Prompted by record droughts across the country, states and municipalities have begun to consider making changes to plumbing codes and water-efficiency standards. California’s latest product labeling requirements concern plumbing manufacturers and other businesses. And new proposed regulations would mandate public companies to more strictly track and report their sustainability efforts throughout their entire supply chains. Plumbing Manufacturers International (PMI) keeps a careful eye on these issues for its members as they navigate a complicated and varied legislative and regulatory landscape.
Discouraging Lower Flow Rates
Municipalities and states are considering lowered plumbing fixture flush and flow rates. Our concern is the unintended consequences that can be caused by extremely low flow rates — such as the potential for increased water age and pathogen growth when installing low-flow fixtures in aging plumbing systems with oversized pipe.
PMI and its members support the Environmental Protection Agency’s WaterSense plumbing fixture flow and flush rates, established in 2007. WaterSense fixtures use 20 percent less water than federal requirements. Most states don’t go below WaterSense rates in their state plumbing codes and laws. The plumbing manufacturing industry becomes concerned when states choose to consider flow rates lower than WaterSense levels.
California is one such state. After recording the driest first three months of a year in the state’s history, California Gov. Gavin Newsom signed an executive order in March asking local water suppliers to conserve water and prepare for a water shortage level of up to 20 percent. Newsom also asked residents to voluntarily reduce their water consumption by 15 percent, and several water districts instituted water conservation measures.
The governor and state legislature recently announced an investment of more than $5 billion over three years to fund immediate drought response and create water resilience.
In addition, legislation in California (SB 1157) proposes to lower residential indoor water use from a maximum of 52.5 to 47 gallons per capita daily from Jan. 1, 2025, until Jan. 1, 2030. The state would like to further reduce water use to 42 gallons per capita daily beginning Jan. 1, 2030.
Our industry’s previous experience in 2017 — when California lowered flow rates on plumbing fixtures — suggests the state may consider lowering those rates again. PMI is taking proactive steps to help the state better understand its options and avoid unintentionally creating health hazards by dropping flow rates too low. We’ve provided technical guidance and feedback on bill language, met with state legislators and gave testimonies at hearings.
PMI carefully tracks federal, state and municipal legislation and codes focusing on water efficiency and water conservation. We also count on our members, especially those operating in drought-ridden states, to alert us to these issues so we can act quickly.
Fort Collins, Colo., is a notable example. The city wrote into its plumbing code — with little notice — a new toilet flush rate of 1.1 gallons/flush (gpf), reduced from 1.28 gpf. Tracking can be challenging in cases similar to this, where the city was required to post the change notice in only one local newspaper. West Hollywood, Calif., made a similar move a couple of years ago, requiring toilets with a 1.1 gpf to be installed in any residential remodeling projects.
Concerns about New California Prop 65 Short-Form Labels
California’s Office of Environmental Health Hazard Assessment (OEHHA) is proposing to change California Proposition 65 (Prop 65) short-form labeling requirements — after implementing the last label change in August 2018. Plumbing manufacturers and others struggle to comply with the short-form label changes and are concerned the changes could worsen supply chain snags and cause other business issues.
Prop 65 is part of California’s Safe Drinking Water and Toxic Enforcement Act of 1986. The act protects the state’s drinking water sources from contamination with chemicals known to cause cancer or birth defects and other reproductive harm. The proposition calls for businesses to post a “clear and reasonable” warning on any products that may expose Californians to one of the more than 900 chemicals included on the Prop 65 list. Products carrying the warning label aren’t necessarily unsafe and may only contain trace amounts of one of the Prop 65 chemicals.
The current short-form warning label — versus the long-form label — remains a top choice for plumbing manufacturers and other businesses because it requires fewer details, occupies less space on a product and doesn’t involve listing any chemical names. However, OEHHA now is calling for the short-form warning to identify one of the chemicals on the Prop 65 list for which the warning is being given.
PMI, along with the California Chamber of Commerce, is among 46 companies, associations and business groups that formed a coalition to voice concerns about modifications to the short-form warnings. The coalition submitted two letters in January and March 2022 during public comment periods.
