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VIRGINIA SUPREME COURT RULING FAVORS SHIPYARD WORKERS IN ASBESTOS SUITS: The VirgJ.nia Supreme Court has issued a ruling wldch may have national implications for present and former shipyard workers suing employers for damages resulting from asbestos-related disease many years ago. The ruling could cost companies and their insurers millions of dollars. In a case brought against eight asbestos manufacturers on behalf of a deceased employee of the New- port News Shipbuilding and Dry Dock Co., the highest state court ruled that the state's two-year statute of limitations should begin only after the disease is diagnosed. The current Virginia law, applicable in many other states, contends that the statute of limitations begins at the time of exposure. The court agreed with the worker that this would mean that employees would be required to file suit long before they knew they had an asbestos-related disease, citing the 15 to 20-year latency period. : "There is no fight of action until there is cause for action," the court ruled. "The running of the t:tme is tied to the fact of harm to the plaintiff; it is not keyed to the date of the wrongful act." Attorneys for the former worker, Douglas T. Locke, accused the companies of failing to warn him of the dangers of asbestos exposure. He had been exposed to asbestos between 1948 and 1972 while working as an industrial electrician at Newport News Shipbuilding. He was diagnosed as having mesothelioma in ~une 1978 and died six months later. The decision was considered a major victory for thousands of shipyard workers in the Newport News- Norfolk area of Virginia, where about 250 asbestos cases totaling more than $300 million in claims are pending. "This is beautiful, a real breakthrough," said a spokesman for tl~e United Steelworkers, which repre- sents shipyard workers at Newport News. "'A lot of time people don't become aware of asbestos-related disease until they get out of the work environment, which may be 15 or 20 years." The case may also have application to textile workers, at least in Virginia. They were expected now to press their claims for compensation for byssinosis as a result of exposure to cotton dust, based on the asbes- tos decision by the Virginia Supreme Court. The state has paid only one worker compensation claim for byssinosis in the last ten years, citing the statute of limitations as a barrier. - BARNAKO NAMED REVIEW COMMISSION CHAIRMAN~ LAGATHER JOINS ORC: Frank R. Barnako, Republican member of the Occupational Safety & Health Review Commission, has been designated Acting Chairman by President Reagan, replacing Timothy F. Cleary, who continues as a Commission member. Barnako, who was formerly manager of safety and workers compensation for Beth- lehem Steel, served as chairman of the Review Commission under President Ford. His six-year term of office as a Commissioner is dud to expire next month. The other member of the Review Commission is Ber~ Cottine. Robert B. Lagather, Assistant Secretary of Labor in charge of the Mine Safety & Health Administra- tion in the Carter Administration, has joined Organization Resources Counselors as head of its mine safety and health group. Dr. Norbert J. Roberts, medical director of Exxon Corp., has been-elected president of the New York Academy of Medicine, the first occupational physician to head the 134-year-old organization. Sue Nelson Wrenn, former director of policy and legislation at OSHA and more recently Deputy Assis- tant Secretary for Public Affairs in the Department of Health & Ht~man Services, has joined with Bill M. Wise, her boss at HHS, in formation of Wise & Wrenn, a consulting firm for public affairs, media and gov- ernment relations at 3240 Prospect St., N.W., Washington, D.C. 20007; (202) 342-7052; she is married to Grover Wrenn, former head of health standards at OSHA who is now with Clement Associates. Dr. Robert I. Leininger has been named Director of the Research Council at Battelle's Columbus Labs; he has been active in biomedical research at Battelle for more than 20 years. HOPKINS STUDY OF RADIOLOGISTS FINDS POSSIBLE LINK WITH HEART DISEASE= A long-term study at Johns Hopkins of radiologists has uncovered evidence of a possible link between chronic exposure to x-rays and an increased risk of death from cardiovascular disease. T!04231089

