May 25, 2009 – A vote, but still no outcome?

A federal action to temporarily halt a ban on youth-designed ATVs and motorcycles has yet to make a noticeable impact on the industry.
That’s because legal questions still surround the question of selling such vehicles — including some youth snowmobiles — that have become part of a controversy over retail products that possess more lead content than what is allowed under a new law, the Consumer Product Safety Improvement Act (CPSIA).
An action by the Consumer Product Safety Commission (CPSC) has temporarily halted the ban at the federal level as well as outlined steps that manufacturers of youth-designed vehicles must meet in the coming months. But industry groups, including the Motorcycle Industry Council (MIC), have said the CSPC’s move to stay the ban still leaves serious legal questions at the state level as well as possible import challenges going forward.
“The dealers are put in a very difficult position, as are the manufacturers, because you have the CPSC saying we did this so you can go ahead and sell,” said Paul Vitrano, general counsel for the MIC, “yet everyone concedes that (CPSC) stay doesn’t change the law.
“Everyone is making their own business decision with their own legal advice as to which way to go. You’re either not selling that product and losing the revenue and not making the appropriate units available or you’re selling under the (CPSC) stay and taking the risk” of being prosecuted at the state level.
Industry groups also are continuing to closely watch federal legislative efforts, as bills seeking to revise the CPSIA currently exist in both the House and the Senate. Neither bill at press time, however, had made it out of committee yet. A MIC press release issued after the CPSC commissioners voted to temporarily halt the ban on youth powersports vehicles said, “it is clear the only way to obtain adequate and permanent relief for riders and the powersports industry from the CPSIA’s lead content requirements is for Congress to take action.”
Acting CPSC Chairman Nancy Nord also hinted at the need for Congressional action on the matter in a statement supporting her vote to halt the ban, which lasts until May 1, 2011. “As the ATV situation before us illustrates, Congress may wish to consider how the retroactive nature of the law is impacting consumers, as well as product sellers,” Nord wrote.
Some Congressional staff members have told Vitrano that they could be reaching out to state attorneys generals in wake of the decision by CPSC vote. The staff members are trying to get the state attorneys general to say whether they will honor the CPSC stay of enforcement on such vehicles, Vitrano said.

Ongoing issues
As part of the CPSC vote, manufacturers will continue to address the topic of lead in their youth-designed vehicles. The federal action requires each manufacturer present a comprehensive plan to the CPSC by Nov. 1 that describes how and when it intends to reduce the lead exposure from specified vehicle parts. The CPSC stay mentioned a number of parts that OEMs must examine, including battery terminals, tire valve stems, fittings and connectors made with copper alloys, brake and clutch levers and other brake components, throttle controls, engine housings and carburetors made with aluminum alloys. Fasteners, frames and structural or engine components made with steel alloys also were mentioned.
CPSC public documents noted some OEMs already have been tackling the issue of lead compliance, including:
One of the largest youth ATV manufacturers, which was not named by the CPSC, said it is considering adding a cover to the ATV’s battery. The cover would then be screwed into place, making it inaccessible to the youth rider, a key compliance issue.
Manufacturers also are looking at making other parts, like the valve stem and some cable systems, inaccessible.
A snowmobile OEM noted it has sent retrofit kits to all its dealers to switch out a few components that did not meet lead limits.
Both the industry and the CPSC have pointed out concerns over what unforeseen safety concerns could result if manufacturers reduce the amount of lead in certain parts. CPSC Commissioner Thomas Moore reiterated this in a statement he issued after voting for the stay, noting the CPSC “does not want to create a scenario where a reduction in lead could result in vehicles that have structural weaknesses or brake components that fail during operation.”
Thus both CSPSC commissioners voted in favor of the stay, which provides time for more safety analysis.
The MIC applauded the decision for the stay, but noted legislative efforts to revise the CPSIA are crucial for the industry.
“Although the commissioners’ intentions are laudable, it is clear that the stay of enforcement as drafted is a temporary stop-gap measure with conditions largely unrelated to safety. It does not and cannot end the ban on these vehicles,” the MIC stated in its press release. “Due to the highly restrictive language of the CPSIA and the fact that the CPSC is not the only agency responsible for enforcing the law, this stay of enforcement is simply inadequate in legal terms and leaves the industry vulnerable to lawsuits and actions by federal and state agencies.”

Question over imports
One particular issue of concern is the importing of youth-designed ATVs and motorcycles.
CPSC public documents explaining the stay say the commission “will not refuse admission into the U.S. of such vehicles based on the lead content of any part of such vehicles.” The MIC, however, stated in its press release that the U.S. Customs and Border Protection is responsible for enforcing this, and CPSC’s action does not bind this separate federal agency to follow it.
“I haven’t heard of anyone having a problem with importation either before or after this stay,” Vitrano said, “but it doesn’t change the fact that Customs is an independent federal agency and they have to make their own determination or not make a determination whether they are going to follow this stay.”
Vitrano said he’s not aware if the Customs department will make an official decision in wake of the CPSC stay.
“Frankly I would not expect them to make an official determination,” he said. “They may just as a matter of practice or policy decide internally that they are going to follow the CPSC stay or they may not do anything and allow the imports to come in. How this plays out practically is unclear, but it doesn’t change the fact the CPSC has its own jurisdiction and other (federal) agencies their own.”