Designation of Biobased Items for Federal Procurement, 47566-47588 [06-6922]

Agencies

• DEPARTMENT OF AGRICULTURE
• Office of Energy Policy and New Uses
• Energy Policy and New Uses Office, Agriculture Department

[Federal Register Volume 71, Number 159 (Thursday, August 17, 2006)]
[Proposed Rules]
[Pages 47566-47588]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 06-6922]



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Part II





Department of Agriculture





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Office of Energy Policy and New Uses



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7 CFR Part 2902



Designation of Biobased Items for Federal Procurement; Proposed Rule

Federal Register / Vol. 71, No. 159 / Thursday, August 17, 2006 / 
Proposed Rules

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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.

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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: https://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 https://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

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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

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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: https://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.

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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 https://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 https://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

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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 https://
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 https://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 https://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