REGULATORY REFORM INITIATIVE SUMMARY REPORTCPSC Home > Business > Current U.S.CONSUMER PRODUCT SAFETY COMMISSION WASHINGTON, DC 20207 CPSC Document #8005 U.S. CONSUMER PRODUCT SAFETY COMMISSION REGULATORY REFORM INITIATIVE SUMMARY REPORT JUNE 1995 TABLE OF CONTENTS I. AGENCY OVERVIEW II. ELIMINATING AND IMPROVING REGULATIONS (1) Eliminating obsolete regulatory provisions (2) Reducing the volume of regulations (3) Consolidating related regulations to make them more user-friendly III. REWARDING RESULTS (1) Agency Level Performance Measures (a) Results-oriented goals (b) Service quality goals (c) Customer satisfaction goals (2) Customer Service Standards (3) Performance Measures for Personnel (4) Measuring Field Performance (5) Shifting Resources From Enforcement Efforts to Partnership Activities Aimed at Compliance IV. CREATING GRASSROOTS PARTNERSHIPS (1) Partnership success stories (a) Window blind and drapery cords (b) Drawstrings in children's clothing (c) Movable soccer goals (d) Baseball injuries (e) Safety Sells Conference (f) Bicycle helmets (2) Programs and plans for the future (a) Home electrical safety (b) International safety standards (c) State and local partnerships (3) Rewarding industry partners for success (4) Publicizing Partnerships V. NEGOTIATE, DON'T DICTATE (1) How CPSC Works With Industry to Develop Voluntary Safety Standards (2) Other Agency Actions to Further the President's Directive VI. AUTHORITY TO WAIVE PENALTIES AND CUTTING FREQUENCY OF REPORTS (1) Penalties (2) Reports Appendix A Safety Sells Conference Report Appendix B CPSC News Releases ================================================================= U.S. CONSUMER PRODUCT SAFETY COMMISSION REGULATORY REFORM INITIATIVE SUMMARY REPORT I. AGENCY OVERVIEW The fundamental mission of the Consumer Product Safety Commission (CPSC) is to reduce the unreasonable risk of injury and death from consumer products. The three-member independent agency enforces five federal statutes: the Consumer Product Safety Act, the Flammable Fabrics Act, the Poison Prevention Packaging Act, the Federal Hazardous Substances Act and the Refrigerator Safety Act. All told, CPSC has jurisdiction over 15,000 consumer products which are found in and around the home. Most people do not realize the terrible toll that dangerous and defective consumer products take on our nation annually. More children in this country die from accidental injuries than from disease. Accidental injuries are the leading cause of death for all Americans under the age of 35 and are the fifth leading cause of death in the nation. Individuals 65 years of age and older are four times as likely to die of product-related injuries than their representation in the population. Each year there are 21,400 deaths and 29 million injuries related to consumer products under Commission jurisdiction. The societal costs associated with deaths, injuries and property damage from consumer products cost the nation about $200 billion annually. Consumer product injuries account for one out of every six hospital days in this country. Because every dangerous product removed from the marketplace prevents an increase in the national health care bill, if each of CPSC's protective actions is multiplied by millions of dangerous products, it is clear that the nation is saved billions of dollars in health care costs annually by the Commission's work. Past agency actions in just four areas (electrocutions, children's poisonings, power mowers and fire safety) save the nation about $2.5 billion each year in societal costs and several hundred million dollars in health care costs. In addition to its primary mission of preventing unnecessary injuries and death from consumer products, CPSC has three additional mission-related goals: (1) to assist consumers in evaluating the comparative safety of consumer products; (2) to develop uniform safety standards for consumer products and to minimize conflicting State and local regulations; and (3) to promote research and investigation into causes and prevention of product-related deaths, illnesses and injuries. In accomplishing its mission, the agency works cooperatively with many different groups, including those representing business and industry. The CPSC supports, as part of this cooperative effort, the Administration's regulatory reform initiative and its objective of achieving the benefits of effective regulation in the least burdensome manner. This report describes some of the steps CPSC is taking to minimize bureaucracy and to work with business to promote greater safety for the American public. II. ELIMINATING AND IMPROVING REGULATIONS CPSC conducted a page by page, section by section review of its regulations. The purpose of this extensive effort was to revoke or revise outdated regulations or those otherwise in need of reform. More specifically, CPSC is: (1) eliminating obsolete regulations; (2) reducing the volume of regulations; (3) consolidating related regulations to make them more user- friendly; and (4) assuring that any changes will not reduce safety to the American public. (1) Eliminating obsolete regulatory provisions. The staff believes that selected provisions in 12 CPSC regulations are no longer needed to protect consumers from the dangers of certain hazardous products. The regulation and the obsolete provisions are as follows: -- stuffed toys - 16 CFR 1145.9 -- squeeze toys - 16 CFR 1145.10 -- mesh-sided playpens - 16 CFR 1145.11 -- mesh-sided cribs - 16 CFR 1145.12 -- expandable enclosures - 16 CFR 1145.13 -- cribs with defective hardware - 16 CFR 1145.14 -- bassinets with collapsible legs - 16 CFR 1145.15 -- bicycle labeling for outdated bicycles - 16 CFR 1512.19(d) and .50 -- sleepwear labeling and segregation of outdated garments (4 provisions): - 16 CFR 1615.5(b) and .31(b)(3); 16 CFR 1615.31(c)(d); - 16 CFR 1616.6(b) and .31(b)(8); and 16 CFR 1616.31(c) The staff will recommend that the Commission eliminate the unnecessary provisions. (2) Reducing the volume of regulations. CPSC regulations governing children's sleepwear are divided by clothing size (0-6x and 7-14), though the regulatory provisions are nearly identical. The staff will recommend that the Commission merge the two regulations into one, thereby eliminating approximately 30 of the 54 CFR pages of duplicative sleepwear provisions. [16 CFR 1615, 1616] (3) Consolidating related regulations to make them more user- friendly. The staff will recommend that the Commission take the following actions on the regulations listed below to make them less complex and easier to use and comply with: -- Consolidate CPSC's investigative regulations governing investigations conducted under the CPSA (16 CFR 1118) and the FFA (16 CFR 1605); -- consolidate CPSC's regulations on children's sleepwear; -- consolidate CPSC's regulations governing imported goods and the export of noncomplying goods, which were adopted as three separate sets of regulations under three different statutes [16 CFR 1010, 1019, 1500.265-272]; -- eliminate CPSC's narrow regulation banning lawn darts [16 CFR 1500.18(a)(4)] because a more comprehensive lawn dart ban is included at 16 CFR 1306. III. REWARDING RESULTS (1) Agency Level Performance Measures CPSC makes