OSHA revises PSM, restricts retailer exemption

The Occupational Safety and Health Administration (OSHA) issued a revised interpretation of the Process Safety Management (PSM) for highly hazardous chemicals.

The PSM standard contains an exemption for retail facilities. Until this week, OSHA defined retail facility as one that derived more than 50 percent of its income from direct sales of highly hazardous chemicals to the end user, otherwise known as "the 50 percent test."

OSHA has rescinded all prior interpretations, including the 50 percent test, and will now interpret the retail facility exemption in accordance with the North American Industry Classification System (NAICS) Manual:

Only facilities, or the portions of facilities, engaged in retail trade as defined by the current and any future updates to sectors 44 and 45 of the NAICS Manual may be afforded the retail exemption.

This will mean that facilities will now be regulated under the Environmental Protection Agency's (EPA) RMP program level 3 (a review of the EPA's level programs can be found here.)

OSHA has explained that the first six months following the change in the interpretation of the rule, it will focus on providing compliance assistance to affected facilities. A copy of OSHA's PSM Retail Exemption Interim Enforcement Policy can be found here.

Following the announcement, ARA released this statement regarding the rule change:

The Agricultural Retailers Association opposes this maneuver by the Occupational Safety and Health Administration, which has removed the opportunity to publicly comment on the significant changes to the "retailer exemption rule. Without a formal rulemaking process, we believe this change may violate the Administrative Procedures Act.

For dozens of years, our members and other agricultural retailers have operated in a safe and sound manner under the myriad rules and regulations that apply to anhydrous ammonia; to make an abrupt change without allowing for public comment is unreasonable and is contrary to prior statements and efforts by OSHA to partner with industry.

This rule change inappropriately applies standards designed for manufacturing facilities to agricultural retailers, adding tens of thousands of dollars in costs and additional burdensome regulatory hurdles for each facility, without significantly increasing the safety and security of employees or the surrounding community. Furthermore, costs and red tape are compounded as additional risk management compliance, through Environmental Protection Agency, is required.

Industry is doing its part to help retailers improve safety and security through programs such as ResponsibleAg, an independent initiative to assist fertilizer retailers achieve and maintain compliance with federal regulations. However, this rule change adds to the increasingly complex and antagonistic regulatory environment faced by our industry.

ARA will continue to monitor this issue and report any developments. For questions regarding the PSM revisions or RMP, please contact Kyle Liske, Director of Public Policy and Counsel (kyle@aradc.org).