(a) The hearing officer shall propose a fair and equitable amount of reimbursement. The formula in paragraph (b) of this section shall be presumed to be fair and equitable as applied to all persons subject to a test rule. However, the hearing officer has the discretion to modify the formula, or to use some other basis for allocation if necessary. Additional factors that may be taken into account include, but are not limited to, relative amounts of exposure attributable to each person and the effect of the reimbursement share on competitive position.

(b) In general, each person's share of the test cost shall be in proportion to its share of the total production volume of the test chemical:

(c) The burden of proposing modifications to the formula shall lie with the party requesting the modification.

(a) Generally, processors will be deemed to have fulfilled their testing and reimbursement responsibilities indirectly, through higher prices passed on by those directly responsible, the manufacturers. There are three circumstances in which processors will have a responsibility to provide reimbursement directly to those paying for the testing:

(1) When a test rule or subsequent Federal Register notice pertaining to a test rule expressly obligates processors as well as manufacturers to assume direct testing and data reimbursement responsibilities.

(2) When one or more manufacturers demonstrate to the hearing officer that it is necessary to include processors in order to provide fair and equitable reimbursement in a specific case.

(3) When one or more processors voluntarily agree to reimburse manufacturers for a portion of test costs. Only those processors who volunteer will incur the obligation.

(b) A hearing including processors shall be initiated in the same way as those including only manufacturers. Voluntary negotiations must be attempted in good faith first, and the request for a hearing must contain the names of the parties and a description of the unsuccessful negotiations.

(c) When processors as well as manufacturers are required to provide reimbursement, the hearing officer will decide for each case how the reimbursement should be allocated among the participating parties. When a test rule is applicable solely to processors, the hearing officer will apply the formula to the amount of the test chemical purchased or processed.

(a) Production volume will be measured over a period that begins one calendar year before publication of the final test rule in the Federal Register and continues up to the latest data available upon resolution of a dispute.

(b) For the purpose of determining fair reimbursement shares, production volume shall include amounts of the test chemical imported in bulk form and mixtures, and the total domestic production of the chemical including that produced as a byproduct. Impurities will not be included unless the test rule specifically includes them.

(c) Amounts of the test chemical manufactured for export will not be included unless covered by a finding under TSCA section 12(a)(2).

(d) Chemicals excluded from the jurisdiction of TSCA by section 3(2)(B) need not be included in the computation of production volume. (Chemicals used as intermediates to produce pesticides are covered by TSCA.)

(e) The burden of establishing the fact that particular amounts of the test chemical are produced for exempt purposes lies with the party seeking to exclude those amounts from the calculation of his production volume.

(a) All costs reasonable and necessary to comply with the test rule, taking into account the practices of other laboratories in conducting similar tests, are eligible for reimbursement. Necessary costs include:

(1) Direct and indirect costs of planning, conducting, analyzing and submitting the test results to EPA.

(2) A reasonable profit, and a reasonable rate of interest and depreciation on the tester's initial capital investment.

(3) The cost of repeating or repairing tests where failure was demonstrably due to some cause other than negligence of the tester.

(b) Costs attributable to tests beyond those specified by EPA shall not be eligible for reimbursement under this rule.

When more than one of a particular kind of test required by the test rule is performed, the additional costs will be shared among all those holding exemptions. The costs of all the tests will be added together and each exemption holder shall be responsible for a share of the total which is equal to its share of the total production of the test chemical. The exemption holders shall divide their shares between test sponsors in proportion to the costs of their respective tests. Those sponsoring a particular test do not have to obtain exemptions for that test and therefore do not have reimbursement responsibilities for the same tests done by others.