[Federal Register: August 17, 2006 (Volume 71, Number 159)] [Proposed Rules] [Page 47565-47588] From the Federal Register Online via GPO Access [wais.access.gpo.gov] [DOCID:fr17au06-12] [[Page 47565]] ----------------------------------------------------------------------- Part II Department of Agriculture ----------------------------------------------------------------------- Office of Energy Policy and New Uses ----------------------------------------------------------------------- 7 CFR Part 2902 Designation of Biobased Items for Federal Procurement; Proposed Rule [[Page 47566]] ----------------------------------------------------------------------- DEPARTMENT OF AGRICULTURE Office of Energy Policy and New Uses 7 CFR Part 2902 RIN 0503-AA30 Designation of Biobased Items for Federal Procurement AGENCY: Office of Energy Policy and New Uses, USDA. ACTION: Notice of proposed rulemaking. ----------------------------------------------------------------------- SUMMARY: The U.S. Department of Agriculture (USDA) is proposing to amend 7 CFR part 2902, Guidelines for Designating Biobased Products for Federal Procurement, to add 10 sections to designate the following 10 items within which biobased products would be afforded Federal procurement preference, as provided for under section 9002 of the Farm Security and Rural Investment Act of 2002: Adhesive and mastic removers; insulating foam for wall construction; hand cleaners and sanitizers; composite panels; fluid-filled transformers; biodegradable containers; fertilizers; metalworking fluids; sorbents; and graffiti and grease removers. USDA also is proposing minimum biobased content for each of these items. Once USDA designates an item, procuring agencies are required generally to purchase biobased products within these designated items where the purchase price of the procurement item exceeds $10,000 or where the quantity of such items or the functionally equivalent items purchased over the preceding fiscal year equaled $10,000 or more. DATES: USDA will accept public comments on this proposed rule until October 16, 2006. ADDRESSES: You may submit comments by any of the following methods. All submissions received must include the agency name and Regulatory Information Number (RIN). The RIN for this rulemaking is 0503-AA30. Also, please identify submittals as pertaining to the ``Proposed Designation of Items.'' Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments. E-mail: fb4p@oce.usda.gov. Include RIN number 0503-AA30 and ``Proposed Designation of Items'' on the subject line. Please include your name and address in your message. Mail/commercial/hand delivery: Mail or deliver your comments to: Marvin Duncan, USDA, Office of the Chief Economist, Office of Energy Policy and New Uses, Room 4059, South Building, 1400 Independence Avenue, SW., MS-3815, Washington, DC 20250-3815. Persons with disabilities who require alternative means for communication for regulatory information (braille, large print, audiotape, etc.) should contact the USDA TARGET Center at (202) 720- 2600 (voice) and (202) 401-4133 (TDD). FOR FURTHER INFORMATION CONTACT: Marvin Duncan, USDA, Office of the Chief Economist, Office of Energy Policy and New Uses, Room 4059, South Building, 1400 Independence Avenue, SW., MS-3815, Washington, DC 20250- 3815; e-mail: mduncan@oce.usda.gov; phone (202) 401-0461. Information regarding the Federal Biobased Products Preferred Procurement Program is available on the Internet at http://www.biobased.oce.usda.gov. SUPPLEMENTARY INFORMATION: The information presented in this preamble is organized as follows: I. Authority II. Background III. Summary of Today's Proposed Rulemaking IV. Designation of Items, Minimum Biobased Contents, and Time Frame A. Background B. Items Proposed for Designation C. Minimum Biobased Contents D. Effective Date for Procurement Preference and Incorporation Into Specifications V. Where Can Agencies Get More Information on These USDA-Designated Items? VI. Regulatory Information A. Executive Order 12866: Regulatory Planning and Review B. Regulatory Flexibility Act (RFA) C. Executive Order 12630: Governmental Actions and Interference With Constitutionally Protected Property Rights D. Executive Order 12988: Civil Justice Reform E. Executive Order 13132: Federalism F. Unfunded Mandates Reform Act of 1995 G. Executive Order 12372: Intergovernmental Review of Federal Programs H. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments I. Paperwork Reduction Act J. Government Paperwork Elimination Act Compliance I. Authority The designation of these items is proposed under the authority of section 9002 of the Farm Security and Rural Investment Act of 2002 (FSRIA), 7 U.S.C. 8102 (referred to in this document as ``section 9002''). II. Background Section 9002 of FSRIA, as amended by section 943 of the Energy Policy Act of 2005, Public Law 109-58 (Energy Policy Act), provides for the preferred procurement of biobased products by procuring agencies. Section 943 of the Energy Policy Act amended the definitions section of FSRIA, 7 U.S.C. 8101, by adding a definition of ``procuring agency'' that includes both Federal agencies and ``any person contracting with any Federal agency with respect to work performed under that contract.'' The amendment also made Federal contractors, as well as Federal agencies, expressly subject to the procurement preference provisions of section 9002 of FSRIA. However, because this program requires agencies to incorporate the preference for biobased products into procurement specifications, the statutory amendment makes no substantive change to the program. USDA amended the Guidelines to incorporate the new definition of ``procuring agency'' through an interim final rule. Procuring agencies must procure biobased products within each designated item unless they determine that products within a designated item are not reasonably available within a reasonable period of time, fail to meet the reasonable performance standards of the procuring agencies, or are available only at an unreasonable price. As stated in the Guidelines, biobased products that are merely incidental to Federal funding are excluded from the preferred procurement program. In implementing the preferred procurement program for biobased products, procuring agencies should follow their procurement rules and Office of Federal Procurement Policy guidance on buying non-biobased products when biobased products exist and should document exceptions taken for price, performance, and availability. USDA recognizes that the performance needs for a given application are important criteria in making procurement decisions. USDA is not requiring procuring agencies to limit their choices to biobased products that fall under the items for designation in this proposed rule. Rather, the effect of the designation of the items is to require procuring agencies to determine their performance needs, determine whether there are qualified biobased products that fall under the designated items that meet the reasonable performance standards for those needs, and purchase such qualified biobased products to the maximum extent practicable as required by section 9002. Section 9002 also requires USDA to provide information to procuring agencies on the availability, relative price, performance, and environmental and public health benefits of such items [[Page 47567]] and, under section 9002(e)(1)(C), to recommend where appropriate the minimum level of biobased content to be contained in the procured products. Overlap with EPA Comprehensive Procurement Guidelines program for recovered content products. Some of the biobased items designated for preferred procurement may overlap with products designated under the Environmental Protection Agency's (EPA) Comprehensive Procurement Guidelines program for recovered content products. Where that occurs, an EPA-designated recovered content product (also known as ``recycled content products'' or ``EPA-designated products'') has priority in Federal procurement over the qualifying