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Chairman Combs, and Members of the Committee:I am Jack Pounds, with the Ohio Chemistry Technology Council.  I am appearing today in behalf of our member companies engaged in the business of chemistry in Ohio.

I thank you for the opportunity to offer brief testimony in opposition to House Bill 112, a proposal that would result in Ohio government entering into an entirely new area of regulation of commerce—namely the content and formulation of products that are sold around the world.

 Should Ohio enter into this area of regulation, it will be duplicating or inconsistent with effective national product safety regulatory programs.  Today, American consumers are able to purchase potentially-hazardous products that are designed, formulated, and packaged to the highest standards in the world.  These include regulatory programs that require products be:

(1) labeled to warn of hazards;

(2) contain appropriate warning symbols;

(3) be sold in child-proof packaging; and,

(4) be formulated to pose no unacceptable risk when used properly.

Today, the Federal government’s Consumer Products Safety Commission (“the Commission) has the mission to protect all Americans from unreasonable risks of injury or death from thousands of consumer products—including household chemicals such as anti-freeze, which is the subject of House Bill 112.  The Commission works to ensure the safety of consumers through a comprehensive regulatory program supported by hundreds of employees, a significant budget, and the authority to take immediate action, including prosecution, when a product poses an unacceptable risk.  In the thirty years the Commission has existed, the rate of deaths and serious injuries associated with consumer products has declined by some 30%.

In addition to the Commission’s work, the United States Environmental Protection Agency (U.S. EPA) and the Federal Food and Drug Administration (FDA) each play a role in regulating respectively pesticides and foods and drugs sold to American consumers. 

In today’s global economy, businesses in Ohio are competing for survival in a fiercely competitive environment.  The state as you know well is doing everything possible to retain good jobs and business investment in Ohio, and to attract new jobs and investment.  One of the most notable accomplishments in Ohio in the past several years—due to the leadership of both the General Assembly and the Strickland and Kasich Administrations--has been the elimination of unnecessary regulatory burdens on businesses.  My member companies deeply appreciate the strong bipartisan support given to Senate Bill 2, which will reduce the cost of regulations on all businesses in the state.

But House Bill 112 goes the other way by pushing state government into an entirely new arena--the regulation of the content of specific products.  Proven Federal regulatory programs that have been both effective and consistent across the entire country make the bill unnecessary.  If House Bill 112 is enacted, the precedent will have been set for bill after bill regulating the content and use of additional products.  Other states that have taken that route—most notably California—have invested in large, expensive bureaucracies to regulate products.  California’s fiscal crisis is a testament to that state’s insatiable appetite to duplicate or exceed effective Federal regulatory programs. 

At a time when you are struggling to provide funding to important state services and dealing with a still-ailing economy, I urge you to allow effective Federal product safety programs to provide Ohioans with the protections they deserve.

I do want to assure those who support House Bill 12 that our opposition to this legislation does not reflect lack of concern for the safety of humans and family pets.  We simply believe that this problem is not unique to Ohio.  The solution must be one for the entire country developed by existing Federal agencies that our taxes support.

Finally, I would note that within my industry—Ohio’s chemistry industry—only a few companies sell directly to the consumer.  None make or sell anti-freeze.   But they are all supportive of a strong consumer safety program that applies consistently to all Americans.

Also, these companies, regardless of whether sales are made directly to consumers or to sophisticated commercial customers, all have product stewardship programs in place.  These are designed to assure that the products they sell are developed, transported, and used safely.  When products are planned for specific applications, one of the most critical questions raised is “How can we formulate a product that meets the customers’ needs and, at the same time, has the least hazardous properties?”  If a hazard can be reduced, then that happens.  For example, if addition of an additional ingredient would reduce the possibility of accidental ingestion of the product or other undesired result without affecting the quality or effectiveness of the product, then the formulation would be changed.  That is done routinely within the chemistry industry through formal product stewardship reviews.

I respectfully submit that neither product safety nor economic growth in Ohio will be advanced through the legislation before you.

I thank you for your consideration.

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Support of the office of consumers' counsel budget request (HB 153)

Ohio House of Representatives

Finance Subcommittee on Agriculture and Natural Resources 

April 6, 2011

Testimony in Support of the Office of the Ohio Consumers’ Counsel Budget Request

(House Bill 153)

Jack R. Pounds, President, Ohio Chemistry Technology Council

Chairman Balderson and Members of the Committee:

I am Jack Pounds, representing the members of the Ohio Chemistry Technology Council, who operate some 120 facilities across Ohio and are engaged in research, development, and production of high value-added chemistries.  In Ohio today, there are some 50,000 of our citizens who have high-paying jobs in the chemistry industry. Annually these companies produce high-technology content products valued at more than $24 billion—with more than $5 billion worth of these products sold to customers outside the United States.I am here this morning to speak in support of the budget request of the Ohio Consumers’ Counsel for SFY 2012-2013.   

That needs explanation—because the Consumers’ Counsel does not directly represent businesses such as those in my organization.  In fact, we sometimes find ourselves in disagreement with specific positions the Counsel takes.  But the Counsel does provide indirect benefit to our industry through its engagement in the rate cases of the electric utilities.  We also have been pleased with the interest the Counsel’s office has shown in working with our industry to pursue sensible energy efficiency programs and practices in Ohio.

