By Lisa M. Campbell and James V. Aidala
On September 18, 2017, the U.S. Environmental Protection Agency’s (EPA) Office of Inspector General (OIG) issued a report on an evaluation conducted by OIG entitled “EPA Needs to Manage Pesticide Funds More Efficiently.” OIG states that it conducted the audit “to determine whether EPA manages the Pesticides Reregistration and Expedited Processing Fund (known as the [Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA)] Fund) and the Pesticide Registration Fund (known as the [Pesticide Registration Improvement Act (PRIA)] Fund) effectively to minimize reliance on appropriated funds.”
In the report, OIG states its finding that “EPA should manage the [Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA)] and [Pesticide Registration Improvement Act (PRIA)] Funds more effectively by reducing excess fund balances to within a target range. As of September 30, 2016, [OIG] identified excess funds of approximately $21.4 million for FIFRA and $8.5 million for PRIA, for a total of $29.9 million. A reduction in fund balances would increase the availability of appropriated funds for other environmental purposes.”
In the report, OIG makes the following recommendations to EPA:
- For the Assistant Administrator for Chemical Safety and Pollution Prevention (OCSPP) to “establish a target range for its FIFRA and PRIA Fund balances and develop and implement a plan to reduce excess funds to within the target range”; and
- For the Chief Financial Officer to “reconcile the FIFRA and PRIA Funds’ balances to the corresponding liabilities.”
The report states that EPA concurred with establishing a target range and developing a plan to reduce excess funds for FIFRA Fund balances, but did not agree with establishing a target range and developing a plan to reduce excess funds for PRIA Fund balances, citing the lack of predictability of PRIA collections. OIG stated that it “still believe[s] PRIA has excess funds that should be addressed,” and “[t]he agency agreed to reconcile FIFRA and PRIA balances.”
This report follows two OIG reports issued on August 14, 2017, on audits of the financial statements of (1) the FIFRA Fund; and (2) the PRIA Fund for fiscal years (FY) 2015 and 2016. OIG is required to perform an annual audit of the financial statements of the FIFRA Fund under the Food Quality Protection Act (FQPA), and of the PRIA Fund under PRIA.
OIG states in its reports on the audits for FYs 2015 and 2016, of both the FIFRA and the PRIA Funds, that it “noted a material weakness in that the EPA cannot adequately support its FY 2016 [PRIA/FIFRA] Fund costs.” OIG further stated, however, that this issue has been noted in prior audit reports, and that EPA is taking corrective actions.” For those reasons, OIG stated that it was making “no new recommendations for [these] material weakness[es].” In FYs 2016 and 2015, EPA “lost the audit trail to properly support how much of the [PRIA/FIFRA] payroll expenses were paid for by appropriations.” To address these losses, in October 2016, EPA instituted an enhancement to its timekeeping system’s cost allocation that will allow for “the creation of an audit trail to capture costs incurred by the [PRIA/FIFRA] Fund and other appropriations that support [PRIA/FIFRA]-related activities.”
More information on other EPA OIG reports is available on our blog under key terms OIG and EPA OIG.
The reality of why the FIFRA funds are in surplus is a political response to the overall budgetary politics of Congress. The Office of Pesticide Programs (OPP) has not been authorized to utilize these funds fully or freely hire staff due to the budget agreements of Congress, and, more recently, due to the attempt by the new Administration to keep the Presidential budget proposal more in balance. The OIG knows this also, but “politics” is not the concern of a good audit, and this is not helped by the problem of EPA having “lost the audit trail” of how these monies were spent. PRIA reauthorization is soon to be overdue, and now appears perhaps to be in some jeopardy, at least in the near term. Fortunately for OPP, the surplus in these funds that OIG addresses will be able to buy the program some time to continue relatively “as is” while waiting for PRIA politics to subside to the point where reauthorization is approved and the program can focus more on the improvements suggested by the OIG report.