3-12-81 (DER) REGULATORY & LEGAL DEVELOPMENTS (No. 48) " A- 15 ?~I[C: ACTING CHAIRMAN MAKES PLEA- 7~, ~'/f" ~ PRESERVING REGIONAL OI=FICES *" ~ The Republican acting chairmen of the Federal Trade Commission today spoke against an Administration budget proposal to eliminate the I=TC's i0 regional of/ices. David A. Clan[on, testifying before a congressio~m/" committee, urged rejection of the (~ffice of Marmgement and Budget's recommendation that the regional offices be closed because, he argued, they serve an important role in the agency's antitrust and consumer protection missions. "In our view, '~ Cianmn, ~Wao has. been acth~g chairman for a week, said, 'many short- run savings achieved by closin~ these i0 offices would be more than offset by corresponding losses to the public, to businesses, especially small business, and to state and local officials served by these offices.." Clanton's remsrks were made to the House Appropriations Subcommktee on Commerce, Justice, State, the Judiciary and Related Agencies, which will prepaxe appropr[adons legisla- tion covering the FTC later this year. President Keagan's budget request for 1982, which was submitted March I0, [ncl.uded $69.5 million for the I~TC that would mean an $8.5 mill~on reduction in funds (II percent) and a cutback of 317 posit~ons (18 percent) (Report No. 47, A-II). l~or remaining fiscal 1981, the FTC's budget would be cut by $3.5 million and 109"~'~tions. The Reagan Administration recommended that the FTC's reductions be made largely [n the regional offices over the next three years by phasing out 20 percent of their operations this year, another 40 percent in fiscal 1982, and the final 40 percent in fiscal 1983. I~TC staff estimated the total opera[Lug expenses for the regional offices over the period at $ii. 2 million. Summarizing the commission's position, Clan[on said loss of the regional offices would deprive the agency of important input from outside Washington in the shaping of FFC policy, would deprive local businesses and officials of a nearby place to take their questions and complaints, and would harm the agency's ability to enforce the law. The FTC offices that" would be closed under OMB's recommendation are Atlanta, Boston, Chicago, Cleveland, Dallas, Denver, Los Angeles, New York, San Francisco, and Sea[de. Clanton said all of the agency's cases, as well as other activities, would have to origi- nate from Washington if Congress accepts the OMB plan. He cited past cases to show the con- tributions of regional offices. The FTC's antitrust complaints against major crayon manu- facturers that resulted in a $1. 225 redress fund to public school systems came from a com- plaint to the Cleveland office by a small distributor of art supplies. The commission's case against Borden for monopolization of processed lemon juice arose after a meeting between the staff of the Chicago office and. a local businessman who had tried unsuccessfully to expand his. sales of processed lemon juice, Clan[on testified. The actLng chairman assured the committee that the FFC was prepared to accept re- ductions as part of the Administration's overall curtailment of federal spending, but he said the FTC believed a I0 percent cut in positions rather than the 17 percent recommended by OMB was preferable. Funding at the level in this budget, Clan[on said, would permit continu- ation of most existing matters but would not permit the agency much flexibility to start up new efforts or respond to new complaints. Clanton declared that all the agency's programs had been sequeezed to some extent to reach the funding level set by OMB: As a result of budgetary c[mnges, he said the agency will be scrutinizing more closely than before the economic impact of its actions, undertake fewer industrywide regulations, and emphasize disclosure of h~ormation to consumers so they could ette - - 0 - ISZSZ mak~ their decisions. Copyright ¢)1981 by" THE BUREAU OF NATIONAL AFFAIRS. INC. Washington. D.C. 20037 014~-815~/81/$00.50 Ti04231090

3-11-81 (DER) REGULATORY & LEGAL DEVELOPMENTS (No. 47) A - ll MICA President Robert Waldo said the tendency of the government over the past few years, prior to the Reagan Administration, has been to promote steady increases in the com- petitive position of P,HA. "We believe that these increases have pointed FHA in the wrong d/recdon, " he declared. "One hundred percent government insura~nce, which is that offered by FHA, should be employed only to accomplish a social objective, such as subsidized housing for the disadvantaged, which c~'nnot be economically met by the private sector. " Waldo said that prior to the founding of the private mortgage insurance industry in 1957, FHA "was the only game in town. " But since then, he continued, private mortgage insurers have grown rapidly and now theLr total insurance-in-force has hit the $100 billion mark, which exceeds that of FHA for unsubsidized single-fam/ly homes. The mortgage bankers -- whose opposition to the Reagan plan for FHA and GNMA was set out in a statement by its executive vice president, Mark Riedy -- said the talk of phasing- out P,HA could not have come at a worse drne. "During the 1980s, this nation r~ust provide housing for 22.5 million new households, more than at any comparable period in our history, " Riedy said. YThe elimination of this P,HA program would needlessly remove an option that the homebuyer now enjoys at a time whe.n mortgage financing is undergoing tremendous change. P,HA helps stabilize the volatile mortgage market and has remained in the forefront of experimentation -- as with the graduated payment mortgage program -- as it searches for ways the mode.rate income