biobased product. In situations where USDA believes there may be an overlap, it plans to ask manufacturers of qualifying biobased products to provide additional product and performance information including the various suggested uses of their product and the performance standards against which a particular product has been tested. In addition, depending on the type of biobased product, manufacturers may also be asked to provide other types of information, such as whether the product contains petroleum-, coal-, or natural gas-based components and whether the product contains recovered materials. Federal agencies may also ask manufacturers for information on a product's biobased content and its profile against environmental and human health measures and life cycle costs (the Building for Environmental and Economic Sustainability (BEES) analysis or ASTM International (ASTM) Standard D7075 for evaluating and reporting on environmental performance of biobased products). Such information will assist Federal agencies in determining whether the biobased products in question are, or are not, the same products for the same uses as the recovered content products and will be available on USDA's Web site with its catalog of qualifying biobased products. Where a biobased item is used for the same purposes and to meet the same requirements as an EPA-designated recovered content product, the Federal agency must purchase the recovered content product. For example, if a biobased hydraulic fluid is to be used as a fluid in hydraulic systems and ``lubricating oils containing re-refined oil'' has already been designated by EPA for that purpose, then the Federal agency must purchase the EPA-designated recovered content product, ``lubricating oils containing re-refined oil.'' If, on the other hand, that biobased hydraulic fluid is to be used to address certain environmental or health requirements that the EPA-designated recovered content product would not meet, then the biobased product should be given preference, subject to cost, availability, and performance. Federal Government Purchase of ``Green'' Products. Three components of the Federal government's green purchasing program are the Biobased Products Preferred Purchasing Program, the Environmental Protection Agency's Comprehensive Procurement Guidelines for products containing recovered materials, and the Environmentally Preferable Products Program. The Office of the Federal Environmental Executive (OFEE) and the Office of Management and Budget (OMB) encourage agencies to implement these components comprehensively when purchasing products and services. In the case of cleaning products, procuring agencies should note that not all biobased products are ``environmentally preferable.'' Unless the cleaning products contain no or reduced levels of metals and toxic and hazardous constituents, they can be harmful to aquatic life, the environment, or workers. When purchasing environmentally preferable cleaning products, many Federal agencies specify that products must meet Green Seal standards for institutional cleaning products or that products have been reformulated in accordance with recommendations from the U.S. EPA's Design for the Environment (DfE) program. Both the Green Seal standards and the DfE program identify chemicals of concern in cleaning products. These include zinc and other metals, formaldehyde, ammonia, alkylphenol ethoxylates, ethylene glycol, and volatile organic compounds. In addition, both require that cleaning products have neutral or less caustic pH. On the other hand, some biobased products may be better for the environment than some products that meet Green Seal standards for institutional cleaning products or that have been reformulated in accordance with the DfE program. To fully compare products, one must look at the ``cradle-to-grave'' impacts of the manufacture, use, and disposal of products. Biobased products that will be available for preferred procurement under this program have been assessed as to their ``cradle-to-grave'' impacts. One consideration of a product's impact on the environment is whether (and to what degree) it introduces new fossil carbon into the atmosphere. Qualifying biobased products offer the user the opportunity to manage the carbon cycle and limit the introduction of new fossil carbon into the atmosphere, whereas non-biobased products derived from fossil fuels add new fossil carbon to the atmosphere. Manufacturers of qualifying biobased products under the Federal Biobased Products Preferred Procurement Program (FB4P) will be able to provide, at the request of Federal agencies, factual information on environmental and human health effects of their products, including the results of the BEES analysis, which examines 11 different environmental parameters, including human health, or the comparable ASTM D7505. Therefore, USDA encourages Federal procurement agencies to examine all available information on the environmental and human health effects of cleaning products when making their purchasing decisions. Green Building Council. More than a dozen Federal agencies use the U.S. Green Building Council's Leadership in Energy and Environmental Design (LEED) Green Building Rating Systems for new construction, building renovation, and building operation and maintenance. The systems provide criteria for implementing sustainable design principles in building design, construction, operation, and maintenance. Points are assigned to each criterion, and building projects can be certified as ``certified,'' ``silver,'' ``gold,'' or ``platinum,'' depending on the number of points for which the project qualifies. LEED for New Construction and Major Renovations (LEED-NC) includes a ``Materials & Resources'' criterion, with one point allocated for the use of rapidly renewable materials. Thus, the use of biobased construction products can help agencies obtain LEED certification for their building construction projects. Interagency Council. USDA has created, and is chairing, an ``interagency council,'' with membership selected from among Federal stakeholders to the FB4P. To augment its own research, USDA consults with this council in identifying the order of item designation, manufacturers producing and marketing products that fall within an item proposed for designation, performance standards used by Federal agencies evaluating products to be procured, and warranty information used by manufacturers of end user equipment and other products with regard to biobased products. III. Summary of Today's Proposed Rulemaking Today, USDA is proposing to designate the following 10 items for [[Page 47568]] preferred procurement: Adhesive and mastic removers; insulating foam for wall construction; hand cleaners and sanitizers; composite panels; fluid-filled transformers; biodegradable containers; fertilizers; metalworking fluids; sorbents; and graffiti and grease removers. USDA is also proposing minimum biobased content for each of these items (see Section IV.C). Lastly, USDA is proposing a date by which Federal agencies must incorporate designated items into their procurement specifications (see Section IV.D). In today's proposed rulemaking, USDA is providing information on its findings as to the availability, economic and technical feasibility, environmental and public health benefits, and life cycle costs for each of the 10 designated items. Information on the availability, relative price, performance, and environmental and public health benefits of individual products within each of these 10 items is not presented in this notice. Further, USDA has reached an agreement with manufacturers not to publish their names in the Federal Register when designating items. This agreement was reached to encourage manufacturers to submit products for testing to support the designation of an item. Once an item has been designated, USDA will encourage the manufacturers of products within the designated item to voluntarily post their names and other contact information on the USDA FB4P Web