VI. Regulatory Impact Analysis, Regulatory Flexibility Analysis, and Environmental Assessment

A. Introduction

The purpose of the revision of the existing pulpwood logging standard, 29 CFR 1910.266, is to protect all loggers from the hazards encountered during timber harvesting regardless of the end use of the wood. Hazards are present, for example, due to falling, rolling or sliding trees and logs, the use of hazardous equipment such as chain saws, and improper work practices. According to BLS, these hazards resulted in an accident incidence rate of 15.6 injuries per 100 full-time workers in 1991, which is nearly twice the incidence rate of 7.9 injuries per 100 full-time workers for overall private sector. The number of lost workdays in logging in 1991 was 274.8 per 100 full-time workers, which is about three times that of manufacturing and four times that of the overall private sector.

The existing logging standard applies only to the logging of wood that is used to make pulp for paper and paperboard. Other logging operations are not covered by the existing standard. However, other general industry safety and health standards in Part 1910, such as but not limited to, Occupational Noise Exposure (29 CFR 1910.95), Lockout/ Tagout (29 CFR 1910.147), and Personal Protective Equipment (29 CFR Subpart I), apply to non-pulpwood logging operations, as well as the General Duty clause of the OSH Act (Section 5(a)(1)).

The final rule expands the coverage of the pulpwood logging standard to include all logging operations, regardless of the end use of the wood. Many of the provisions in the pulpwood logging standard have been retained in this standard. Some provisions have been modified, such as those requiring safety and first-aid training for all employees, and personal protective equipment. In certain cases, work practices have been made more specific.

It should be noted that six State Plan States (Alaska, California, Hawaii, Michigan, Oregon, and Washington) have developed logging standards that cover all logging operations and are not limited to just pulpwood logging.

This Regulatory Impact Assessment (RIA) has been prepared by OSHA in compliance with Executive Order 12866 and the Regulatory Flexibility Act of 1980 (5 U.S.C. 601 et seq.). The analysis was developed based on information and comments in the OSHA logging docket and informal public hearings.

B. Affected Industries and Workers

For purposes of analysis, logging operations in the United States were divided in four relevant geographical regions -- the North, the South, the Rocky Mountains, and the Pacific Coast. The leading States in logging employment in 1987 were Oregon, Washington, Alabama and Georgia, which accounted for 40 percent of logging employment. The final rule will affect approximately 72,100 employees engaged in logging operations covered by the final rule and 11,936 logging establishments. Almost 94 percent of all logging establishments employ fewer than 20 employees and 60 percent of all logging employees work in small establishments. These estimates do not include independent contractors.

Affected workers include, but are not limited to, fellers and buckers, who cut the trees; skidder and yarder operators, choker setters, and chasers, who are responsible for delivering a felled tree to the landing; and loader operators and truck drivers, who load the trees onto trucks for transport to a mill. Although all stages of logging present hazards to workers, the loggers most at risk are manual felling crews rather than those who operate mechanical harvesting equipment and are protected by enclosed cabs.

C. Technological Feasibility Determination

The work practice and training provisions as well as the requirements regarding personal protective equipment and equipment protective devices in the final rule are technologically feasible. The fact that the requirements of the standard already are being achieved in the logging industry is the best evidence of feasibility. The record shows that many logging establishments are currently providing the training, equipment protection devices and personal protective equipment that would meet the requirements of the new standard. In addition, the record also shows they are operating under the same work practices as those required by the standard. Based on the record, OSHA has determined that numerous logging establishments of all sizes are already in compliance with most of the provisions of the final standard. In addition, equipment protective devices and personal protective equipment which are required by the final rule are all commercially available. Therefore, OSHA has determined that the final rule is technologically feasible.

D. Costs of Compliance

OSHA estimated compliance costs using data in the record on current practices and exposed population, including a report prepared by Centaur Associates, Inc. (Ex. 3). Based on all the data and evidence in the record, OSHA estimates that first-year costs associated with compliance will be $14.3 million. Total annualized cost of compliance with the standard is estimated to be $12.5 million. Table 22 shows the summary of costs of compliance with the final rule.

     Table 22. -- Summary of Costs to Comply With the Logging Standard
__________________________________________________________________________
                     |
                     |    First year                      Annualized
Provision            |--------------------  Recurring  -------------------
                     |    Cost     | (1)  |   cost    |    Cost   |  (1)
_____________________|_____________|______|___________|___________|_______
                     |             |      |           |           |
Training provisions: |             |      |           |           |
  Safety training....|  $1,481,635 | 10.3 |   $120,695|   $120,695|   1.0
  Safety meetings....|     469,251 |  3.3 |    469,251|    469,251|   3.7
  First aid training.|   3,410,935 | 23.8 |  3,410,935|  3,410,935|  27.2
                     |-------------|------|-----------|-----------|-------
                     |   5,361,820 | 37.4 |  4,000,881|  4,000,881|  31.9
Operators manuals....|     189,293 |  1.3 |    189,293|    189,293|   1.5
Inspection and       |             |      |           |           |
  maintenance........|   5,396,789 | 37.6 |  5,396,789|  5,396,789|  43.0
Safety belt          |             |      |           |           |
  replacement........|     493,282 |  3.4 |  .........|     80,279|   0.6
First aid kits.......|     267,593 |  1.9 |    232,028|    232,028|   1.8
Personal protective  |             |      |           |           |
  equipment..........|   2,637,597 | 18.4 |  2,637,597|  2,637,597|  20.6
                     |-------------|------|-----------|-----------|-------
    Total........... |  14,346,375 | .... | 12,456,588| 12,809,333|  .....
_____________________|_____________|______|___________|___________|_______
  Note: (1) The number in these columns represent the percentage of the
total cost that each provision represents and that are incurred in the
first year and in each year thereafter.
  Source: OSHA, Office of Regulatory Analysis.

