Nanotech and Jobs: Congress Weighs In

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Courtesy of Bergeson & Campbell, P.C.

The new Republication-led House of Representatives has expressed its concerns with what it refers to as the adverse impact of regulations on jobs and the economy. On February 10, 2011, this concern reached a new pitch. On this date, during a hearing on 'Regulatory Impediments to Job Creation,' the House Committee on Oversight and Government Reform released a preliminary staff report entitled 'Assessing Regulatory Impediments to Job Creation'. The report reflects the response to letters Committee Chair Darrell Issa (R-CA) sent  to over 150 businesses, industry organizations, and think tanks asking for examples of existing and proposed regulations that have negatively impacted job growth, as well as suggestions on reforming identified regulations and the rulemaking process.  Issa received almost 2,000 pages in response, and the Committee staff prepared the preliminary report based on the responses.  The report is available online for Nanotechnology Industries Association members, nanotechnology was explicitly identified in several contexts, as discussed below.

In the Staff Report, the U.S. Environmental Protection Agency (EPA) is noted for its 'burdensome regulation.'  The Staff Report states that respondents identified over 60 regulatory actions taken by EPA that may have a negative impact on job creation.  While almost half the respondents who identified EPA regulations focused on EPA's boiler heater maximum achievable control technology, greenhouse gas regulations, and National Ambient Air Quality Standards for ozone, respondents also expressly called out EPA's nanotechnology policies under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) and the Toxic Substances Control Act (TSCA).

Specifically, the Staff Report notes that nanotechnology, as defined by the National Science Foundation, 'refers to the ability to manipulate individual atoms and molecules, making it possible to build machines on the scale of human cells or create materials and structures from the bottom up with novel properties.  Nanotechnology could change the way almost everything is designed and made, from automobile tires to vaccines to objects not yet imagined.'

With regard to FIFRA, the Staff Report states that representatives of nanotechnology manufacturers have expressed frustration regarding EPA's consideration of a requirement that the 'manufacturers report any adverse effects of any nanomaterial-containing pesticide product -- regardless of whether the problems were caused by nanomaterial or not.' Because there would be no proof offered or even study of risk associated with nanomaterial, this could create a significant chilling effect on the use of this technology.  In fact, according to the Staff Report, 'some nanotechnology manufacturers have already begun laying off workers and others fear they will soon go out of business because of these regulations.  This is an example of how even seemingly minor actions taken by the federal government can have devastating effects on a manufacturing industry.'

Under TSCA, the Staff Report acknowledges that to ensure that nanoscale materials are manufactured and used in a manner that protects against unreasonable risks to human health and the environment, EPA is pursuing a comprehensive regulatory approach under TSCA.  As noted, however, manufacturers have expressed concern about the scope of these regulations and the impact they may have on the commercialization of nanotech products.

Among the almost 2,000 pages of submissions, EPA is mentioned almost 3,500 times, almost always cited as a barrier to job creation.  As noted above, certain of the EPA activities are cited more often (e.g., greenhouse gas proposals), and those would be expected to be the most likely subject to any further Committee activity.  The submissions to the Issa Committee, however, will also provide a roadmap of concerns to the other Committees of the House, the authorizing Committees and Appropriations Committee, for example.  What is less clear is what any of these Committees will do with the information.

In the House, partisan response to the submissions will invite both a defense of their actions by the Administration, and could ironically limit the willingness of the Administration to be more flexible in some cases to avoid the appearance of yielding to partisan attacks.  At the same time, the Democratic majority in the Senate presumably will continue to provide a friendlier forum for the Administration to offer its perspective.  The divided Congress may also result in some pressure for EPA to be even more aggressive in targeted policy areas given that legislative agreements are even less likely now than in the past.

For nano stakeholders, it will be important to continue to work with EPA and the new Congress to ensure regulatory bodies have the information they need to make the right decisions, but also to ensure that regulations are science-based, appropriate, and reasonable.  This will continue to be a priority over the years to come, but close monitoring is urgently needed now as the new Congress is finding its way.

Follow this link to download the full report.

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