Clean-Up Regulations for Small Business

Your firm may now be subject to federal environmental regulations.

The classification of the dry­cleaning industry and automotive service shops as potential generators of hazardous waste profoundly shocked thousands of small "Main Street" business proprietors, many of whom represent second and third generation owners of family­operated businesses. For the most part they grew up in the business, learning their trade from fathers, relatives, or friends. They work long hours doing everything from sweeping the floor to bookkeeping.

A typical owner of a dry­cleaning establishment must not only operate the huge cleaning and drying machines, the washer/dryers and finishing equipment, but also does the tagging, garment spotting, garment repair, and/or alterations along with cash accounting, tax reporting, buying, hiring, firing, deliveries, etc. The typical proprietor works 10 to 12 hours a day, grosses $150,000 per year, employs six people, and (after salaries and expenses) makes a profit of $5,000 to $7,000 annually.

Automotive repair shops and service­stations boast an even greater range of diverse responsibilities that occupy the owner/operator from dawn to dusk and often beyond. Their profit margin is usually less than $6,000 per year, and the average workday exceeds 12 hours.

It is against this backdrop of long hours of labor and marginal profits that the small business community received the news that some of them might now be subject to new federal environmental regulations. One can well appreciate their reluctance to assume another reporting responsibility along with the higher costs of liability insurance that follow the designation "generator of hazardous waste – albeit small in quantity. Any new and unforeseen expenditure to comply with environmental regulations would have to come from current revenues or directly out of the owner's pocket.

These and other business entities falling under the new regulatory umbrella began to seek out answers to their questions and help with their problems. The Small Business Ombudsman's toll­free hotline began to ring and ring and it's been ringing ever since! The small businessman wants to know, is my company a small quantity generator? What wastes are hazardous? What regulations apply to me? What must I do to comply? Where can I get help and more information?

Of course, the Resource Conservation and Recovery Act (RCRA) isn't the only federal environmental legislation affecting small business. The Ombudsman's Office has provided assistance to hundreds of businesses and industries affected by water quality standards under the Clean Water Act, drinking water testing requirements authorized by the Safe Drinking Water Act, and automotive­import emission­control requirements and conversions under the Clean Air Act, to name a few.

During a week, the Small Business Ombudsman (SBO) may receive requests for information and assistance from placer gold mines, photo finishing companies, metal finishing companies, pesticide formulators, waste recyclers, laundries, dry cleaners, service stations, muffler installers, meat packing houses, chicken farms, poultry processors, hot springs mineral spas, paint stores, chemical plants, hospitals, and drug stores. A number of these enterprises are required to comply with several environmental acts and numerous federal regulations.

For example, one such enterprise is agribusiness – which often includes formulation and application of farm chemicals, grain warehousing, storage and sale of petroleum products, livestock buying stations, and general farm­related commercial sales. A typical agribusiness could be regulated under RCRA as a generator of hazardous waste and as an operator of underground storage tanks for petroleum and chemical products – the Superfund Amendments and Reauthorization Act (SARA) of 1986, which requires community Right­to­Know reporting; the Clean Water Act, which regulates liquid wastes, livestock feed lots, organic chemical production, etc; the Clean Air Act regulating atmospheric emissions from chemical and fertilizer production, grain drying (blowers), etc.; the Toxic Substance Control Act (TSCA) requiring compliance with reporting toxic chemicals and premanufacturing product notices; and, the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) requiring pesticide registration and approval, applicator training and certification, and worker protection standards for commercial farmers.

In addition agribusinesses would be subject to any future Agency regulation on used oil, fuel additives, and "user charges" for pesticide registrations, and waste minimization requirements among others. The agribusiness sector is not atypical. Hundreds of small businesses and industries are subject to multiple environmental acts and regulations. The typical "Main Street" dry cleaner may be impacted by provisions of RCRA, CWA, and CAA while the vehicle repair shops are subject to the same Acts along with guidance on brake asbestos exposure under the authority of the TSCA. The list goes on.

Considering that only a handful of these tens of thousands of business entities has ever heard of the Federal Register, the government's traditional means of outreach, and that fewer than half of them belong to national trade associations, EPA must greatly expand its efforts to get the word out. Effective educational outreach is imperative because, with the numbers of entities involved, voluntary compliance is an absolute necessity if the Agency is to achieve its environmental goals!

Though environmental consideration may be a burden on the entrepreneurial spirit, EPA pledges to work with small businesses to make the nation – and the small business workplace – safer and more salubrious than ever.

Considering the Impacts

The regulatory Flexibility Act of 1980 requires federal agency decision-makers to take into account the affect of regulations upon small businesses before choosing among regulatory alternatives. "Regulatory impact analyses," which are performed for most major regulations, often include a discussion of effects on small businesses, and arguments for or against relaxing controls for some or all categories within the affected industries. However, impacts on small business are almost always weighed against relaxing controls for some or all categories within the affected industries. However, impacts on small business are almost always weighed against estimates of the environmental benefits that would result from imposing controls on these entities. Consequently, small businesses in different industries can end up being treated differently. For instance, when the effluent guidelines for metal foundries were promulgated, magnesium foundries were exempted from regulations and some iron foundries received reduced controls. On the other hand, the effluent guidelines formulated for the electroplating industry did not include any exemptions, even though most of this industry is composed of small plants.