OEHHA addressed some of our concerns, such as changing the implementation date from one to two years and changing the label size limit. However, our most recent comment letter asked OEHHA to withdraw the proposed rulemaking because it would significantly disrupt business, increase costs of consumer goods, exacerbate current supply chain challenges and create litigation risk.
Californians are so used to the Prop 65 warnings — on everything from their public swimming pool to new cars to groceries — that they have lost all meaning, noted a Los Angeles Times article. Often, companies view the label essentially as a protective measure to avoid litigation. The article noted that many of the lawsuits brought against companies choosing not to use the warning label were frivolous.
Many of our plumbing manufacturing members revamped their labeling systems to accommodate the last round of short-form label requirements in 2018. For simplicity, some chose to include the label not only on products sold to California customers but on products being distributed to the rest of the country.
Anyone buying plumbing products outside of California may be confused or upset by the warning label because they’re not familiar with Prop 65. One PMI member’s website describes in detail why it uses the Prop 65 label on its products while reassuring customers that the product is safe — a clear example of the potential confusion caused by this requirement.
SEC, California Propose Stricter Greenhouse Gas Rules
This year will be important for environmental, social and governance regulatory activity. Investors, customers and the public demand to know more about companies’ environmental policies. They may soon get additional transparency with a new proposed Securities and Exchange Commission (SEC) rule mandating public companies track and report carbon emissions and climate-related risks throughout their entire supply chains. California proposed similar legislation.
The proposed SEC rule would require public companies, including plumbing manufacturers, to invest heavily in creating and maintaining systems for tracking carbon emissions — even those produced by their distributors and suppliers. Smaller plumbing manufacturing companies supplying parts to larger, publicly held manufacturers will eventually need to disclose their carbon emission and climate-related risks as well.
In addition, the SEC proposed rule amendments would require public companies to list certain climate-related information in their registration statements and periodic reports (https://bit.ly/3913sbb). The required information includes oversight and governance, operational and financial material impacts, risk identification and management, and Scope 1, 2 and 3 emissions. For large companies, the Scope 1 and 2 emissions disclosures would require third-party verification.
PMI is actively involved with the National Association of Manufacturers to monitor the proposed rule, which affects some PMI member companies. Those companies already disclose emissions and reduction targets under voluntary standards set by the business community.
I’d like to note that PMI members have been making solid progress in their sustainability efforts. One of our members created an Environmental Vision 2050 to achieve net-zero carbon emissions, focusing on climate change mitigation and adaptation. Another PMI member recently launched a zero-landfill initiative, and one member announced a commitment to setting science-based targets to reduce greenhouse gas (GHG) emissions.
To support our members, PMI is building thought leadership on sustainability through our PMI climate initiative.
In the meantime, we’re keeping a close eye on the proposed SEC rule, which stirred up considerable controversy. It’s anticipated that companies and trade groups will challenge the rule, saying it goes too far, which may lead to litigation. On the other end of the spectrum, environmental groups may take legal action to push for even stronger environmental tracking measures.
If adopted, these new SEC requirements would — at the earliest — take effect in fiscal year 2023 and begin to apply to SEC filings in 2024. Many companies, trade associations and business groups pushed back over the initial 30-day public comment period, saying it was too short for such a significant rule. The SEC responded by extending the comment period another 30 days through June 17 and will then review those comments over the summer.
A similar measure pending in California, the Climate Corporate Accountability Act (SB 260), would impact public and private U.S.-based companies with annual revenues of more than $1 billion doing business in the state. The measure would require those companies to report their Scope 1, 2 and 3 GHG emissions to the California Secretary of State. Activities to be reported include business travel, employee commutes, procurement, waste and water usage.
The GHG disclosure requirements would take effect in 2025. When making those GHG disclosures, companies will need to follow the Greenhouse Gas Protocol Standards and guidance developed by the World Resources Institute and the World Business Council for Sustainable Development. The disclosures will require independent verification by a third-party auditor.
Kerry Stackpole, FASAE, CAE, is the CEO/executive director of Plumbing Manufacturers International. Stackpole has spent more than two decades leading trade associations in manufacturing, technology and services. Contact him at email@example.com.