1665ss15

SUPPORTING STATEMENT

1. Identification of the Information Collection

1(a) Title

Confidentiality Rules (Renewal) EPA ICR No. 1665.15, OMB Control No 2020-0003.

1(b) Short Characterization/Abstract

The U.S. Environmental Protection Agency (EPA or Agency) established the requirements set forth in 40 C.F.R. § 2.201 et seq. “Confidentiality of Business Information” to establish rules to govern claims of confidential business information (CBI), i.e., the rules governing the handling by the Agency of business information which is or may be entitled to confidential treatment, determining whether such information is entitled to confidential treatment for reasons of business confidentiality and responding to Freedom of Information Act (FOIA) requests pursuant to 5 U.S.C. § 552 for this information.

This request to renew an existing information collection request (ICR) allows the Agency to continue collecting information the Agency requires to make final determinations regarding whether information claimed as confidential is entitled to confidential treatment under EPA’s CBI regulations 40 C.F.R. § 2.201 et seq., which sets forth:

• the procedures business submitters must follow to assert and justify business confidentiality claims;

• the procedures EPA must follow in reviewing CBI claims; notifying and providing affected business submitters with an opportunity to comment; reviewing business submitters substantiations; making final confidentiality determinations; and

• the requirement for signing and maintaining confidentiality agreements by all contractor/subcontractor employees who are given access to confidential information in the course of performing work for EPA.

The Agency collects such information from businesses asserting CBI claims, which may include state or local governments and other entities.

Office of Management and Budget (OMB) Terms of Clearance

In a previous ICR renewal, OMB had these terms of clearance, "Prior to resubmission of this request for extension, the Agency should reassess burden taking into account recent experience of respondents and changes in EPA's reporting programs. In addition, the Agency should describe its method for estimating burden."

In 2016 and 2019, EPA responded to OMB’s terms of clearance by obtaining burden information from businesses that prepare responses to the Agency’s requests for information to substantiate CBI claims. To update EPA’s analysis and obtain current burden estimates, in Fall 2022, EPA contacted a sample of respondent businesses and, in some cases, respective outside counsel, that prepare responses to the Agency’s CBI substantiation request letters. The burden estimates contained herein are predicated on input from the respondent businesses contacted in Fall 2022, identified in Section 3(c) of this document, and input from EPA employees involved in the substantiation process. The Agency’s method for estimating burden is discussed in Section 6.

2. Need For and Use of the Collection

2(a) Need/Authority for the Collection

EPA administers several environmental protection statutes, e.g., the Clean Water Act; the Clean Air Act; the Toxic Substances Control Act (TSCA), the Federal Insecticide, Fungicide and Rodenticide Act (FIFRA); the Resource Conservation and Recovery Act and the Comprehensive Environmental Response, Compensation, and Liability Act. Environmental information is submitted by the regulated industry to EPA in accordance with the requirements of regulations issued under these statutes. Information is also submitted to the Agency voluntarily by the regulated industry. In many instances, the information received by the Agency is claimed as CBI by the submitter.

Substantiation of Confidentiality Claims

In accordance with 40 C.F.R. § 2.201 et seq. when EPA finds it necessary to make a final confidentiality determination (e.g., to respond to a FOIA request or in the course of rulemaking or litigation), it may provide the affected business written notice that EPA is determining whether the information claimed as CBI is entitled to confidential treatment and afford the business an opportunity to comment [i.e., substantiate the submitter’s CBI claims]. See 40 C.F.R. §§ 2.204, 2.205. The notice is furnished by certified mail (return receipt requested), by personal delivery, or by other means which allows verification of the delivery and date of receipt. The business must comment on the items detailed under Section 4(b) of this supporting statement within 15 working days of receipt.