person can re- main in the homebuying market. " Although Veterans Administration housing programs are not covered in the Administra- tion's proposals, Riedy said that they could also ]De hurt because of their close relation with I=HA's policies and procedures. He also stated that cutbacks in GNMA programs could mean more trouble for the already weakened .savings and loan industry. The .proposed reductions in F[-/A and GNMA activities represent.s a major portion of the Reagan plan to reduce federal credit programs and thereby ease the pressures on private markets for government borrowing that have played a role in..driving up interest rates. An important factor in the Administration approach is phasing out the access of some agencies to the financing aid provided by the .Federal P,inancing Bank, which borrows funds for the Treasury to finance the agencies' programs. Without help from the P,ederal Financing Bank, the agencies would have to go into the private market to raise their own funds. The Administration budget-cutting proposal lists three agencies -- the Student Lo~n Market Association, the Rural Electrification Administra- tion, and the Tennessee Valley Authority -- whose access to the P,FB is being phased out. -0- ANTITRUST: REAGAN BUDGET PRESERVES LEVEL FOR DOJ DIVISION, CUTS FTC MONEY BY 11% The Reagan Administration spared.from any cuts the Justice Department's antitrust budget request for fiscal 1982, but funding for the P,ederal Trade Commission would be rediced by more than $8 million below what President Carter had proposed to about $69.5 million. The overall Justice Department budget submitted by President Reagan March i0 pro- posed spending of $2.33 billion, a reduction of about $231 million from the Carter budget submitted in January. The primary reductions would come in programs for U.S. marshals and U.S. trustees, the Immigration and-Naturalization Service, and juvenile justice assistance. Copyright ©1981 by THE BUREAU OF NATIONAL AFFAIRS, INC.. We~hington. D.C. 20037 0148-8~ 55181/$00.50 T!04231091

A - 12 (No. 47) REGULATORY & LEGAL DEVELOPMENTS (DER) 3-11-81 The ~ntitrust division is budgeted for $49. 6 million and would have an authorizea level of 8 97 positions. " The antitrust division' s budget request was left unchanged from that proposed by the Carter Administration. It was spared the cuts felt by other Justice Department programs be- cause of the possibility of a cutback in antitrust enforcement by the FTC, according to Assist- ant A~torney General Kevin Rooney. Rooney said a reduction in the budget for the bureau of competition could mean an increase in the workload for antitrust enforcers at the Justice Department. Rooney alsosaid the Administration w.ill seek congressional approval to discontinue the antitrust division as a separate item in the department's annual budget. The antitrust division would be added to other divisions, like the lands and civil divisions, under a general heading of legal services. If the change is accepted by Congress and the increased workload from FTC cutbacks does not materialize, the department might decide to take away some of the $49. 6 million earmarked for antitrust and distribute it to other divisions if it decided greater need existed elsewhere, Rooney said. The department's budget officer said he could not predict ~ow much more work the antitrust division might have, if any, since the impact of budget reductions at the I~TC are still unknown. In any event, the antitrust division will not receive an increase in positions. A reduction of 42 authorized positions first proposed by Carter earlier this year was re- tah~ed in the Reagan budget (Report Iqo. ii, D-13). The Reagan budget did include a minor reduction in the division's fiscal 1 981 budget-- $126,000 for equipment and consulting. The fiscal 1981 total for the division is $46.6 million with 939 authorized positions. For the FTC, the Reagan Administration's budget proposa-i of $69.5 million for FY '82 amounts to an ii percent decrease from the original Carter budget request in January. Last month, the Office of Management and Budget told the agency even deeper cuts were wanted to bring the FTC's budget to $59.4 million (Report IWo. 30, i-4). The bureau of com- petition, the antitrust enforcement arm of the agency, would have been gradually eliminated under the earlier plan, but the Administration later disavowed any intention to cut out the bureau through the budget process (Report No. 41, A-13). A proposal OMB originally made, which was retained in the revised budget, is the elimination of the commission's regional offices over a three-year period, beginning this fiscal year. As a result, 355 positions eventually will be eliminated. The FTC's public participation program, which provides funds for outsiders to appear before the agency, is cut out of the 1982 budget. • The current budget plan calls for a 16 percent reduction in the I~TC's competition mission, which consists mainly of the activities of the bureau. The bureau's