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New Silica Dust Proposal Would Have Big Impact on Foundries, Other Manufacturers

The Fabricator
October 2013

The Occupational Safety and Health Administration (OSHA) could impose new costs on metal casters and other manufacturers if it moves forward with new workplace exposure rules for crystalline silica, which gets into the air, in the case of foundries, when silica sand molds are broken in order to remove the  cast metal part. The OSHA lists foundry workers as numbering the highest among any general industry category for being exposed to levels of crystalline silica above the current permissible exposure limit (PEL). And only the concrete products sector has more total workers exposed to crystalline silica.

The proposed rule would replace a 40-year-old PEL of 100 micrograms with one set at 50 micrograms and an action level of 25 micrograms. The action level is the standard’s trigger for increased industrial hygiene monitoring and initiation of worker medical surveillance.

Groups such as the National Association of Manufacturers say no new standard is needed because there has been a 93 percent reduction in silicosis mortality from 1968 to 2002, according to the Centers for Disease Control and Prevention. Silicosis, an incurable sometimes fatal lung disease, is the major health effect caused by crystalline silica exposure.

The costs for all companies subject to the new standard, even those with admirably low current exposure limits, might be substantial given the exposure monitoring, medical monitoring and training costs. The OSHA estimates those to be $630 million for all sectors, total, on an annual, recurring basis. Amanda Wood, Director, Labor and Employment Policy, NAM, says industry estimates are $5 billion. Given the costs of compliance that all companies would face, Wood says the OSHA ought to focus on companies violating the current standard. 

The yawning difference between the OSHA and industry cost estimates may be because the OSHA says the  provisions of the proposed rule "are similar to industry consensus standards that many responsible employers have been using for years, and the technology to better protect workers is already widely available."

New SEC Task Force on Financial Reporting

Strategic Finance
September 2013

The head of the Securities and Exchange Commission's new Financial Reporting and Audit Task Force says he will be using data mining and other techniques to find companies who may be skating on thin accounting ice. In an interview with Strategic Finance, David Woodcock, Director of the SEC's Fort Worth Regional Office and head of the task force announced in July, explains that instead of relying on whistleblower tips or looking at public restatements, the task force will use internal and external data mining technologies and data bases such as the SEC's accounting quality model to locate companies who appear to be using aggressive accounting. "We will incubate the cases, basically kicking the tires of the company's accounting," he explained. If the task force finds some potential financial reporting or accounting fraud, it will refer the company to either a regional office or the national enforcement division for additional investigation.

Woodcock appears to be uniquely suited for this job, which he will be doing part time, ceding full time responsibilities to a staff of about eight professionals, half accountants, half lawyers, who will remain in the current locations. They will not relocate to Ft. Worth. Prior to obtaining a law degree, Woodcock worked for four years at Ernst & Young and Price Waterhouse as an auditor, and received a CMA certification.   

Some have argued that the SEC has ignored financial reporting fraud over the past decade, possibly because the Sarbanes-Oxley reforms may have curbed those problems, or perhaps because the agency, especially since 2008, has been preoccupied by Wall Street and financial company excesses. But Francine McKenna, who has written about accounting fraud in Forbes magazine, published a story last October which stated that the SEC’s 2012 whistleblower program statistics show that the most common complaints are for corporate disclosures and financial fraud, 18.2 percent, "even though we know now that it’s the eleventh straight year of fewer enforcement cases filed for accounting fraud and disclosure violations."

Woodcock says he does not think the SEC has turned a blind eye to corporate reporting fraud. He admits, however, that he doesn't know the dimensions of problems in that area. He aims to find out, by "concentrating" the agency's resources which have been somewhat spread around, and by going outside the agency to academic experts and others who may have some useful technologies for analyzing and finding corporate financial peccadilloes. The task force will be looking at both small and large companies, paying particular attention to areas such as revenue recognition, underreporting of costs and expenses, long term contract accounting, reserves and allowances and non-GAAP measures.

DOE Takes Next Step on Energy Efficiency Standards for Industrial Pumps

Green Manufacturer
September/October 2013 - for the online version go HERE.

The Department of Energy (DOE) has taken the next step in establishing first-time energy efficiency standards for industrial and commercial pumps. The agency is in the process of putting together what is called a negotiated rulemaking committee composed of users, manufacturers, and environmentalists who ostensibly hammer out a standard which then flies through the rulemaking process, without any objections.