vital contributions to decreasing the deaths and injuries associated with consumer products. The Commission's actions result in immediate reductions in the nation's health care costs. Every dangerous product removed from the marketplace prevents an increase in the national health care bill. Multiply each of CPSC's actions by millions of removed products and the nation is saved billions in health care costs. CPSC's long-term goals are easily categorized by the three goals defined in the Government Performance and Results Act (GPRA). In brief, results-oriented goals focus on reducing injuries and deaths from various types of consumer products. Service quality goals focus on improving the services CPSC provides to the agency's major constituents -- consumers and industry. Customer satisfaction-oriented goals focus on improving the usefulness, timeliness and accuracy of the services the Commission provides to its external customers. (a) Results-oriented goals. The overall goal is to reduce the annual 21,400 deaths, 29 million injuries and $200 billion in societal costs associated with consumer products. The general strategy is to use all the hazard reduction tools available to the agency and address those hazards that represent the greatest opportunity for injury reduction. For example: -- The recently issued rule on child-resistant cigarette lighters is projected to prevent up to 100 deaths each year, several hundred injuries and millions of dollars in property damage. Total savings to society will be over one-half billion dollars per year. -- CPSC scrutiny of dangerous fireworks prevented 17,000 to 20,000 injuries over the past seven years and continued scrutiny is projected to prevent approximately 3,000 injuries each year. To illustrate the development of results-oriented goals for the Commission, CPSC's FY 1996 budget submission contains baseline data at the agency and program level. Examples of specific results-oriented goals that will be considered by CPSC are as follows: -- Reduce the approximately 4,000 deaths, 22,000 injuries and $4.8 billion in property damage from fires; -- reduce the 1,400 deaths and 310,070 injuries from electrical, mechanical, and children's products; -- reduce the 585 deaths and 340,000 injuries from sports and recreational products; -- reduce the injuries and deaths from chemical hazards; -- increase the agency's capability to reduce injuries and deaths by improving the identification and analysis of product hazards. (b) Service quality goals. These goals focus on compliance and information activities. CPSC's compliance efforts strive to help manufacturers deliver safe consumer products to the marketplace. CPSC information systems provide consumers with critical product safety information so they can make informed purchasing decisions. For example: -- The recently passed Child Safety Protection Act (CSPA) requires choking hazard warnings on toys and games containing small parts, small balls, marbles, and balloons. the requirements, which have broad, extensive impact on the toy and children's products industry, became effective on January 1, 1995. In preparation for ensuring compliance with these new requirements, CPSC published a notice in the Federal Register in November 1994 announcing the upcoming rules. Staff explained the requirements of the CSPA at industry meetings in Florida, Washington, D.C., New York, Texas, and California, and the staff did a mass mailing of information on the new labeling requirements to some 1,500 toy and children's products manufacturers and importers. As a result of the efforts to involve and inform the regulated industry, the staff has thus far found a very high level of compliance with these requirements throughout all levels of the industry. -- To speed delivery of life-saving information to the American people, CPSC transformed its outmoded telephone center into a cutting-edge interactive information system that incorporates a 24-hour Hotline, Internet, bilingual operators and fax-on-demand. The White House has cited CPSC's new Hotline as an outstanding example of government "reinvention." Other Federal agencies have used it as a model for their own improved consumer information systems. CPSC is working on additional service quality goals to: -- Develop a closer working relationship with industry to assist companies in the development of comprehensive and effective quality assurance programs to ensure the safety of the products they manufacture, import, distribute and sell; -- improve recall effectiveness and minimize the recall burden to industry by working with companies to develop appropriately targeted corrective action measures; -- enhance the timeliness of identifying potentially defective consumer products; -- provide timely, useful and accurate information to industry regarding the requirements of CPSC rules, regulations and reporting obligations; and -- communicate more effectively with high-risk groups about potential hazards and the safe use of consumer products. (c) Customer satisfaction goals. CPSC's consumer information program informs consumers about product hazards and makes recommendations on ways to reduce these hazards. Information may be provided to individual consumers who request information on specific products or product areas or to groups of consumers through targeted outreach programs. CPSC's use of video news releases is an effective, inexpensive way of quickly reaching tens of millions of consumers with critical product safety information. For example: -- The video news release on the recall of flammable skirts reached over 100 million viewers and generated over 22,600 calls to the CPSC Hotline; -- the flammable fleece recall video news release reached more than 44 million viewers and generated nearly 15,000 calls to the Hotline; -- the video news release on the suffocation hazard posed by bean bag chairs reached well over 43 million viewers and generated over 17,500 calls to the Hotline. As illustrated above, CPSC's goals support the objectives defined in the Government Performance and Results Act (GPRA). In the future, CPSC's results-oriented goals will continue to focus on reducing injuries and deaths. Its service quality goals will focus on improving services provided to the agency's major constituents -- consumers and industry. And its customer satisfaction goals will focus on improved usefulness, timeliness and accuracy of services provided to external customers. (2) Customer Service Standards In FY 1994, in response to Executive Order 12862 on Setting Customer Service Standards, Chairman Ann Brown issued a Proclamation to all CPSC employees declaring all of CPSC a reinvention laboratory and setting improved customer service as its first goal.. Since its toll-free Hotline is CPSC's primary point of contact with the public, the agency surveyed a sample of Hotline users to determine the kind and quality of services desired by American consumers. Survey results were analyzed and CPSC issued customer service standards for the Hotline. In an August 28, 1994 letter to Vice President Al Gore, the Chairman transmitted the agency's first customer service plan, in which she underscored the agency's commitment to continued improved