Jeannie Layson: [0:00] ...over, we'll now hear from Joe Wendler.
Joseph Wendler: [0:05] Good morning. My name's Joseph Wendler. I'm the Director of Standards and Certification Initiatives for ASME. I'd like to also thank PHMSA for hosting this workshop and allowing me to share some of ASME's perspectives. [0:17] For those of you who are not familiar with the acronyms or want to keep up. ASME is the American Society of Mechanical Engineers. A little bit about us. We were founded in 1880. We published our first standard in 1884, which was a performance test on steam boilers. Steam power and pressure technology are still very much a part of our core competencies.[0:39] Today, we have over 120,000 members around the world. We have 4,900 volunteers who participate in our standards development activities. Interestingly, 700 of our members that write standards are not from the US. This is a trend that we expect to continue to grow significantly.
[0:56] We publish over 550 standards now. Everything from fasteners, to plumbing fixtures, to hand tools, up to machines like cranes, elevators, escalators and power plant equipment including equipment for nuclear power plants.
[1:11] These are used in over 100 countries. This reflects not only the global relevance of ASME standards since they are accepted outside the US, but also the fact that technology innovation is not only happening here in the US. It's being advanced and applied in other parts of the world, like oil and gas pipelines being built in India and the Middle East, power plants being built in China and Korea to ASME standards. We look at ASME as a truly global enterprise.
[1:42] Our mission has always revolved around improving the quality of life, so we have a shared interest with PHMSA and other agencies in protecting public safety, health and the environment.
[1:53] A little bit about our standards developing process. We're also accredited by ANSI, the American National Standards Institute. They have essential requirements and formal procedures that ensure our standards are developed in an open, inclusive and transparent process.
[2:07] These kind of requirements are also mirrored by the World Trade Organization. They have criteria for the development of international standards, and we take these very seriously because we think this adds to the credibility and the relevance of our standards.
[2:19] One of the real key criteria is the balance of our committees. Our standards are not written by a group of four individuals or four organizations with a narrow view. They're written both by producers, consumers, owners, operators, inspectors, maintenance people, laborers. Anybody that we can involve in this process, we try to solicit to make our standards more robust.
[2:45] If we do identify an interest class that's not being represented, we do take proactive measures to solicit that kind of input. We truly strive to develop relevant standards for every kind of stakeholder possible.
[2:59] Another key part of our development process is relevance. Our standards are reviewed at least every five years. Most of the ones that are important to industry are reviewed on a continuous basis. We receive requests for revisions daily on an evolving basis for all of our standards, most of the ones that are referenced in regulation, anyway.
[3:22] This keeps them technically relevant. It helps us incorporate lessons learned from people who are having difficulty applying these in practice. It's a good way to ensure that they've taken all the new information out there.
[3:38] Another key component involving the openness and transparency is the way we engage the public. We have no fees for participating. All of our meetings are open to the public. All of our agendas are published, and all of our revisions are published in advance.
[3:52] Prior to issuing any new publication, we have a public review period similar to a federal rule making process, where those revisions are all published for free. Not just to people in the US, but all over the world. Anyone can log on and see these revisions, what they are, before they're actually published. There is a lot of openness and transparency in our process.
[4:15] The question that we're getting asked a lot right now is, why do you charge for your standards? Why do you charge so much for your standards? Simply put, as other have said, creating these standards take a lot of time. It takes a lot of money. It takes a lot of resources. They don't just drop out of the sky.
[4:30] There are quite a few benefits to selling the standards. Number one, with the principles of the Technology Transfer Act, it prevents the government and tax payers from having to bear that cost. Secondly, it prevents it from being overly influenced by a group of stakeholders who perhaps pay to have that standard development, whether that's the private sector or the government.
[4:55] As ASTM noted, having a low or no cost participation model does attract small and medium size businesses. We recently conducted a survey that showed us that 50 percent of our standards committee volunteers work for organizations with less than 500 employees, and 20 percent work for organizations with less than 10 employees. We think this is really effective at getting small and medium sized businesses a seat at the table, and having the ability to influence the ultimate rules that affect their business.
