General Publications August 6, 2012

Maureen Gorsen: Five Things You Need to Know About Green Chemistry

Serving two governors in environmental leadership posts, Maureen Gorsen is the former general counsel of the California Environmental Protection Agency, where she oversaw the enforcement policies and activities of the myriad state, regional and local agencies that enforce California’s environmental laws. From 1993 to 1998, Maureen was the general counsel for the California Natural Resources Agency where, among other duties, she was responsible for reform and revisions of the 1998 CEQA Guidelines and issues relating to the California Endangered Species Act, the Williamson Act and the Coastal Act.

Most recently, Maureen served as the director of the California Department of Toxic Substances Control, where she directed soil and water clean-ups under CERCLA, RCRA, water and brownfields laws, and the regulation of solid and hazardous waste, as well as spearheaded the California Green Chemistry Initiative, and the new laws governing toxics in products sold in California.

At Alston & Bird, Maureen focuses on providing strategic public policy, litigation and regulatory advocacy and counsel to a wide range of product manufacturers, brand owners, industrial facilities and landowners. She represents clients in enforcement defense and regulatory compliance issues before administrative agencies in Sacramento, and in numerous state capitols, and provides permit and compliance issues on environmental, product and supply chain regulation issues in the United States and abroad.

 

What is green chemistry?

Green chemistry is the design of chemical products and processes that reduce or eliminate the use or generation of hazardous substances. Green chemistry applies across the lifecycle of a chemical product, including its design, manufacture and use.

How long have you been involved in California’s green chemistry movement?

Since 2003. I was the general counsel of the California Environmental Protection Agency when the ideas of Paul Anastas, John Warner and Bill McDonough about the design of products and materials used in products were embraced by then-Governor Schwarzenegger and spread among Sacramento’s legislative and regulatory policymakers. In 2005, he appointed me as director of the Department of Toxic Substances Control (DTSC) and asked me to spearhead his Green Chemistry Initiative, which was implemented only in part when the legislature passed the Green Chemistry Laws (AB 1879/SB 501) in 2008. Since returning to the private sector in 2009, I have been advising clients on the compliance issues that are raised by the proposed implementation of these laws, which have veered significantly from their original intent.

What’s the big deal?

This is quite possibly the broadest set of environmental regulations ever crafted. California is seeking to regulate the manufacture of products worldwide, exporting its environmental values to every country where products sold into California are manufactured, to influence decisions about what materials to use in the design and manufacture of those products.

These regulations give sweeping authority to the DTSC to obtain broad sets of data and information from any manufacturer, importer or retailer of a consumer product sold in California regarding the source and ingredients in their products. If a company does not supply this information, it risks its business reputation by having it posted on the “Failure to Comply List” on the government’s website. This is all regardless of whether the ingredient is listed as what the DTSC views as a “Chemical of Concern” or the product is selected as a “Priority Product.”

The DTSC intends to select Priority Products by applying some very vague criteria of “safety” and “exposure” that leave room for a lot of agency discretion. If a company’s product is selected as a Priority Product, the consequences can be severe. It will have to conduct an alternatives analysis of the entire lifecycle of that product and the various ways it could have designed the product, as well as all its supply chain choices and the environmental consequences of the ultimate disposal of their product. In addition to the costs involved in this analysis (estimated to be anywhere from $500,000 to $6 million), the company risks disclosure of trade secret information and must submit its entire analysis for public review, where NGOs and consumer groups comments will weigh in on the ultimate government decision as to how the company should manufacture that product in the future. There are those who believe the stringency of this process is designed to simply drive Priority Products from the marketplace.

Most disconcerting, these regulations will require companies subject to its provisions to develop, fund and maintain a comprehensive product stewardship plan, including the posting of financial guarantees such as bonds and letters of credit in advance to fund the entire program, as well as compensation to retailers and other entities, such as local governments, that agree to administer or participate in the collection program.

What type of companies/industries will be impacted?

With very few exceptions (e.g., food, pesticides, medical devices), every company involved in the global supply chain of products sold in California will be impacted.

The regulations clearly reflect the strong engagement of environmental advocacy groups. For example, the most onerous paperwork requirements of the regulations can be triggered by amounts of a chemical as low as the detectable limit in laboratory equipment.

What should affected companies do to prepare?

Now that the rules have been formally proposed under the APA, it highlights the importance for all manufacturers, importers and retailers of goods in California to be engaged. The first point of engagement should take place within the next 45 days by reviewing the DTSC’s proposed regulations, obtaining assistance on what those regulations mean (if the impact is unclear) and submitting comments in writing to the DTSC of any concerns. These comments are due no later than September 11, 2012. After the regulations become final, there will be a further period when the DTSC will begin designating specific “Chemicals of Concern” and “Priority Products.” Impacted companies should be actively engaged in evaluating these proposals by the DTSC and commenting. Without that active engagement, companies will be unable to affect the direction these new regulations will take.

Companies should also make sure they know which of the thousands of chemicals are being used in their products, assure that risks and responsibilities for compliance with these regulations are allocated contractually to that part of the global supply chain with most knowledge of the toxicity of those chemicals, and dictate who will be responsible for unsold inventories if DTSC cites a product as noncompliant.

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