site. Warranties. Some of the items being proposed for designation today may affect maintenance warranties. As time and resources allow, USDA will work with manufacturers on addressing any effect the use of biobased products may have on maintenance warranties. At this time, however, USDA does not have information available as to whether or not the manufacturers will state that the use of these products will void maintenance warranties. USDA encourages manufacturers of biobased products to work with original equipment manufacturers (OEMs) to ensure that biobased products will not void maintenance warranties when used. USDA is willing to assist manufacturers of the biobased products, if they find that existing performance standards for maintenance warranties are not relevant or appropriate for biobased products, in working with the appropriate OEMs to develop tests that are relevant and appropriate for the end uses in which biobased products are intended. If despite these efforts there is insufficient information regarding the use of a biobased product and its effect on maintenance warranties, USDA notes that the procurement agent would not be required to buy such a product. As information is available on warranties, USDA will make such information available on its FB4P Web site. Additional Information. USDA is working with manufacturers and vendors to post all relevant product and manufacturer contact information on the FB4P Web site before a procuring agency asks for it, in order to make the preferred program more efficient. Steps USDA has implemented, or will implement, include: Making direct contact with submitting companies through email and phone conversations to encourage completion of product listing; coordinating outreach efforts with intermediate material producers to encourage participation of their customer base; conducting targeted outreach with industry and commodity groups to educate stakeholders on the importance of providing complete product information; participating in industry conferences and meetings to educate companies on program benefits and requirements; and communicating the potential for expanded markets beyond the Federal government, to include State and local governments, as well as the general public markets. Section V provides instructions to agencies on how to obtain this information on products within these items through the following Web site: http://www.biobased.oce.usda.gov. Comments. USDA invites comment on the proposed designation of these 10 items, including the definition, proposed minimum biobased content, and any of the relevant analyses performed during the selection of these items. In addition, USDA invites comments and information in the following areas: 1. Four of the items being proposed for designation (insulating foam, composite panels, fertilizers, and sorbents) may overlap with products designated under EPA's Comprehensive Procurement Guidelines for products containing recovered material. To help procuring agencies in making their purchasing decisions between biobased products within the proposed designated items that overlap with products containing recovered material, USDA is requesting from manufacturers and users product specific information on unique performance attributes, environmental and human health effects, disposal costs, and other attributes that would distinguish biobased products from products containing recovered material, as well as non-biobased products. USDA will post this information on the FB4P Web site. 2. We are proposing a single item designation for hand cleaners and sanitizers. We are seeking comment as to whether there are different performance standards for this item and, if so, whether USDA should consider either creating subcategories within this item, each with its own minimum biobased content, or limiting the scope of the current item and proposing one or more new items for hand cleaners and sanitizers. In your comments, please be sure to identify specific performance standards and rationale for either subdividing the current proposed item or for limiting the scope of the current proposed item and proposing one or more new items for hand cleaners and sanitizers. 3. We are proposing a single minimum biobased content for the item insulation foam for wall construction. The proposed minimum biobased content is based on two measured biobased contents, one for a spray foam product and one for a rigid foam product. USDA is interested in receiving comments as to whether USDA should set a minimum biobased content for spray foam products and one for rigid foam products. Please be sure to provide your rationale for your comments. 4. We have attempted to identify relevant and appropriate performance standards and other relevant measures of performance for each of the proposed items. If you know of other such standards or relevant measures of performance for the proposed items, USDA requests that you submit information identifying such standards and measures, including their name (and other identifying information as necessary), identifying who is using the standard/measure, and describing the circumstances under which the product is being used. 5. Many biobased products within the items being proposed for designation will have positive environmental and human health attributes. USDA is seeking comments on such attributes in order to provide additional information on the FB4P Web site. This information will then be available to Federal procuring agencies and will assist them in making ``best value'' purchase decisions. When possible, please provide appropriate documentation to support the environmental and human health attributes you describe. To assist you in developing your comments, the background information used in proposing these items for designation can be found on the FB4P Web site. All comments should be submitted as directed in the ADDRESSES section above. [[Page 47569]] IV. Designation of Items, Minimum Biobased Contents, and Time Frame A. Background In order to designate items (generic groupings of specific products such as crankcase oils or products that contain qualifying biobased fibers) for preferred procurement, section 9002 requires USDA to consider: (1) The availability of items; and (2) the economic and technological feasibility of using the items, including the life cycle costs of the items. In considering an item's availability, USDA uses several sources of information. USDA performs Internet searches, contacts trade associations (such as the Biobased Manufacturers Association) and commodity groups, searches the Thomas Register (a database, used as a resource for finding companies and products manufactured in North America, containing over 173,000 entries), and contacts individual manufacturers and vendors to identify those manufacturers and vendors with biobased products within items being considered for designation. USDA uses the results of these same searches to determine if an item is generally available. In considering an item's economic and technological feasibility, USDA examines evidence pointing to the general commercial use of an item and its cost and performance characteristics. This information is obtained from the sources used to assess an item's availability. Commercial use, in turn, is evidenced by any manufacturer and vendor information on the availability, relative prices, and performance of their products as well as by evidence of an item being purchased by a procuring agency or other entity, where available. In sum, USDA considers an item economically and technologically feasible for purposes of designation if products within that item are being offered and used in the marketplace. In considering the life cycle costs of items proposed for designation, USDA uses the BEES analytical tool to test individual products within each proposed item. (Detailed information on this analytical tool can be found on the Web site http://www.bfrl.nist.gov/oae/software/bees.html. ) The BEES analytical tool measures the environmental