customer service. CPSC takes pride in the standards set for the Hotline in its customer service plan. When the Hotline is called, callers can expect the following: -- to be given easy-to-follow instructions on how to use the Hotline; -- to hear the most up-to-date and easy-to-understand recorded information on product safety recalls and consumer products, seven days a week, 24 hours a day; -- to be given courteous service; -- to have the caller's complaint of an unsafe product or product-related injury taken accurately and a copy of the report sent to them so that they can confirm the information recorded by our Hotline staff; and, -- to have their telephone call left at night, weekends or holidays returned the next business day, or, if they do not want a return call, to receive a letter confirming receipt of their product-complaint message. CPSC's next customer service standards will be issued this Fiscal Year for its state and local partners. The standards will be introduced in a series of upcoming meetings this fall. (3) Performance Measures for Personnel The CPSC is currently revising its performance management plan for all employees. The goals of this revision are to: -- Enable supervisors to efficiently develop results- oriented performance plans and appraisals in the least burdensome manner; -- ensure that safety investigators continue to focus on results, not process and punishment such as the number of violations found or the amount of fines levied; and -- develop generic elements and standards for all employees which will ensure fair and equitable evaluation of employees. It is anticipated that the entire plan, including development of generic elements and standards and training for supervisors and employees, will be implemented by September 1, 1995. In support of these initiatives, CPSC staff are rewarded for activities that reduce deaths and injuries to the American public. This is best exemplified by the awards given to CPSC staff at the annual recognition day ceremony this past May: -- An attorney in the Office of Compliance met with several industry groups and spoke to scores of individual members of industry and representatives of consumer groups in order to craft common sense rules implementing the labeling provision of the Child Safety Protection Act. This attorney's efforts to inform industry have led to a very high level of compliance with these new rules; -- an engineer received an award for working effectively and successfully with the water heater industry to encourage them to develop an industry program to identify means of modifying or redesigning gas-fired water heaters to prevent flammable vapors from reaching the pilot light and causing fires; -- a statistician received an award for developing and leading a program to identify the role that consumer products may play in contributing to the suffocation of infants diagnosed with Sudden Infant Death Syndrome (SIDS). The work resulted in recommendations not to place babies to sleep face down on top of soft bedding; -- a management analyst received an award for organizing a meeting on baseball safety which brought together interested parties from industry, academia, the medical community and government to develop and implement strategies for dealing with controversial issues regarding baseball protective equipment for young players; -- the Director of State and Local programs vigorously and effectively promoted CPSC's interests at the state and local level and developed partnerships with 22 states that resulted in promoting use of smoke detectors to vulnerable populations, increased media coverage of product recalls and advanced the cause of product safety; and, -- the Division of Corrective Actions in the Office of Compliance was recognized for its cooperative work with manufacturers, distributors and retailers to negotiate recalls of tens of millions of defective products. Using minimal staff resources, compliance staff worked effectively with industry to protect the public in a cooperative manner without resort to litigation in a single case. The staff engaged in several industry-wide cooperative efforts to remove hazards presented by bunk beds, bean bag chairs, venetian blind cords, mobile soccer goals, and strings in clothing, as well as working to recall scores of individual defective products. (4) Measuring Field Performance In response to the request to examine and change, if necessary, the methods used to measure the performance of CPSC's front-line regulators to focus on results, not process and punishment, CPSC reviewed the performance plans for members of the field staff. CPSC's field staff, located in three regional centers and 34 smaller offices, are responsible for the following: minimizing conflicting state and local regulations; investigating the causes and promoting prevention of product-related deaths, illnesses and injuries; motivating manufacturers, distributors and retailers to comply with safety regulations; inspecting and investigating activities to determine if firms and products are in compliance with laws; and obtaining evidence to support legal action when violations are found. CPSC's Office of Human Resources Management examined methods used to measure performance and concluded that performance measures are based on quality and timeliness of work products, not on numbers of violations found or the amount of fines levied. Performance elements for regional office supervisors and investigators do contain measures of productivity which are expressed in terms of completion of allocated portions of the field operating plan. These measures of productivity also represent percentages of projected work accomplishments. 5) Shifting Resources From Enforcement Efforts To Partnership Activities Aimed At Compliance As compliance problems are identified, the staff frequently contacts a broad industry segment to advise them of the problem and how to comply with the CPSC's regulations. In many areas, the staff has been able to shift resources from enforcement efforts to partnership activities aimed at compliance. During the past year, for example, the staff made efforts to correct some slippage in compliance in the flammable fabrics area. A recall of lightweight Indian skirts involved hundreds of retailers, importers, U.S. Customs offices and embassy officials. The skirts were found to present a serious risk of burn injuries because they did not meet the applicable flammability regulation under the Flammable Fabrics Act. The commission worked with U.S.Customs to stop additional entries of failing skirts and to identify past entries of suspect skirts so that staff could investigate further if needed; identified small businesses, particularly importers affected by the failing garments, to communicate the requirements of the Flammable Fabrics Act; and held discussions with the Indian Embassy to assure that it conveyed to its fabric industry the requirements for exporting garments to the United States. The meetings with the Indian Embassy staff resulted in the Government of India establishing a testing certification program for rayon chiffon skirts. The Indian Government now requires that all exporters of sheer chiffon rayon skirts conduct