HTA Presentation to the CPSC Roundable Discussion on Small Business Outreach, October 6, 2011

The Handmade Toy Alliance, (HTA) representsa broad swath of small and micro businesses involved in production, retailing and importing of specialty toys and children’s products. These businesses are the backbone of specialty children’s products culture in America. They are mothers crafting items for sale on etsy.com, they aresmall specialty toy shops in towns across America, they are small businesses producing small batch toys in the USA, and they are all entrepreneurs providing new and unique opportunities for safe play.

This diverse membership struggles with assembling, reading, interpreting, understanding and implementingthe Consumer Product Safety Improvement Act (CPSIA.) The smallest microbusinesses have the largest hurdle to jump, but even our small business members have a sizeable learning curve. I’ll summarize these issues along with suggested outreach opportunities for threebusiness categories within the HTA.

Micro and Small Businesses Manufacturers
Micro-businesses are those crafting and retailing toys and children’s products in very small batches, each in very narrow product types. These businesses are family or single owner businesses with no employees and they represent 61% of our membership.In addition to selling their products online in a marketplace like etsy.com, they retail their products at small craft shows throughout the country. These may be church fairs, county fairs and other artisan events where they sell directly to the public.

Small businesses are those producing children’s products in small batches, often with broader product types. They represent 7% of our membership.

The following factors combine to makecomprehensionof the law problematic:

1. Insufficient time to digest the thousands of pages of law and rulings.
2. Inability to interpret the laws and rulings for their specific products and circumstances.
3. No feasible access to legal representation to provide an interpretation the law.
4. Difficult to obtain documents required by the law – ASTM F963 – because of cost and limited availability.

These businesses need the law boiled down to the minimum required for compliance in their specific business implementation. This amounts to individual legal interpretations for each business for each product they produce. This is literally hundreds of thousands of applications of the law. (There are currently over half a million children’s items for sale at etsy.com alone.)

The HTA suggests flowcharts or other easy to use methods like web-based question-answer forms for providing requirements in a logical manner. The intelligence programmed into the flowchart or form sequence leads business owners through questions ultimately arriving at requirements for their product. Either technique mustprovide the user the following information:

1. What parts of the law are applicable,

2. What tests are required and whether the test must be performed by a 3rd party;

• what is the specific component that causes the test requirement,
• a list of certified testing laboratories.
  

3. What possibility there might be for component part certification,
4. How to apply the small batch rules from H.R.2715,
5. What are the labeling requirements,
6. What are the record keeping requirements,
7. What liabilities and penalties come into play,
8. And, what form a certificate must take.

Another tool the CPSC can provide is to publish lists of components to avoid when making one of a kind and crafted children’s items. For instance; metal beads, colors that have a greater risk of containing lead, hazardous fasteners, etc. This is an easy way to keep components that are more likely to pose a risk of injury or that likely cause test failure out of children’s products from the start.

For reaching these businesses, the Internet is the primary method. Micro businesses rarely attend trade shows and most of them are NOT members of a trade organization like the HTA.The largest of the small business manufacturers may attend a trade show like ABC Kids recently held in Kentucky.

Specialty Toy Retailers
The second category is small specialty toy retailers, both brick and mortar and internet based. These businesses provide a market for small batch children’s products and an alternative for consumers not interested in products mass produced in the Far East. They differentiate themselves from mass market retailers by offering unique small batch products, usually through a single retail outlet. These businesses represent 25% of our membership.

Technically, these retailers are not required to test and certify but are subject to some requirements of the law depending on how they acquire their product for sale. Without sorting through thousands of pages of law, they need to know:

1. What parts of the law they should be aware of when working with small batch suppliers,

2. What record keeping requirements affect them,
3. What responsibilities they have when acquiring product directly from a local small batch manufacturer,
4. What responsibilities they have when acquiring product directly from a foreign manufacturer,
5. And how they can ensure their inventory is safe and compliant.

The Internet is also a primary source of information for specialty toys retailers. Many of these retailers attend at least one trade show yearly, for instance ABC Kids or the International Toy Fair in New York. These small retailers are seldom members of the Toy Industry Association (TIA) but some may be members of the American Specialty Toy Retailing Association (ASTRA.)

Specialty Toy Importers
The final category is specialty toy importers and these businesses represent 5% of our membership. It is a small percentage, but a big component in the culture of specialty toys in America as these importers provide access to mainly small batch products from Europe.

For importers the CPSIA blurs the definition of manufacturer to include the importer. The law is not always clear in how this blurring occurs. They need to know:

1. How to determine if they are considered the manufacturer of record, especially when they hold no inventory or only facilitate transport from foreign manufacturer to domestic retailer,

2. What testing requirements apply when a product is already third party tested to a European standard,
3. What record keeping requirements affect them,
4. And how to apply the small batch rules from H.R.2715.
The primary source of information for specialty toy importers is the internet and a secondary source is an industry group like the Handmade Toy Alliance.

In General

It is important to note that small batch manufacturers are constantly under production, although certainly the fourth quarter is the busiest time of the year for all of our membership. Issuing request for comments, changes and requirements during these 3 months will often go unnoticed.

The CPSC already has a wealth of information available. Unfortunately it is not always easy to find and utilize. Perhaps it would be advantageous to create a Wiki where businesses can post questions and the CPSC can post an official response. The wiki can also incorporate existing FAQs and guidance documents. Over time this becomes a valuable, searchable knowledgebase.

About the Handmade Toy Alliance

The HTA was formed in 2009 as an ad hoc group of businesses that were adversely affected by the CPSIA. During these past few years we have worked to save our member businesses from the unintended consequences of the CPSIA. We have testified before House and Senate committees and lobbied our representatives and senators. This culminated in the passing of H.R.2715 in August of 2011 which has two provisions that are an outgrowth of our work. Unfortunately, H.R.2715 is not the legislative fix our group desired, but places the fate of all of our businesses in the hands of the Consumer Product Safety Commission.

We currently have nearly 700 members but no offices, no staff, no legal representation, a volunteer board of directors who donate time and resources to the cause, and very limited financial resources. Although we work hard to help our members understand the law and to disseminate information, we are in no way prepared to be the source or conduit of comprehensive compliance information to our members. The width and breadth of the products produced by our members is enormous and the need to interpret the law for all of these single cases beyond our capability.

Today we hope to communicate to the staff of the CPSC as an advocate for our members, the magnitude of this issue and the primary problems that need to be addressed for educating our membership. We appreciate this opportunity to voice these concerns and look forward to working together to implement suitable solutions.

Image from Michelle Sorensen.

HTA Letter to CPSC on Registration of Small Batch Manufacturers in the CPSIA Reform Law

August 19, 2011

Office of the Secretary
Consumer Product Safety Commission
Room 502
4330 East-West Highway,
Bethesda, Maryland, 20814

Dear Mr. Stevenson:

On behalf of the Handmade Toy Alliance, an alliance now numbering 670 toy stores, toymakers and children's product manufacturers from across the country who want to preserve unique handmade toys, clothes, and children's goods in the USA, we respectfully request your clarification and action in regards to the registration requirements for small batch manufacturers in the newly signed CPSIA reform law, H.R. 2715.

Congress has now expressed its clear intent to provide regulatory relief to the small businesses we represent. As you know, H.R. 2715 allows small batch manufacturers to assure compliance with applicable product safety laws through less expensive alternative testing methods and exempts them from testing altogether when no affordable alternative testing methods are identified by the Commission.

The Handmade Toy Alliance would like to be fully engaged with the CPSC as it interprets H.R. 2715. Our goal, as always, is to create a regulatory environment which protects both public health and the welfare of the small businesses we represent.