performance and the economic performance of a product. Environmental performance is measured in the BEES analytical tool using the internationally-standardized and science-based life cycle assessment approach specified in the International Organization for Standardization (ISO) 14000 standards. The BEES environmental performance analysis includes human health as one of its components. All stages in the life of a product are analyzed: Raw material production; manufacture; transportation; installation; use; and recycling and waste management. The time period over which environmental performance is measured begins with raw material production and ends with disposal (waste management). The BEES environmental performance analysis also addresses products made from biobased feedstocks. Economic performance in the BEES analysis is measured using the ASTM standard life cycle cost method (ASTM E917), which covers the costs of initial investment, replacement, operation, maintenance and repair, and disposal. The time frame for economic performance extends from the purchase of the product to final disposal. USDA then utilizes the BEES results of individual products within a designated item in its consideration of the life cycle costs at the item level. There is a single unit of comparison associated with each designated item. The basis for the unit of comparison is the ``functional unit,'' defined so that the products compared are true substitutes for one another. If significant differences have been identified in the useful lives of alternative products within a designated item (e.g., if one product lasts twice as long as another), the functional unit will include reference to a time dimension to account for the frequency of product replacement. The functional unit also will account for products used in different amounts for equivalent service. For example, one surface coating product may be environmentally and economically preferable to another on a pound-for- pound basis, but may require twice the mass to cover one square foot of surface, and last half as long, as the other product. To account for these performance differences, the functional unit for the surface coating item could be ``one square foot of application for 20 years'' instead of ``one pound of surface coating product.'' The functional unit provides the critical reference point to which all BEES results for products within an item are scaled. Because functional units vary from item to item, performance comparisons are valid only among products within a designated item. The complete results of the BEES analysis, extrapolated to the item level, for each item proposed for designation in today's proposed rulemaking can be found at http://www.biobased.oce.usda.gov. As discussed above, the BEES analysis includes information on the environmental performance, human health impacts, and economic performance. In addition, ASTM D7505, which manufacturers may use in lieu of the BEES analytical tool, provides similar information. USDA is working with manufacturers and vendors to post this information on the FB4P Web site before a procuring agency asks for it, in order to make the preferred procurement program more efficient. As discussed earlier, USDA has also implemented, or will implement, several other steps intended to educate the manufacturers and other stakeholders on the benefits of this program and the need to post this information, including manufacturer contact information, on the FB4P Web site to make it available to procurement officials. Additional information on specific products within the items proposed for designation may also be obtained directly from the manufacturers of the products. USDA recognizes that information related to the functional performance of biobased products is a primary factor in making the decision to purchase these products. USDA is gathering from manufacturers of biobased products being considered for designation information on industry standard test methods that they are using to evaluate the functional performance of their products. Additional standards are also being identified during meetings of the Interagency Council and during the review process for each proposed rule. We have listed under the detailed discussion of each item proposed for designation (presented in Section IV.B) the functional performance test methods identified during the development of this Federal Register notice for these 10 items. While this process identifies many of the relevant standards, USDA recognizes that the performance test methods identified herein do not represent all of the methods that may be applicable for a designated item or for any individual product within the designated item. As noted earlier in this preamble, USDA is requesting identification of other relevant performance standards and measures of performance. As the program becomes fully implemented, these and other additional relevant performance standards will be available on the FB4P Web site. In gathering information relevant to the analyses discussed above, USDA has made extensive efforts to contact and request information and product samples from representatives of all known manufacturers of products [[Page 47570]] within the items proposed for designation. However, because the submission of information is on a strictly voluntary basis, USDA was able to obtain information and samples only from those manufacturers who were willing voluntarily to invest the resources required to gather and submit the information and samples. USDA used the samples to test for biobased content and the information to conduct the BEES analyses. The data presented are all the data that were submitted in response to USDA requests for information from all known manufacturers of the products within the 10 items proposed for designation. While USDA would prefer to have complete data on the full range of products within each item, the data that were submitted are sufficient to support designation of the items in today's proposed rulemaking. To propose an item for designation, USDA must have sufficient information on a sufficient number of products within an item to be able to assess its availability and its economic and technological feasibility, including its life cycle costs. For some items, there may be numerous products available. For other items, there may be very few products currently available. Given the infancy of the market for some items, it is not unexpected that even single-product items will be identified. Further, given that the intent of section 9002 is largely to stimulate the production of new biobased products and to energize emerging markets for those products, USDA has determined that the identification of two or more biobased products within an item, or even a single product with two or more suppliers, is sufficient to consider the designation of that item. Similarly, the documented availability, benefits, and life cycle costs of even a very small percentage of all products that may exist within an item are also considered sufficient to support designation. B. Items Proposed for Designation USDA uses a model (as summarized below) to identify and prioritize items for designation. Through this model, USDA has identified over 100 items for potential designation under the preferred procurement program. A list of these items and information on the model can be accessed on the USDA biobased program Web site at http://www.biobased.oce.usda.gov . In general, items are developed and prioritized for designation by evaluating them against program criteria established by USDA and by gathering information from other government agencies, private industry groups, and independent manufacturers. These evaluations begin by asking the following questions about the products within an item: Are they cost competitive with non-biobased products? Do they meet industry performance standards? Are they readily available on the commercial market? In addition to these primary concerns, USDA then considers the following points: Are