flammability testing by competent laboratories to comply with the CPSC flammability regulation and to receive certification for export to the United States. CPSC also notified about 50 other countries that export similar items about the flammability requirements, and CPSC staff worked with the U.S. Customs Service to test incoming shipments of suspect garments for compliance with the regulation. Another example of shifting resources to partnership activities aimed at compliance involves the CPSC product defect investigation program. Product defect investigations lead to the identification and removal of defective products from the marketplace. CPSC is exploring ways to reduce industry's concern about the potential negative impact of a report to the agency about a potentially defective product. The staff has under consideration a pilot plan whereby a "preliminary staff determination of a substantial product hazard" may not be made if certain criteria are met. To forgo the staff making a preliminary determination, a firm reporting under section 15 would have to implement a corrective action plan in cooperation with the CPSC within a specified time period. Such an approach meets the firm's responsibilities of reporting that defect to CPSC. It also allows the firm to readily implement its corrective action plan. In addition, this approach reduces the burden on staff, because the full technical evaluation may not be required if the initial submission by the firm meets staff's needs to truncate a full-scale product-defect investigation. IV. CREATING GRASSROOTS PARTNERSHIPS The U.S. Consumer Product Safety Commission has put great emphasis on working in partnership with the industries it regulates. Since she arrived in March 1994, Chairman Ann Brown has made a special effort to reach out to business and industries regulated by CPSC and has met with their representatives in Washington, D.C., at association meetings and trade shows around the country. The Commission also has developed partnerships with a wide variety of other groups concerned with product safety, including consumer, medical, safety and standards-setting organizations. Among the many groups the Chairman has met with are the Juvenile Products Manufacturers Association, the National Association of Manufacturers, the National Retail Federation, and the Toy Manufacturers of America (TMA). For example, she visited the annual Toy Fair trade show sponsored by TMA in New York in February 1995. She toured several exhibits, met with CEOs of major toy manufacturing and retailing companies, and delivered a speech to several hundred toy industry representatives. In addition, other top agency officials participated in a compliance seminar at Toy Fair, designed to assist manufacturers, retailers and importers in understanding CPSC's regulations and applicable safety laws. Finally, CPSC had a booth at the trade show staffed with knowledgeable Commission employees to answer questions and provide information about Commission requirements to the thousands of trade show participants. 1) Partnership success stories CPSC has initiated several partnerships over the past 15 months that have sparked creative approaches to promoting product safety. The following examples illustrate some of these innovative partnerships and their results. a). Window blind and drapery cords. Over 140 children between eight months and four years old have died since 1981 as a result of blind and drapery cords. Most of them strangled after becoming entangled in the cords. In the spring of 1994, CPSC initiated a cooperative effort with the window covering industry to respond to the hazards posed by window blind and drapery cords. On October 5, 1994, CPSC and the newly-created Window Covering Safety Council, made up of manufacturers, importers and retailers of drapery and blind cords, announced a three-part program to address this hazard. Specifically, the program was designed to: (1) eliminate the loop in window blind cords already in consumers' homes by providing free retrofit kits; (2) modify future production of window coverings by manufacturing only blinds and draperies with safety tassels to prevent strangulation; and (3) implement an educational campaign to reach consumers through brochures, posters in pediatricians' and public health offices, and warnings inserted in window covering packaging. In concert with the Window Covering Safety Council, CPSC developed its own public information outreach effort to inform consumers about the hazard and how to remedy it. CPSC is now working with industry to develop a voluntary standard to address the risk of injury associated with looped blind cords. b) Drawstrings in children's clothing. Since 1985, CPSC has learned of 17 deaths and 39 near-strangulations of children whose clothing with drawstrings caught on such things as playground equipment, cribs, school bus doors and escalators. Last spring, the agency called on manufacturers and retailers to work with CPSC to change children's clothing to prevent such entanglements and deaths. Industry accepted the challenge. On July 7, 1994, CPSC announced a major cooperative effort with 26 manufacturers and retailers. They agreed to modify or remove drawstrings from the hoods and necks of their lines of children's clothing. Some made the changes to their fall '94 line of children's clothing. Others agreed to modify or eliminate the hood and neck drawstrings from their spring or fall '95 lines. CPSC estimates these actions -- taken without regulation or red tape -- will make more than 20 million garments sold each year safer. CPSC issued a video news release and print materials to alert consumers about the dangers of drawstrings in children's clothing and how to modify garments already in their possession. CPSC also acted to distribute the information to school health officials. CPSC is now working with the industry to develop a voluntary standard addressing the risk of injury associated with drawstrings c) Movable soccer goals. Soccer has become increasingly popular as a sport for youth groups in the last few years. With that popularity, however, has come an increasing number of deaths and injuries from movable soccer goals. Soccer goals can weigh up to 600 pounds and are highly unstable if not firmly anchored to the ground. A child or young adult who climbs on a goal, attempts to do chin-ups, hangs from the crossbar or moves the goal can be crushed and killed or severely injured if the goal falls on him or her. There are some 120 injuries annually involving movable soccer goals. CPSC is aware of 21 deaths to date. CPSC collaborated with the Sporting Goods Manufacturers Association, the Soccer Industry Council of America and four major soccer goal manufacturers to form the Coalition to Promote Soccer Goal Safety. The coalition's primary focus has been a safety warning and education program conducted through a labelling campaign, press releases and safety alerts issued by CPSC, posters, educational talks at soccer coach clinics and conventions, and press conferences. Building on the work of the coalition, on October 7, 1994, CPSC held a conference to promote safer soccer goals. Representatives of soccer organizations, educational