Summary of USDA Guidelines for Designating
Biobased Products for Federal Procurement
 
(Click here for a PDF version of this document)

Below please find a brief summary of USDA’s proposed rule to implement the Federal Procurement of Biobased Products program, Section 9002 of the Energy Title (Title IX) of the The Farm Security and Rural Development Act of 2002 (H.R. 2646/P.L. 107-171).  This document is intended to provide a brief overview of the proposed regulation.

To read the proposed rule, please visit http://www.biobased.oce.usda.gov/public/pro_regs.cfm.

EESI encourages all stakeholders to read the proposed rule and submit comments.   Stakeholder comments are important in ensuring that the final rule will achieve the goals of Sec. 9002 in the most efficacious way possible.

Comments must be submitted by February 19, 2004.  Instructions on submitting comments (electronic, fax, regular mail) can be found at http://www.biobased.oce.usda.gov/public/howto.cfm.

Background:  The Farm Security and Rural Development Act of 2002, signed into law May 2002, was the first Farm Bill to contain an energy title. The Energy Title was designed to promote the development of agriculture-based renewables by encouraging federal procurement of biobased products, providing grants and loans for renewable energy projects, and funding vital research and development in bioenergy.

Section 9002 of the Energy Title, Federal Procurement of Biobased Products, makes available $1 mil/yr (FY02-07) and requires Federal agencies to purchase biobased products that meet price, availability, and performance standards; provides for a voluntary labeling program of certified “Biobased Products;” and provides financial assistance for testing of biobased products by manufacturers.

On Dec. 19, 2003 , USDA published a proposed rule for public comment to implement the preferred procurement program for biobased products by federal agencies.  

Interested parties can also contact Marvin Duncan, Office of Energy Policy and New Uses, at (202) 401-0532 or at mduncan@oce.usda.gov for further information on this program and the proposed rule.

Please Note:

• Public Meeting on Proposed Rule to Implement Preferred Procurement of

Biobased Products:

Where:  Jefferson Auditorium , U.S. Department of Agriculture

1400 Independence Ave. S.W. , Washington D.C.

When:   Thursday, January 29, 2004 , from 9:00 a.m. to 4:30 p.m.  

This event will be video web streamed in real time through a link at the “Current Issues Box” on the home page of www.biobased.oce.usda.gov.  Further information on the Public Meeting can be found on the same site.

Overview - Proposed Rule, Federal Procurement of Biobased Products Program

Proposed § 2902.1: Purpose and Scope

• The purpose of the guidelines in this part is to assist Federal agencies in complying with the requirements of Section 9002, which states that Federal agencies must procure biobased products unless the items are not reasonably available, fail to meet applicable performance standards, or are available only at an unreasonable price.

• The guidelines in this part designate items that are or can be produced with biobased products

Proposed § 2902.2: Applicability to Federal Agencies and Exceptions to Procurement of Biobased Items

• The procurement preference applies to all Federal agencies (as defined in this document) with respect to all procurement actions where the purchase price of the item exceeds $10,000 or where the quantity of such items (or of functionally equivalent items) purchased during the preceding fiscal year cost a total of $10,000 or more.

Proposed § 2902.3: USDA Guidance on Item Availability and Procurement

• USDA plans to initially rely, in part, on the information developed in a study by Concurrent Technologies Corporation (CTC) to address the statutory requirement for information on item availability.  The CTC study can be viewed on the website http://www.biobased.oce.usda.gov.
• USDA proposes to gather information on relative price, performance, and environmental and public health benefits from industry using an Internet website to which manufacturers and vendors will be invited to voluntarily provide information, including availability on the commercial products with biobased content that they offer to Federal agencies.
• Information on economic and technological feasibility of using biobased items and life cycle costs will be sought from industry.
• USDA envisions the voluntary, web-based information system as the principal clearinghouse of information on manufacturer and vendor contact information, currently available products, and relevant product characteristics.
• USDA seeks comments on the kinds of contact and product information that should be made available on its web-based information system, as well as comments on the appropriate components of a model procurement program for biobased items.

Proposed § 2902.4: Definitions

• USDA defines the terms such as: Secretary, BEES, ASTM International, diluent, filler, FSRIA, biological products, Federal agency, agricultural materials, biobased content, forestry materials, and small and emerging private business enterprises.

Proposed § 2902.5: Preferred Procurement Program

• Federal agencies should interpret the requirement to mean procuring items with the highest biobased content consistent with other desired attributes such as availability, price, and performance.  USDA has tried to set minimum requirements for biobased content of items at levels which are low enough to allow items produced with biobased products to compete with fossil energy based products in performance and economics, using current technology.
• Information on environmental and public health benefits will be developed from voluntary information manufacturers and vendors provide on individual products. When voluntarily providing such information to USDA, this information must be based on a National Institute of Standards and Technology BEES (Building for Environmental and Economic Sustainability) analytical tool analysis of the product.  USDA plans to rely on information from the previously discussed CTC study to determine the availability of items.

