Highly anticipated legislation implementing the Miscellaneous Tariff Bill (MTB) introduced in the House of Representatives in the closing days of the 112th Congress calls for changes to previous duty relief in place for rayon fibers.

That measure, the U.S. Job Creation and Manufacturing Competitiveness Act of 2013 (H.R. 6727), which was introduced by the House Ways and Means Committee on Jan. 1, provides temporary duty suspensions or reductions for hundreds of imports not being made in the U.S. This includes various categories of viscose rayon staple fibers used by the nonwovens and other textile industries. 

Unfortunately, the measure included unexpected duty reductions for certain categories of rayon that previously had enjoyed full duty suspensions. These changes were unavoidable and reflect determinations made by the government during the MTB vetting process to ensure the bills meet a key requirement of all miscellaneous tariff bills—that the duty revenue lost as a result of the relief does not exceed $500,000. The good news is that the bill also contains duty suspensions for two new categories of rayon.

The specifics of the rayon fiber provisions found in H.R. 6727 are listed below:

• HTS Heading 9902.23.33: Staple fibers of viscose rayon, not carded, combed, or otherwise processed for spinning, measuring 1.67 to 16.67 decitex and having a fiber length each measuring 20 mm or more but not over 150 mm; (provided for in subheading 5504.10.00). If H.R. 6727 is passed and enacted, the current 4.3% duty will be reduced to 4.0% until Dec. 31, 2015.

• HTS Heading 9902.23.34: Staple fibers of rayon, carded, combed, or otherwise processed for spinning, the foregoing presented in the form of top (provided for in subheading 5507.00.00). If H.R. 6727 is passed and enacted, the current 5% duty will be reduced to 0% until Dec. 31, 2015.

• HTS Heading 9902.25.59: Staple fibers of viscose rayon, not carded, combed, or otherwise processed for spinning. If H.R. 6727 is passed and enacted, the current 4.3% tariff will be reduced to 3.4% until Dec. 31, 2015.

• HTS Heading 9902.45.35: Staple fibers of viscose rayon, not carded, combed or otherwise processed for spinning, measuring 1 decitex or more but not over 1.3 decitex and having a fiber length each measuring 20 mm or more but not over 150 mm (provided for in subheading 5504.10.00). If H.R. 6727 is passed and enacted, the current 4.3% duty will be reduced to 0% until Dec. 31, 2015.

• HTS Heading 9902.45.36: Staple fibers of viscose rayon, not carded, combed or otherwise processed for spinning, measuring over 1.3 decitex but less than 1.67 decitex and having a fiber length each measuring 20 mm or more but not over 150 mm (provided for in subheading 5504.10.00). If H.R. 6727 is passed and enacted, the current 4.3% duty will be reduced to 0% until Dec. 31, 2015.

• HTS Heading 9902.55.04: Viscose rayon staple fibers having a decitex of less than 5.0 and a multi-limbed cross-section, the limbs having a length-to-width aspect ratio of at least 2:1 (provided for in subheading 5504.10.00). If H.R. 6727 is passed and enacted, the current 4.3% duty will be lowered to 2.1% until Dec. 31, 2015.

The Ways and Means bill was not acted upon before the close of the 112th Congress, so it will need to be re-introduced in the current 113th session. Meanwhile, the Senate will have to introduce its own MTB package, which is not a certainty as a number of Senate lawmakers have raised concerns about whether the MTB duty relief bills represent earmarks. Regardless, companies should assume that the provisions included in H.R. 6727 will serve as the framework for legislation when and if it does move forward, and should be prepared to make whatever business planning adjustments are necessary to account for these changes.

If you have any questions, please contact INDA’s Director of Government Affairs Jessica Franken at 703-521-0545 or [email protected].

EPA Finalizes Emission Rules for Boilers, Incinerators and Cement Kilns

After years in the works, the Environmental Protection Agency (EPA) Dec. 20 finalized first-ever limits on toxic air emissions from industrial boilers and incinerators found across the country. Under the so-called “boiler MACT” (maximum achievable control technology) rules, large industrial boilers found at refineries, chemical plants and other manufacturing facilities, as well as certain incinerators and cement kilns will be required to comply with numerical limits on mercury, acid gases, and fine particulate matter. The final standards, which the agency says will prevent thousands of premature deaths, heart and asthma attacks each year, substantially revises earlier proposals in order to reduce burden on industry, and give businesses additional time to comply. However, the new standards will be costly, with EPA projecting industry wide annual compliance costs in excess of $2 billion for impacted boilers, incinerators and cement kilns. 

The EPA has battled for these standards for almost decade, with its first attempt to regulate boiler emissions in 2004 struck down by a federal appeals court in 2007 as violating the Clean Air Act. EPA reissued rules in June 2010 and March 2011, but industry groups decried those emission limits as being unachievable. The recently released rules reflect substantial industry input, and will affect some 2,300 or approximately 1 percent of the nation’s approximately 1.5 million boilers. Owners of “major source” boilers (those that annually emit 10 tons of any one air toxic or 25 tons of any combination of air pollutants will have until 2016 (with a possible year extension) to comply by installing pollution control technologies. Only larger coal-fired area source boilers will be required to meet emissions limits for mercury and carbon monoxide, while the smaller coal-fired units (less than 10 million BTUs) can show compliance through work practices. Regulations for impacted “area source” boilers (those that emit less than 10 tons tpy of any one air toxic or less than 25 tpy of any combination of air toxics) typically found at universities, hospitals, hotels, and other commercial facilities will have until March 21, 2014 to comply. The EPA estimates the remaining 99 percent of boilers will not fall under or will be able to meet the new standards by conducting periodic maintenance or regular tune-ups. 

The solid waste incinerator rule revises new source performance standards and emissions guidelines for an estimated 106 incinerators. To comply, incinerators will need to install controls to meet emissions limits or use alternative waste disposal options by 2018. Cement plants must comply with new emission limits by September 2015. While there are only 115 cement plants in the U.S., they account for 7 percent of the mercury released into the air from stationary sources, according to EPA. 

The reaction from industry representatives and environmental groups alike has been mixed. The Natural Resources Defense Council applauded the EPA’s boiler rules for being stronger than previous versions but criticized the agency for going in the “wrong direction” in its standards for incinerators and cement kilns. The Portland Cement Association, which had been long embroiled in litigation with the EPA welcomed the revisions, as the “right balance in establishing compliance limits that, while still extremely challenging, are now realistic and achievable,” according to Greg Scott, president of the industry group.” Robert Bessette, president of the Council of Industrial Boiler Owners found “these changes will greatly improve the ability of facilities to comply,” but Donna Harman, chief executive of the American Forest and Paper Association, noted that “several billions of dollars in capital spending will be necessary to comply, a significant investment for an industry still recovering from the economic downturn.”

As we have noted in previous coverage of the boiler MACT rules, the emissions limits represent a double-edged sword for the nonwoven fabrics industry, potentially creating new opportunities for nonwoven filtration, but at the same time requiring a very broad swath of industrial and manufacturing facilities to incur the expense of imposing additional emissions control technologies.

The final Boiler MACT rules can be found at: www.epa.gov/airquality/combustion/actions.html.