groups, product manufacturers, sports injury and safety groups and government organizations attended. The goal of the conference was to develop voluntary guidelines, alternatives and additions to the coalition's safety campaign. The conference quickly yielded positive results on two fronts. First, in January 1995, CPSC issued its "Guidelines for Movable Soccer Goal Safety." The guidelines are intended for use by parks and recreation personnel, school officials, sports equipment purchasers, parents, coaches, and any other members of the general public concerned with soccer goal safety. Second, later in January, a conference attendee who is assistant director of the National Federation Soccer Rules Committee was instrumental in securing approval to a change to the committee's rules: Beginning with the 1995 high school soccer season, portable goals must be securely anchored to the ground. d) Baseball injuries. More than 165,000 baseball-related injuries required emergency room treatment for children between 5 and 15 years old in 1993. CPSC, in cooperation with the Centers for Disease Control (CDC), convened a Baseball Protective Equipment Roundtable on October 18, 1994, to discuss what can be done to reduce the number and severity of such injuries. The 52 roundtable participants represented manufacturers of sporting goods and protective sports equipment, professional and amateur sports groups, consensus standards-setting organizations, the medical community, trade associations, academia, county government, consumer groups, the National Institutes of Health, and the legal community. The Commission urged the development of voluntary consensus standards for four types of sports equipment: face guards, soft baseballs, chest protectors and safety bases. The Commission also told the roundtable participants that it would develop guidelines for consumers on the safest use of such equipment, based in part on the outcome of the roundtable discussions. As a direct result of the roundtable meeting, working groups made up of members from industry and elsewhere have formed and begun work on developing consensus standards in all four areas under the aegis of ASTM (formerly known as the American Society for Testing and Materials). CPSC is providing technical support. The face guards working group has completed a first draft of revisions to the existing standard. The soft baseballs working group completed a draft test method which will be circulated among ASTM members for a ballot vote. The chest protectors working group is focusing on developing a test protocol for protective padding, a preliminary step to developing a consensus standard. All of these activities were discussed at a May conference in Denver, Colorado. e) Safety Sells Conference. Product safety is an emerging business trend. In fact, safety sells. To highlight this and to emphasize her commitment to cooperative CPSC-industry relations, the Chairman hosted a one-day "Safety Sells Conference" on March 28, 1995, for top executives of consumer product companies and others. The conference marked the very first time CPSC had brought together senior industry executives to talk about business profitability and safety as mutual objectives. Eight chief executive officers and other top executives from major consumer product companies were the featured speakers. Each was asked to present a case study of a safe product or approach to safety in his company and to discuss how the company had benefited and profited from it. The speakers emphasized their companies' commitment to safety and the competitive advantages of their safety innovations. Their presentations demonstrated an extraordinary range of new and creative approaches to making and selling safer products. The conference was attended by nearly 200 representatives of industry, trade associations, standards-setting organizations, the legal community, academia, non-profit and governmental organizations. The conference was so well received by the business audience that CPSC plans to make it a regular event. The International Consumer Product Health and Safety Organization (ICPHSO) provided funding to print copies of the speakers' presentations for attendees. A copy of this publication is included as Appendix A. f) Bicycle helmets. Each year, about 400,000 children under the age of 15 are treated in emergency rooms for bicycle- related injuries. An additional 300 are killed. About one-third of the injuries and two-thirds of the deaths are head-related. Bike helmets can reduce the risk of head injury by up to 85 percent, yet only about 15 percent of all children nationally wear helmets when they ride their bikes. In late May 1995, CPSC announced the results of an eight- state survey conducted by the American Automobile Association (AAA) on bicycle helmet usage by children. AAA surveyed 282 children, ages 8 to 13, to get their ideas on how to encourage more kids to wear bicycle helmets. Chairman Brown discussed the survey results, contained in a CPSC report, at the Child Transportation Safety Conference at the U.S. Department of Transportation on June 1. The results showed that more than two- thirds of those questioned think improving the way bicycle helmets look or fit would increase helmet usage among children. Many had ideas on how to improve marketing to make bike helmets more appealing. For example, some suggested featuring sports or mass media role models wearing helmets: "Show pros wearing helmets and being cool." CPSC is distributing the report to bike helmet manufacturers and will make it available to the general public. In addition, the Commission and AAA have jointly produced a brochure on bicycle safety that targets children 8 to 13 years old and places special emphasis on the importance of wearing bicycle helmets when riding a bicycle. CPSC and AAA plan to distribute the brochure widely. The brochure was featured in a segment on NBC's Today Show and was covered by local media as well. 2) Programs and plans for the future In response to the President's March 4 directive to expand grassroots partnerships, CPSC consulted with business, consumer groups, and with its state partners. On the basis of their suggestions, CPSC planned several future meetings including an international safety standards conference to be held in July 1995, and a series of conferences for state officials scheduled for September and October. In addition, CPSC will incorporate a business/consumer dialogue in the planned 1996 Safety Sells Conference, which will build on the successful 1995 meeting. a) Home electrical safety. National fire statistics show that more than 40,000 fires are caused each year by problems with home electrical distribution systems. For the past 10 years, home electrical distribution systems have been the leading cause of fire deaths involving electrical equipment, claiming an average of nearly 400 lives each year. These deaths and fires cost society more than $2 billion annually. A CPSC study indicates aging electrical wiring systems caused many of the fires. CPSC has formed a public-private partnership to address this problem. It developed a pilot "electrical safety" project, and, based on the results, will recommend ways to rehabilitate