The procedures laid out in 40 C.F.R. § 2.201 et seq. derive their authority from the FOIA, as amended, 5 U.S.C. § 552; the Trade Secrets Act, as amended, 18 U.S.C. § 1905; the Federal housekeeping statute, as amended, 5 U.S.C. 301; the Administrative Procedure Act, as amended; 5 U.S.C. § 551, et seq.; and the confidentiality provisions of environmental statutes administered by EPA, as follows:

• Sections 114, 206, 208, 301, and 307, Clean Air Act, as amended (42 U.S.C. §§ 7414, 7525, 7542, 7601, 7607)

• Sections 308, 501, and 509(a), Clean Water Act, as amended (33 U.S.C. §§ 1318, 1361, 1369(a))

• Section 13, Noise Control Act of 1972, as amended (42 U.S.C. § 4912)

• Sections 1445 and 1450, Safe Drinking Water Act, as amended (42 U.S.C. §§ 300j–4, 300j-9)

• Sections 2002, 3001, 3007, and 9005, Resource Conservation and Recovery Act, as amended (42 U.S.C. §§ 6912, 6921, 6927, 6991d)

• Sections 8(c), 11, 12(b), and 14, Toxic Substances Control Act (TSCA), as amended (15 U.S.C. §§ 2601, 2607(c), 2610, 2611(b), 2613)

• Sections 10, 12, and 25, Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), as amended, (7 U.S.C. §§ 136h, 136j, 136w)

• Section 408(i), Federal Food, Drug, and Cosmetic Act, as amended (21 U.S.C. § 346a(i))

• Sections104(f) and 108, Marine Protection Research and Sanctuaries Act of 1972, as amended (33 U.S.C. §§ 1414(f), 1418)

• Sections104 and 115, Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended (42 U.S.C. §§ 9604, 9615)

2(b) Practical Utility/Users of the Data

EPA will use information provided to substantiate CBI claims by industry to inform the Agency’s determination as to whether the information claimed as CBI is entitled to confidential treatment; whether the Agency needs to make a formal confidentiality determination; and/or whether the information in question can be withheld pursuant to Exemption 4 of FOIA when a FOIA request has been filed for the information.

3. Non-Duplication, Consultations and Other Collection Criteria

3(a) Non Duplication

This information is not collected elsewhere from businesses.

3(b) Public Notice Required Prior to ICR Submission to OMB

EPA published a notice of the renewal of the existing ICR for confidentiality rules in the Federal Register on January 25, 2023 (88 FR 4822) and invited public comment. No comments were received.

3(c) Consultations

EPA consulted with the following sample of business submitters. These businesses are subject to the environmental statutes administered by EPA and have previously prepared substantiations to support their CBI claims. Specifically, the Agency sent emails to nine businesses inquiring as to the estimated amount of time it took each respective business to respond to a substantiation request letter. The Agency also inquired as to the estimated hourly cost associated with the response. The Agency received responses from the six businesses (and outside counsel) below. Input from the businesses was used to determine the burden associated with responding to the Agency’s request for substantiation letters.

Chevron Products Company, a division of Chevron U.S.A. Inc.

Lake Restoration Solutions, LLC

Sinclair Oil

Beveridge & Diamond PC

Douglas Products

Ford Motor Company

3(d) Effects of Less Frequent Collection

The ICRs are one-time collections regarding individual CBI claims. The one-time collection of information related to individual CBI claims ensures that the Agency meets statutory and regulatory requirements to protect CBI under statutes listed in Section 2(a) of this document, including the FOIA, while also enabling EPA to release to the public information not entitled to confidential treatment. If EPA does not collect such information, then EPA will not have all information that EPA needs to complete confidentiality determinations, such as information regarding actions the submitter takes to protect the information that is claimed to be CBI.

3(e) General Guidelines

Only one provision of this collection exceeds the Paperwork Reduction Act guidelines at 5 C.F.R. § 1320.5(d)(2). This collection calls for responses to be furnished to EPA within 15 working days after the business receives the letter requesting substantiation. Under 5 C.F.R. § 1320.5(d)(2)(ii), EPA must justify why the response needs to be prepared within a period shorter than 30 days after receipt of the collection. In the context of addressing the time frame for determinations under the FOIA, EPA “tentatively” determined that 15 days is “a reasonable period for the business to furnish comments and substantiating data concerning its claim.” 40 FR 21987, 21988, 21989 (May 20, 1975) and 41 FR 36902, 36908 (Sept. 1, 1976). EPA has found through experience in the years since these regulations were promulgated (40 C.F.R. § 2.204(e)) that 15 days fits well with the general timetable of FOIA responses.

3(f) Confidentiality

Under EPA’s current CBI regulations, 40 C.F.R. § 2.201 et seq., respondents may claim substantiations submitted to EPA as CBI.