The DOE previously released a request for information in 2011 and then a framework document last February providing some direction on where it expects to go, in terms of the categories of pumps covered and the kind of metrics that could be used to set new efficiency standards. The pump manufacturers, represented by the Hydraulic Institute, are pressing for "an extended product approach" using an energy efficiency index (EEI) which would take into account the pump, motor, variable speed drive and control and feedback systems. The HI has been working with environmental groups such as the American Council for an Energy-Efficient Economy (ACEEE), the Alliance to Save Energy, and the Natural Resources Defense Council (NRDC) on consensus standards with those efforts focusing on clean water commodity-type pumps. 

However, environmentalists want to expand the types of clean water pumps to include double-suction and circulator pumps. The EU already has a Directive (547, 2012) on efficiency standards  for clean water pumps, and the DOE generally intends to follow it. Charles Llenza, project manager for the rulemaking, says, "We have sort of borrowed from their playbook a little until we get our footing with this rulemaking and  the stakeholders input in the U.S. industry."

The DOE estimates clean water pumps represents about 70 percent of sales by value and 90 percent of  pump energy use. Those pumps can be used for chemicals and other liquids, and the DOE is considering roping "chemical" pumps--to the extent any are used primarily for that end use--into the new standard. But wastewater, slurry, API 610 pumps are outside the purview of this rulemaking.

A major issue will be whether to include variable speed drives (VSDs) in the standard. Greg Towsley, Director, Regulatory and Technical Affairs, Grundfos Pumps Corporation, the Danish concern which claims to be the world's largest pump manufacturer, wants VSDs to be included.  

But Steve Rosenstock, Senior Manager, Energy Solutions, the Edison Electric Institute, which represents investor-owned utilities, says, "EEI does not support establishing standards or test procedures based on pump performance with a variable speed drive controller. Pumps are used in a variety of applications and not all are a good fit for VSD."

Senate to Consider Pipeline Permitting Reform, Too

Pipeline & Gas Journal
September 2013 - for the online version go HERE.

The Senate may consider some form of pipeline permitting reform but the bill may not look like the one the House was expected to pass. Sen. Ron Wyden (D-OR), chairman of the Energy and Natural Resources Committee, released a broad statement on natural gas issues July 25.

Fleshing out the details in a speech hosted by the Bipartisan Policy Center Wyden laid out four areas – infrastructure, transportation, exports and shale development – where he is working to find bipartisan agreement. With regard to infrastructure he said he wants to speed pipeline development while plugging methane leaks that threaten the climate advantage that natural gas provides. “I’m going to look for ways to not just build more pipelines, but to build better pipelines,” Wyden said.

Sen. Lisa Murkowski (R-AL), the top Republican on the committee, is also interested in moving forward with pipeline legislation, but apparently is less interested in some broader natural gas bill. "We are doing our due diligence and seeing whether legislation is needed or whether the Federal Energy Regulatory Commission (FERC) can improve the permitting process administratively," says Robert Dillon, spokesman for Murkowski. "Sometimes legislation leads to unintended consequences."

Keith Chu, a spokesman for the Senate Energy Committee, says there isn’t a hearing scheduled for H.R. 1900. He adds, "Chairman Wyden is interested in talking to colleagues about whether there is interest in speeding up permitting while also addressing methane emissions, but it’s too soon to say whether there would be legislation."

Any Senate bill may contain some of the provisions in the Natural Gas Pipeline Permitting Reform Act (H.R. 1900) passed by the House Energy & Commerce Committee 28-14 on July 17. But there wasn't much Democratic support for that bill in the House. That means Wyden is likely to either modify many of H.R. 1900's provisions and add new ones, especially given his interest in seeing pipelines reduce methane emissions.

Wyden may accept some elements of H.R. 1900 since its sponsor, Rep. Mike Pompeo (R-KS), agreed to changes in the bill to appease the FERC. Those changes clarified that the expedited approval process endorsed by the bill would only be available to pipeline sponsors who put projects through the pre-filing process. That 12-month limit on how long FERC could take to either approve or reject a project after completion of a final environmental impact statement would begin after the commission received a completed application from the sponsor. Even after those changes were made, 14 Democrats voted against the bill and only two voted for it, meaning the legislation has a GOP stamp on it, clouding prospects in the Democratic-controlled Senate.

EPA Balks at Updating Aftermarket Catalytic Converter Standard