electrical wiring systems in older homes. Its partners include the U.S. Fire Administration, the Federal National Mortgage Association (Fannie Mae), the National Fire Protection Association, and other private industry sources, which will provide funding, and building code organizations, electrical inspectors, and fire safety experts, who will lend their expertise. CPSC will select test houses based on geographic location to reflect varying construction methods used around the country. In concert with its partners, CPSC will conduct demonstration inspections of those homes to identify gross electrical wiring hazards and demonstrate cost-effective solutions to improve home wiring systems. Working with its partners, CPSC also will promote an electrical inspection code developed for older homes by the National Fire Protection Association and press for wide acceptance of periodic home inspections to identify and correct gross electrical wiring hazards. Finally, CPSC will disseminate and promote the findings from the pilot project and produce and distribute a video demonstrating electrical rehabilitation and repair methods to consumers, local government officials and the electrical community in general. b) International safety standards. The international harmonization of product standards is becoming very important to our international trade relationships and the need to create effective markets abroad for U.S. products. Several Federal agencies with trade responsibilities are actively involved in this process. CPSC, for example, has finalized a formal agreement with the Canadian Product Safety Bureau whereby each will make its standards-related measures and procedures for product approval compatible with the other's, taking into account international standardization activities. At the same time, a number of non-governmental organizations have been successful in developing bilateral and multilateral voluntary product standards. "Mutual Recognition Agreements" on product testing and certification, involving numerous countries, are currently being negotiated. Because greater coordination is needed, the CPSC has scheduled a conference involving government agencies, voluntary standards organizations, trade associations, academic institutions and industry representatives to ascertain ways to strengthen efforts to harmonize international product standards. The conference will take place on July 18. At the conference, experienced leaders and professionals from government, industry, non-governmental organizations and the academic community will discuss how to enhance international trade and strengthen product safety through more effective international harmonization of product standards. The CEO of Toys "R" Us, for whom international harmonization of product standards is of great concern, will be the keynote speaker. Panelists will discuss how international agreements are critical to global product standards; share "success stories" about making specific product standards compatible; describe techniques on how to eliminate product-related trade barriers; and explore how increased coordination between government and industry can lead to more effective product standard harmonization. Among the agencies that will take part in the conference are the Departments of State and Commerce, Federal Aviation Administration, Food and Drug Administration, and the U.S. Trade Representative. c) State and local partnerships. The Commission plans to strengthen both its own and the states' ability to reduce consumer product-related deaths and injuries through the development of new and innovative partnerships. In the fall of 1995, CPSC will host a series of three conferences, to which it will invite representatives of all 50 states, the District of Columbia, Puerto Rico, the Virgin Islands and Guam. Each will be invited to send a team of key officials, including the current state designee for product safety and two or three other individuals who have responsibilities and interests in this area. CPSC's field staff will work closely with the states to identify and prepare team members. In a day and a half of planned conference activities, attendees will hear about the latest in CPSC activities, including the following: emerging safety hazards; the latest recall and compliance activities; special efforts to reach "at-risk" populations; and innovations in CPSC's communications system, including its Hotline, Internet connections and fax-on-demand. They will hear what CPSC is doing to reduce injuries related to children's toys and products, fire and carbon monoxide hazards, and sports activities, such as bicycling, in-line skating and baseball. The conferees will brainstorm with CPSC staff and colleagues from other states on the best and most useful ways to promote and communicate product safety in their own states. Using what they have learned at the conference, each state will develop an action plan for working more effectively with CPSC and its own citizens to reduce deaths and injuries from consumer products. 3) Rewarding industry partners for successes Very shortly after she took office, Chairman Brown initiated the Chairman's commendation program to recognize substantial contributions to product safety by individuals, companies or groups for one-time, ongoing or multiple actions. The Chairman holds press conferences with the companies to publicize the awards and underscore the importance of their safety contributions. To date, she has given commendations to four companies: The Procter & Gamble Company (March 1994): "for voluntarily marketing a major product in senior-friendly child-resistant packaging." Playskool, a division of Hasbro, Inc. (August 1994): "for developing an innovative passive restraint to help prevent children from sliding under the trays of highchairs and strangling." Sunbeam Plastics (September 1994): "for its long-term commitment to developing innovative and effective senior-friendly child-resistant packaging for a broad range of consumer products." Toys "R" Us (February 1995): "for its corporate commitment to child safety, as exemplified by its product safety programs." Factors that are considered in choosing award recipients may include, among others, the following: -- Actions that contribute to reducing hazards to children and other vulnerable populations; -- voluntary actions that are not mandated by government regulations, that anticipate government regulations, or that go beyond what the government requires; -- developments that affect the safety of large numbers of individuals; -- innovations or improvements to existing products; and -- safety devices, packaging, warnings or products that enhance consumer safety. 