Special Report
Bush Administration Kills Safety Regulation Opposed by Donors

By Bill Dawson

The Bush administration quietly shelved a proposal to tighten regulations on a group of hazardous chemicals despite evidence linking dozens of deaths and hundreds of injuries to accidents involving those chemicals, an investigation by the Center for Public Integrity has found.

‘Lower risk’ chemicals have the highest accident rates

Federal workplace-safety officials relied upon an already existing hazard-ranking system when they first developed their Process Safety Management (or PSM) standard to prevent chemical disasters in the early 1990s.

To choose which reactive chemicals to regulate, OSHA used a system originally developed by the National Fire Protection Association (or NFPA). This five-level system classifies chemicals according to each one's "reactive hazard." The five categories of risk range from 0 ("normally stable") to 4 ("readily capable of detonation, explosive decomposition or explosive reaction at normal temperatures and pressures.")

Some, though not all, of the chemicals in the NFPA's categories 3 and 4 were covered by the PSM standard's initial rules. Congress had decreed in the 1990 Clean Air Act amendments that the new standard should regulate "highly hazardous" chemicals, and OSHA officials decided that only the fire-protection group's two highest-risk categories fit that definition.

A mid-90s petition by labor unions to cover still more reactive chemicals came after a number of incidents involving chemicals in the system's lower-risk categories 1 and 2, as well as some chemicals in categories 3 and 4 that OSHA had omitted from regulation.

An unpublished OSHA study found that many of the unregulated chemicals with the highest accident rates are in categories 1 and 2, according to a summary obtained by the Center.

Likewise, the U.S. Chemical Safety and Hazard Investigation Board's continuing investigation of 167 "significant harm" incidents involving reactive chemicals has found that in about 88 percent of them, the chemicals in question were not in the NFPA system's highest-risk categories 3 and 4.

A plant explosion at Lodi, N.J., which killed five workers in 1995 and galvanized union concerns about reactive chemicals, resulted from the mixture of sodium hydrosulfite (NFPA category 2) and aluminum powder (category 1). Neither is regulated under the PSM standard.

At issue in the shelved proposal is a particular group of hazardous materials that can produce runaway reactions. Some of these "reactive" chemicals become unstable, for instance, when they're subjected to heat, pressure, air or water. Others can react dangerously when mixed with other chemicals in uncontrolled ways. A particularly serious example of such chemical combinations was a 1995 explosion and fire that claimed five lives at a Lodi, N.J., plant.

The Bush administration abandoned a proposal to address such dangers after the workplace-safety standard it was meant to expand appeared on a "hit list" of 57 regulations targeted by business groups. This government list, which came to light last fall, was solicited for White House budget officials.

A spokesperson for the Occupational Safety and Health Administration said the agency was "unaware of any industry objections" to the chemical proposal, which OSHA officials had drafted.

But a government source told the Center that three industry trade groups -- the American Chemistry Council (then known as the Chemical Manufacturers Association), the American Petroleum Institute and the Synthetic Organic Chemical Manufacturers Association -- all opposed the initiative. Employees of those groups and their member companies, and their political action committees, contributed more than $216,000 to Bush's presidential campaign.

Eric Frumin, safety and health director for UNITE, the Union of Needletrades, Industrial and Textile Employees, charged that the decision to drop the proposal shows how "regulated industries are determining administration policies." UNITE, which represented workers at the Lodi, N.J., plant where five lost their lives, has been in the forefront of efforts by industrial and firefighters unions to have more chemicals covered by the OSHA standard.

The proposal that might have accomplished that goal was erased from an official roster of pending regulatory initiatives as administration officials were preparing President Bush's budget request for 2003. Announced in February, the administration's spending proposal would cut OSHA's budget by $7.9 million and eliminate 83 jobs at the workplace-safety agency.

