chemical present in a mixture, only the weight of the chemical itself, exclusive of any solvent, solution, or carrier is counted.
This memo also includes a number of examples and Q&A to provide further clarity. This change in enforcement policy is potentially significant because facilities not previously subject to PSM regulations could become covered by PSM under this new policy.
When OSHA released its Request for Information on Process Safety Management potential reforms in 2014, ACA commented on the proposal and argued that if OSHA decides to make substantive changes to Appendix A, it must go through the rulemaking process. However, because this was a memoranda to regional enforcement officers; it was not part of the rulemaking process, so was not subject to notice and comment.
OSHA Memo on Retail Exemption
On July 22,OSHA sent another memo for regional administrators and state plan designees that revises OSHA's interpretation of the exemption for retail facilities from coverage under PSM. Although the term "retail facility" is not defined, the preamble to the final PSM standard explains that chemicals in retail facilities are generally sold in small packages, containers, and allotments.
The revised retail exemption policy moves away from OSHA's previous "50 percent test" (an establishment was exempt from PSM coverage if it derived more than 50 percent of its income from direct sales of highly hazardous chemicals to the end user) and clarifies that the retail exemption applies only to NAICS sector 44-45 Retail Trade and not to NAICS Sector 42 Wholesale Trade. A compliance safety and health officer may recommend issuance of a citation for any applicable violation of the PSM Standard after determining that the employer's primary NAICS related to the sale of HHCs is something other than a retail trade, as defined in NAICS sectors 44 or 45, and PSM coverage is otherwise established.
This new policy also has the potential to bring in new facilities that previously fell under the retail facility exemption. According to OSHA, "it chose to exclude retail facilities from PSM coverage because the small container, package, or allotment sizes of the chemicals typically found at these facilities do not present the same safety hazards as establishments that handle large, bulk quantities of materials. The types of facilities described in the preamble generally fall into NAICS Sectors 44-45 - Retail Trade. In contrast, facilities that handle large, bulk quantities of materials typically fall into NAICS Sector 42 - Wholesale Trade…. Because the exemption is limited specifically to retail facilities, it should never have been interpreted to cover facilities engaged in distinctly wholesale activities."
OSHA also issued a PSM Retail Exemption Interim Enforcement Policy calling for use of its enforcement discretion in the form of a six-month compliance assistance policy for previously exempt facilities unless there is an imminent and severe danger and the employer has not exercised reasonable good faith to eliminate or substantially control the hazard.
OSHA Memo on RAGAGEP
Also on June 5, OSHA released guidance on enforcement of PSM's recognized and generally accepted good engineering practices (RAGAGEP) requirements, including how to interpret "shall" and "should" language in documents related to RAGAGEP.
RAGEGEP is referenced in a number of provisions of the PSM Standard, including in relation to equipment used in PSM-covered processes, inspections and tests performed on process equipment, and inspection and test frequency. Also, RAGAGEP apply to process equipment design, installation, operation, and maintenance. RAGAGEP must be both "recognized and generally accepted" and "good engineering" practices. OSHA allows for employers to select RAGEGEP that they apply to their covered processes, which can come from sources like widely adopted consensus standards (such as NFPA 101), published consensus documents, and published non-consensus documents. Employers can also use appropriate internal standards so long as they meet or exceed the protective requirements of published RAGAGEP.
The memo clarifies that, "shall," "must," or similar language means a mandatory minimum requirement, whereas "should" means an acceptable or preferred approach. So, if an employer does not follow a "shall" requirement in the employer's adopted RAGEGEP, OSHA will presume a violation; but, if the employer chooses to use an alternate approach to a published "should" RAGAGEP, OSHA should evaluate whether the employer has determined and documented that the alternate approach is at least as protective, or that the published RAGAGEP is not applicable to the employer's operation. The memo also includes a number of enforcement considerations for OSHA officers in evaluating RAGAGEP compliance.
OSHA to Commence Small Business Review Panel for PSM Modernization this Fall
On June 8, OSHA announced its intention to convene a Small Business Advocacy Review panel in August 2015 for its PSM Standard. The panel, comprising OSHA, the Small Business Administration (SBA), Office of Management and Budget (OMB), and small entity representatives regulated by PSM, will discuss the potential impacts OSHA's proposed changes to the PSM standard could have on small businesses.
When an OSHA proposal is expected to have a "significant impact on a substantial number of small entities," the agency must notify SBA, and SBA then recommends small entity representatives be consulted on the rule and its effects. OSHA next convenes the SBAR panel, and the panel hears comments from small entity representatives and reviews the draft proposed rule and related analyses prepared by OSHA. A written report of this interagency panel must be submitted to OSHA within 60 days. OSHA can then review the report, make any appropriate revisions to the rule, and publish the proposed rule along with the panel's report in the Federal Register.
A number of industries have nominated small entity representatives to participate in this panel, including ACA.
For more information, please visit SBA's Office of Advocacy website: https://www.sba.gov/advocacy.
Contact ACA's Javaneh Nekoomaram or Stephen Wieroniey for more information.http://www.paint.org/news/industry-news/item/1855-osha-addresses-process-safety-management-psm-as-part-of-efforts-to-enhance-chemical-facility-safety.html