It has come to our attention that members of the Commission are interpreting H.R. 2715's requirement for small batch manufacturers to register with the CPSC as a technicality which requires the completion of an official registration process by the Commission before relief willbe provided. This interpretation is contrary to our understanding of the law and contrary to congressional intent as we understand it through dozens of conversations with bothRepublicans and Democrats in the House and Senate.

The text of the law reads:

Any small batch manufacturer that utilizes alternative requirements or an exemption...shall register with the Commission prior to using such alternative requirements or exemptions pursuant to any guidelines issued by the Commission to carry out this requirement.

The word any in this sentence makes it clear that a manufacturer's ability to register with the Commission is not predicated upon whether or not the Commission has issued guidelines for registration. If the word any were not present in the sentence, the meaning would be different. However, the inclusion of the word any makes it clear that small batch manufacturers may still register with the Commission even in the absence any official guidelines. It is our interpretation that, in the absence of any guidelines from the CPSC, a small batch manufacturer may register with the CPSC in any manner which the manufacturer deems appropriate.

Our interpretation is supported by the previous section of the law, which reads:

The Commission may not require third party testing of a covered product by a third party conformity assessment body until the Commission has provided either an alternative testing requirement or an exemption...

This sentence clearly states Congress's intent that, in the absence of any action by the CPSC, third party testing will not be required for covered products made by small batch manufacturers. Relief is not contingent upon the CPSC's ability to identify alternative testing methods. Nor should relief be made contingent upon the establishment of registration guidelines.

We therefore formally request the Commission to make an immediate finding of fact that relief for small batch manufacturers under H.R. 2715 is not contingent upon the promulgation of registration guidelines by the Commission.

Notwithstanding our position on this interpretation, we would like express our interest to help create a sensible registration process as soon as possible. Registration should be simple and straightforward for both the Commission and small batch manufactures. We agree with Senator Rockefeller, who spoke on the Senate floor:

The creation of a new public [sic] registry for small batch manufacturers...can be implemented without notice and comment or even a hearing. As such, the Commission should act to effectuate the new mandates of this bill in a most expeditious manner.

Senator Pryor then seconded this view:

I also share the Senator’s view that nothing in H.R. 2715 is intended to delay the Commission’s rulemaking with respect to third party testing and believe that the Commission should conclude its testing rulemakings in the next 2 months.

We agree with Senators Rockefeller and Pryor that 2 months is an appropriate timeline to complete registration guidelines. This will allow enough time for small batch manufacturers to register prior to the expiration of the ASTM F963 and lead in substrate testing stays of enforcement on December 31. If the registration process is not completed by October 31, 2011, there will not be enough time to notify small businesses before the expiration of these stays. As we have stated previously, the last two months of the year are the busiest season for our members. So, the earlier they can begin to register, the better.

Small batch manufacturer registration can and should be as simple as filling out a registration form or sending an email to a specified address at the CPSC. The Commission may also want to allow outsourcing of this task to trade associations or businesses who could collect and compile a database for the Commission. We would like to discuss alternatives with the Commission as soon as possible, as well as ways in which our organization can help publicize the registration process to our members.

Thank you again for taking the time to read and consider our comments.

Respectfully Submitted,

The Handmade Toy Alliance

As Seen in Today's Issue of The Hill

Fix the CPSIA!

Fix the CPSIA: ‘Unintended Consequences’ Cost Thousands of Small Business Jobs

The Consumer Product Safety Improvement Act (CPSIA) passed by Congress in 2008 was intended to make products safer, but after three years it has also effectively ended the American Dream for many small businesses and needlessly raised consumer prices. Both Democrats and Republicans agree that the law's "unintended consequences" must be urgently fixed.

The safety of our products is our top priority. Our member companies want to focus on improving safety instead of generating paperwork. We want to invest in our products and employees instead of spending millions of dollars for unnecessary and redundant testing. The CPSIA has jeopardized the availability of and, in some cases, banned safe products such as books, bicycles, musical instruments, rhinestones, youth model ATVs and motorcycles, and clothing with zippers.

HR 1939 maintains the CPSIA's important safety provisions but adopts some modest, common sense reforms. HR 1939 amends the CPSIA to ease regulatory burdens where appropriate, eliminate duplication and needless paperwork, and improve the accuracy of information in the CPSC’s public database. With unrealistic deadlines and new regulatory burdens fast approaching, the time is now to fix the CPSIA.

It’s Time to Put Politics Aside. Support HR 1939 and Save U.S. Jobs

A message from the National Association of Manufacturers, with thanks to:

Alliance for Children’s Product Safety
American Apparel & Footwear Association
American Pyrotechnics Association
The Art and Creative Materials Institute
Association of Home Appliance Manufacturers
Bicycle Product Suppliers Association
Craft and Hobby Association
Fashion Jewelry and Accessories Trade Association
Handmade Toy Alliance
HandsOn Science Partnership
International Sleep Products Association
Juvenile Products Manufacturers Association
Motorcycle Industry Council
National Retail Federation
National School Supply & Equipment Association
Promotional Products Association
International Retail Industry Leaders Association
Specialty Vehicle Institute of America

Press Release: HTA Urges CPSC to Stay Enforcement of ASTM Testing for Small Batch Manufacturers

Stamford, CT – July 5, 2011 – In a letter dated July 3, 2011, the Handmade Toy Alliance (HTA) addressed the Consumer Product Safety Commission’s (CPSC) recent staff briefing package on the “notice of requirements” for laboratories to become accepted to test for ASTM F963 as presented to the Commission and public. Primarily geared towards testing laboratories, this notice also signals to stakeholders such as the HTA that once approved and published in the Federal Register, all children’s products falling under toy guidelines manufactured 90 days after publish date will need to be tested and certified by a CPSC accepted laboratory.

“To begin requiring third party testing to the ASTM F-963 standard will dramatically and permanently harm small batch toymakers,” shares Dan Marshall, HTA President and owner of Peapods Natural Toys (MN). “We are therefore petitioning the Commission to delay the publication of lab certification standards for ASTM F-963 or to stay indefinitely the enforcement of the ASTM F-963 third party testing requirement for small batch manufacturers.”

Currently, Congress is considering substantive changes to the Consumer Product Safety Improvement Act (CPSIA) which would significantly reduce the compliance costs for small batch manufacturers. “We have received clear indications from the leadership of both the Democratic and Republican parties of their intention to modify the CPSIA in order to reduce its unintended consequences for small batch manufacturers,” states Randall Hertzler, HTA Vice President and owner of euroSource (PA). “While this legislation is pending and progressing, it is simply unnecessary to employ a ruling that will imperil thousands of small business.”

“The vast majority of HTA members are extremely small businesses, consisting of no employees, very small revenues and a limited number of products produced in short quantities,” explains Jill Chuckas, HTA Board member and owner of Crafty Baby (CT). “Yet, the CPSIA treats these micro businesses exactly the same as large, multi-national corporations. A typical HTA manufacturer making only a few thousand units of a toy per year simply cannot afford to absorb fixed testing costs (often at $500 to $3500 per toy created).”

The HTA also states concerns regarding the timing of this proposed rule making, which, by estimates, will bring ASTM F-963 into effect in mid-October, directly in the middle of holiday production runs. “Large companies who mass produce product for holiday sales complete their production runs at least 6 months prior to sale,” shares Mary Newell, HTA Treasurer and owner of Terrapin Toys (OR). “Imposing third party testing requirements in mid-October will have a much more negative impact of small batch toymakers like those in our membership who generally are crafting and creating product right up until the actual holidays.”

