Final EPA Rule Revises Solid Waste Definition

This advisory addresses the Environmental Protection Agency's (EPA) final rule providing for regulatory exclusions from the definition of solid waste. The following summarizes key provisions of the new regulation.

On October 30, 2008, the EPA published a final rule revising the definition of solid waste to exclude certain hazardous secondary materials from regulation under Subtitle C of the Resource Conservation and Recovery Act (RCRA), 42 U.S.C. 6921 through 6939(e). The rulemaking was originally proposed in October 2003, in response to a series of seven decisions by the U.S. Court of Appeals for the D.C. Circuit that provided the EPA with additional direction regarding the proper formulation of the RCRA regulatory definition of solid wastes for purposes of Subtitle C. The EPA's stated purpose for the final rule was to streamline the regulation of hazardous secondary materials in order to encourage recycling.

The final rule establishes exclusions from the definition of solid waste for secondary hazardous materials (i.e., listed sludges, listed by-products and spent materials) that are generated and legitimately reclaimed under the control of the generator. The scope of this exclusion includes:

• Recycling onsite at the generating facility
• Off-site recycling within the same company
• Recycling through a "tolling" agreement.

All materials under this exclusion must be reclaimed within the United States and must be contained when they are stored. Further, notification to the EPA or the authorized state would be required, speculative accumulation would not be allowed, and the hazardous secondary material must be legitimately reclaimed. The final rule also establishes an exclusion for secondary hazardous materials that are transferred for the purposes of legitimate reclamation under specific conditions. Under this exclusion, materials that are generated by one company and then transferred to an intermediate facility or to another company for legitimate reclamation are excluded from regulation, as long as all parties comply with certain conditions.

The final rule clarifies the RCRA concept of legitimate recycling regarding the EPA's approach to recycling hazardous secondary materials. In order to be legitimately recycled under the new exclusions and non-waste determinations, the hazardous secondary materials must provide a useful contribution to the recycling process and the recycling must make a valuable new intermediate or final product. In addition, the rule provides for non-waste determination process that affords interested parties with an administrative process to receive an EPA determination that their hazardous secondary materials are not discarded and, therefore, not solid wastes when legitimately reclaimed. This process is voluntary and establishes two types of non-waste determinations:

• Determination for hazardous secondary materials reclaimed in a continuous industrial process.
• Determination for hazardous secondary materials indistinguishable in all relevant aspects from a product or intermediate.
  

The final rule specifies the criteria that will determine whether the product will be considered hazardous secondary material rather than a waste. The process for the non-waste determination is the same as that for solid wastes variances found in 40 CFR § 260.30.

The EPA estimates that approximately 5,600 facilities handling an estimated 1.5 million tons of hazardous secondary material annually may be affected by the final rule. The anticipated cost savings for all affected industries is expected to be approximately $95 million per year. The final rule is effective December 29, 2008.