there manufacturers interested in providing the necessary test information on products within a particular item? Are there a number of manufacturers producing biobased products in this item? Are there products available in this item? What level of difficulty is expected when designating this item? Is there Federal demand for the product? Are Federal procurement personnel looking for biobased products? Will an item create a high demand for biobased feed stock? Does manufacturing of products within this item increase potential for rural development? After completing this evaluation, USDA prioritizes the list of items for designation. USDA then gathers information on products within the highest priority items and, as sufficient information becomes available for groups of approximately 10 items, a new rulemaking package will be developed to designate the items within that group. The list of items may change, with items being added or dropped, and the order in which items are proposed for designation is likely to change because the information necessary to designate an item may take more time to obtain than an item lower on the list. In today's proposed rulemaking, USDA is proposing to designate 10 items for the preferred procurement program: Adhesive and mastic removers; insulating foam for wall construction; hand cleaners and sanitizers; composite panels; fluid-filled transformers; biodegradable containers; fertilizers; metalworking fluids; sorbents; and graffiti and grease removers. USDA has determined that each of these 10 items meets the necessary statutory requirements--namely, that they are being produced with biobased products and that their procurement by procuring agencies will carry out the following objectives of section 9002: To increase demand for biobased products, which would in turn increase demand for agricultural commodities that can serve as feedstocks for the production of biobased products; To spur development of the industrial base through value- added agricultural processing and manufacturing in rural communities; and To enhance the nation's energy security by substituting biobased products for products derived from imported oil and natural gas. Further, USDA has sufficient information on these 10 items to determine their availability and to conduct the requisite analyses to determine their biobased content and their economic and technological feasibility, including life cycle costs. Mature Markets. Section 2902.5(c)(2) of the final guidelines states that USDA will not designate items for preferred procurement that are determined to have mature markets. Mature markets are described as items that had significant national market penetration in 1972. USDA contacted manufacturers, manufacturing associations, and industry researchers to determine if, in 1972, biobased products had a significant market share within any of the items proposed for designation today. USDA found that biobased products within none of the 10 items proposed for designation today had a significant market share in 1972 and that, generally, the companies that produce biobased products within these proposed designated items have been in business for only 10 to 20 years. Overlap with EPA-Designated Recovered Content Products. In today's proposed rule, 4 of the 10 items may overlap with EPA-designated recovered content products. These four items are: Insulating foam, composite panels, fertilizers, and sorbents. For these four items, USDA is requesting that certain information on the qualifying biobased products be made available by their manufacturers to assist Federal agencies in determining if an overlap exists between the qualifying biobased product and the applicable EPA-designated recovered content product. As noted earlier in this preamble, USDA is requesting information on overlap situations to further help procuring agencies make informed decisions when faced with purchasing a recovered content material product or a biobased product. As this information is developed, USDA will make it available on the FB4P Web site. Exemptions. When proposing items for preferred procurement under the FB4P, USDA will identify, on an item-by-item basis, items that would be exempt from preferred procurement on [[Page 47571]] the basis of their use in products and systems designed or procured for combat or combat-related missions. USDA believes it is inappropriate to apply the biobased purchasing requirement to tactical equipment unless the Department of Defense has documented that these products can meet the performance requirements for such equipment and are available in sufficient supply to meet domestic and overseas deployment needs. After evaluating these situations for each of the 10 items being proposed for designation, USDA is proposing to exempt fluid-filled transformers from preferred procurement under the FB4P when used in combat or combat- related missions. USDA is proposing an exemption for all designated items when used in spacecraft systems and launch support equipment, because failure of such items could lead to catastrophic consequences. Many, if not all, items that USDA is or is planning to designate for preferred procurement are or will be used in space applications. Frequently, such applications used these items in ways that are different from their more ``conventional'' use on Earth. It is difficult, if not impossible, to forecast what situations may occur when these items are used in space and how they will perform. Therefore, USDA believes is it reasonable to limit the preferred procurement program to items used in more conventional applications and is proposing to exempt all designated items used in space applications from the FB4P. For each item being proposed for exemption, the exemption does not extend to contractors performing work for DoD or NASA. For example, if a contractor is producing a part for use on the space shuttle, the metalworking fluid the contractor uses to produce the part should be biobased (provided it meets the specifications for metalworking). The exemption does apply, however, if the product being purchased by the contractor is for use in combat or combat-related missions or for use in space applications. For example, if the part being produced by the contractor would actually be part of the space shuttle, then the exemption applies. Each of the 10 proposed designated items are discussed in the following sections. 1. Adhesive and Mastic Removers Adhesive and mastic removers represent that group of industrial cleaning solvent products formulated for use in removing asbestos, carpet, and ceramic tile mastics as well as adhesive materials, including glue, tape, and gum, from various surface types. Products in this item eliminate the need to sand and grind glue and adhesives from parts, floors, or walls, significantly reducing the time required on a project. These products are typically formulated from natural soy-based or citrus-based feedstocks. For the reasons cited earlier in this notice, USDA is proposing to exempt this item from preferred procurement under the FB4P when used in spacecraft systems and launch support equipment. For biobased adhesive and mastic removers, USDA identified 11 different manufacturers producing 13 individual biobased products. These 11 manufacturers do not necessarily include all manufacturers of biobased adhesive and mastic removers, merely those identified during USDA information gathering activities. Information supplied by these manufacturers indicates that each of these products is being used commercially. Using the procedure described earlier in this notice, no industry standard performance tests were identified by the manufacturers who submitted information on these products or others. USDA contacted procurement officials with various procuring agencies, including the General Services Administration, several offices within the Defense Logistics Agency, OFEE, USDA Departmental Administration, the National Park Service, the EPA, Oak Ridge National Laboratory, and OMB, in an