Another Consumer Product Safety Act – Better or Worse?

The House of Representatives is currently reviewing the Consumer Product Safety Enhancement Act (CPSEA of 2010), a bill proposed by Representative Waxman that would amend the Consumer Product Safety Improvement Act (CPSIA of 2008). The purpose of the bill is to grant relief to secondhand retailers and small batch manufacturers that, by many accounts, have been disproportionately impacted by the stringent new laws. While some are praising the bill’s attempt to fix long recognized problems with the CPSIA, others fear it does little to improve the situation and hurts chances of gaining a more comprehensive amendment in the future.

So what exactly does the CPSEA propose?  Here is a quick summary of the main points in each section:

CPSEA Summary:

Section 1: Short Title

Names this Bill the “Consumer Product Safety Enhancement Act of 2010”.

Section 2: Regulatory Flexibility on Lead Content

Sets forth the criteria that would allow the Consumer Product Safety Commission (CPSC) to grant exemptions to lead limits on grounds of a product’s “functional purpose” either on its initiative or based on a petition by an interested party. If passed, the CPSC could grant an exception if it is determined that the product, material, or component part in question:

1. cannot be practicably or feasibly manufactured without accessible lead,
2. is not likely to be placed in the mouth or ingested, taking into account normal and foreseeable use and abuse by a child, and
3. an exception will have no “measurable adverse effect” on public health or safety, again taking into account normal and foreseeable use and abuse.

Exceptions will be granted only after a minimum 60 day public comment period and examination of all evidence submitted. The party seeking exception bears the burden of proof but may make reference to relevant evidence submitted by other parties seeking exceptions.
If an exception is granted, the CPSC still has the authority to:

1. require the manufacturer to reduce the level of lead or
2. place an expiration date on the exception.

Section 3: Relief for Thrift Store and Other Retailers

Defines the scope of exclusions to lead limits for used children’s products, including some exceptions. The term “used” is defined to mean a product that is obtained from a person who originally purchased the product for use, not resale. The exceptions to used children’s products, meaning products that still must comply with lead limits are:

1. children’s metal jewelry
2. painted children’s toys
3. children’s products composed primarily of accessible vinyl
4. any children’s product for which the donating party or the seller has actual knowledge that the product is in violation of the lead limits
5. any other children’s product designated by the Commission

The prohibition on sale of recalled products stands and is not affected by any other exclusion.

Section 4: Relief for & Cooperation with Small Batch Manufacturers

States that the CPSC will “work cooperatively” with small batch manufacturers and take into consideration any economic, administrative, or other limits on the ability of small batch manufacturers to comply with lead limits, third party testing requirements, additional compliance testing, and tracking label requirements.

The CPSC, “may, by regulation, provide alternative testing requirements for covered products manufactured by small batch manufacturers,” to, “assure compliance with the relevant consumer product safety standards.” The alternative testing methods may apply to a specific product, or product class, or a specific safety standard.
Small batch manufacturer is defined as a manufacturer for which total gross revenue in the preceding year was no more than $1,000,000 and for which at least two-thirds of its products meet the following criteria:

1. no more than 7,500 units of the product were manufactured or imported in the previous calendar year,
2. no more than $50,000 in gross revenue was generated from the sales of that product in the previous calendar year.

The above dollar amounts are adjusted every year by the Consumer Price Index as defined by the Department of Labor. In determining whether a manufacturer qualifies, the CPSC will look at each entity the manufacturer controls, or is controlled by, and any business affiliations.

An “Office for Education, Outreach, and Small Business Ombudsman”, with an annual budget of $1.8 million, is created to assist the CPSC with, “providing education and outreach to all stakeholders and to inform and educate manufacturers and retailers, including resellers, about requirements under this Act or any other Act enforced by the Commission. Such office shall provide special assistance and guidance to small batch manufacturers in understanding and complying with such requirements.’’

Section 5: Additional Provisions

Establishes that the CPSC must notify standards organizations when adopting their standards and creates a rule whereby the organization must contact the CPSC if the standard is revised. The CPSC may or may not accept any revisions of the standard.

Clarifies the authority of the CPSC to subpoena Federal, State, or local government agencies for evidence, and makes changes to definitions of “State” in certain sections of the Virginia Graeme Baker Pool and Spa Safety Act so that subdivisions of a State may be eligible for grants.

Section 6: Effect on Other Law

Clarifies that the CPSEA does not modify the CPSC’s authority with regard to product recalls, nor does it affect rules related to preemption of state and local laws.