The near- and long-term cost of electricity is the most critical issue facing Ohio’s chemical industry today—and that is exactly the same statement I made six years ago when we supported enactment of SB 221, the adoption of a sweeping new energy policy for Ohio. For large production facilities, expenditures on purchased electricity and natural gas can run into the millions of dollars per month.   The industry is energy intensive.  But chemical companies don’t waste energy.  Since 1974, the industry has reduced energy consumed in making a pound of product by nearly 50%.  That has been accomplished through aggressive demand side conservation programs, reengineering processes, and investment in advanced control equipment and less energy intensive production equipment.   

Where we see benefit to our industry from the Consumers’ Counsel is in the office’s role as an arm of government that brings the expertise and influence of an independent body to bear in rate cases and other matters related to the price and availability of electricity in Ohio.  We see value in having a diversity of viewpoints and technical assessments in the policy mix in the electric marketplace in Ohio.We also recognize that the markets for electricity and natural gas in Ohio have changed dramatically since the Office of the Consumer’s Counsel was created in Ohio in 1976.  Those changes have been profound; and they have affected the policy arena in which the Consumers’ Counsel operates.  While some refinement of the Counsel’s role is worth considering in light of these changes, we do not believe that simply cutting the office’s budget in half is the best course.  We urge support of the Counsel’s original budget request so that the advocacy and engagement the office provides are not lost.Thank you.

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OCTC SUPPORTS ADOPTION OF TAILORING RULE LIMITS FOR OHIO EPA PERMIT PROGRAM

Testimony Delivered before Joint Committee on Agency Rule Review

Monday, March 7, 2011

Joint Committee on Agency Rule Review, March 7, 2011

 Mr. Chairman and Members of the Committee:

I am Jack Pounds, representing the members of the Ohio Chemistry Technology Council.

While our organization opposes the current efforts by the United States Environmental Protection Agency to regulate so-called “greenhouse gases” as pollutants under the Clean Air Act, we believe that Ohio must make use of the so-called “Tailoring Rule” promulgated by the Federal agency to minimize the hardships of major source permitting on thousands of facilities in Ohio, including small businesses, fast food restaurants, hospitals, colleges, and the like.  The rules before you will do just that.

Without the rules proposed by Ohio EPA, it is our counsel’s opinion, and the opinion of other attorneys, that Ohio law would require the state to impose the much more stringent permit thresholds now contained in Ohio’s Air Pollution Control Act.  Thus, adopting these “Tailoring Rules” provisions in our regulations, Ohio EPA will not be required to regulate the very smallest sources of greenhouse gases.

We note that the rules proposed have provisions that make the rules go away immediately upon an action of the Federal courts or the Congress that eliminates the U.S. EPA’s authority to regulate so-called greenhouse gases under the Clean Air Act. I thank you for your consideration of our comments.

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TESTIMONY IN SUPPORT OF SENATE BILL 2

Small Business Rule Review Process (Senator Hughes)
Ohio Senate Committee on Government Oversight and Reform

Thursday, February 17, 2011 - 9:30 a.m.

Good morning, Chairman Seitz, and members of the committee:

I am Jack Pounds, President of the Ohio Chemistry Technology Council, the trade association for companies in Ohio’s chemistry industry.

I appreciate the opportunity to present brief testimony this morning in support of Senator Hughes’ legislation to lessen unnecessary regulatory burdens on small businesses.

While our Council does have some members who are “small businesses” according to the definition in Senate Bill 2, most are not.  We are principally an organization of larger companies.  We do know, however, that there are literally hundreds of smaller companies in Ohio that produce or blend a broad range of chemistries.  When it comes to regulations on the chemistry industry, these small companies are covered by all of the Federal and state rules governing the production, transportation, and ultimate disposal of materials that have hazardous properties.

Every company in my organization has a vested interested in assuring that the business of chemistry is recognized for the technologies it produces that make our lives better, and that the public has confidence that the industry operates safely and in an environmentally-responsible way.   Many of the hundreds of small chemical companies I referenced purchase raw materials or intermediates from our member companies.  Our member companies have product stewardship programs in place that emphasize close interaction with their customers to assure that these customers understand the hazards associated with the products they buy, and to provide technical advice and support. 

However, these small companies have the responsibility for complying with Federal and state rules governing this industry.  Their performance in meeting regulatory obligations and in conducting their businesses safely reflect on the entire industry’s reputation. 

Because regulatory compliance for companies engaged in the business of chemistry is very complex, we believe that certain provisions in Senate Bill 2 can be of great help to smaller companies who may not have the regulatory compliance experience, technical personnel, and other resources that larger companies have.   We specifically applaud the provision that asks regulators to draft rules that will make requirements as easy to understand as possible.  Given the sheer volume and complexity of rules governing the business of chemistry, especially in the air pollution control area, anything that can be done to help a regulated business identify what is required and how compliance is to be achieved will be a tremendous help.  I should note that for the past eight years the Ohio Environmental Protection Agency has been doing a very good job of providing small business compliance assistance—and many companies, and not just small ones, have found their educational seminars, one-on-one assistance help line, and on-line guidance to be of great value.

We also appreciate other provisions in Senate Bill 2 that promote predictability, consistency, and flexibility.  Finally, cost of compliance analyses versus benefits expected, as emphasized in the bill, are always important.

Senate Bill 2 is a sensible step to assuring Ohio’s regulatory environment is focused on achieving compliance and measurable benefits for our citizens. 

Speaking for our member companies, I thank you for the opportunity to provide support for this legislation.