effort to gather information on the purchases of products within the 10 items proposed for designation today. Communications with these officials lead to the conclusion that obtaining credible current usage statistics and specific potential markets within the Federal government for biobased products is not possible at this time. Most of the contacted officials reported that procurement data are reported in higher level groupings of materials and supplies than the proposed designated items. Also, the purchasing of such materials as part of contracted services and with individual purchase cards used to purchase products locally further obscures credible data on purchases of specific products. USDA also investigated the Web site http://www.fedbizopps.gov, a site which lists Federal contract purchase opportunities greater than $25,000. The information provided on this Web site, however, is for broad categories of products rather than the specific types of products that are included in today's rulemaking. Therefore, USDA has been unable to obtain data on the amount of adhesive and mastic removers purchased by procuring agencies. However, Federal agencies routinely procure building construction, renovation, cleaning, and repair services and materials, including adhesive and mastic removers. Thus, they have a need for adhesive and mastic removers and for services that require the use of adhesive and mastic removers. Designation of adhesive and mastic removers will promote the use of biobased products, furthering the objectives of this program. An analysis of the environmental and human health benefits and the life cycle costs of biobased adhesive and mastic removers was performed for two of the products using the BEES analytical tool. Table 1 summarizes the BEES results for the two adhesive and mastic removers. As seen in Table 1, the environmental performance score, which includes human health, ranges from 0.0257 to 0.0625 points per gallon. The environmental performance score indicates the share of annual per capita U.S. environmental impacts that is attributable to one gallon of the product, expressed in 100ths of 1 percent. For example, the total amount of criteria air pollutants emitted in the U.S. in one year was divided by the total U.S. population to derive a ``criteria air pollutants per person value.'' The production and use of one gallon of adhesive and mastic remover sample A was estimated to contribute 0.000002 percent of this value. Table 1.--Summary of BEES Results for Adhesive and Mastic Removers ------------------------------------------------------------------------ Adhesive and mastic removers Parameters --------------------------- Sample A Sample B ------------------------------------------------------------------------ BEES Environmental Performance--Total Score 0.0257 0.0625 \1\........................................ Acidification (5%).......................... 0.0000 0.0000 [[Page 47572]] Criteria Air Pollutants (6%)................ 0.0002 0.0007 Ecological Toxicity (11%)................... 0.0052 0.0170 Eutrophication (5%)......................... 0.0015 0.0111 Fossil Fuel Depletion (5%).................. 0.0110 0.0157 Global Warming (16%)........................ 0.0035 0.0062 Habitat Alteration (16%).................... 0.0000 0.0000 Human Health (11%).......................... 0.0025 0.0085 Indoor Air (11%)............................ 0.0000 0.0000 Ozone Depletion (5%)........................ 0.0000 0.0000 Smog (6%)................................... 0.0011 0.0019 Water Intake (3%)........................... 0.0007 0.0014 Economic Performance (Life Cycle Costs($)) 15.99 17.66 \2\........................................ First Cost.................................. 15.99 17.66 Future Cost (3.9%).......................... (\3\) (\3\) Functional Unit............................. 1 gallon. ------------------------------------------------------------------------ \1\ Numbers in parentheses indicate weighting factor. \2\ Costs are per functional unit. \3\ For this item, no significant/quantifiable performance or durability differences were identified among competing alternative products. Therefore, future costs were not calculated. When evaluating the information presented in Table 1, as well as in the subsequent tables presented in this preamble, the reader should be aware that comparisons of the environmental performance scores are valid only among products within a designated item. Thus, comparisons of the scores presented in Table 1 and the scores presented in Tables 2 through 10 for other proposed designated items in this preamble are not meaningful. The numbers in parentheses following each of the 12 environmental impacts listed in the tables in this preamble indicate weighting factors. The weighting factors represent the relative importance of the 12 environmental impacts, including human health impacts, that contribute to the BEES Environmental Score. They are derived from lists of the relative importance of these impacts developed by the EPA Science Advisory Board for the purpose of advising EPA as to how best to allocate its limited resources among environmental impact areas. Note that a lower Environmental Performance score is better than a higher score. Life cycle costs presented in Tables 1 through 10 in this preamble are per the appropriate functional unit for the proposed designated item. The life cycle costs of the submitted adhesive and mastic removers range from $15.99 to $17.66 (present value dollars) per gallon. Present value dollars presented in this preamble represent the sum of all costs associated with a product over a fixed period of time, including any applicable costs for purchase, installation, replacement, operation, maintenance and repair, and disposal. Present value dollars presented in this preamble reflect 2005 dollars. Dollars are expressed in present value terms to adjust for the effects of inflation. Future costs are discounted to present value using the OMB discount rate of 3.9 percent. The complete results of the BEES analysis, extrapolated to the item level, for each item proposed for designation in today's proposed rulemaking can be found at http://www.biobased.oce.usda.gov. 2. Insulating Foam for Wall Construction Insulating foam for wall construction represents that group of products designed as spray-in-place insulation systems for residential or commercial construction applications. Products in this item provide a sealed thermal barrier, which significantly simplifies construction and reduces the effort required on a project. Biobased insulating foams are typically formulated from natural soy-based feedstocks. Qualifying products within this item may overlap with the EPA- designated recovered content product: Construction--Building Insulation. For the reasons cited earlier in this notice, USDA is proposing to exempt this item from preferred procurement under the FB4P when used in spacecraft systems and launch support equipment. For biobased insulating foam for wall construction, USDA identified 14 different manufacturers producing 21 individual biobased products. These 14 manufacturers do not necessarily include all manufacturers of biobased insulating foam for wall construction, merely those identified during USDA information gathering activities. Information supplied by these manufacturers indicates that each of these products has been tested against one or more industry performance standards and is being used commercially. While other applicable performance standards may exist, applicable industry performance standards against which these products have been typically tested, as identified by manufacturers of products within this item, include: ASTM E84-05, Standard Test Method for Surface Burning Characteristics of Building Materials; ASTM C177-04, Standard Test Method for Steady-State Heat Flux Measurements and Thermal Transmission Properties by Means of the Guarded-Hot-Plate Apparatus; ASTM E283-04, Standard Test Method for Determining Rate of Air Leakage Through