3(g) Sensitive Questions

Not applicable. This information collection does not include questions of a sensitive nature. Only the information returned by the respondents may be of a sensitive nature.

4. The Respondents and the Information Requested

4(a) Respondents/SIC Codes

Respondents can potentially include any business that submitted to EPA information that may be claimed as CBI. Respondents can be entities in both the manufacturing (SIC codes 20-39) and non-manufacturing sectors (no SIC codes identified).

4(b) Information Requested

A. Substantiation of business confidentiality claims

Whenever EPA finds it necessary to determine whether information is entitled to confidential treatment (e.g., in response to a FOIA request or in connection with rulemaking or litigation, or with an advance confidentiality determination under 40 C.F.R. §§ 2.204(a), (c) and (d), 2.206), it shall notify affected businesses and provide them with an opportunity to comment (40 C.F.R. § 2.204(e)).

With this ICR renewal, EPA is proposing continued use of the five attached “Request for Substantiation” letters. The letters address different situations which, under 40 C.F.R. § 2.203(a), require or allow EPA to determine the confidentiality of information claimed as CBI: Letter A addresses the situation where information claimed as CBI, in EPA possession, is responsive to a FOIA request. Letter B requests a generic substantiation for other contexts in which EPA may need to determine whether information is entitled to confidential treatment or foresees the likelihood that the Agency will be requested to disclose the information at some future date. Letter C covers FOIA requests for FIFRA records. Letter D is for FIFRA not related to a FOIA request. Letter E is related to TSCA records. The Agency has made the following revisions to the letters since the last ICR renewal: (1) Letter A – deleted one question and edited another question to better clarify the type of information the Agency seeks in response to the question; (2) Letter B – deleted one question and deleted a redundant paragraph; (3) Letter C – deleted one question, edited another question to better clarify the type of information the Agency seeks in response to the question, and deleted a redundant paragraph; (4) Letter D – deleted one question; (5) Letter E – revised the substantiation questions to reflect new and amended requirements concerning the assertion and treatment of CBI claims for information reported to or otherwise obtained by EPA under TSCA, as reflected in ongoing Agency rulemaking. See 87 FR 29078, May 12, 2022; and (6) Letters A-E – corrected minor typographical errors.

(i). Data Items, including record keeping requirements

The written notice from EPA (40 C.F.R. §§ 2.204(e)(1) and (4)) invites the business’s comments (substantiation), as applicable, on information including the following:

(i) The portions of the information which are alleged to be entitled to confidential treatment;

(ii) The period of time for which confidential treatment is desired by the business (e.g., until a certain date, until the occurrence of a specified event, or permanently);

(iii) The reasons why the information should be protected as confidential;

(iv) Whether EPA, another federal agency, or court has made any determination as to the confidentiality of the information;

(v) Whether measures have been taken by the business to guard against undesired disclosure of the information to others;

(vi) The extent to which the information has been disclosed to others, and the

precautions taken in connection therewith;

(vii) Whether the business has customarily kept the information private or closely held;

(viii) Whether, at the time the information was submitted, EPA provided any express or implied assurance of confidentiality;

(ix) Whether EPA provided any express or implied indications at the time the information was submitted that EPA would publicly disclose the information;

(x) The reasons for any belief that submitted information is a trade secret;

(xi) Whether there are means by which a member of the public could obtain access to the information or readily discover the information;

(xii) Whether the information is data or information that is prohibited from protection under a regulation or statute;

(xiii) What harm to the competitive position of the business would be likely to result from the release of the information claimed as confidential;

(xiv) Whether the chemical substance publicly known to be in U.S. commerce; and

(xv) Whether disclosure of the specific chemical identity release confidential process information.

All records will be preserved and managed in accordance with the Federal Records Act and any applicable federal records schedules.

(ii). Respondent Activities

To respond to the written notice, the respondent must:

• Read EPA’s request for comments;

• Review the information it claimed as confidential; and

• Respond in one of two ways:

  • Justify the CBI claim by substantiating the CBI claims to EPA; or

  • Waive the CBI claim by deciding not to submit the substantiation to EPA.