“For almost 3 years now, our membership has been working tirelessly together in order to better understand and manage the CPSIA. The basic language within the law is extremely difficult at best for our membership to comprehend, particularly without the assistance of attorneys and technical support staff,” states Marshall. “We have urged the Commission to author a simplified guide to the ASTM F-963 standards for small businesses, to no avail. Without such clear guidance, small batch manufacturers cannot negotiate fairly or openly with the third party labs they would be required to employ.”

The HTA consists of 653 member businesses, including retail stores, toymakers and children's product manufacturers from across the country who want to preserve consumer access to unique handmade toys, clothes and all manner of small batch children's goods in the USA. Formed in November of 2008 in response to the CPSIA, HTA members are parents, grandparents and consumers who are passionate about their businesses as well as the safety of the children in their lives. While in support of the spirit of the law, the unintended consequences of the CPSIA have motivated members of the HTA to work to enact change at a federal level. For more information, visit www.handmadetoyalliance.org.

Image from Wee Wonderfuls.

HTA Letter to CPSC on Upcoming ASTM Toy Safety Testing Requirements

July 3, 2011

Office of the Secretary
Consumer Product Safety Commission
Room 502
4330 East-West Highway,
Bethesda, Maryland, 20814


RE: Commencement of ASTM F-963 Toy Safety Testing Requirements and Petition for a Stay of Enforcement

Dear Honorable Commissioners:

We are alarmed to learn that the Commission is proceeding this month with rulemaking to begin certifying third party labs to test for the ASTM F-963 Toy Safety Standard. Unless the Commission's course is altered, the result of this process will be the initiation of third party testing requirements for all toys made after mid-October of this year as mandated by the Consumer Product Safety Improvement Act (CPSIA).

To begin requiring third party testing to the ASTM F-963 standard will dramatically and permanently harm small batch toymakers. We are therefore petitioning the Commission to delay the publication of lab certification standards for ASTM F-963 or to stay indefinitely the enforcement of the ASTM F-963 third party testing requirement for small batch manufacturers.

We request this action for four reasons.

First, our members simply cannot afford to pay for third party testing of toys they produce in small batches. ASTM F-963 testing fees range from $500 to $3,500 or more per toy. A manufacturer making only a few thousand units of a toy per year simply cannot afford to absorb this fixed cost, which is borne easily by larger corporations.

Second, the timing of the CPSC's proposed actions is markedly unfair to small batch manufacturers. Many, if not all, small batch toymakers continue to make their toys for the holiday season right up until the third week of December. Large-scale manufacturers, however, almost always complete their holiday production runs by early summer. Imposing third party testing requirements in mid-October will therefore have a much more negative impact on small batch toymakers.

Third, the language of the ASTM F-963 standard itself is extremely difficult for a typical small batch toymaker to comprehend. It is intended solely for the use of product safety engineers. The result of this complexity is that our members are much more at the mercy of third party labs and must rely entirely on these labs to determine which standards apply to a given product. Labs can therefore require and bill for redundant or unnecessary tests under the standard that they could not impose on larger companies which employ a dedicated compliance staff. We have urged the Commission to author a simplified guide to the ASTM F-963 standards for small businesses, but to no avail. Without such a document, small batch manufacturers cannot negotiate fairly or openly with the third party labs they would be required to employ.

Fourth, as the Commission is well aware, Congress is actively considering substantive changes to the CPSIA which would significantly reduce the compliance costs for small batch manufacturers. Leadership of both the Democratic and Republican parties have expressed their intentions to modify the CPSIA in order to reduce its unintended consequences for small batch toymakers. While this legislation is pending and progressing it makes little sense to unnecessarily imperil thousands of small businesses.

For these reasons, we urge the Commission to delay the third party testing requirement for the ASTM F-963 standard or stay its enforcement for toys made in batches of fewer than 10,000 units per year.

On behalf of our 653 member small businesses, we appreciate your willingness to consider our concerns. We hope to preserve the long American tradition of hand-crafted children's goods while ensuring safety for the children who enjoy them.

Respectfully,

The Handmade Toy Alliance

Image from mypapercrane.com.

HTA Endorses New CPSIA Reform Bill

On Tuesday, the House Subcommittee on Commerce, Manufacturing and Trade released a discussion draft of a proposed amendment to the CPSIA. This document is the first attempt to begin a meaningful discussion of CPSIA reform since the demise of Rep. Waxman's bill a year ago, which we had endorsed with reservations.

In the intervening year, we've seen more small businesses fold because of the unintended consequences of the CPSIA. And, we've seen a momentous election which drastically changed the political landscape on Capitol Hill.

While this new bill does not give us everything we've been asking for, we believe it saves most of our member businesses from extinction. Furthermore, we are relieved that the bill is by no means a wholesale repeal of the CPSIA but seeks to find a middle ground. We are hopeful that Senate Democrats will see it as a thoughtful and measured reform worthy of meaningful bipartisan discussions.

In general, this bill would restore the CPSC's ability to set its own priorities and would allow the commission to use the tool of third party testing as a scalpel rather than as an axe. Instead of requiring third party testing for every children's product, the commission could target specific categories for specific tests in areas where the benefits of testing would outweigh the costs. This would restore the commission's volition to analyze risk and greatly reduce the need for businesses to repetitively test perfectly safe products.

Furthermore, the bill would exempt one-of-a-kind items from third party testing and would require the CPSC to either exempt small batch manufacturers from third party testing or allow us to use alternative testing methods such as XRF screening for lead in substrates. Small batch manufacturers would be given a safety valve which was originally left out of the CPSIA.

This by far the best bill we've seen to date. The Handmade Toy Alliance therefore endorses this bill both for its text and also for the context we hope it will create—a bipartisan and bicameral dialog which quickly leads to meaningful reform of the CPSIA.

Image by Robert Mahar.

HTA's Letter to the CPSC About the Feasibility of a 100ppm Lead Content Limit

On February 16, the CPSC will hold a public hearing on the feasibility of lowering the lead content standard in children's products from 300ppm to 100ppm. We have submitted the following letter as our testimony.

February 10, 2011

Office of the Secretary
Consumer Product Safety Commission
Room 502
4330 East-West Highway,
Bethesda, Maryland, 20814
cpsc-os@cpsc.gov

Re: 100 PPM—Technological Feasibility Public Hearing

Dear Mr. Stevenson:

On behalf of the Handmade Toy Alliance, an alliance now numbering 620 toy stores, toymakers and children's product manufacturers from across the country who want to preserve unique handmade toys, clothes, and children's goods in the USA, we respectfully submit the following comments for consideration during the Commission's hearing on the feasibility of imposing a 100ppm lead content limit on children's products.

To begin with, we would like to refer the Commission to our earlier letter on the subject, dated September 27, 2010. We would like to reiterate that letter's conclusion, which stated:

As small manufacturers, we lack the wherewithal to demand consistent compliance to such a low standard from our component suppliers, many of whom do not specifically manufacture for children's products. We lack the resources to test repeatedly to ensure that any given test's results are actually within a 100ppm limit given the tests' margins of error. And, in an environment where the Commission blurs bright lines, we lack the patience for such a low limit that has no impact on human health but could well jeopardize our family businesses.

After reading the other responses to the Commission's initial requests for comments on the feasibility of a 100ppm standard, we were struck by the near unanimity among manufacturers and trade groups representing manufacturers. Almost all these respondents agreed with us that a 100ppm would be difficult to achieve consistently, would be difficult to measure, would add unnecessary and untenable compliance costs, and would not directly correspond with any health risks associated with lead content in different materials.

Voltaire: "The perfect is the enemy of the good."

Now, we are being asked to clarify our position regarding how the feasibility of a 100ppm standard would vary according to the type of material and the extent to which 100ppm-compliant components are “commercially available”.