Exterior Windows, Curtain Walls, and Doors Under Specified Pressure Differences Across the Specimen; ASTM D1622-03, Standard Test Method for Apparent Density of Rigid Cellular Plastics; ASTM E96/E96M-05, Standard Test Methods for Water Vapor Transmission of Materials; ASTM 90-04, Standard Test Method for Laboratory Measurement of Airborne Sound Transmission Loss of Building Partitions and Elements; ASTM C423-02a, Standard Test Method for Sound Absorption and Sound Absorption Coefficients by the Reverberation Room Method; [[Page 47573]] ASTM C518-04, Standard Test Method for Steady-State Thermal Transmission Properties by Means of the Heat Flow Meter Apparatus; and ASTM E84-05e1, Standard Test Method for Surface Burning Characteristics of Building Materials. USDA attempted to gather data on the potential market for biobased products within the Federal government as described in the section on adhesive and mastic removers. These attempts were largely unsuccessful. However, Federal agencies routinely procure building construction, renovation, and repair services and materials, including insulating foam for wall construction. Thus, they have a need for insulating foam for wall construction and for services that require the use of insulating foam for wall construction. Designation of insulating foam for wall construction will promote the use of biobased products, furthering the objectives of this program. An analysis of the environmental and human health benefits and the life cycle costs of biobased insulating foam for wall construction was performed for one of the products using the BEES analytical tool. Table 2 summarizes the BEES results for the one sample of insulating foam for wall construction. As seen in Table 2, the environmental performance score, which includes human health, was 0.0018 points for a quantity of material necessary to provide one square foot of insulated wall surface for a period of 50 years. The environmental performance score indicates the share of annual per capita U.S. environmental impacts that is attributable to the quantity of material necessary to provide one square foot of insulated wall surface for a period of 50 years, expressed in 100ths of 1 percent. Table 2.--Summary of BEES Results for Insulating Foam for Wall Construction ------------------------------------------------------------------------ Insulating foam for Parameters wall construction ------------------------------------------------------------------------ BEES Environmental Performance--Total Score \1\........... 0.0018 Acidification (5%)........................................ 0.0000 Criteria Air Pollutants (6%).............................. 0.0000 Ecological Toxicity (11%)................................. 0.0002 Eutrophication (5%)....................................... 0.0000 Fossil Fuel Depletion (5%)................................ 0.0009 Global Warming (16%)...................................... 0.0002 Habitat Alteration (16%).................................. 0.0000 Human Health (11%)........................................ 0.0003 Indoor Air (11%).......................................... 0.0000 Ozone Depletion (5%)...................................... 0.0000 Smog (6%)................................................. 0.0001 Water Intake (3%)......................................... 0.0001 Economic Performance (Life Cycle Costs($)) \2\............ 1.10 First Cost................................................ 1.15 Future Cost (3.9%) \3\.................................... -0.05 Functional Unit........................................... (\4\) ------------------------------------------------------------------------ \1\ Numbers in parentheses indicate weighting factor. \2\ Costs are per functional unit. \3\ Note that because this product has a residual (or salvage) value after its initial use, the future cost is a negative value. \4\ The quantity of material necessary to provide one square foot of insulated wall surface for a period of 50 years. The life cycle cost of the submitted insulating foam for wall construction was $1.10 (present value dollars) for a quantity of material necessary to provide one square foot of insulated wall surface for a period of 50 years. 3. Hand Cleaners and Sanitizers Hand cleaners and sanitizers represent that group of personal care products formulated for use in cleaning and sanitizing human hands. Products in this item, which may be used with or without water, are used to remove a variety of different soils, greases, and bacteria. These products significantly reduce the potential for transmitting harmful bacteria. Biobased hand cleaners and sanitizers are typically formulated from natural corn, soy, or citrus-based feedstocks. Procuring agencies should note that, as discussed in section II of this preamble, not all biobased cleaning products are ``environmentally preferable'' to non-biobased products. Unless cleaning products have been formulated to contain no (or reduced levels of) metals and toxic and hazardous constituents, they can be harmful to aquatic life, the environment, or workers. When purchasing environmentally preferable cleaning products, Federal agencies must compare the ``cradle-to- grave'' impacts of the manufacture, use, and disposal of both biobased and non-biobased products. As noted earlier in this preamble, USDA is requesting comment on whether there should be one or more subcategories within this item based on required performance properties of the item. For example, hand cleaners and sanitizers used in medical situations might be required to meet different performance standards from those used in households. If this is the case, then there may be differences in the level of biobased content depending on the performance standard to be met. As proposed, USDA is not differentiating between settings in which hand cleaners and sanitizers are used. For the reasons cited earlier in this notice, USDA is proposing to exempt this item from preferred procurement under the FB4P when used in spacecraft systems and launch support equipment. For biobased hand cleaners and sanitizers, USDA identified 36 different manufacturers producing 73 individual biobased products. These 36 manufacturers do not necessarily include all manufacturers of biobased hand cleaners and sanitizers, merely those identified during USDA information gathering activities. Information supplied by these manufacturers indicates that each of these products has been tested against one or more industry performance standards and is being used commercially. While other applicable performance standards may exist, [[Page 47574]] applicable industry performance standards against which these products have been typically tested, as identified by manufacturers of products within this item, include: American Type Culture Collection Number 11229, Organism: Escherichia coli (Migula) Castellani, and Chalmers; and American Type Culture Collection Number 6539 Organism: Salmonella enterica subsp. enterica (ex Kauffmann and Edwards) Le Minor and Popoff serovar Typhi; deposited as Salmonella typhi (Schroeter) Warren and Scott. Some products within this item may require ``higher'' standards than other products. For example, hand cleaners and sanitizers used in hospitals and medical clinics may require higher levels of performance than those used in typical households. Procuring agencies, therefore, may need to contact the manufacturer of a biobased product or access the FB4P Web site to obtain additional information on the performance specification of a product within this item. USDA attempted to gather data on the potential market for biobased products within the Federal government as described in the section on adhesive and mastic removers. These attempts were largely unsuccessful. However, Federal agencies routinely procure washroom and janitorial services and materials, including hand cleaners and sanitizers. Thus, they have a need for hand cleaners and sanitizers and for services that require the use of hand cleaners and sanitizers. Designation of hand cleaners and sanitizers will promote the use of biobased products, furthering the objectives of this program. An analysis of the environmental and human health benefits and the life cycle costs of biobased hand cleaners and sanitizers was performed for three of the products using the BEES analytical tool. Table 3 summarizes the BEES results for the three hand cleaners and sanitizers. As seen in Table 3, the environmental performance score, which includes human health, ranges from 0.0227 to 0.0412 points per gallon of hand cleaner and sanitizer. The environmental performance score indicates the share of annual per capita U.S. environmental impacts that is attributable to one gallon of the product, expressed in 100ths of 1 percent. Table 3.