money is re- duced by $487,000 and staffing by 99 positions in fiscal 1982, compared to a reduction of $755,000 and 99 positions for the bureau of consumer protection. The bureau of economies is faced with the smallest reductions of the three--S74,000 and I0 positions. A supplemental money bill for fiscal 1981 of $3.5 million to pay for salary increases and other expenses was also cut by the Reagan Administration. The FTC program budget, sent to the congressional appropriations subcommittees headed by Sen. Lowell P. Weicker Jr. (R-Conn) and Rep. Neal Smith (D-Iowa), said that while the funding for the competition mission "permits the continuation of ongoing matters in the majority of programs," the commission's ability to initiate new projects or respond to complaints of anticompetitive behavior will be reduced substantially. (5ne vi&tim of the reductions in the competition mission will be implementation of a new computer processing system at the FTC for premerger notification under the Hart-Scott- Rodino Act. Of the total competition mission proposed budget of $31.8 million, the largest cut ($3 94, 000) would come in food indus~tries projects. Copyright © 1981 by THE BUREAU OF NATIONAL AFFAIRS, INC., Washington. D.C. 20037 0148-8155/81/$00.50 T!04231092

3-11-81 (DER) REGULATORY & IE(~AL DEVE~.OPMENT$ (HOG 47) A - .13 Projects that would get more money thanin fiscal 1981's hudgetwouldbe mergers and joLut ventures (~181,000), distributional restraints ($73,000), and energy and petroleum ($64,000). The bureau of consumer protection suffers the biggest cuts. The agency said its budget reflects a shifting of resource.s away from industrywide rule proposals. A total of 59 work- years was budgeted for promulgating consumer protection rules last year, but the fiscal 1982 budget would reduce that amount by 61 percent, the budget document stated. The decrease in resources will hit hardest the FTC's ability to tackle deceptive adver- tising and its programs on energy, food, and drugs, the budget proposal said. A major in- crease in the consumer protection area will come in resources devoted to the analysis of the economic impact of rules, which will be increased 180 percent over the funding allocated i~. 1980. Although there will be reductions in the agency's economic activities, the proposed budget "maintains the core" of the economic analytical and repo.rting work of the agency, the program.'budget said. The economic activities Po/ssion is reduced in positions by 5 percent in fiscal 1981 and 8 percent in fiscal 1982, compared to the Carter budget.estimates. -0- REGULATORY REFORM: ABOUT 50 REGULATIONS ARE DESIGNA'fED FOR COST-BENEFIT REVIEW, MILLER SAYS About 50 existing and proposed reg~t, lations have been picked to be put to the cost-bene- f/t t~st of President Reagan's regulatory reform executive order, James Miller Ill, head of regulatory affairs at the Office of Management and Budget, .said today. The 50 re~/ations wi~ be th~ first set of rules to be sibject.ed to the requirements of Executive Order 12291, issued Feb. 17. That order requires that major new rules be scru- tinized to ensure that the benefits of a rule outweigh the ~ost of complying with it (Report No. The order also calls for agencies to systematically review existing rules and gives OMB the authority, at the diredtion of the Task Force on Regulatory Relief chaired by Vice President George Bush, to designate existing rules for review. Miller said the list will probably be released next week. Miller, speaking to an annual meeting of the Computer and Communications Industry Association in Washington, D.C., would not say what rules are on the list. However, he did say the Environmental Protection Agency has the most rules on the list, and indicated that some "midnight regtllsrions" are on Also likely to be on the list is the lead standard promulgated by the Occupational Safe- ty and Health Administration. OSHA on March 3 deferred a part of the standard that was to have taken effect last week, which required that workers exposed to certain levels of airborne lead be temporarily transferred. Labor Secretary Raymond Donovan has indicated that he wants to go one step further and review the whole standard, according to Miller. When ~ombined with the budget cuts President Reagan is proposing, the designation by the task force of such a large block of rules will mean regulators will have to shift resources away from producing new rules to undertake the review, iV/ller indicated. By Vc'hite House estimates, executive agencies produce about 150 major ru/es a yea_r, so a comprehensive re- view of 50 regulations could be one third of the executive branch regulatory workload. Copyright ~) 1981 by THE BUREAU OF NATIONAL AFFAIRS, INC.. Washlngton, D.C, 20037 014~8155/811500.50 Ti04231093