The budget and personnel cuts are being proposed at a time when evidence has been accumulating that reactive chemicals beyond the reach of OSHA's current regulatory standard can pose serious hazards. Among the findings of the Center's examination of the issue:

• An unpublished study, commissioned by OSHA, determined that 44 reactive chemicals that aren't covered by its standard were implicated in 408 documented workplace accidents from 1992 through 1997. These incidents resulted in 66 deaths and 404 injuries, including 225 injuries that required hospital treatment, according to a draft copy of the shelved proposal obtained by the Center.
• A separate and continuing government study attributes a larger number of fatalities to uncontrolled chemical reactions over a longer period. Focusing only on selected incidents that produced "significant harm," the U.S. Chemical Safety and Hazard Investigation Board has counted 108 deaths in 48 such episodes between 1980 and 2001. The four-year-old federal board makes recommendations but has no regulatory authority. Its investigation of reactive chemicals has also determined that about half of the chemicals involved in the 167 events it is scrutinizing are not regulated by the OSHA standard, or by a complementary standard of the Environmental Protection Agency.
• OSHA officials were still publicly spotlighting the hazards of such chemicals as recently as last October, about six weeks before the shelving of the agency proposal was announced. The published summary of an OSHA official's scheduled presentation to the American Public Health Association on Oct. 22 declared: "Recent reactive chemical processing incidents have shown the dangers of working with these chemicals. While some reactive chemicals are regulated by OSHA's Process Safety Management (PSM) standard, these incidents have shown that even less reactive chemicals which are not covered by PSM can have catastrophic consequences when appropriate safety measures have not been developed and implemented."
• Private experts recently expressed similar concerns. The American Institute of Chemical Engineers' Center for Chemical Process Safety, which is co-sponsored by dozens of major oil, chemical, pharmaceutical and other companies, issued a "safety alert" about reactive chemicals last October. It warned: "Many facilities have chemically reactive materials and systems without knowing the hazards they pose. Others are aware of the hazards, but they have inadequate safeguards. Still others have situations where materials are adequately controlled individually, but the potential for a major incident exists if materials are inadvertently combined."
• One of the chemicals that the abandoned OSHA proposal cited for possible regulation, ammonium nitrate, was involved last September in an incident that became France's worst industrial disaster in a half-century. Atofina, the fertilizer plant's owner, has said an unintended reaction with other chemicals was unlikely, but is being investigated along with other possible causes. The explosion at a fertilizer factory in Toulouse killed 31 people, injured more than 2,400 and rendered 500 nearby homes uninhabitable, according to a United Nations report. Six deaths and most of the injuries occurred outside the plant. As a result, the incident has triggered widespread debate in Europe about whether to permit hazardous facilities in such densely populated areas.
• The Chemical Safety Board's study also underscores the danger that reactive chemicals can pose beyond industrial boundaries. Of the 167 U.S. incidents it is investigating, about 30 percent had a public impact outside of the affected workplace — injuries, evacuations, or orders for citizens to "shelter in place." (The Lodi, N.J., accident that devastated the Napp Technologies plant, for example, caused off-site damage and prompted the evacuation of hundreds of residents.)

A series of incidents involving reactive chemicals excluded from the 1992 standard, especially the Napp disaster, prompted six unions to petition OSHA for an emergency rule. In response to the unions' request, OSHA prepared the now-abandoned proposal during the late 1990s.

The Clinton administration was expected to issue the proposal, but it remained unpublished at the time of President Bush's inauguration, in a bureaucratic limbo.
  

A modest proposal

Bush assumed the presidency with a conservative's long-declared skepticism about the need for many government regulations. Still, some government, business and union officials thought the reactive chemicals proposal was one Clinton-era initiative that the new administration might carry forward.

Lending some credence to this view was Bush's choice of John Henshaw, a recognized chemical-safety expert, to head OSHA. Henshaw had more than a quarter-century's experience supervising environmental, safety and health programs in the chemical industry, and had served as president of the American Industrial Hygiene Association, before taking the top job at OSHA.

Additionally, the wording of the chemical initiative itself was modest. It was not the emergency proposal for comprehensive regulation of reactive chemicals that union leaders had requested. Instead, it was structured as a request for public comments on how OSHA might address problems posed by materials that aren't now regulated, and which ones the standard should cover.

In the draft copy obtained by the Center, several alternative approaches were outlined, including one described as "nonregulatory" — an increase in government assistance to employers in lieu of bringing extra chemicals under mandatory rules.

