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AHFA execs to lawmakers: formaldehyde rule costs staggering

Heath E. Combs -- Furniture Today, July 17, 2013

WASHINGTON — A team of American Home Furnishings Alliance member executives is meeting with lawmakers to detail concerns with the proposed national formaldehyde rule for composite panel.

An AHFA press release said the proposed federal formaldehyde rules released in June will dramatically increase costs and force plant closures and job loss.

The rules are designed to provide implementation requirements for the standard that Congress established in 2010 for formaldehyde emissions from composite panels. A big problem, the AHFA said, are portions of the rule establishing a third-party certification framework.

California's regulations adopted in 2007 don't require furniture manufacturers to perform batch testing or third-party certification on composite panel, but put that onus on composite wood product producers.

The AHFA said the EPA considered this a loophole in the California regulation and attempted to close it by making furniture manufacturers subject to in-house quality control batch testing and quarterly third-party, product-type certification.

The AHFA said the rule would create gridlock in daily furniture production by requiring daily batch testing and quarterly certification on each hardwood-plywood type. It has estimated the cost of a single daily certification test at $600 per hardwood-plywood type.

"Both domestic and overseas producers will be forced into an unrealistic, product-level certification system that will require costly new equipment and specialized personnel," AHFA CEO Andy Counts said in a press release.

"We are making sure lawmakers understand that the cost of this rule to our industry will be in the hundreds of millions of dollars. This despite evidence that these new measures will do nothing to decrease formaldehyde emissions nor to increase the health benefit to consumers," Counts said.

AHFA officials were accompanied by executives from Ashley Furniture, Bassett Furniture, Home Meridian International, Hooker Furniture, La-Z-Boy and Vaughan-Bassett. The group met with EPA and Small Business Administration officials and several members of Congress.

The AHFA said costs would overwhelm furniture suppliers.

An AHFA member company producing mostly special-order, custom products has estimated their probable testing costs at $7,200 per day, a press release said. A second member company specializing in larger runs of mass market designs has estimated its testing costs at $28,800 per day.

"When you factor in the additional cost of quarterly certification tests and on-site certification personnel, the anticipated compliance costs for these two sample companies would equal or exceed their total annual payroll," Counts said.

The EPA provided an exemption from the testing requirements for companies using no-added-formaldehyde resins. But the AHFA said the EPA "assumed the furniture industry could immediately switch to these emerging resin systems."

In California, an additional exemption is provided for companies using ultra-low-emitting formaldehyde resins, but the federal rule does not provide this exemption.

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