~ - 12 (No. 48) REGULATORY "& "L'EGT~L'DEVELDP1VIENTS (DER) 3-12-81 The source said the Admirdstration will propose Ed Noble, a Tulsa businessman, as chairman of the board. Noble headed up the synfuei corporation's transition re,am for Presi- dent Reagan. According to the source, the Administration also will nominate Victor Schroeder, of Portman Properties in Atlanta, to the board. Schroeder was a member of the synfuels cot- potation transition team. (kher possible nominees include, the source said, Texas business- man Ed Vetter and Roderick Hills, a parmer with the law firm Latham, Watkins and Hills in Washington. The synfuels corporation currently has $5 billion allotted to it from the federal gov- eznment's Energy Security Reserve. DOE has not committed auy of its $5 billion fund for synfuels project backing, and unobligated funds will transfer to the corporation at the end of June, if the Reagan Administration does not speed up the switch. -O- [-~ODUCT SAFETY: REDUCED $33 MILLION BUDGET REQUEST FOR CPSC CALLED "DEVASTATING" In a move that had already been labeled "devastating" by members of the Consumer Product Safety Commission, President Reagan submitted to Congress March I0 a budget, re- quest proposing a $33 million appropriation for the agency's fiscal 1982 activities, a figure $Ii. 6 million lower than that proposed by the previous Administration. The commission first learned of the Administration's plan to cut the agency's budget by nearly a third on Feb. 13, and immediately began to develop a strategy to avert the fiscal surgery. In a letter to the Office of Management and Budget, the commission said a budget below $39 million and 775 full-time permanent staff members "would have a devastating im- pact on the agency's mission and would prevent the commission from carrying out key activi- ties mandated by Congress." Having failed in its appeal to OMB, the commission took its case to Congress, but there, too, encountered a lukewarm reception. At a March 5 hearing before the House Com- merce Subcommittee on Health and the Environment, the commission got little support from Republican congressmen and found no friends within the indfistries it regulates. Testifying on behalf of the CPSC, the former chairm~n of the agency, Susan King, said the budget proposal "may be no more than a minor league numbers game in which no one comes out ahead." According to King, the commission has already lost between 25 percent and 30 percent in purchasing power over the last five or six years. Further cuts, she told the sub- committee, cannot be absorbed by the CPSC in across-the-board reductions, but rather, will require the termination of whole programs (Report No. 44,_~A-I). Consumer representatives, who also testified in support of the commission, said the proposed budget cuts amounted to the Administration's attempt to avoid Congress in controlling regulatory agencies. But while no definite decisions have been made by the commission as to how and where to reduce its activities to fit the size of the new budget, the Administration's proposal has already produced its first victim. In executive session March 9, the commission voted to dis- continue its program to regulate Christmas tree lights, saying that, although a .safety standard for the lights might be necessary', it simply will not have the money to develop and enforce the rule, The commission is facing further hearings in the House before going before the Senate of Subcommittee at April. Consumer the beginning ~mmerce " 0" BANKING: DIDC LIKELY TO DISCUSS HIGHER YIELDING BANK INSTRUMENT, REGULATION Q PHASEOUT PLAN A more liquid and higher-paying deposit instrument for banks and a strategy for phasing out interest rate controls probably will be discussed by the Depository Institutions Deregulation Committee at its meeting on March 26. Copyright ~)1981 by THE BUREAU OF NATIONAL AFFAIRS, INC., W~shinglon, D.C. 20037 0148-8155181/$00.50 1S2S3 T104231094

BNA's Daily Reporter System DALLY REPORT FOR EXECUTIVES REGULATORY & LEGAL DEVELOPMENTS 3-6-81 .... CNo. 44) A - 1 PRODUCT SAFETY: FORMER CPSC CHAIRMAN DEFENDS COMM'N AGAINST FUNDING CUTS, RESTRUCTURING The Reagan Administration's proposal to slash the Consumer Product Safety Commis- sion's fiscal 1982 budget to $33 million and its staff to 633 '~vould seriously undercut if not incapacite CPSC's entire program, " fbrmer agency Chairman Susan King told members of the House Commerce subcommittee on health and the environment at the first day of reauthor- ization hearings March 5. A panel of representatives from consumer organizations echoed King's warning, add- ing that Reagan's proposal is really an attempt to bypass Congress in curtailing the agency's authority. Industry, however, not only endorsed the Administration's budget figure, but called for changes in the agency's structure and enabling legislation. The subcommittee has before it two CPSC authorization measures. Subcommittee Chairman Henry A. Waxman (D-C'alif) March 3 introduced a bill (HR 2271) which would au- thorize fiscal 1982 appropriations for the CPSC of $45 million, the agency's current fundiug level. However, a proposal (HR 2201) introduced Feb. 25 by Republicans James T. BroyhilI (NC) and Edward Ro Madigan (II1) would set a $33 million ceiling on agency funding for fiscal 1982. Broyhill's proposal would also make several amendments to the Consumer Product Safety Act which would alter the agency's rulemaking procedures. Under the bill, Congress would have'90 days to veto consumer product safety rules issued by the ~ommission. The CPSC would be required for each proposed ~ule to prepare an analysis of the costs, benefits, and net benefits, and alternaf2ve approaches that could achieve the same goal at lower cost. In instances where a voluntary standard exists, the agency would be required to deter- mine that the voluntary rule is not likely to result in the elimination or reduction of the risk of injury before a mandatory standard could be pursued. The Broyhill proposal would also repeal the current prohibition against the use of sampling in data collection by the commis- stonand would require the agency to justify requests for data submission by industry. The proposed cuts in the CPSC's 'budget may not bear up under a cost-benefit analysis, King told subcommittee members. "My personal concern is that the [Office of IV/~nagement and Budget] proposal may be no more than a minor league numbers.game in which no one comes out ahead~" she said. "CPSC is a small agency with a small budget. It has no impact o11 the larger budget figures, and more importantly, the agency is highly cost-effective. The losses to the public, in both health/safety terms and dollars saved, may be greater than realized. " • King also noted that in constant dollar terms, the CPSC has lost between 25 and 30 percemt in purchasing power over the last five to six years. The budget cuts proposed by President Reagan could not be absorbed across the board, she said. Rather, according to King, whole programs would have to be abandoned. King defended the agency's present structure and rule making procedures in remarks addressing various pr0pogals advanced recently by industry groups and transition advisors. The suggestion that the legal powers of the commission be curtailed, and its activities centered on information and education is an "elitist concept," King maintained. The proposal does not account for the fact that many consumers cannot choose among various products, she said. Rather, they are constrained by cost, she explained. Copyright ©1981 by THE BUREAU OF NATIONAL AFFAIRS. INC.. Washinffton, D.C. 20037 0148-8 ! 55/81/$00.50 T!04231095

A -2 (No. 44) REGULATORY & LEGAL DEVELOPMENTS (DER) -3-6-81 The proposal that the CPSC be restructured as a single admi_nistrator agency within another cabinet department -- a recommendation endorsed by acting CPSC Chairman Stuart Statler -- also met with King's disapproval. Such an action would involve a tradeoff of inde- pendence for increased efficiency, which she called "unwise. " There is no justif[cation for the proposal that the CPSC drop ks chronic hazards pro- gram, .Kin~ said. '~n my view, this is the most important initiative undertaken by the agency in the last few years. " She added that there is no conflict between the CPSC chronic hazards program and the programs of other federal agencies. The CPSC is the only body with jurisdic- tion over the actual product purchased and used by the consumer, she noted. According to King, another reason for retaining the chronic hazards program is that products having chronic adverse health effects also often pose acute hazards. Giving the En- vironmental Protection Agency sole authority to regulate chronic hazards, as some critics of • the CPSC have suggested, would result in the same product being regulated by two different agencies, she maintained. King said that although she did not agree with Broyhkll's proposed authorization of $33 million, she did not object to most of the other provisions of his legislation. She noted that the CPSC already conducts a cost-benefit analysis of proposed rules similar to that required by the bill. She called the provision requiring the agency to justify requests for data submissions "reasonable, " and said that the use of sampling in data collection should be considered. However: King told the subcommittee that she would have "trouble" accepting the pro- vision for a legislative veto of CPSC rules. She said the provision would place an "enormous burden" on the committee and would raise the question of whether the lack of a Congressional veto for any specific rule would legai/y imply Congressional approval. "There is no substitute for vigorous Congressional oversight of agency procedures in conjunction with reauthortzation hearings, " King maintained. .. King urged the subcommittee to avoid cuts in the agency's Section 15, chronic hazards and children's products programs, which she labeled the CPSC's "most important" activities. Representatives of the National Consumers League, the Consumer Federation of America, and Consumers Union endorsed ~}Vaxman's proposal to reauthorize the commission.at its current spending level. Sharon Nelson of CU said that the budget cuts