4) Publicizing Partnerships A vital aspect of the Commission's work is informing the public about its safety efforts. The Commission issues press releases on all major actions. The Office of Information and Public Affairs works with television, radio, newspapers and magazines to get maximum public exposure for the Commission's work. Press releases describing several of the partnership activities described in this report are attached as Appendix B. V. NEGOTIATE, DON'T DICTATE 1) How CPSC Works With Industry To Develop Voluntary Safety Standards CPSC uses an alternative approach to negotiated rulemaking which accomplishes the goal of negotiating rather than dictating rules. By statute CPSC can only issue a mandatory standard when there is no voluntary standard in place that adequately addresses the risk of injury, or when industry fails to comply with such voluntary standards. The Commission has had great success in working cooperatively with industry to develop voluntary standards. Indeed, the Commission has found that with the products it regulates, negotiating such standards can be far more efficient than rulemaking or even negotiated rulemaking. CPSC always attempts to work cooperatively with industry to address safety hazards. It is far more effective for CPSC and industry to work together than for the agency to dictate mandatory standards. Industry knows its own products best and obviously has considerable technical expertise. Accordingly, the Commission uses mandatory standards only as a last resort when negotiated voluntary standards and the marketplace prove ineffective. CPSC relies extensively on the voluntary consensus process for the development of safety standards for consumer products in the United States. As much, if not more than any other federal regulatory agency, the CPSC has used the voluntary process to address safety problems since its beginning in 1973. Since this time, CPSC has worked with industry representatives to develop more than 300 voluntary product standards while promulgating less than 50 mandatory rules during this same period. This 6 to 1 ratio of voluntary to mandatory standards is impressive and illustrates that CPSC has long relied on this process to carry out its mission. The following are examples of the positive results of voluntary standards activities: -- Chain saw injuries were reduced 48%, from 69,000 injuries to 36,000 injuries. -- Fire deaths were reduced 30%, from 5,450 deaths to 3,800 deaths. -- Electrocutions were reduced 62%, from 650 deaths to 250 deaths. Since 1981, CPSC's statutes have required the agency to make two findings before it can issue a mandatory standard; first, that there is no voluntary standard in place that adequately addresses the risk of injury of concern, and second, if there is such a standard, that there is not significant conformance to that standard. Furthermore, CPSC follows OMB Circular A-119, which directs agencies to use voluntary standards whenever possible. CPSC is extremely active in the development of voluntary safety standards in the United States. CPSC long ago established a high level staff position to coordinate voluntary standards policy activities. CPSC's Voluntary Standards Coordinator is the Chairman of the American National Standards Institute's (ANSI) Government Member Council, and as such is a non-voting ANSI Board member. Commission staff sit on several councils of Underwriters' Laboratories (UL); in fact, a CPSC staffer is the first woman member of UL's Electrical Council. CPSC is a member of the ASTM F-15 Executive Committee for Consumer Products. These bodies establish domestic and international policies for the development of voluntary consensus standards. Also, CPSC staff is active on many of the U.S. code bodies (National Electric Code, National Fuel Gas Code, etc.) that establish national model codes for the safe installation of consumer products. All of these activities are heavily relied on by CPSC to ensure that adequate safety standards exist for consumer products. These non-regulatory activities represent the vast majority of the Agency's standards development activities today. On occasion, CPSC concludes that mandatory regulations may be appropriate because of ineffective self-regulation by the marketplace. However, in these cases the CPSC staff works as closely as possible with industry to assure that the rulemaking process is as efficient and effective as possible. For example, CPSC is currently conducting a regulatory investigation on upholstered furniture. Technical staff is conducting the following work in close cooperation with industry: (1) a fire incident data study to determine the number of fires involving upholstered furniture and small open flames; (2) testing of existing furniture to small open flame conditions to evaluate current furniture performance; and, (3) surveying manufacturers to gather specific information about the upholstered furniture market. Industry has been given an opportunity to review our data collection methodology, our laboratory testing protocols, and provide input on the type of questions we ask manufacturers about the market. There are times when industry prefers a mandatory federal standard because of the preemptive effects of CPSC's regulations over state regulation and because of the CPSC's enforcement capabilities, particularly with imported goods. A recent example of this is the CPSC's mandatory standard for child-resistant cigarette lighters. The CPSC was initially proceeding on a dual track of working on a mandatory and voluntary standard. Then industry decided to stop all work on the voluntary standard, in part because of conflicting legislation in two states to regulate this product. Just as importantly, the domestic manufacturers were very concerned that overseas manufacturers would not comply with a voluntary standard and they would therefore be placed at an economic disadvantage. Because of these considerations, the industry specifically requested a mandatory regulation. 2) Other Agency Actions To Further the President's Directive The goal of the CPSC's compliance program is to ensure that firms comply with the laws, regulations, and standards that protect consumers from hazardous products. To achieve this goal, the agency presently conducts three main types of compliance activities over the 15,000 types of consumer products under its jurisdiction: -- Informs industries of CPSC reporting and product requirements and educates them through seminars and correspondence, as appropriate; -- maintains surveillance over consumer products and follows up on reports of products that may not be in compliance with federal standards or may be defective and present substantial risks of injury; and -- obtains correction of violations of mandatory standards and recall of hazardous products from the marketplace or consumers, primarily by working cooperatively with industry but through litigation when necessary. There are many examples of the effectiveness of CPSC compliance corrective actions. To illustrate, the number of lives saved in one year due to recalls and specific product modifications are seen in the following: -- A cradle swing recall saved an estimated 7 lives; -- a playpen recall saved an estimated 7 lives; -- a crib recall saved an estimated 24 lives. Over 95 percent of the 1,400 product violations (instances of non-compliance with a rule or regulation) the Commission identified in 1994 were voluntarily corrected. The affected companies agreed to prospective correction of the products in question, by labeling (including warnings or instructions for use), product redesign or use of an appropriate child-resistant closure. Of the 1,400 product violations in 1994, CPSC determined that 170 