Unfortunately, none of our members are chemists or materials scientists. Nor do we posses the resources to engage a scientific study of the vast myriad of products our members produce in order to fully answer these questions. The best we can do is describe our businesses and the difficulties we would encounter if we were required to meet a 100ppm lead standard.

For this hearing, the Commission asked, “What factors or considerations should we evaluate in deciding whether a product complying with the limit is 'commercially available?'” Unlike mass market manufacturers, we do not always begin our production with raw materials. We frequently purchase component goods like zippers and buttons from Jo-Ann Fabrics, beads and polyfill from Michael's, and screws and hinges from Home Depot.

These components have not been tested by a CPSC-accredited third party lab and do not indicate their lead content. Nor do the manufacturers of these components make any claim or guarantee regarding the consistency of materials used that would suggest that a hinge or button purchased in June would have the same lead content as the same item purchased in August. Indeed, many of these component parts are sold by distributors such as Dritz Notions or Stanley Hardware and bear no indication of the company which actually manufactured the part in the first place.

So, before the CPSC decides the extent to which 100ppm-compliant components are “commercially available”, we ask that the Commission should first conduct a thorough survey of the lead content of the component parts on sale at Jo-Ann Fabrics, Michaels, and Home Depot (or other comparable retailers). We urge the Commission to test a few dozen screws, buttons, zippers, and hinges—and then do the same test again in a month. This would be the best and only way determine the commercial availability of 100ppm-compliant parts for our members.

Unfortunately, we were not able to initiate such a study in the 15 days from when the Commission posted notice of this hearing and the date our comments were due. Nonetheless, the difficulty and expense of conducting such a survey is the exact same difficulty and expense small batch manufacturers will be facing if they would be required to comply with a 100ppm lead content standard.

While we recognize that it would be problematic for larger companies as well, we believe that small batch manufacturers, who have little or no negotiating power with their component suppliers, would be most adversely affected by a 100ppm standard. Much as we'd like to see the development of marketplace of pre-tested component parts, the truth is that, in most cases, this marketplace has so far failed to materialize. The burden of compliance, therefore, remains almost exclusively with the end-product manufacturer. A 100ppm standard would vastly aggravate this burden.

We believe the Commission can and should consider the economic feasibility of a 100ppm standard. And, we believe that any such consideration of the economic impact would logically lead to the conclusion that a 100ppm standard is not, in fact, feasible.

Finally, as discussed in our previous letter, we believe that a 100ppm total lead limit which does not take bioavailability into account is an inappropriate standard for measuring the health risk of a children's product. We have read the comments by consumer groups which reiterate the facts that lead accumulates in a child's body over time and that there is no safe amount of lead exposure. And, while we agree with these assertions, we can not find any logic which would justify a blanket 100ppm limit for all types of materials in all children's products.

It simply does not make sense to us that the lead content in brass, steel, plastic, vinyl, or glass should all be subject to the same limit, since each material behaves differently when exposed to human skin or saliva. Nor does it make sense to us that a baby rattle, puzzle, football, or bicycle should pose the same risks of lead ingestion or that these various products should all be subject to the same 100ppm standard.

We therefore urge the Commission to conclude, as we have, that a 100ppm lead standard is not technologically feasible; that 100ppm compliant component parts are not commercially available, especially for small batch manufacturers; and that a 100ppm standard would not relate to the risk of lead exposure as it varies from one material to another and from one type of product to another.

Our members are personally dedicated to making safe, quality products. We represent centuries of American craftsmanship which has nourished generations of American children.

Please consider the impact of 100ppm on our member businesses. Please do not allow the perfect to be the enemy of the good.

Thank you again for taking the time to read and consider our comments.

Respectfully Submitted,

The Handmade Toy Alliance

A listing of all 620 business members of the Handmade Toy Alliance is available at http://www.handmadetoyalliance.org/AllianceInfo/OurMembers.aspx .

HTA Letter to the CPSC about Extending the CPSIA Stay of Enforcement

January 3, 2011

Office of the Secretary
Consumer Product Safety Commission
Room 502
4330 East-West Highway,
Bethesda, Maryland, 20814


RE: CPSC Lifting of Stay of Enforcement under Section 102 of the CPSIA

Dear Honorable Commissioners:

As the Commission prepares for the lifting of the stay of enforcement for the CPSIA in just five short weeks, we would like to share our members’ concerns regarding this action and how it affects their abilities to produce children’s products in small batches.

A toy by Selecta Spielzeug of Germany,
now celebrating 2 years of extinction under the CPSIA.
Courtesy of HTA member EuroToyShop.com

We appreciate the opportunities the Commission has granted us to share our concerns regarding the CPSIA. Our fundamental belief continues to be that the CPSIA focuses resources on processes rather than safety and needlessly hampers the Commission's ability to make product safety determinations based on risk.

While the Commission has been able to address some of our concerns, there continue to be a number of issues that require resolution prior to our members being able to effectively implement testing protocols under the CPSIA. Our greatest concern remains the cost of third-party testing, which disproportionately affects small-batch manufacturers. We have testified in congressional hearings in both the House and the Senate that lifting the stay now will unnecessarily doom hundreds of small family businesses.

In the last month, Congress has shown it's determination to amend the CPSIA. At the December 2, 2010 Senate Commerce subcommittee hearing, both Chair Tenenbaum and Commissioner Northup testified about ways Congress could add flexibility to the CPSIA. The Senate also heard from industry stakeholders, including the HTA, who shared concerns with the legislation and urged for common sense amendment to rectify the many unintended consequences.

We strongly believe that a properly crafted amendment can and will protect small businesses, maintain a vibrant selection of children's products in the marketplace, reduce compliance costs, create a more effective CPSC, and promote common sense without sacrificing safety. But, until this legislative amendment is completed, lifting the stay would create chaos for our member’s businesses.

Furthermore, the component part testing rule has yet to be finalized and manufacturers are still working to understand the draft rules. While we have been advising our members that this ruling will be forthcoming and doing our best to share what their responsibilities will be, we have yet to receive clear, concise guidance. Without this formal ruling, we continue to have difficulty explaining to our component part suppliers the necessity for their testing information.

To that point, many of our member’s suppliers are refusing to test altogether, or refusing to supply their certifications to our members. In addition, for those members who purchase supplies direct from fabric and craft shops, such as JoAnn Fabrics or Michael’s, supplier certifications are not readily made available. Finalized rulings are necessary to push compliance upstream and help our members prove their testing protocol under the CPSIA.

Finally, while we appreciate the work of Neal Cohen, the CPSC's new small business ombudsperson, he has had only a few short months to initiate his outreach and education efforts. We would very much like to see these efforts more firmly in place before the stay is lifted.

For these reasons, we urge the Commission to further extend the stay of enforcement under Section 102 of the CPSIA.

On behalf of our 609 member small businesses, we appreciate your willingness to consider our concerns. We hope to preserve the long American tradition of hand-crafted children's goods while ensuring safety for the children who enjoy them.

Respectfully,

The Handmade Toy Alliance

A listing of all 609 business members of the Handmade Toy Alliance is available at http://www.handmadetoyalliance.org/AllianceInfo/OurMembers.aspx

Board members:
Cecilia Leibovitz, Craftsbury Kids, VT
Dan Marshall, Peapods Natural Toys, MN
Jill Chuckas, Crafty Baby, CT
Mary Newell, Terrapin Toys, OR
Jolie Fay, Skipping Hippos, OR
Marianne Mullen, Polka Dot Patch, VT
Rob Wilson, Challenge & Fun, MA
Randall Hertzler, euroSource, PA
Kate Glynn, A Child's Garden, MA

cc: Neal Cohen, Small Business Ombudsman, CPSC

An Open Letter on Pending CPSC Actions Against Baby Slings

October 6, 2010

Office of the Secretary
Consumer Product Safety Commission
Room 502
4330 East-West Highway
Bethesda, Maryland, 20814

Re: An Open Letter on Pending CPSC Actions Against Baby Slings

Dear Mr. Stevenson:

As you know, the Handmade Toy Alliance represents more than just toymakers, but small batch clothing and children's product manufacturers of all kinds. In particular, several of our members make or sell baby slings and work to promote the benefits of babywearing.