This proposal was included for possible publication on the Bush administration's first regulatory agenda last April, barely three months after he took office — too early in the new president's term to signal any definitive intention regarding such a holdover item. But at least one major consulting firm serving the chemical industry said in an online newsletter dated last October that publication of the proposal "is expected by the end of 2001."

On Dec. 3, however, a new regulatory agenda posted in the Federal Register contained a terse item saying the reactive chemicals initiative was being dropped because of "resource constraints and other priorities." The notice said the proposal had been withdrawn from consideration on Sept. 24.

"Basically, OSHA had a very ambitious schedule of projects" at the time the Bush administration took office, which was reflected in the original regulatory agenda, explained the OSHA spokesperson, who asked not to be identified.

"Only a few" of these pending proposals were published in the following months, and "after a review, the new administration decided to set more realistic goals," the OSHA official said. This, in turn "led to the withdrawal of some projects and the setting of undetermined timeframes for other projects."

The withdrawal of the proposal on reactive chemicals, which included other changes to bolster the Process Safety Management standard, "doesn't mean the agenda for revising PSM is unimportant, nor does it constrain future rulemaking on the issue," the OSHA official said.

This individual had no comment, however, on any possible relevance that the "hit list" of regulations unpopular with business groups may have had to the shelving of the chemical-safety proposal.
  

Rule targeted by business interests

Between the publication of the Bush administration's first two regulatory agendas — the first one with the chemical proposal and the second without it — the existing PSM program showed up on this "non-public" list of 57 regulations, later revealed to comprise items that business representatives considered too burdensome.

The Washington Post disclosed the list's existence in December, and that it had been in the works by late September. The Post reported that a congressional staffer, consulting privately with invited business lobbyists, had prepared the list at the request of the White House Office of Management and Budget. The public interest group OMB Watch later publicly identified all 57 regulations, which included the PSM program, and charged that the document amounted to a "hit list."

That term echoed the characterization of an unidentified business lobbyist who had initially provided the list to Post. The newspaper reported that the lobbyist was upset by the list's secret preparation, which he regarded as an "underhanded" attempt to use paperwork guidelines to weaken long-established regulations.

The PSM standard was adopted to comply with the 1990 Clean Air Act Amendments signed by the first President Bush. The standard requires various safe-management procedures to protect workers against accidental releases of those reactive, toxic, flammable or explosive chemicals that qualify as "highly hazardous." The mandatory checklist for facilities with large enough volumes on-site includes things like a workplace hazard assessment, written operating procedures and worker training.

Although the OSHA spokesperson said agency officials didn't know of any industry objections to the shelved proposal to revisit the PSM standard, there are other indications that some key industry representatives have been unhappy for years about the prospect that additional reactive chemicals might be regulated.
  

Industry-friendly alternatives offered

The draft of the shelved proposal says its alternatives were "developed after discussions with a number of stakeholders," including "several trade organizations."

A government source told the Center that during this process, the biggest industry concern about expanded regulation of reactive chemicals was the added cost. The principal objectors were the American Chemistry Council, American Petroleum Institute and Synthetic Organic Chemical Manufacturers Association, the official said.

(The Center sought comment on the issue from the three trade organizations, but received none.)

Industry leaders' opposition to any rapid addition of more reactive chemicals to the PSM standard was noted in a 2000 report that the ABS Consulting firm posted on the Internet: "Union and media pressure forced OSHA to consider an emergency rulemaking for reactive chemicals, but after a significant amount of information was provided by industry groups, OSHA decided not to go that route."

Another consulting firm, EQE International, had publicly reported four years earlier that union calls for broader regulation of reactive chemicals had catalyzed industry worries "about how this might be done, given the unforeseeable combinations of reactive mixtures, and the potential unlimited nature of inadvertent intrusion."

Similarly, Dennis Hendershot, a safety expert for Rohm and Haas, a leading chemical manufacturer, told the Center that he doubted expanding the PSM standard's list of reactive chemicals would address problems associated with their inappropriate mixing, because of the "almost infinite list of combinations."

