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Global warming and climate change have already made green building an industry watchword. Now a string of federal court decisions calling on the government to get back into regulatory mode sends the signal, in case one was needed, that industry can look forward to operating in a more stringent regulatory environment. The Supreme Court decision on carbon emissions earlier this spring may set the tone for environmental regulatory activity over the coming years. “Obviously the decision itself was on mobile sources, but it could start to spill out into other rule making processes,” says Tim Hunt, American Forest & Paper Association (AF&PA) vice president for air quality programs. More legislation and tightening of environmental laws and regs could well follow, Hunt says. For wood industry sectors, Environmental Protection Agency (EPA) rule making under the Clean Air Act (CAA) is a major current focus. EPA, responding to legal actions brought by a coalition of environmental groups, has asked the Washington D.C. Court of Appeals to allow it to take back and reformulate the PCWP (wood) MACT (Maximum Achievable Control Technology) air toxics rule. EPA withdrew the Boiler MACT on its own following an earlier decision on a MACT in another industry, brick manufacturing. The Brick MACT didn’t set emission limits, and the wood industry MACTs used the same approach. “The D.C. court said that’s illegal,” says John Bradfield, Composite Panel Association (CPA) director of environmental affairs. The appellate court essentially told EPA to go and regulate. “EPA got the message loud and clear,” Bradfield says. The cases were argued earlier this spring. The court hadn’t ruled as of publication deadline, but decisions on both cases are expected in the current time frame.

Uncertainty ahead
Uncertainty for individual plants and companies is a clear concern in the MACT cases as the court sorts out the issues and the competing assertions of industry and environmental groups and EPA’s own position. “Companies could end up in the awkward position of investing too little if they’ve already started preparing or investing too much,” says Hunt. “Your compliance strategy could fall apart.” “It leaves the industry in unknown territory. If you’re a business owner, how do you know what to invest in?” asks Bill Altman, executive vice president of the Hardwood Plywood & Veneer Association (HPVA). Wood sectors are assessing the potential impact. The plywood MACT applies more to suppliers than to cabinet shops. But, says Kitchen Cabinet Manufacturers Association (KCMA) executive vice president Dick Titus, “We’re concerned about availability and whether it could impact our supply chain. The Boiler MACT is of significant interest to several members, but not to the majority. The major impact is on larger companies.” “We thought the boiler MACT was a good rule. If the court agrees to vacate Table I, we start all over again. We want to see the off-ramp remain intact,” says Bill Perdue, American Home Furnishings Alliance (AHFA) vice president for environment, safety and health. “We’ve got a lot at stake in both this and the PCWP rule.” Environmental groups point to health risks and environmental impacts. “We challenged the (PCWP) rule because it violated the Clean Air Act in three respects,” says John Walke, clean air director and a lawyer for the Natural Resources Defense Council (NRDC) Walke pointed to the rule’s failure to establish pollution limits, the one-year compliance extension, and the “large number of facilities” exempted under the rule as written. “We argued that what EPA had done violated the plain language of the Clean Air Act,” Walke says. In their statement filed with the court for the April 23 Wood MACT hearing, the environmental groups said that the “no emission reduction” floors do not comply with the law. The rule as written would allow all but a few facilities to avoid installing controls, the statement said.

Details differ
Legal issues and technical details differ somewhat on the two MACTs. Basically, the EPA filings on both asked for withdrawal of specific sections and for their remand back to the agency for rewrite to bring them into CAA compliance. The Boiler MACT is back on the table because EPA used the “no emission limit” approach for it that it used in the Brick MACT the appellate court tossed out in March, ordering EPA to set limits. Industry sources note that many wood sector plants burn biomass, which is a clean-burning fuel. The PCWP MACT is a similar issue, but the rule was set up differently. It separated presses from dryers, and EPA only asked to withdraw the part of the rule covering production units where no emission limit was set. “With regard to plywood, EPA has asked the court to return to EPA determinations that for some emissions points no emissions control is required, so the agency may revisit these decisions in light of the Brick MACT,” says EPA spokesman John Millett. “The big issue in (the wood MACT) hearing is risk,” said Bradfield, as CPA and other industry groups prepared for the hearing. And in fact, much of the hearing, held April 23, centered on attempts by the judges to tease out health risk levels likely to be associated with different emissions limits.

Fabric Flammability
Fabric flammability regulatory initiatives on the federal level and in several states are a key issue for residential and office furniture manufacturers. The Consumer Products Safety Commission (CPSC) on the federal level and several states are in various stages of passing laws and issuing regulations banning several flame-retardant chemicals shown to be accumulating in the environment. Health impacts are being studied. A bill now before the California assembly has probably grabbed the most attention, says Dick Driscoll, director of technical services for the Business & Institutional Furniture Manufacturers Association (BIFMA International). Chemical companies and furniture makers are looking at the science. “The risk is that you grab something different and then find you’re in a worse situation,” Driscoll says. “It takes years to study and determine the environmental effects.” Industry seminars, including one held in April, are looking at the issue and its potential impacts on furniture manufacturers. AHFA, says Perdue, is working to make sure that newer flame-retardant chemicals are safe and cost-effective, don’t limit fabric choices, and don’t add to manufacturing burdens. The fabric issue, and other regulatory areas, are playing out in a global marketplace. That requires knowledge of other markets even as it affects competitive positioning. “If you’re going to do business world-wide, you have to be aware of the requirements of other countries and not just your own,” says Brad Miller, BIFMA director of government affairs.

Forestry and Logging
Illegal logging is a major concern, and one where business and environmental groups have a shared interest in finding solutions, says AF&PA spokesman Charles Lardner. A recently introduced bill, the Legal Timber Protection Act, is now before Congress. “Illegal logging continues to grow as an important international issue that the forest products community recognizes and continues to address,” Lardner says. In other forestry issues, recent court decisions in San Francisco and Seattle stuck down federal government actions easing logging restrictions and opening more road-less areas in national forests to logging. “We continue to object to court decisions, like the decision on road-less [areas], that require federal agencies to do more costly and burdensome analysis that adds little or nothing to the quality of their decisions and provides no real environmental benefits,” Lardner says. AF&PA has been working on passage of the Timber Revitalization and Economic Enhancement (TREE) Act of 2007. It is now before Congress, with bipartisan support. The act would tax all timber gains at a maximum 14 percent rate. “This would significantly reduce the cost disadvantage that American timber growers face vis-a-vis their international competitors,” says Dave Koenig, AF&PA director of tax policy.

In brief
In other issues, the Tulane Wood Dust is going through peer review for publication in a scientific journal. “People are pretty much waiting for the peer review,” KCMA’s Titus says. In labor issues, KCMA is concerned about the Employee Free Choice Act now before Congress. “Industry is concerned that it could be used to coerce employees into joining unions,” Titus says. BIFMA is calling for attention to a bill now before the U.S. Senate. It would force Federal Prison Industries (FPI) into competing in order to get federal contracts.