We understand that the Commission has been applying increased scrutiny to baby slings in the past few months. We also understand that several manufacturers of baby slings have been investigated and that one well-respected company may be facing a forced recall.

Before the Commission takes any further actions in these investigations, we urge it to consult closely with the Baby Carrier Industry Alliance (BCIA), which has been working tirelessly to develop ASTM standards for baby slings.

Babywearing is a time-honored practice all around the world. We agree with the BCIA that babywearing is safe and promotes the health and well-being of babies while strengthening the bonds betweens parents and babies. We urge the Commission to carefully consider the BCIA's white paper on the safety and benefits of babywearing, which can be found at http://tinyurl.com/35o67t7, before taking any further actions.

We join the BCIA to ask that: 1) all baby sling recall actions be stopped immediately; 2) the ASTM sling carrier standard should be voted on so that sling carriers may be tested for this safety standard; 3) the CPSC should provide baby sling manufacturers with scientific evidence of a product defect before forcing a recall.

There is a strong network of babywearing safety advocates and volunteer groups, including many HTA members, throughout the nation whose mission is to teach caregivers how to use their baby carriers safely and effectively. Baby carriers are absolutely safe; perhaps even safer than many other baby care devices such as swings, playpens, and car seats. Additionally, ASTM International just sent the baby sling voluntary standard to ballot this very week. This standard is the result of 3 years of hard work by consumer advocates, manufacturers, and members of the CPSC's own staff.

Please, do not rush to judgement on baby slings.

Thank you again for taking the time to read and consider our comments.

Respectfully Submitted,

The Handmade Toy Alliance

A listing of all 548 business members of the Handmade Toy Alliance is available at . http://www.handmadetoyalliance.org/AllianceInfo/OurMembers.aspx

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Image: A 2000 US Dollar Coin, featuring Sacagawea carrying her son Jean in a Baby Sling.

More information on this issue, along with sample letters to Congress, can be found on the Babywearing Safety Facebook Page.

HTA Comments on the Technological Feasibility of Lowering CPSIA Lead Limits to 100ppm

September 27, 2010

Office of the Secretary
Consumer Product Safety Commission
Room 502
4330 East-West Highway,
Bethesda, Maryland, 20814

Re: Comments Regarding the Technological Feasibility of 100ppm for Lead Content Under the Consumer Product Safety Improvement Act (CPSIA) [Docket No. CPSC-2010-0080]

Dear Mr. Stevenson:

On behalf of the Handmade Toy Alliance, an alliance now numbering 548 toy stores, toymakers and children's product manufacturers from across the country who want to preserve unique handmade toys, clothes, and children's goods in the USA, we respectfully submit the following comments regarding the technological feasibility of a 100ppm lead content limit.

We wish to reiterate that the CPSC and the Congressional leadership from both parties have openly acknowledged that the broad sweep of the CPSIA has created unintended consequences for products and industries which had nothing to do with the toy and jewelry safety scare of 2007. In light of the fact that Congressional Democrats and Republicans have so far been unable to work together to craft a solution for the small businesses we represent, it remains up to the Commission to promulgate rules that serve to help businesses large and small to understand what is needed to comply with the CPSIA.

As with the rulemaking process regarding the definition of a children's product, we believe that Congress has given the Commission an important opportunity to avoid further unintended consequences by ruling that the 100ppm limit on lead in substrates is not a feasible standard.

First and foremost, we believe that total lead is not a reasonable standard for evaluating the risk of lead poisoning from a consumer product. Whether the limit is 300ppm or 100ppm, a total lead standard is a purely political, not a scientific, assessment of risk. Despite the fact that no scientific study directly correlates total lead content with the risk of lead poisoning, consumer groups insisted during the drafting of the CPSIA that a “bright line” total limit, which was easier to measure, enforce, and explain to the public, was preferable to a soluble standard which more accurately reflects risk.

This key difference has unnecessarily set the US market apart from other markets, in particular the European Union, and has cost millions of dollars worth of redundant testing.

We have been arguing for two years that the US should adopt the European Union's method of evaluating the risk of lead exposure by measuring the bioavalibility of soluble lead in substrates. By defining the limits based on total lead, the CPSIA has effectively outlawed materials such as brass, crystal, and rhinestones which are perfectly safe biologically yet violate the CPSIA's limits on total lead.

Now we are being asked to comment on whether a 100ppm standard would be “technologically feasible”. Most of the comments the commission will receive on this issue will likely focus on the word “feasible”. We, however, would like to argue that a 100ppm limit is not technological.

The simplest definition we found of the word “technology” is: The practical application of science to commerce or industry.

Because science shows that a total lead limit does not actually measure the risk of lead poisoning, such a limit, whether it is 300ppm or 100ppm, cannot be described as the application of science to commerce or industry. It may represent the application of political expediency or good intentions, but it is not an application of science. Therefore, reducing the limit from 300ppm to 100ppm would merely be compounding and increasing the side-effects of an unscientific principle. Whether or not 100ppm is feasible, it is not technological.

We agree that consumer products should be regulated by “bright line” standards, but these should be based on science and common sense. For example, we had hoped that the Commission would adopt clear and and easy to understand standards when it recently considered the definition of a children's product. Instead, our comments seeking clear standards were ignored, as were the comments of many other stakeholders. The Commission staff chose to issue a 63 page definition which provides no bright lines and no clear definition. HTA member Sarah Natividad, the owner Curious Workmanship, a home-based business in Utah, observed:

[The CPSC] could have saved hard drive space, several forests of trees, and a lot of time and effort by just making the rule say “It’s a children’s product if we say it is, so just ask us and if we feel like it, we’ll decide for you.” Because that’s what it boils down to. Now, besides the fuzzy line between kids and adults, we also have the fuzzy line between infants and kids and whether a child might reasonably be assumed to touch and use a lamp or a piece of furniture. Why on earth did they think TWO fuzzy lines constituted clarification?

Indeed, in the weeks since the final draft of the definition was published, the CPSC has illogically re-defined the intended age of at least two products so that it could initiate recall procedures. The first was a recall of Click Armband Bracelets by Fun Stuff, Inc., which were clearly marked as designed for ages 3 and over. Despite the fact that no responsible parent would give these throwaway plastic toys to a toddler, the Commission chose to initiate recall proceedings by redesignating them as toddler toys.

In the second recent case, a line of mood rings were reclassified by the Commission as a children's product despite the fact that they were clearly labelled with sexually suggestive language which was specifically designed to appeal to teenagers and adults, not children.


By issuing an obfuscating definition of a children's product and by creatively reclassifying products so that it can force recalls, the Commission is doing everything except promulgating bright line standards. These actions do not go unnoticed. They tell children's product manufacturers both large and small only one message: there are no bright line standards, only the will of Commission.

The end result of this uncertainty is a growing realization that any children's product business, no matter how responsible or how ethical, is just one incident report away from terrible penalties and overwhelming legal fees. Small businesses like our members lack the resources to defend themselves from the Commission's unilateral actions and are increasingly choosing to exit the children's' product marketplace altogether.