Of the total annualized cost, 43 percent is attributable to inspection and maintenance of logging equipment. Training costs, which include safety and first-aid training as well as monthly safety and health meetings, account for 32 percent. Personal protective equipment accounts for about 21 percent of total annual costs. First-aid kits for 1.9 percent. Replacement of operator manuals or instructions accounts for 1.5 percent and replacement of seat belts removed from machines and vehicles accounts for about 0.6 percent of total costs.

D. Benefits of the Revised Standard

The record shows that injury rates in the logging industry are high. In 1991, there were 15.6 injuries per 100 workers in the logging industry as compared to an injury incidence rate of 7.9 and 11.2 per 100 workers in the private industry and manufacturing sectors, respectively. Lost workday rates are especially high in the logging industry, indicating that most logging accidents are serious. Based on the data in the record, OSHA estimates that there are approximately 158 fatalities, 6,798 lost workday injuries, and 3,770 nonlost workday injuries annually in the logging industry.

The revised standard mandates a variety of methods of control to reduce hazards in the logging industry. Included in the standard are provisions for personal protective equipment, machine protective devices, equipment inspection and maintenance, work practices, and training. The revised standard is expected to significantly reduce the number of accidents, and, consequently, fatalities and injuries that occur in the logging industry. The ability of the revised standard to reduce accidents, injuries and fatalities depends largely on this integrated program of controls to deal with the range of hazards that exist in logging operations. For this reason, the effects of the overall standard on workplace safety is expected to be greater than the effects of the elements of the standard when considered individually. OSHA estimates that compliance with the final standard will prevent 111 fatalities, 4,759 lost workday cases, and 2,639 nonlost workday cases annually (Table 23). These estimates were developed based on the comprehensiveness of the standard in dealing with the range of workplace hazards in logging.

Table 23. -- Reduction in Fatalities and Injuries From Compliance With the
                            Logging Standard
___________________________________________________________________________
                             |           |        |         |
                             |           |        |  Lost   |  Non-lost
                             | Fatalities| Total  | workday |  workday
                             |           |injuries| injuries|  injuries
_____________________________|___________|________|_________|______________
                             |           |        |         |
Baseline cases...............|       158 | 10,568 |   6,798 |   3,770
Cases avoided by compliance  |           |        |         |
  with standard..............|       111 |  7,398 |   4,759 |   2,639
_____________________________|___________|________|_________|______________
  Source: U.S. Department of Labor, OSHA, Office of Regulatory Analysis,
1994.

F. Economic Feasibility Determination

The projected economic impact of the final standard on the logging industry is small. The cost of full compliance with the standard represents only 0.1 percent of the value of shipments for this industry as a whole. Although these annual costs of compliance represent a relatively insignificant amount of total shipments, some firms will bear more costs than others depending on their existing compliance with the various provisions of the standard.

The annual cost of compliance per logging establishment ranges from about $38 in California where firms are at a high level of compliance with their own State logging standard, to an average of $1,300 per establishment in the South where no comprehensive logging standards exists. These annual costs per establishment are insignificant when viewed in terms of other costs incurred by logging employers. It is expected that the costs of compliance with the final rule are too small to have a significant effect on price, employment, production, or profit rates.

The impact of compliance with the final rule is expected to fall primarily on small businesses, because the vast majority of logging establishments employ fewer than 20 workers. The record shows that most large logging establishments are already in compliance with many of the provisions of the final rule. However, many small firms are also located in States that have comprehensive logging standards. These firms are currently in compliance with these standards and are able to operate while incurring these costs. Even if it is assumed that small firms will bear all the costs of compliance with the final rule, the economic impact is still small. OSHA estimates that the average cost per small firm is substantially less than 0.5 percent of the average annual value of shipments per firm and will be more than offset by the probable decrease in workers' compensation costs resulting from fewer injuries. Even small establishments that operate on less than a full-time basis could incur the costs of compliance without experiencing an economic disruption that would threaten the competitive structure of the industry or cause any dislocation.

Based on these estimates developed from data and evidence in the record, OSHA has concluded that the economic impact of the standard would not threaten the stability or profitability of the logging industry. In addition, neither the Gross National Product (GNP), the level of international trade, the price of consumer goods, nor the level of employment would be significantly affected.

G. Regulatory Flexibility Certification

In accordance with the Regulatory Flexibility Act, the Assistant Secretary has made a preliminary assessment of the impact of the rule on small entities. As discussed above, the estimated compliance costs for small firms (i.e, those employing fewer than 20 workers) are estimated to be less than 0.5 percent of the average annual value of shipments per firm and will be more than offset by the probable decrease in workers' compensation costs resulting from reduction in logging accidents. As is the case for compliance costs for all firms covered under the standard, the costs of compliance for small firms would be very small compared with net income. Therefore, OSHA does not anticipate the final rule will have a significant impact on small firms.

H. Environmental Impact Assessment

The revisions to the standard have been reviewed in accordance with the requirements of the National Environmental Policy Act (NEPA) of 1969 (42 U.S.C. 4321, et seq.), the regulations of the Council on Environmental Quality (CEQ) (40 CFR 1500), and the Department of Labor (DOL) NEPA Procedures (29 CFR 11). As a result of this review, OSHA has determined that the rule will have no significant environmental impact.

The provisions focus on training, work practices, personal protective equipment, and protective devices on equipment in order to reduce worker fatalities and injuries. In general, these provisions do not impact on air, water, or soil quality, plant or animal life, the use of land, or other aspects of the environment. The revisions are considered excluded actions under Subpart B, Section 11.10 of the DOL NEPA regulations.

[59 FR 51672, Oct. 12, 1994]