--Summary of BEES Results for Hand Cleaners and Sanitizers ------------------------------------------------------------------------ Hand cleaners and sanitizers Parameters ----------------------------------------- Sample A Sample B Sample C ------------------------------------------------------------------------ BEES Environmental 0.0227 0.0347 0.0412 Performance--Total Score \1\. Acidification (5%)............ 0.0000 0.0000 0.0000 Criteria Air Pollutants (6%).. 0.0001 0.0002 0.0004 Ecological Toxicity (11%)..... 0.0112 0.0128 0.0125 Eutrophication (5%)........... 0.0007 0.0034 0.0052 Fossil Fuel Depletion (5%).... 0.0063 0.0077 0.0102 Global Warming (16%).......... 0.0015 0.0028 0.0047 Habitat Alteration (16%)...... 0.0000 0.0000 0.0000 Human Health (11%)............ 0.0017 0.0053 0.0058 Indoor Air (11%).............. 0.0000 0.0000 0.0000 Ozone Depletion (5%).......... 0.0000 0.0000 0.0000 Smog (6%)..................... 0.0008 0.0015 0.0014 Water Intake (3%)............. 0.0004 0.0010 0.0010 Economic Performance (Life 17.02 17.30 21.24 Cycle Costs ($)) \2\......... First Cost.................... 17.02 17.30 21.24 Future Cost (3.9%)............ (\3\) (\3\) (\3\) Functional Unit............... 1 gallon. ------------------------------------------------------------------------ \1\ Numbers in parentheses indicate weighting factor. \2\ Costs are per functional unit. \3\ For this item, no significant/quantifiable performance or durability differences were identified among competing alternative products. Therefore, future costs were not calculated. The life cycle cost of the submitted hand cleaners and sanitizers range from $17.02 to $21.24 (present value dollars) per gallon. 4. Composite Panels Composite panels represent that group of engineered products designed for use in non-structural construction applications, including wall panels, shelving, decorative panels, lavatory dividers, and exterior signs. Biobased composite panels are typically formulated from natural wheat or rice straw, recycled or forest clean-up wood, and paper industry wastes. This item applies to both interior and exterior applications. However, some products within this item may not be applicable to all exterior applications, which may require specific insulating values and moisture protection properties. Procuring agencies, therefore, need to assess an individual product's performance specifications before using in exterior applications. Qualifying products within this item may overlap with the following three EPA-designated recovered content product: Construction--Laminated Paperboard and Structural Foam Board; Construction--Shower and Restroom Dividers; and Miscellaneous Products--Signage. For the reasons cited earlier in this notice, USDA is proposing to exempt this item from preferred procurement under the FB4P when used in spacecraft systems and launch support equipment. For biobased composite panels, USDA identified 26 different manufacturers producing 51 individual biobased products. These 26 manufacturers do not necessarily include all manufacturers of biobased composite panels, merely those identified during USDA information gathering activities. Information supplied by these manufacturers indicates that each of these products has been tested against one or more industry performance standards and is being used commercially. While other applicable performance standards may exist, applicable industry performance standards against which these products have been typically tested, as identified by manufacturers of products within this item, include: [[Page 47575]] ASTM C473-03, Standard Test Methods for Physical Testing of Gypsum Panel Products; ASTM D1037-99, Standard Test Methods for Evaluating Properties of Wood-Base Fiber and Particle Panel Materials; ASTM D3273-00, Standard Test Method for Resistance to Growth of Mold on the Surface of Interior Coatings in an Environmental Chamber; ASTM D4060-01, Standard Test Method for Abrasion Resistance of Organic Coatings by the Taber Abraser; ASTM E72-05, Standard Test Methods of Conducting Strength Tests of Panels for Building Construction; ASTM E84-05, Standard Test Method for Surface Burning Characteristics of Building Materials ASTM E90-04, Standard Test Method for Laboratory Measurement of Airborne Sound Transmission Loss of Building Partitions and Elements; ASTM E119-00a, Standard Test Methods for Fire Tests of Building Construction and Materials; and ASTM E413-04, Classification for Rating Sound Insulation. USDA attempted to gather data on the potential market for biobased products within the Federal government as described in the section on adhesive and mastic removers. These attempts were largely unsuccessful. However, Federal agencies routinely procure building construction, renovation, and repair services and materials, including composite panels. Thus, they have a need for composite panels and for services that require the use of composite panels. Designation of composite panels will promote the use of biobased products, furthering the objectives of this program. An analysis of the environmental and human health benefits and the life cycle costs of biobased composite panels was performed for two of the products using the BEES analytical tool. Table 4 summarizes the BEES results for the two composite panels. As seen in Table 4, the environmental performance score, which includes human health, ranges from 0.0085 to 0.0113 points per square foot of partition for a period of 50 years. The environmental performance score indicates the share of annual per capita U.S. environmental impacts that is attributable to one square foot of partition for a period of 50 years, expressed in 100ths of 1 percent. Table 4.--Summary of BEES Results for Composite Panels ------------------------------------------------------------------------ Composite panels Parameters --------------------------- Sample A Sample B ------------------------------------------------------------------------ BEES Environmental Performance--Total Score 0.0085 0.0113 \1\........................................ Acidification (5%).......................... 0.0000 0.0000 Criteria Air Pollutants (6%)................ 0.0001 0.0001 Ecological Toxicity (11%)................... 0.0004 0.0010 Eutrophication (5%)......................... 0.0001 0.0001 Fossil Fuel Depletion (5%).................. 0.0044 0.0055 Global Warming (16%)........................ 0.0012 0.0016 Habitat Alteration (16%).................... 0.0000 0.0000 Human Health (11%).......................... 0.0017 0.0026 Indoor Air (11%)............................ 0.0000 0.0000 Ozone Depletion (5%)........................ 0.0000 0.0000 Smog (6%)................................... 0.0004 0.0004 Water Intake (3%)........................... 0.0002 0.0000 Economic Performance (Life Cycle Costs ($)) 2.37 4.96 \2\........................................ First Cost.................................. 2.37 4.96 Future Cost (3.9%).......................... (\3\) (\3\) Functional Unit............................. one square foot of partition over 50 years. ------------------------------------------------------------------------ \1\ Numbers in parentheses indicate weighting factor. \2\ Costs are per functional unit. \3\ For this item, no significan