B. Designation by Business of Addressee for Notices and Inquiries

Pursuant to 40 C.F.R. § 2.213, a business may elect to designate an official contact for inquiries and notices concerning confidentiality claims.

(i). Data Items, including record keeping requirements

Name and address of the business making the designation, and the name and address of the designated person or office.

All records will be preserved and managed in accordance with the Federal Records Act and any applicable federal records schedules.

(ii). Respondent Activities

To review subject materials and decide whether to respond to EPA’s request for comments.

5. The Information Collected – Agency Activities, Collection Methodology, and Information Management

5(a) Agency Activities

1. Review and identify whether business information may be claimed as CBI. This review is completed by the affected program office, and it may be undertaken in response to a FOIA request or when EPA desires to determine the confidentiality of information within its possession for other purposes (e.g., rulemaking, litigation, an advance confidentiality determination, etc.). It would involve determining whether a business confidentiality claim exists or whether a Federal court or an EPA legal office has previously determined that the information in question is entitled to treatment as CBI.

2. Notify the affected business orally and in writing that the Agency is determining the confidentiality of the information and provide the business with an opportunity to comment.

3. Review the substantiation received (if any) and make a final determination whether the business information in question is entitled to confidential treatment. This determination will be made by the appropriate EPA legal office as described in 40 C.F.R. § 2.205. Not all businesses choose to substantiate their CBI claims.

5(b) Collection Methodology and Management

The types of information that are requested are described in Section 4 above. EPA shall notify affected businesses that it is determining the confidentiality of the business information they have submitted and afford them the opportunity to comment. Affected business submitters may provide comments by the date specified in the notice (i.e., postmarked or hand delivered no later than the specified date); or if a request for an extension of the comment period is made by the business submitter and approved by the EPA legal office before the comments are due, the comment period may be extended (40 C.F.R. § 2.205(b)(2)).

Information claimed as CBI that is submitted to EPA is protected in accordance with the policies and procedures discussed in (1) Interim Records Management Policy, CIO 2155.4 (Aug. 22, 2018); (2) Information Security Policy, CIO 2150.5 (Aug. 27, 2019); and (3) information security procedures issued by EPA organizations with statutory authority for the information (e.g., EPA’s Office of Chemical Safety and Pollution Prevention developed specific procedures for protecting the confidentiality of information obtained under the TSCA and FIFRA).

5(c) Small Entity Flexibility

EPA does not have the flexibility to waive the need for substantiations from small entities for several reasons: (1) EPA is required to disclose information that is requested under the FOIA, unless the information is specifically exempt; (2) if EPA discloses information that is entitled to confidential treatment, the Federal government could potentially be held liable under the Federal Tort Claims Act and individual Federal employees could be subject to criminal liability under the Trade Secrets Act and other statutes; and (3) the submitter of the information is in the best position to explain why particular information should be entitled to confidential treatment.

5(d) Collection Schedule

The request for substantiations occurs on a case-by-case basis, as needed.

6. Estimating the Burden and Cost of the Collection

6(a) Estimating Respondent Burden

The burden estimates were developed after consultations with the businesses identified in Section 3(c), above.

Although EPA receives numerous FOIA requests for information that is claimed as CBI each year, many of the requests do not require EPA to request a full substantiation from the affected business submitter(s). EPA may find that a federal court or EPA legal office has previously determined that the information in question is entitled to confidential treatment; or, after consulting with an individual who requested information under the FOIA, the Agency may be able to provide the information that is of most interest to the requester without disclosing any CBI. In these cases, no request for substantiation is issued.

For those cases where substantiation is required, the Agency will notify affected businesses that it is making a final confidentiality determination on information the business submitter has previously claimed as CBI (or which could be expected to be claimed as CBI), in accordance with the procedures outlined in 40 C.F.R. § 2.201 et seq. EPA provides each affected business with an opportunity to submit comments explaining why the previously submitted information should be treated as CBI. The Agency receives approximately 225 responses annually from affected businesses.