By Lisa M. Campbell, James V. Aidala, and Margaret R. Graham
On July 18, 2017, four Senators (Tom Udall (D-NM); Benjamin Cardin (D-MD); Richard Blumenthal (D-CT); and Cory Booker (D-NJ)) submitted a letter to Senators Pat Roberts (R-KS) and Debbie Stabenow (D-MI), the Chairman and the Ranking Member of the Senate Committee on Agriculture, Nutrition, and Forestry, regarding reauthorizing the Pesticide Registration Improvement Act (PRIA), worker protections, and the U.S. Environmental Protection Agency’s (EPA) “legal duty to protect the public from unreasonable harm from pesticides.” H.R. 1029, the Pesticide Registration Improvement Extension Act of 2017, which reauthorizes PRIA, was passed by the Agriculture Committee on February 16, 2017. The letter states that it should include a “limited number of improvements” before being approved by the full Senate, including “adequately reflect[ing] important worker safety priorities” via “ensuring that the worker protection rules are implemented in a timely manner” and “finalizing the EPA staff recommended ban on chlorpyrifos.” The letter states the EPA’s decision to deny the petition to ban chlropyrifos should be “reversed immediately.”
More information on H.R. 1029 is available in our blog item House Agriculture Committee Passes Pesticide Registration Enhancement Act of 2017.
On July 25, 2017, Udall, Blumenthal, Booker, Cardin, and several other Senators introduced S. 1624, the Protect Children, Farmers, and Farmworkers from Nerve Agent Pesticides Act of 2017, which prohibits the use of chlorpyrifos on food and directs EPA to enter into a contract with the National Research Council to “conduct a cumulative and aggregate risk assessment that addresses all populations, and the most vulnerable subpopulations, including infants, children, and fetuses, of exposure to organophosphate pesticides.” S. 1624 proposes to amend Section 402 of the Federal Food, Drug, and Cosmetic Act (FFDCA) to add to the list of adulterated food any food that “bears or contains chlorpyrifos, including any residue of chlorpyrifos, or any other added substance that is present on or in the food primarily as a result of the metabolism or other degradation of chlorpyrifos.”
The Senate letter regarding issues with H.R. 1029 can possibly forestall the reauthorization of PRIA, which would cause many problems for EPA’s Office of Pesticide Programs (OPP), as the PRIA funds are necessary for OPP to operate the pesticide regulatory program.
Politically, the hiccup on PRIA reauthorization indicates a further acceleration of the partisan sniping already sapping the ability of the Senate to reach agreement on any subject. PRIA contributes to EPA’s budget, with specific funds directed to support farmworker protection. As such, it has not proven to be controversial in past reauthorization efforts. PRIA represents an industry contribution to support EPA’s regulatory reviews and farmworker protection programs, and without it, EPA’s budget will face further cuts. Normally, democratic members of Congress would be expected to be against further cuts to EPA and applaud the more robust regulatory regime supported by the regulated community’s own fees.
The chlorpyrifos legislation also portends a new, more hostile operating environment for the current leadership of EPA. It has been years since action on specific pesticide products has seen a serious legislative proposal; generally Congress is reluctant to engage on a specific regulatory conclusion which has complex scientific disputes at its core.
Opposition to current EPA leadership and Administration agendas appears to be so intense that partisan bickering will surround almost any EPA-related initiative brought to the Senate floor.