So, in this environment, is a 100ppm limit feasible? Consider the analysis by Sarah Natividad, who is also a former mathematics professor. She concludes that the more we test and the stricter we make our standards, the more impossible it is to comply with the law. She writes:

It is mathematically impossible to find all defective objects without going to the expense of testing them ALL. And that's assuming testing is 100% accurate, which it's not. And to add insult to injury, the more zealously you test by sampling, the more confused you will be about the safety of your product. CPSIA was supposed to reduce confusion about product safety, but now you have mathematical proof that it does exactly the opposite.

This mathematical paradox will be dramatically aggravated by lowering lead limits to 100ppm--a limit which makes sampling errors, random chance, and the accuracy of testing equipment much more likely to play a decisive role in the outcome of both pre- and post-market product safety evaluations. Testing costs will increase, uncertainty will increase, risk of destroying finished inventory will increase, and the number of CPSC recalls will increase. The result will be weakened businesses, undermined consumer confidence, and a public even more inured to the product recall process.

As small manufacturers, we lack the wherewithal to demand consistent compliance to such a low standard from our component suppliers, many of whom do not specifically manufacture for children's products. We lack the resources to test repeatedly to ensure that any given tests results are actually within a 100ppm limit given the tests' margins of error. And, in an environment where the Commission blurs bright lines, we lack the patience for such a low limit that has no impact on human health but could well jeopardize our family businesses.

Thank you again for taking the time to read and consider our comments.

Respectfully Submitted,

The Handmade Toy Alliance

A listing of all 548 business members of the Handmade Toy Alliance is available at . http://www.handmadetoyalliance.org/AllianceInfo/OurMembers.aspx

What is the CPSC's definition of a Children's Product under the CPSIA? Two years and 63 pages later, we're still not sure.

Last week, the Consumer Product Safety Commission published its final rule on the definition of a children's product, three months after soliciting and receiving input from dozens of stakeholders, including the Handmade Toy Alliance.

This was an opportunity for the CPSC to listen to voices of hundreds of businesses affected by the CPSIA. It was a chance to reduce the law's sweeping impact on thousands of children's products which have never posed any safety risk, including school learning materials, music CDs, riding saddles, and craft tools. This definition is incredibly important because any product which is defined as a children's product is subject to expensive third party lab testing for lead and other elements which does not apply to general use consumer products. All the CPSC had to do was to state clearly that certain classes of products are, by definition, not children's products.

Instead, the CPSC chose to ignore, disregard, or refute virtually every commentator's perspective and issued a 63 page document that does little to define a children's product and creates surging gulfs of ambiguity that threaten to drown entire businesses, especially small businesses who don't have access to teams of lawyers to explain the CPSC's reasoning.

In short, instead of taking the opportunity to create bright lines and clear definitions, the CPSC has created a world in which virtually any product may be considered a children's product depending on how it is decorated, where it is sold, and what consumers' perceptions are.

Under these rules, there is nothing that a manufacturer of a general use product can do to ensure that a product does not fall under the definition of a children's product, including stamping "Not for use by children," all over it or packaging it with a portable flame thrower. This means assuming coverage or facing ex post facto liability. A manufacturer of tools, for example, might have no idea that their product was repackaged by a retailer as part of a kid's tool kit, yet under these rules the manufacturer would still be liable for for third party testing.

That leaves every manufacturer at the mercy of where and how the product is sold (which they often have no control over), whether it appeals to a certain age group (which they often have no control over), how it is perceived by the public (which they have no control over), how it is used or misused by the consumer or their children (which they have no control over), entertainment industry ratings (which they have no control over) and the subjective judgment of the CPSC (which we obviously have no control over). All of the CPSC's "examples" of non-covered items are padded with counter-statements making them ambiguous.

None of this makes a single child more safe.

To highlight the absurdity of this document, consider how the CPSC will determine whether a music CD or DVD is a children's item:

“The...rule states that the CDs and DVDs with content intended for children younger than 4 years old were not determined to be children’s products because children younger than 4 are usually not allowed to use household digital media players. However, having defined use to mean physical interaction with the product, because DVDs and CDs and other digital media may be handled by older children to load and unload DVDs in their appropriate media devices, CDs and DVDs could be considered children’s products if such movies, video games, or music were specifically aimed at and marketed to children 12 years of age or younger and have no appeal to older audiences.”

In order words, a Baby Loves Mozart CD is not a children's product because it is marketed to children under 4 who are unable to operate a CD player, but a Dan Zanes CD is a children's product because it is marketed to children older than 4 but younger than 12.

Music labels will be forced to test each batch of CDs they make, which will be the death knell for independent children's music. Why would any label pay for such testing when they can stop publishing CDs altogether and sell exclusively via iTunes? How will the CPSC explain this to Pete Seeger, who was blacklisted by McCarthy in the 1950's only to have his right to publish children's music curtailed by the government in 2010?

In its wisdom, though, the CPSC had defined iPods, DVD players, CD Players, video game consoles etc., as general use items as long as they aren't decorated with children's themes or marketed to children, even though a child will be “interacting” with these devices much more than with a CD or DVD itself. This is reasoning reminiscent of Lewis Carroll.

We keep hoping that, at some point, the CPSIA will become more understandable and easier for small businesses to manage. Instead, the CPSC continues to add layers of ambiguity and confusion on top of an already overwhelming law. This latest document makes it abundantly clear that businesses who make children's products and the CPSC itself are not ready for enforcement of the third party testing requirement, which is scheduled to begin in five short months. It also makes it clear that Congress needs to correct its mistakes and reign in a safety law that's running amok. Congress has stalled on passing any type of real relief and that in and of itself has limited the CPSC’s ability to make better rulings on the CPSIA.

We keep expecting answers about the CPSIA, but between Congress and the CPSC, all we're getting is more questions.

HTA Comments on the Definition of a Children's Product under the CPSIA

The following is our letter to the CPSC regarding their definition of a Children's Product. This definition is important because products which are defined as general use products will not be subject to the same standards and 3rd party testing requirements as a children's product.

July 20, 2010
Office of the Secretary
Consumer Product Safety Commission
Room 502
4330 East-West Highway,
Bethesda, Maryland, 20814
http://www.regulations.gov


Re: Comments Regarding The Definition of a Children's Product Under the Consumer Product Safety Improvement Act (CPSIA) [Docket No. CPSC-2010-0029]

Dear Mr. Stevenson:

On behalf of the Handmade Toy Alliance, an alliance now numbering 442 toy stores, toymakers and children's product manufacturers from across the country who want to preserve unique handmade toys, clothes, and children's goods in the USA, we respectfully submit the following comments regarding the CPSC's definition of a children's product under the CPSIA.

The CPSC and Congressional leadership from both parties have openly acknowledged that the broad sweep of the CPSIA has created unintended consequences for products and industries which had nothing to do with the toy and jewelry safety scare of 2007. We believe that the Commission's task in defining what constitutes a children's product is an important opportunity for the Commission to address and repair some of these unintended consequences and provide relief for several industries whose products have been placed under a cloud of uncertainty and potentially overwhelming costs by the CPSIA.

Although the Commission's draft definition provides helpful and needed relief for several categories of goods, particularly décor, we feel that the Commission should be much more specific in the types of products which will not be considered children's products. We would like to suggest a number of areas where more specificity is needed.

Under the category of Art Materials, the draft definition states: “Crafting kits and supplies that are not specifically marketed to children 12 years of age or younger would likely be considered products intended for general use.” while simultaneously stating that “Materials sized, decorated, and marketed to children 12 years of age or younger...would be considered children's products.” We feel that this emphasis on marketing will lead to contradictions, misunderstandings, and needless compliance costs. The Commission should instead focus on the intended function of a product and the context in which it will be used.