proposed by President Reagan are the Ad- ministration's attempt to avoid Congress in controlling the regulatory agencies. Her contention was echoed by James Boyle, director of governmental relations for the Consumer Federation of America, who said, 'The OIVIB is making, an important policy change in the guise of economy. " All three testified that in the past three years, the CPSC has established its priorities, .streamIkned its processes, and become one of the most c0st-effective federal agencies. Industr)r, on the otherhand, gave its support to Broyhill's proposal to reduce the agency's budget. Industry spokesmen also endorsed Broyhiil's suggestions for revising the CPSC's reg- ulatory procedures. William Stevens, testifying for the Upholstered Furniture Action Council, said that UFAC's dealings with the commission have made it clear that the agency needs a clearer man- date from Congress to place its primary emphasis on cooperating with industry in voluntary standards development. Jan Amundson, testi_rying for the National Association of Manufacturers, endorsed Broyhill's pr.oposal to permit sampling In data collection activities. NAIVI made recommenda- tions which went beyond Broyhill's revisions to the CPSA, however, including giving the EPA sole jurisdiction over chronic hazard regulation and appointing a single CPSC administrator and transferring the agency to the executive branch. Copyriiiht © 1981 by THE BUREAU OF NATIONAL AFFAIRS, INC., Washington. D.C, 20037 0148-8155/811500.50 Ti04231096

3-6-81 (DER) REGULATORY & LEGAL DEVELOPMENTS (No. 44) A - 3 Douglas Thompson, of the Toy Manufacturers Association, toId subcommittee members that the commissioners lack the technical and engineering expertise which should be required of regulators of consumer products. He also said that, given the low rate of complaints and injuries involving children's toys, the agency has spent a "disproportionate" amount of time regulating and recalling toys.. John Graft, of the International Association of Amusement Parks, complained that, al- though the CPSC lacks clear jurisdiction over amusement park rides, the agency has been vig- orously asserting such jurisdiction in recent months through inspections and press releases. He maintained that the commission's staff lacks the expertise to develop effective standards for ride safety and that the cost of such regulations is not justified by the few injuries assodiated with amusement park rides. Richard Hersh, of the National Mass Retailing Institute, and a former member of the Product Safety Advisory Council, said that Congress should instruct the commission to advise business of their right to have counsel present during plant inspections and of their right to re- quest a search warrant. He also said that because the CPSC was formed in an era of low infla- tion and faith in the efficacy of government regulation, he questions "the continued need for an independe'nt agency" to regulate consumer products. Committee members appeared to follow party lines in favoring a continuation of cur- rent funding levels for the commission or supporting the proposed cuts. While Waxman ex- pressed his belief that the CPSC has "vital responsibilities which cannot be neglected, " Broy- hill maintained that questions of the agency's regulatory zeal and neglect of voluntary stand- ards development need to be addressed. The reauthorization hearings will continue March 13 at 9:30 a.m. in Room 2322 of the Rayburn Building. Commissioners Stuart Statler, Edith Sloan, Sam. Zagoria, .and David Pittle are expected to testify. -0- PRODUCT SAFETY: CPSC STAFF DRAFTS INFORMATION DISCLOSURE REGULATION The Consumer Product Safety Commission's legal staff recently submitted to the com- missioners a draft informatidn disclosure regulation interpreting a June 1980 Supreme Court decision that had dealt a severe blow to the CPSC's practice of releasing product hazard-re- lated information. The Supreme Court in CPSC v. GTE Sylvania, Inc., ruled that the commission must apply the "bad publicity" provision of its enabling statute in making .Freedom of Information Act releases (1980 Report No. 112, A-4, B-l). The CPSC's office of general counsel on Feb. 27 submitted to the commissioners a draft regulation explhining the procedure the CPSC will follow in providing the advance notice to manufacturers and private labelers prior to disclosure of information to the public required by section 6(b) of the Consumer Product Safety Act. : The draft rules also contain the commission's interpretation of the section as to what information is subject to or exempted ~om section 6(b) and what "reasonable steps" the com- mission will take in applying this section. The draft represents the result of extensive discussion among the staff, based on legal interpretation and experience in applying Section 6(b) since June I980, when the Supreme Court ruled in GTE Sylvania. Copyright ¢}1981 by THE BUREAU OF NATIONAL AFFAIR~o INC., Washington, D.C. 20037 O1488155/8115O0=5O Ti04231097