By Lynn L. Bergeson, James V. Aidala, and Margaret R. Graham
On February 14, 2017, in the House of Representatives, Rep. Rodney Davis (R-IL) introduced H.R. 1029, the “Pesticide Registration Enhancement Act of 2017,” which reauthorizes the Pesticide Registration Improvement Act (PRIA). H.R. 1029 was immediately referred to the Agriculture Committee and to the Energy and Commerce Committee; it was passed by the Agriculture Committee on February 16, 2017. Per Agriculture Committee Chair Michael Conaway’s opening statement at the Business Meeting markup of H.R. 1029, changes to PRIA include “reasonable increases in registration fees, funding for Good Laboratory Practices, and a seven year reauthorization as opposed to the five-year reauthorizations of the past.” H.R. 1029 would allow the U.S. Environmental Protection Agency (EPA) to collect up to 31 million in registration fees (up from 27.8 million) per year from fiscal years (FY) 2017-2023. It also includes the following registration increases for FY2017 through FY2023:
- The maximum annual fee for registrants holding 50 pesticide registrations or less would be $129,400 (up from $115,500);
- The maximum annual fee for registrants holding over 50 pesticide registrations would be $207,000 (up from $184,800);
- The maximum annual fee payable for a small business registrant holding 50 pesticide registrations or less would be $79,100 (up from $70,600); and
- The maximum annual fee payable for a small business registrant holding over 50 pesticide registrations would be $136,800 (up from $122,100).
PRIA represents a commitment by the pesticide registrants to help with the continued resource issues of the pesticide regulatory program. This has become an issue of increased concern with the arrival of the Trump Administration after campaign rhetoric about eliminating EPA and cutting budgets. Fees are seldom a popular topic, but an essential program component. Without staff and resources to approve pesticide registrations, registrants would be left with new products destined to pile in EPA in-boxes. PRIA is designed to help maintain some certainty and predictability to the review process.
Of some note is that in recent years Congress has appropriated funds at a level below the statutory minimum that originally was a line in the sand which, if breeched, would de-authorize EPA’s authority to charge application fees. The regulated community has reluctantly supported Congressional action to lower this “minimum” level of funding to hold onto the programmatic progress which has been made since the first PRIA authorization. This appears to be an uneasy acceptance of the budget realities surrounding federal spending on discretionary, non-defense expenditures.
By Sheryl L. Dolan, Lisa M. Campbell, and Henry M. Jacoby, M.S.
On September 22, 2105, the U.S. Environmental Protection Agency (EPA) published a notice in the Federal Register listing its revised registration service fees applicable to specified pesticide applications and tolerance actions for fiscal year (FY) 2016 that are registered under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA).
The Pesticide Registration Improvement Act of 2003 (PRIA) established FIFRA Section 33, creating a registration fee-for-service system for certain types of pesticide applications, establishment of tolerances, and certain other regulatory decisions under FIFRA and the Federal Food, Drug, and Cosmetic Act (FFDCA). Section 33 also created a schedule of decision review times for applications covered by the service fee system. EPA began administering the registration service fee system for covered applications received on or after March 23, 2004.
PRIA has been reauthorized twice, most recently by the Pesticide Registration Improvement Extension Act (PRIA 3) signed on September 28, 2012. PRIA 3 revised FIFRA section 33, reauthorized the service fee system through fiscal year 2017, and established fees and review times for applications received during fiscal years 2013 through 2017. The registration fees for covered pesticide registration applications received on or after October 1, 2015, increase by five percent from the fees published for fiscal year 2015 in the Federal Register notice issued September 26, 2013, Pesticides; Revised Fee Schedule for Registration Applications. The new fees became effective on October 1, 2015.
The notice retains the format of prior PRIA tables; it identifies the registration service fees and decision times and is organized according to the three Office of Pesticide Programs (OPP) registration divisions within EPA, with the additional sections for inert ingredients and other actions added as part of PRIA 3. Thereafter, the categories within main sections of the table are further organized according to the type of application being submitted, including new active ingredients, new uses, new products, and registration amendments There are 189 categories of activities spread across the three OPP divisions: Registration Division (63 categories), Antimicrobial Division (39 categories), and Biopesticides and Pollution Prevention Division (69 categories), plus ten inert ingredient and eight miscellaneous categories. Each has its own decision review time and service fee for FY 2016-2017. The scale of the fees differs between the three registration divisions. We note that not all submissions are subject to PRIA 3; generally speaking, any submission requiring data review will be subject to PRIA 3.