[5:25] Lastly, by funding standards development through the sale of standards, it spreads the cost out amongst industries, amongst stakeholders, who ultimately benefit from the use of those standards.
[5:40] In terms of how ASME is impacted. We're very much impacted. I think the current Office of Pipeline Safety regulations reference 60 or so standards. They incorporate 60 or so standards by reference. 11 of those are ASME standards.
[5:54] Several of those are very germane to the pipeline community. The B31 standards. Several other ones, as was noted by NIST are the Boiler and Pressure Vessel Code, which span well beyond pipeline, and oil and gas industry, and are used in things like hospitals and schools and power plants. It expands beyond just the scope of pipeline safety.
[6:18] In terms of our position with the Section 24 of the Pipeline Safety Act, once this was put out, ASME led a coalition of nine standards developers. We submitted letters to both the Senate and the House of Representatives requesting a repeal of this provision. We also sent a letter to the DOT advising them of our concerns. I'll share some of those concerns with you in a bit.
[6:39] Our main problem is, essentially, this forces ASME to do one of two things, either tell PHMSA not to reference our standards, in which case we would be impeding them from accomplishing their very necessary public safety mission.
[6:54] Or, we would be forced to put our standards online for free and roll the dice with how long we can actually stay in business, one year, two years, whatever, then who is going to fill this void and how. It was really a no-win situation for us, so we were really compelled to action.
[7:11] Our rationale for some of this was included in the letter. As others have said, the specific policy, it doesn't align with OMB A-119. It doesn't align with the Transfer Technology and Advancement Act. Both of those point to the government agencies to continue to look to the private sector for standards development.
[7:32] Interestingly, there was a lot of concurrent review of the existing policies by other parts of government. They expressed the collective understanding that access and availability, on a reasonable basis, may include monetary compensation.
[7:44] ASME underscored those things in its letters to Congress. We also outlined some of the potential negative repercussions of implementing this as we move forward. If ASME and other SDOs were to withhold its standards from being referenced, what you might see is a divergence in the industry practice and what the regulations are set out to do. This divergence is what the policies are intended to prevent.
[8:13] You might see reduced responsiveness from federal agencies. As it is now, a lot of agencies aren't consistent and are overwhelmed with just updating the references that are existing to more recent versions, and doing the due diligence and reviewing the common standard.
[8:27] If you also task them with developing standards on top of that, you might see varied lag in terms of what the private sector is learning and what is being up taken by federal agencies.
[8:42] Another concern is reduced stakeholder diversity. Who is ultimately going to bear the cost of those standards? Are small businesses going to be able to participate? Is the government going to be able to sustain some kind of standard where they do have a dedicated group of volunteers who contribute on a sustainable basis?
[9:00] Along with a divergence in industry practice and regulations, you kind of create confusion because businesses don't know, "Do I comply with the private sector and latest standard, or do I comply with the regulation that might be 10 or 20 years old?" You have this divergence and that kind of creates confusion.
[9:17] When you have that confusion, businesses and people are put in a choice where they don't know what to follow. That creates risk for people, safety, the environment. It also creates burdens on businesses who are forced to comply with competing frameworks for compliance.
[9:33] This doesn't apply just to Office of Pipeline Safety and Regulations. Anytime you have a business that's forced to comply with more than one standard, they have to bear the cost of complying with two different frameworks.
[9:46] Just some final thoughts from ASME moving forward. ASME is definitely open to new ways of increasing transparency of what's in its standards. We want to underscore that we feel the issue of accessibility and reasonable availability is separate from the issue of cost. Our standards are very accessible. They're published online. We sell them through resellers.
[10:11] We support many of the ACUS recommendations, specifically the one that says consideration should be given to the types of parties that need access to material and their ability to bear the cost of accessing such materials.
[10:23] Lastly, in the OFR petition that was submitted several months ago, there was a proposal that some central agency serve as a clearinghouse to arbitrate what is reasonably available. ASME supports that kind of determination, if one is needed, to reside within the agencies who are closest to industry who understand the standards, the complexity of the process, and the value that it presents to the people who need the standard.
[10:48] That concludes my comments, and thank you.