6(b) Estimating Respondent Costs

(i) Estimating Labor Costs

The burden that responding to a substantiation request letter poses to a respondent business is fact-specific and varies depending on the CBI matter. Factors that necessarily affect a respondent business’s burden include, familiarity with recent changes in the applicable law, the volume and complexity of the CBI claims, and/or familiarity with the CBI substantiation request letters and substantiation process. After consulting with the respondent businesses (or respective outside counsel) identified in Section 3(c), the average estimated burden for each response is approximately 14.3 hours. As part of consulting with the respondent businesses listed in Section 3(c), the Agency received burden estimates ranging from as few as approximately 5 hours to as many as nearly 40 hours for varying amounts of information claimed as CBI. These estimates reflect the time it took the respondent business to respond to its specific CBI matter. The average estimated burden across the responses that the Agency received is approximately 14.3 hours per response. The median estimated burden is approximately 10 hours per response. For purposes of this ICR renewal, the Agency is calculating the burden using the average.

Burden hours for 225 respondents = 3,217.50

EPA estimates the cost per substantiation to be approximately $5,720.00, which includes reviewing the information, preparing the response, and mailing the response back to the Agency at the average rate of $400/hr. The average rate is based on the responses received from the respondent businesses listed in Section 3(c). The average rate has increased compared with the ICR currently approved by OMB.

Burden cost for respondents = $1,287,000.

(ii) Estimating Capital and Operations and Maintenance Costs

Not applicable.

(iii) Capital/Start-up Operating and Maintenance (O&M) Costs

Not applicable.

(iv) Annualizing Capital Costs

Not applicable.

6(c) Estimating Agency Burden and Cost

As with the burden on respondent businesses, the burden on EPA to evaluate CBI claims, notify affected businesses, and make final confidentiality determinations varies depending on the volume and complexity of the CBI claims asserted in each submission. In some cases, the information that industry claims as confidential is specific and easily identified; yet, in other cases, entire reports may be claimed as CBI. In the latter case, a significant amount of time may be required to review the information in question. In other cases, EPA may be able to satisfy a FOIA request without going through the entire substantiation process, if after conferring with a requestor, the Agency is able to provide the information of interest without releasing the information claimed as CBI. The Agency estimate is based on an “average” confidentiality determination process.

Initial Activities

Burden hours: Based on experience, EPA estimates that on average, it requires approximately 3 hours (2 attorney hrs. 1 clerical hr.) to conduct an initial review of a confidentiality claim and prepare and mail a substantiation request letter to a submitter.

Burden costs: Burden costs are estimated to be $286.44 per letter ($71.88 attorney hr. @ GS-14, Step 5 [using the salary table for 2023-DCB], multiplied by the standard government benefits multiplication factor of 1.6; and $35.27 clerical hr. @ GS-9, Step 5 [using the salary table for 2023-DCB], multiplied by the standard government benefits multiplication factor of 1.6).

Total burden to review the subject information and prepare 225 substantiation requests annually = 675 hours at a total labor cost of $64,449.00.

Making Confidentiality Determinations

Burden hours: After respondent substantiation is received, approximately 8 hours (6 attorney hrs. and 2 technical hrs.) are required to review the substantiation and determine whether the information that is claimed as confidential is entitled to confidential treatment.

Burden costs: Burden costs to review and make final confidentiality determinations on each response is estimated to be $884.71 ($71.88 attorney hr. @ GS-14, Step 5 [using the salary table for 2023-DCB], multiplied by the standard government benefits multiplication factor of 1.6; and $60.83 technical hr. @ GS-13, Step 5 [using the salary table for 2023-DCB], multiplied by the standard government benefits multiplication factor of 1.6).

Total burden to review and to make final confidentiality determinations on 225 substantiations = 1,800 hours at a total labor cost of $199,059.75.

The total Agency burden to perform initial activities and make final confidentiality determinations on 225 responses = 2,475 hours at a total labor cost of $263,508.75 annually.

6(d) Estimating the Respondent Universe and Total Burden and Costs

The Agency collects substantiation information from businesses asserting CBI claims, which may include state or local governments. The Agency collects approximately 225 substantiation response letters annually.

Total Burden hours for 225 respondents = 3,217.50

Total Burden cost for respondents = $1,287,000.