In many incidents involving reactive chemicals, "the materials are fairly specialized and they're not on anybody's radar screen until something happens," said Hendershot, a prominent industry advocate for reducing and eliminating plant hazards to achieve "inherently safer" chemical processes.

But Frumin, the safety official for UNITE, placed the issue's recent trajectory squarely in the context of what he said was longstanding industry resistance to OSHA's chemical-accident regulation throughout its history.

Industry leaders "are not big fans of the PSM standard," he said. "The fight to get the standard, including the Clean Air Act, didn't go down easy."

When the standard was first being developed in the early 1990s to implement one of the 1990 act's mandates, "industry opposed including any but the most obvious reactives," Frumin said. "There are huge, gaping loopholes they don't want closed because it would require accountability within their own organizations."
 

Deadly consequences

Those gaping loopholes can lead to fatal outcomes. A joint OSHA-EPA investigation of the Napp disaster in Lodi, N.J., concluded in 1997 that the likeliest cause was the inadvertent introduction of water and heat to a mixture of two chemicals that the PSM standard didn't cover.

The investigation by the two federal agencies came under strenuous criticism by union leaders, who charged that it took too long and didn't properly assign blame to management deficiencies — precisely the kind of problem the PSM rules are designed to guard against. An investigation by reporters at The Record in Bergen, N.J., found that some supervisors at the company did not have proper training and the plant was not adequately equipped to mix the chemicals in question.

This controversy helped bring about the belated activation of the nonregulatory Chemical Safety Board in 1998. The Clinton administration had previously been unwilling to fund the board, which was authorized in the 1990 Clean Air Act as a scientific investigatory body, akin to the National Transportation Safety Board.

The OSHA spokesperson said in the absence of any near-term action on the shelved reactive chemicals proposal, the agency will address the issue in a number of ways. One is preparation, with the EPA, of a new "guidance document" for employers. Another, the OSHA official said, will be coordination with the Chemical Safety Board. The board's final report on problems related to problems with reactive chemicals is expected to include recommendations later this year.

Meanwhile, the OSHA spokesperson said the agency will seek to reduce risks associated with reactive chemicals through enforcement of regulations other than the PSM standard.

Labor leaders greet such pledges with skepticism. The AFL-CIO has questioned, for example, how the administration's budget proposal can simultaneously eliminate 64 of OSHA's enforcement positions, as it seeks to do, and also increase inspections, as OSHA says will happen.

One union official in New Jersey, unhappy with past OSHA actions on reactive chemicals, was likewise disappointed to learn about the shelving of the agency's proposal that could have led to broader regulation of such materials.

"OSHA has been very ineffective, because (existing) regulations just don't cover these issues," said Mark Dudzic, president of a Rahway, N.J., local of the Paper, Allied-Industrial, Chemical and Energy Workers International Union.

The union local represented workers at the now-closed Morton International facility in Paterson, N.J., where a runaway reaction in 1998 injured nine employees, released hazardous chemicals into the community and heavily damaged the plant.

"OSHA cited Morton on some peripheral issues, but not the root cause of the incident," Dudzic said. "Morton claimed — and was upheld — that their process was not covered under the PSM rules."

The reactive chemicals issue is "particularly heart-rending" in densely populated New Jersey, Dudzic said, remarking that the Morton plant is just 10 miles from the Napp facility where five workers died, and that some individuals worked at both places.

"They could have made some progress here," Dudzic said of the abandoned OSHA proposal. Reactive chemicals, he said, "are killing people, and they're going to kill more people."

 
Campaign contributions to Bush

Top donors among member companies of the trade groups that opposed the reactive chemical proposal

Company	Amount
ExxonMobil*	$38,575
El Paso Energy	$34,884
Occidental Petroleum	$22,279
ChevronTexaco*	$15,950
Shell Oil	$13,900
BP Amoco and related entities	$12,501
Halliburton	$11,995
CH2M-Hill	$10,250
Conoco	$9,500
Phillips Petroleum	$8,450

Contributions include donations to Bush’s presidential campaign.
* company formed after merger between individual parties; both original companies' employee contributions are included.
  

-- Cherri (jessam5@home.com), May 13, 2002