Under the proposed marketing-based framework, for example, the same pair of small knitting needles would be considered a general use product or a children's product depending only upon how they are packaged. It goes against reason to argue that the same product either does or does not require extensive testing based on the type of label it uses, especially when craft stores often sell these products side by side and consumers can easily substitute one for the other.

The importance of this issue was illustrated by one of members, Eric Vought of The Misty Manor, Mercers in Missouri, who manufactures fiber art tools:

We still have questions on the status of many of our products. We operate a fiber farm...But the real trouble spot is that we produce craft tools and educational materials for many of our crafts. For instance, we sell Learn-to-Spin kits consisting of a drop spindle, fiber, and instructions. We also produce Learn-to-Knit kits, tools for weaving and so forth. These products are not targeted at children, but certainly (older) children, parents, and teachers are among those who purchase them. We have no way of knowing the use for which the kits are intended and we make the products, often from recycled materials, specifically to encourage people to try learning a craft before spending a lot of money on expensive tools...Certainly, these are not intended as 'toys' but we would like a clear statement that they are not covered and that we do not need to send reusable materials to the landfill out of fear that someone will chew on them. As written, the CPSIA's broad age range potentially covers an enormous variety of non-toy products.

A more compelling and logical framework is to consider the circumstances under which a child will be using a product. There are hundreds of art and craft supplies which are designed for children, but are intended for instructional purposes under the supervision of an adult. We believe that such instructional products should be regulated as general use products and not as children's products.

Under this framework, we believe the following products should be specifically defined by the Commission as general use products:

• Child-sized craft tools such as knitting needles, child-sized looms, drop spindles, corking tools, leatherworking tools, sewing needles, woodworking tools, etc. Tools that could also be used by an adult and which are meant to be used under adult instruction for the purpose of learning a craft should be considered general use products. Toy versions of these products which are meant for a child to use by themselves should be considered children's products.
  

• Child-sized musical instruments such as guitars, violins, flutes, clarinets, drums, etc., which are substantially similar to adult-sized instruments in everything except scale. These instruments are meant to be used by a child under the instruction of an adult at school or at home, are fully capable of holding a tune, and should be considered general use products. Toy versions of these instruments which are not designed for instructional use should be considered children's products.

• Child-sized saddles and equestrian equipment. Specially-made saddles for children are also used by adults with small stature and, when used by children, are only used under the direct supervision of an adult. They are almost always installed by an adult and should be considered a general use product.

• Classroom science kits which include general use items such as paper clips; rubber bands; electronic components such as resistors, capacitors, transistors, batteries, motors and wires; geological specimens; lenses, etc., which are sold for educational purposes and intended for use in schools or homeschools under the direct supervision of an adult should be considered general use products.

We are arguing that the context in which are product is meant to be used is more important than the packaging in determining whether it is a children's product or a general use product. We feel that an instructional product intended to be used by a child with the help of an adult poses far less risk than a product which is meant to be used by a child on his or her own. Furthermore, these products represent the core of our nation's hands-on learning structures. Learning crafts, music, and science will be made considerably more difficult and expensive if these instructional tools must be subject to the same rules as toys.

Music CDs

We would also like to change the Commission's approach to children's musical CDs, which are sold or distributed by several of our members. The Commission's proposal that “certain CDs and DVDs that contain content for very young children would not be handled or otherwise touched by children because they do not have the motor skills to operate media players and because such products, by themselves, do not have any appeal to children.” The Commision has proposed that such CDs would therefore not be considered children's products while a nearly identical CD encoded with music designed to appeal to an older child would be considered a children's product. Under this logic, a “Baby Loves Mozart” CD is not a children's product, but Dan Zanes album is.

This distinction is entirely false for two reasons. First, as any parent knows, an older child will only be allowed to handle a CD once he or she has learned to hold it by its edges so that it won't be scratched. In short, the child must learn how to touch a CD without actually interacting with it. Since they are not interacting with it, a CD should not be a children's product. Indeed, a child will interact much more with the CD player or computer which plays the CD (which the Commission has ruled to be a general use product) than he or she will with the CD itself.

Second, the Commission's proposed guidelines regarding CDs provide no clear mechanism for manufacturers and distributers to interpret or implement the definition. Children's music is not marketed like toys as “age 3+” or “suitable for under 3”. Any such distinctions in children's music would be entirely arbitrary and meaningless.

We strongly recommend that the commission define all CDs as general use items. Otherwise, the children's music industry, especially small independent labels, will face years of uncertainty and needless costs. Unless this is changed, independent children's music will no longer be published in CD form and will only be available through digital downloads. This would be no win for safety, but would certainly be a win for Microsoft and Apple.

Thank you again for taking the time to read and consider our comments.

Respectfully Submitted,

The Handmade Toy Alliance

A listing of all 442 business members of the Handmade Toy Alliance is available at . http://www.handmadetoyalliance.org/AllianceInfo/OurMembers.aspx

Join the HTA and CPSC Officials for a Chat Addressing CPSIA and Small Businesses

Friday, March 26, 2010

In cooperation with the Handmade Toy Alliance, the Consumer Product Safety Commission will be joining us in a Webinar to talk about what the CPSIA means for our community. This is your opportunity to get answers to your questions both specific and general about how the CPSIA affects your business.

Here are the details:

On Friday, March 26 at 11 a.m. EDT, (8 a.m. PDT) Senior CPSC Officials Jay Howell and Gib Mullan will be live on a Webinar for our members to talk about how the CPSIA has impacted small businesses.

Jay and Gib will share their insights and experiences about how the CPSIA is being implemented and enforced, how compliance with the law is possible, what has been stayed and what is in effect, what needs to be tested and what does not, and what the future holds.

Presentations by both officials will be followed by a question and answer session. Jay and Gib are doing this webinar as part of an effort by CPSC to connect with organizations like ours and to demystify the CPSIA for small business owners.

CPSC will record the session for those who can't make it.

You can help move the presentation into your areas of concern by sending in advance questions to the web address below. That will help us decide which topics will be most useful for you!

To participate in the webinar go to: www.cpsc.gov/webcast/index.html

Send in your questions before, during and after the webinar to:

HTAquestions@cpsc.gov. (This email address will be active until a month after the webinar to follow up on all questions.)

Who we are: Results of our CPSIA Small Business Survey

Below are the results of our survey of small batch children's product manufacturers and retailers which we conducted this past weekend. 223 business owners participated in the survey, 135 of whom are HTA members. That means that we achieved a 95% confidence rate with a +/- 4.9% confidence interval for the purposes of describing the entire population of 420 businesses who are members of the HTA.

We're sharing this report with congress and the CPSC in hopes that it will help guide their legislation and rulemaking. One thing this survey makes clear is that there are a lot of very low volume toymakers and children's products manufacturers in this country who should not be overlooked.

Handmade Toy Alliance CPSIA Survey Results

Note: Revenue data was also collected and shared with congress and the CPSC but was omitted from this public version of the report for privacy reasons.

Allowing XRF Testing for CPSIA Compliance Could Save $3.7 Billion and Save Small Businesses

The following was written by Seth Goldberg, President of Essco Safety Check, a product safety firm based in Redmond, WA. Seth has calculated the potential savings of using XRF scanning technology instead of the destructive chemical dissolution tests mandated by the CPSIA. In particular, he finds that small businesses would save tremendously with no erosion of product safety. The Handmade Toy Alliance believes that this approach would be a tremendous help to small busineses struggling to comply with the testing requirements of the CPSIA.

This is an objective view of how the Consumer Product Safety Improvement Act (CPSIA) is potentially affecting small businesses, the testing costs and methods, as well as a common sense approach to certification and job creation.

The CPSIA was written in 2008 to ensure that children’s products don’t contain harmful amounts of certain elements, like lead and cadmium. All children’s products must eventually be certified by an accredited 3rd party laboratory who utilizes specific testing methods. With these laboratory results a company can create the required general certificate of conformity (GCC).