6(e) Bottom Line Burden Hours and Cost Tables

(i) Respondent Tally

Task	Activity	Burden Hours	Total Annual Burden Hours	Burden Costs	Total Annual Burden Costs
RESPONDENTS
Respond to request from EPA	Approximately 225 responses per year	14.3 hours per letter	3,217.50 (14.3 hrs. x 225 respondents)	$5,720.00 per substantiation	$1,287,000.00 ($5,720.00 x 225)
Overall Respondent Burden			3,217.50		$1,287,000.00

(ii) The Agency Tally

Task	Activity	Burden Hours	Total Annual Burden Hours	Burden Costs	Total Annual Burden Costs
AGENCY
Perform Initial activities	Review, preliminary determination & mail substantiation letters	3 hours per letter	675	$286.44 per letter	$64,449.00
Make final confidentiality determinations	Review comments and make final confidentiality determination on responses	8 hours per letter	1,800	$884.71 per response	$199,059.75
Overall Agency Burden			2,475		$263,508.75

(iii) Variations in the Annual Bottom Line

Variations in the annual burden on EPA and business respondents could potentially occur due to changes in:

• the number of FOIA requests that EPA receives for information that has been claimed as confidential;

• the volume and complexity of CBI claims made and substantiated by affected businesses;

• the number of times that EPA determines that a formal confidentiality determination is necessary and notifies affected businesses, providing them with an opportunity to comment; and/or

• the number of times that affected businesses decide to submit CBI claims and substantiations.

EPA does not foresee any significant changes in the Agency’s annual burden outlined above. However, the Agency does expect that there could be a change in the respondent’s annual burden. The estimated respondent burden outlined above is based on information received from the respondent businesses listed in Section 3(c). Those respondent businesses have responded to EPA’s substantiation request letters in the context of specific CBI-related matters. The estimated respondent burden is therefore, largely, based on case-specific information. As such, the Agency expects that the annual bottom line could change depending on the types of CBI matters that the Agency may handle in any given year that would necessitate sending out CBI substantiation request letters.

6(f) Reasons for Change in Burden

EPA has experienced a modest increase in the estimated number of respondents compared with the ICR currently approved by OMB. Additionally, based on input received by respondent businesses (or respective outside counsel), the estimated burden for each response has increased compared with the ICR currently approved by OMB. The increase in the average estimated burden was determined by consulting with the respondent businesses listed in Section 3(c). The amount of time it takes a respondent business to complete a request for substantiation letter is case-specific and, consequently, using case-specific data to estimate the average burden for each response is necessarily inexact. The respondent businesses listed in Section 3(c) have responded to EPA’s substantiation request letters in the context of specific CBI-related matters. As such, the increase in the estimated respondent burden, in as much as it is based on case-specific data, could be due to any combination of factors, including, recent changes in the applicable law, the volume and complexity of the CBI claims made by certain respondent businesses, lack of familiarity with the revised CBI substantiation request letters for certain respondent businesses, and/or the novelty of the CBI substantiation process for certain respondent businesses. As noted above, in Section 4(b), the Agency has revised parts of the substantiation request letter templates. The Agency does not anticipate that these revisions will affect the respondent burden.

6(g) Burden Statement

The annual public reporting and recordkeeping burden for this collection of information is estimated to average about 14.3 hours per response. Burden means the total time, effort, or financial resources expended by persons to generate, maintain, retain, or disclose or provide information to or for a Federal agency. This includes the time needed to review instructions; develop, acquire, install, and utilize technology and systems for the purposes of collecting, validating, and verifying information; processing and maintaining information; adjusting approaches to comply with any previously applicable instructions and requirements; training personnel to be able to respond to a collection of information; searching data sources; completing and reviewing the collection of information; and transmitting or otherwise disclose the information. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations are listed in 40 C.F.R. part 9 and 48 C.F.R. chapter 15.

To comment on the Agency’s need for this information, the accuracy of the provided burden estimates, and any suggested methods for minimizing respondent burden, including the use of automated collection techniques, EPA has established a public docket for this ICR under Docket ID No. EPA-HQ-OGC-2020-0020, which is available for online viewing at www.regulations.gov. This site can be used to submit or view public comments, access the index listing of the contents of the public docket, and to access those documents in the public docket that are available electronically. Once in the system, select “search,” then key in the docket ID number identified above. Please include the EPA Docket ID No. (EPA-HQ-OGC-2020-0020) and OMB control number (2020-0003) in any correspondence.

14