presented a hazard significant enough to request recall of the product. As it does in all such cases, the agency discussed the violation with the affected firm, addressing issues such as the nature of the violation and the population at risk. All 170 of these cases resulted in voluntary product recalls. By voluntarily correcting the problem, firms served their own interests and the interests of consumers too. The same "win-win" approach is used with all of the firms involved with product defect matters where products are preliminarily found by CPSC staff to present a substantial product hazard under section 15 of the Consumer Product Safety Act or the Federal Hazardous Substances Act. In these matters, the product that could create a substantial risk of injury to the public is discussed with the responsible importer, manufacturer, distributor or retailer in terms of the pattern of the defect, the number of defective products in commerce, severity of the risk and other factors. Any firms that disagree with a preliminary staff determination of a substantial product hazard are entitled to an administrative hearing pursuant to Section 15 of the CPSA. In FY 1994, all firms negotiated mutually acceptable agreements with CPSC on corrective action plans. The Commission continues to increase its efforts to encourage companies to comply voluntarily with its laws and regulations. A successful example of this approach was the staff's initiative to explain to industry its obligation under the new Child Safety Protection Act. On June 16, 1994, Congress passed the Child Safety Protection Act (CSPA) which amended the Federal Hazardous Substances Act (FHSA), requiring choking hazard warnings on toys and games containing small parts, small balls, marbles, and balloons. The requirements, which have broad, extensive impact on the toy and children's products industry, became effective on January 1, 1995. In order to explain the new requirements to industry, CPSC staff took part in industry meetings in Florida, Washington, D.C., New York, Texas, and California. The staff also did a mass mailing of information on the new labeling requirements to some 1,500 toy and children's products manufacturers and importers. As a result of the efforts to involve and inform the regulated industry, staff enforcement efforts thus far have found a very high level of compliance with these requirements throughout all levels of the industry. A pilot survey of imported toys at six selected ports of entry throughout the country since January 1, 1995, has identified only 13 violations, a surprisingly low number. CPSC plans to expand its efforts to ensure compliance with this new regulation. VI. AUTHORITY TO WAIVE PENALTIES AND CUTTING FREQUENCY OF REPORTS In matters of enforcement, CPSC's goal is to protect the public by achieving a high level of compliance, not simply to impose penalties. CPSC exercises its enforcement discretion prudently, with the aim of bringing about compliance with its laws and regulations without the need for penalties or other legal remedies. 1) Penalties CPSC's compliance staff pursues civil or criminal penalties, as appropriate, generally only in cases where firms have repeatedly committed prohibited acts or have failed to report certain information as required under the laws CPSC enforces. The penalties are in addition to the corrective actions necessary to correct the product for the future or recall a product from distribution. In those cases where the violations identified are minimal and the firm appears to be taking steps to assure that its products comply with applicable regulations, the matter is then put on hold. The staff sends the firm a letter informing it of the disposition, but states that the firm may be subject to civil penalties for future violations. The letter informs the firm not only of the potential civil penalty and the reasons for it, but also contains suggested options on how to avoid civil penalties in the future. If, after reviewing all available information, CPSC's compliance staff decides that a civil penalty should be pursued, the staff sends the firm a letter giving it an opportunity to show cause why a civil penalty is inappropriate. If after evaluating the firm's response to that show-cause letter the staff continues to believe a civil penalty is warranted, the staff attempts to negotiate a settlement. Only if the settlement attempt is unsuccessful does the staff forward a recommendation to pursue civil penalties in federal district court to the Commission for its decision. CPSC's use of its civil penalty and criminal authority is used infrequently compared to the number of compliance activities that are resolved voluntarily. In 1994 the Commission assessed four civil penalties under the CPSA, eight civil penalties under the FHSA, two civil penalties and one cease-and-desist order in lieu of a civil penalty under the FFA, no criminal penalties under the FHSA, no criminal penalties under the FFA, and no penalties under the PPPA. 2) Reports The Commission has no routine, periodic reporting requirements such as those associated with a number of other government agencies where employment statistics, financial data, or production data is required to be reported to the government on a monthly or quarterly basis. The reporting requirements the CPSC does have are minimal requirements and are directly related to the agency's mission to reduce the unreasonable risk of injury and death from consumer products. The reporting requirements are under sections 15(b) and 37 of the CPSA, section 102 of the Child Safety Protection Act, and specific regulations covering four product categories where information may be required under certain circumstances. Some garment and fabric importers, manufacturers and distributors voluntarily file reports with CPSC that provide documentation to support their claims regarding their products' compliance with the FFA. This documentation -- known as continuing guarantees -- remains on file with CPSC indefinitely and can be updated whenever a firm chooses. These reports assist the firms in satisfying the demands of their customers who require evidence of compliance with the FFA. Appendix A: This appendix is not included as part of this document. It consists of the report and proceedings of the "Safety Sells" conference hosted by CPSC in March 1995. You can obtain it here, or by fax-on-demand by calling 301-504-0051 from the handset of a fax machine and ordering document #6001. The fax document is approximately 37 pages in length. Appendix B: This appendix is not included as part of this document. It consists of a number of news releases issued by CPSC. They are available here as follows: Announcement of Kids Bike Helmet Study CPSC and Industry Join Together in Safety Sells Conference Soccer Goal Deaths Prompt Warning CPSC and Industry Redesign Products to Save Lives CPSC Chairman Awards Commendation to Sunbeam, Child-Resistant Closures CPSC Commends Playskool for High Chair CPSC Works With Industry to Remove Drawstring CPSC Chairman Ann Brown Commends Procter and Gamble Fax-on-demand service users should order document numbers: 95127, 95099, 95061, 95003, 94126, 94108, 94103, and 94050 respectively.