There is also a stay of enforcement with the CPSIA until 2/10/11 for the GCC on all children’s products other than those that are painted, children’s jewelry, cribs or pacifiers. Additionally, there is regulation in total content of lead and regulation in soluble content for eight elements (including lead), this method (soluble) ASTM F-963 is currently voluntary. There is also regulation for the amount of certain phthalates, a chemical added to plastics to make them softer.

All current approved testing methods are destructive, they are very costly, can take extensive periods of time to get results. This testingcan only done by a select group of laboratories (only 227 worldwide and 60 within the United States, many of these labs have one parent company).

While researching this article, I attempted to find an economic impact analysis that was performed for CPSIA, but was unable to find one. I even contacted a state representative with Washington State, in April 2008, four months prior to the federal CPSIA regulation, Washington State passed the Children’s Product Safety Act, but apparently no impact study was done either.

How does one figure out the economics behind this piece of legislation?

I thought to try and simplify things and try to figure out how many businesses would be impacted, what size of business they are and ultimately how products that would be affected. I will compare an approximate cost of traditional testing methods, to a technology that is mobile and non-destructive (X-Ray Fluorescence). And I will show how many jobs could be potentially created.

Number of businesses potentially affected by the CPSIA

Businesses that are potentially affected by the CPSIA include; Manufacturers, importers, retailers, charities and re-sellers who make, distribute in commerce, children’s products, those designed and marketed to children 12 and under.

I found two main sources for this data, the US Census and the North American Industry Classification System (NAICS). The US Census numbers were from 2006 and the numbers from the NAICS are from 2009.

Here is data from the North American Industy Classification System (NAICS) their data was used to calculate the number of potentail businesses affected by the CPSIA.

Total number of manufacturers potentially affected by the CPSIA in the United States 52,544***
Total number of wholesalers potentially affected by the CPSIA in the United States 125,624***
Total number of retailers potentially affected by the CPSIA in the United States 511,240***
Total number of businesses potentially affected by the CPSIA according to the NAICS 689,408***

The US Census provided data on the size of the businesses affected and is broken down by percentage. My use and definition of small business is based on <500 href="http://www.essco-safetycheck.com/CPSIA" target="_blank">CPSIA.

Total Manufacturers potentially affected have 0-4 employees 46.3%, <20>

What does all of this mean? More small businesses are going to be affected by this regulation than large businesses. 40% of all businesses potentially affected by the CPSIA are very small with only 0-4 employees. 61% of all businesses potentially affected by the CPSIA have less than 20 employees. All businesses classified as small businesses, less than 500 employees, 71% of them potentially will be affected by the CPSIA.

Number of products potentially needing testing

Attempting to figure out the amount of SKUs or total products potentially affected was an even larger task than trying to figure out the number of businesses potentially affected. There is no single source of data about the number of products manufactured or sold, so I took a slightly different approach. I researched a few key consumer websites and contacted a few experts to make my assumptions.

Yes, I said assumptions. The problem with figuring out some specifics is that I’m guessing on a few key points. Here we go!

I first visited ETSY.com. ETSY.com is a website that sells handmade consumer products, you know, made by your friends and sold online. When I looked on their site earlier this week, they had over 280,000 children’s products listed.

I decided to go to two other major consumer product retail sales websites, Buy.com and Amazon.com. At Buy.com when I tallied all the potential products that could be affected by the CPSIA I found over 66,000 different products. On Amazon.com the amount was much more. I will add one caveat, at amazon.com they did not separate jewelry into a product category “children’s jewelry” so I used the total of all jewelry in my tally. With all jewelry listed and all other products I found that could be potentially affected by the CPSIA, the total was almost 1.18 million products on Amazon.com. Without the jewelry the total was over 150,000 products.

In a conversation I had with a regulatory agency employee in the State of Washington, she suggested that the total number of potential products on the market is in the tens of millions.

Based on these numbers and suggestions, I’m going to split the middle and suggest that there are five million different products on the market that could be impacted by the CPSIA.

The Cost Breakdown

First we need to look at the traditional testing methods. I’m only going to look for three things, amount of lead, amount of cadmium and phthalate testing (traditionally this is tested using a Gas Chromatography machine). For this analysis, disregard all other potential costs.

Traditional ICP-MS testing for heavy metals can easily be hundreds of dollars per test, per color, per substrate. I have been quoted ranges from $75 to $300 per test for heavy metal testing; phthalate testing has been a bit lower from $75 to $150. For this comparison, I’m going to use the low end of $75 per test.

I am also going to assume that every item needs to be tested a total of five times. Every product is a little be different, they’re made with different colors, different substrates and materials. Take an old childhood favorite Rubik’s Cube. It has six different colors and is made of one substrate (black plastic), that item would require a minimum of seven tests. As I said, I’m going to use a five test average.

If there are five million items and each has to be tested five times, that is a total of twenty-five million tests. Considering we are looking for three things (lead, cadmium and phthalates at $75 per test) the total for traditional testing methods would be $5.625 billion.

If all the accredited laboratories split this testing evenly, that would be approximately $25 million per lab worldwide.

Other testing method

There is a technology that is mobile and non-destructive that can simultaneously look for lead, cadmium and PVC in one simple push of the button. Unfortunately, it is not the approved testing method for the CPSIA.

This technology is called X-Ray Fluorescence (XRF) and is readily available to use for consumer product testing. It is the approved testing source for HUD Lead inspections, and is used by the EPA, FDA and CPSC.

Data that I have collected from over 8000 test results using XRF analyzers shows that of all consumer products tested only 16.3% are found with any amount of lead, 4.3% are found with any amount cadmium and 11.1% are identified to be made of PVC. In total only 31.7% of all consumer products I have tested using XRF analyzers have been found with lead, cadmium or PVC, yet all products are required to be tested destructively.

I used these percentages to help figure out the comparable numbers.

Comparison

If all products are tested by traditional testing methods using ICP-MS and GC machines the cost for testing for lead, cadmium and PVC would be $5.625 billion. However, if you were to use XRF analyzers to screen all these products, at a cost average of $5.00 per test the total cost would be $125 million.

At this point, all items that tested positive for lead, cadmium or PVC should be further tested by the traditional testing methods. Using the percentage of items found with lead, cadmium or PVC (31.7%) traditional testing methods would cost $1.784 billion. If you add up the XRF screening and then the re-testing by traditional testing methods, the costs would be approximately $1.9 billion.

That would be a cost savings of $3.7 billion or 66.1% for consumer product testing for the CPSIA.

That is a tremendous amount of money that these businesses can put back to work in our economy, hiring people, investing, building business all while keeping compliant with the regulations.

Number of jobs created

I’m going to specifically look at this as the formation of XRF Certified Consumer Product Inspectors. If a total of twenty-five million tests need to be done annually, and each inspector can do two hundred tests per day, two hundred and fifty days per year, that could create five hundred jobs. That is not including managers and office staff to handle additional work. Overall, I would suspect that close to one thousand jobs could be created, but that is only based on five million products that need to be tested.

What if that total number is closer to twenty million? That would potentially be upwards of four thousand jobs and a potential economic impact of close to $15 billion going back in to the pockets of businesses of which almost 71% are considered small businesses.

Conclusion

What I’m suggesting is a common sense approach to testing and the certification that consumer products meet the regulations of the CPSIA. If XRF testing is approved to simply screen products for certain heavy metals and PVC, and only those found to contain these elements or chemicals would be further tested, there can be a huge positive economic impact for small businesses, as well as the creation of jobs.

***These figures were calculated from two sources, the US Census and the NAICS.