Proposed § 2902.6: Funding for Testing

• USDA has $1 million per year for each of the fiscal years 2002 through 2007 to support the testing of biobased products to carry out the provisions of the section. The Secretary, at her discretion, may “give priority to the testing of products for which private sector firms provide cost sharing for the testing.”
• USDA will consider cost-sharing proposals only for the BEES Analysis and performance testing of products. Information regarding the submission of proposals for cost sharing also will be posted on http://www.biobased.oce.usda.gov.
• USDA will enter into arrangements with entities capable of conducting tests to conduct tests of biobased content and BEES Analyses on products identified by USDA as part of the process of gathering such information on a sufficient number of products to enable USDA to extrapolate such information to the item level. Entities are welcome to propose cost-sharing for the testing of such items.
• Cost sharing will be considered first for products of "small and emerging private business enterprises."  Priority ratings will be based on the following criteria:

o        A maximum of 25 points will be awarded a proposal based on its market readiness.

o        A maximum of 20 points will be awarded a proposal based on the potential size of the market for that product in Federal agencies.

o        A maximum of 25 points will be awarded based on the financial need, for testing assistance, of the manufacturer or vendor.

o        A maximum of 20 points will be awarded a proposal based on the product’s prospective competitiveness in the market place.

o        A maximum of 10 points will be awarded a proposal based on its likely benefit to the environment.

• USDA seeks comments on possible methods of providing financial assistance for manufacturers and vendors for testing of individual commercial products with biobased content that are intended to qualify for preferred procurement by Federal agencies under this program.

Proposed § 2902.10: Communicating Information on Qualifying Biobased Products

·         Manufacturers and vendors of designated items have the responsibility to inform Federal procurement officials of items that comply with the guidelines, including the biobased content of the product.

• When asked for performance data by Federal agencies, manufacturers and vendors are required to use test results obtained, for the individual products they offer for preferred procurement, from testing against industry accepted performance standards, which may include a Federal or Military Specification (ASTM, ISO, Military Specifications, etc.) for the product, in the use for which it is intended. The test must be conducted by a third party in an ASTM/ISO compliant test facility.
• Manufacturers and vendors must use the BEES analytical tool to provide information on life cycle costs and environmental and health benefits when asked for such information by Federal Agencies.  Any claims regarding health and environmental benefits of their products should conform to the Federal Trade Commission (FTC) Guides for the Use of Environmental Marketing Claims (http//www.ftc.gov/ftc/legal/htm)

Proposed § 2902.11: Characteristics Required for Obtaining Designated Item Status

• Preference to items composed of the highest percentage of biobased products practicable.
• American Society for Testing and Materials (ASTM) is in the process of finalizing and adopting a method for determining biobased content. USDA anticipates that ASTM International will adopt a standard prior to USDA publishing its final rule.  The method under consideration by ASTM International is a Radioisotope Standard Method to discriminate between "old carbon" from fossil resources and "new carbon" from renewable resources.
• USDA proposes that manufacturers and vendors must utilize third party ASTM/ISO compliant test facilities using that testing standard method to determine the biobased content of their products offered for preferred procurement.
• USDA is proposing that biobased content be determined based on the weight of the biobased material (exclusive of water and other non-active ingredients, fillers, and diluents) divided by the total weight of the product and expressed as a percentage by weight.  Minimum biobased content requirements used in the proposed guidelines refer to the biobased portion of the product itself.

Proposed § 2902.12: Items and Minimum Biobased Content

• The biobased products listed in the proposed guidelines would be grouped according to category, with each category consisting of one or more items; an item developed by a particular manufacturer is referred to as a product.
• Items and the indicated biobased content of items contained within the categories discussed in this preamble are based on the study conducted in 2002 for the USDA Agricultural Research Service by CTC.  USDA also has posted the study on its informational website, http://www.biobased.oce.usda.gov.
• Comments proposing a new item should include information similar to that found in USDA’s initial survey of the industry, including biobased products from which the items are derived, item characteristics, likely uses of the item, and percentage of biobased content of the items. In addition to new items proposed for inclusion in the guidelines, USDA is seeking comment on procedural issues, such as a process for proposing additional items, the review of such proposals, and what market information should be necessary to support the addition or deletion of an item. USDA particularly seeks public comment on the proposed categories and items, and the reasonableness of the biobased content percentages, discussed below.

Plan for Future Development of Voluntary Labeling Program

• Biobased products that qualify for preferred procurement would be eligible to qualify for use of the "U.S.D.A. Certified Biobased Product" label, based on:
1. analysis of life cycle costs and health benefits of the product would be required using NIST’s BEES (Building for Environmental and Economic Sustainability)
2. product would have passed one or more tests against applicable ASTM, International Organization for Standardization (ISO)
• USDA seeks comments on the potential direction of future regulation regarding a voluntary program for use of the label by manufacturers and vendors of biobased products and on the possibility of assessing a user fee to support the labeling program.

Minimum Content Levels

USDA seeks comments on the following categories, items (subcategories), minimum content levels based on manufactured value, and the minimum biobased content levels.

• Adhesives:  Adhesive products are to have a minimum biobased content of 70 percent by weight of the adhesive.  Finished products in which 90 percent of all of the adhesives used in production are biobased would be designated as biobased products.
• Construction Materials and Composites:  USDA particularly welcomes comments on adding additional subcategories to this section to more clearly define content requirements.

• Fibers, Paper, and Packaging Category:  USDA has listed a few of the more common uses and encourages comment on content requirements for a wide range of uses.

• Fuel Additives:

·         Landscaping Materials, Compost, and Fertilizer:

• Lubricants and Functional Fluids

• Paints and Coatings

• Solvents and Cleaners

• Sorbents

·         Plant and Vegetable Inks

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