Contact: Tara Hendershott, Washington, D.C., 202-224-5444
February 05, 2009
Contact: Tara Hendershott, Washington, D.C., 202-224-5444 |
FOR
IMMEDIATE RELEASE February 05, 2009 |
Says Congress must craft a compromise to protect businesses while still improving child safety
WASHINGTON, D.C. – Senator Bob Bennett (R-Utah) today introduced a bill that would give the Consumer Product Safety Commission (CPSC) the discretion to postpone the enactment of the Consumer Product Safety Improvement Act (CPSIA) and give Congress and the commission time to evaluate the effects of this legislation and the unintended consequences that would harm small businesses and thrift enterprises.
“I believe it is important to improve our children’s safety and protect them from harmful lead products,” said Bennett. “We must, however, craft a compromise before this well-intended law wreaks havoc upon many of our small businesses and those in the thrift industry that serve the lower income families in our country.”
CPSIA is scheduled to go into effect on February 10, 2009. The act requires manufacturers to use accredited third-party laboratories to certify the safety of their products made for children 12 years of age and under. Resellers are exempt from the testing requirements of the legislation, but they are not exempt from the penalties associated with violating the legislation. Violations can result in criminal punishments of up to five years in prison and $250,000 in fines, and civil penalties up to $15,000,000.
Bennett met with Acting Commissioner Nancy Nord last week to discuss the unintended consequences of the legislation. That same day, the commission postponed the testing and certification requirements for one year to have more time to finalize the rules and issue clearer guidance on how businesses should comply with the law.
“I’ve heard from many Utahns who are very concerned that parts of the act are going to put them out of business and harm those who benefit from their products and services,” added Bennett. “At a time when we are debating how to stimulate the economy and keep businesses afloat, we should not overlook this problem that has the potential to cost our economy millions of dollars in litigation costs and many, many jobs if it is not implemented in the right way. During an economic downturn like the one we are experiencing, thrift stores and others that sell used goods are going to be more important than ever.”
The Bennett bill would provide the time needed to solve the problems associated with the act without compromising safety protections for our children. The commission would continue to have the authority to keep our children safe from hazardous substances under the Federal Hazardous Substances Act.
For more information on CPSIA, visit the Consumer Product Safety Commission web site at http://www.cpsc.gov/about/cpsia/cpsia.html.
Below is Senator Bennett’s entire speech submitted into the Congressional Record upon introduction of the bill:
I rise to introduce important legislation today.
Last year, this body passed the Consumer Product Safety Improvement Act. Overall, I think this was a good bill, and will contribute to improving our children’s safety.
However, as is the case sometimes, we are now learning about some of the unintended consequences arising from that legislation. I’ve heard from Utahns who are very concerned that parts of the act are going to put them out of business and harm those who benefit from their products and services.
Next week, as part of the Consumer Product Safety Improvement Act, a new lead standard for products goes into effect. The act makes it illegal to sell products that contain more lead than the new standard allows classifying those products as banned hazardous substances. The new standard should help protect our children from the harmful effects of lead poisoning.
The act also requires manufacturers to use accredited third-party laboratories to certify the safety of their products made for children ages 12 and under. If you don’t test the product, you can’t sell it. This makes perfect sense.
But here’s the problem: while resellers of those products are exempt from the testing requirements of the legislation, they are not exempt from the penalties associated with violating the act. Violations can result in criminal punishment of up to $250,000 and five years in prison, and civil liability up to $15 million. All of this is scheduled to go into effect on February 10 of this year—less than one week from today.
However, the Consumer Product Safety Commission understands there are problems associated with the act. I met with Acting Commissioner Nancy Nord last Friday about these issues. We discussed both the act’s potential problems and the importance of maintaining public safety. That same day, her organization postponed the testing and certification requirements of the act for one year. They needed additional time to finalize the rules, and issue clearer guidance on how businesses should comply with the law. Congress gave them the discretion to do this.
However, and this is the problem, the Consumer Product Safety Commission doesn’t have the discretion to postpone the actual standard—how much lead is legally allowable in certain products. So you have a situation where the agency is not enforcing the standard by requiring testing and certification while at the same time the companies that have products in their inventory that exceed the lead standard are subject to both criminal and civil penalties. As one who ran his own business, I can tell you that this makes no sense.
The legislation that I introduce here today will remedy this seeming contradiction. My legislation gives the commission the authority, if it determines necessary, to also delay implementing the new lead standards until they have finalized the rules and begin to enforce the law. If the commission were to exercise those authorities, it would give both Congress and the Consumer Product Safety Commission enough time to really evaluate the effects of this legislation, particularly on our small businesses and thrift enterprises, and implement something that actually makes sense.
You must understand that I am not opposed to the new lead standards or keeping our children safe. My bill is not mandating a year delay; it’s simply giving the commission that authority. In the meantime, we must craft some sort of compromise before this well-intended law wreaks havoc upon many of our small businesses and those in the thrift industry that serve the lower income in our country.
Let me explain some of the problems associated with the CPSIA. Some of my constituents who are concerned about this bill are running small businesses out of their homes to supplement their family income during these difficult economic times. One constituent, Katie Erwin, recently wrote to my office to tell me her personal experience. She designs and makes baby dresses that are sold on the Internet. Her dresses require the use of many fabrics, buttons, snaps, and elastic materials. She has done her research into what her business will have to do after the CPSIA becomes law. Even though she only uses materials that have been proven to have safe lead content, she has to have her end product tested. Not just each dress, but each element of each dress. At $75 per test, one dress could end up costing $750. She told us that, in order to be compliant, the dresses would be so expensive that she’d never make a profit. And that is if she could even sell the more expensive dresses. Other small and home-based businesses tell the same story. Many fear going out of business, and don’t know how to cope with the new enforcement.
The Ogden Rescue Mission in northern Utah has two thrift stores that have been around for decades selling used goods. The owner has made it clear that he will stop selling any children’s products on February 10 because he doesn’t want to break the law or be held liable for inadvertently selling a now-illegal product. Companies risk losing their insurance if they accidentally sell an unsafe product. With the new standards required by the Consumer Product Safety Improvement Act, the chance of that happening is almost certain. I have to believe that larger thrift stores like Deseret Industries, the Salvation Army, and Goodwill Industries will all have similar concerns once the act is fully understood and implemented.
Remember, these companies are going to be subject to criminal penalties and civil liabilities for products they sell that exceed the standard, including the resellers whom the law exempts from the testing and certification requirements. Again, five years in prison, $250,000 in criminal penalties and $15 million in civil penalties.
At a time when we are debating how to stimulate the economy and keep businesses afloat, we should not overlook this problem that has the potential to cost our economy millions of dollars in litigation costs and many, many jobs if it is not implemented in the right way. During an economic downturn like the one we are experiencing, thrift stores and others that sell used goods are going to be more important than ever. Let’s make sure they are able to serve our communities by providing the commission with the tools necessary to work out the problems associated with implementing the CPSIA.
I hope the Senate expeditiously considers my legislation. I think this approach makes sense, and will ultimately help the commission to better implement this law. I understand others may have different approaches to resolving the same problem, and I would invite a discussion of this issue during the coming weeks with my colleagues so we can fix it quickly before we do irreparable damage to businesses across the country. Thank you.
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