The notice also provides information on how to pay fees, how to submit applications, and the addresses for applications.
More information on the registration fees is available on EPA’s webpage FY 2016/17 Fee Schedule for Registration Applications.
By Lisa M. Campbell and Lisa R. Burchi
On March 1, 2015, the U.S. Environmental Protection Agency (EPA) released the 11th Annual Report on EPA’s implementation of the Pesticide Registration Improvement Extension Act (PRIA 3) that is required under Section 33(k) of the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA).
This annual report details changes in processes, practices, and policies for Fiscal Year (FY) 2014 that ran from October 1, 2013, through September 30, 2014. The report is divided into different sections related to: (1) pesticide registration service fees; (2) maintenance fees; and (3) process improvements in the pesticide program; all of which can be accessed on EPA’s website at the below links. Specifically, the report covers the following topics:
Pesticide Registration Service Fees
* Fees Collected, Waived, Exempted and Expended
o Pesticide Worker Protection
o Partnership Grants
o Progress in Meeting Decision Times
* Fees Collected and Expended
o Expedited Processing FIFRA Section 3(c)(3)(B)
o Pesticide Reevaluation Programs
Process Improvements in the Pesticide Program
* Pesticide Reevaluation Programs
* Information Technology and Labeling
* Science Review/Assessment Improvements
EPA’s report addressing process improvements in the pesticide program discusses several areas where EPA believes its registration programs have improved, either through increased efficiency, consistency, and/or transparency. The areas discussed are:
* EPA’s use of the “Lean” business model to improve business processes;
* Delegation of authority to EPA’s Biopesticides and Pollution Prevention Division (BPPD) to expedite fast track and notification actions to reduce approval times and the number of actions in backlog status;
* Biopesticide Industry Alliance Registration Workshops to improve quality of application submissions;
* Release of testing guidelines to clarify scenarios under which efficacy testing at the lower certified limit is needed;
* Reduction of registered products for which EPA is taking action under the Antimicrobial Testing Program;
* Continued crop grouping regulations to save resources and reduce the number of required residue studies;
* Establishment of a Pre-decisional Determination Due Date to provide adequate time to reach agreement with the registrant on required label changes prior to EPA approving the label; and
* International work sharing to assist in individual country registration decisions while striving to harmonize regulatory decisions with global partners.
With regard to EPA’s review of electronic labels, EPA states the following:
1. Of approximately 6,300 labels submitted to EPA in FY 2014, almost half included an electronic label. Comparing the statistics from FY 2011 to FY 2014 reveals a steady increase of approximately 10 percent each year in the percentage of labels submitted in electronic format.
2. The use of electronic label review software varies significantly across the three regulatory divisions with the Registration Division reporting the highest use, the Antimicrobials Division reporting moderate use, and BPPD the lowest use.
PRIA 3 is effective from October 1, 2013, through September 30, 2017.
By Sheryl Lindros Dolan
On December 16, 2014, the U.S. Environmental Protection Agency (EPA) will host a half-day workshop on the application process for the use of inert ingredients in pesticide products. The workshop will take place in Arlington, Virginia. The goal of the workshop is to clarify the necessary elements of an application for approval to use an inert ingredient in a pesticide product. Complete application packages save applicants time and money, and reduce the number of application rejections. The workshop will cover: selection of a Pesticide Registration Improvement Act (PRIA) category, elements of an application, EPA’s evaluation process, and a retrospective review of inerts under PRIA. EPA will answer stakeholder questions throughout the workshop.
By Sheryl Lindros Dolan
On September 30, 2014, the U.S. Environmental Protection Agency (EPA) redesigned the Pesticide Registration Improvement Extension Act of 2012 (PRIA 3) website. The new website is available at www2.epa.gov/pria-fees. The purpose of the redesign is to make PRIA 3 information more easily accessible to stakeholders and the public, regardless of the type of device being used. EPA made no technical or regulatory changes to PRIA 3.