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                                                       Calendar No. 252
108th Congress                                                   Report
                                 SENATE
 1st Session                                                     108-128
_______________________________________________________________________

 
   THE CONSUMER PRODUCT SAFETY COMMISSION REAUTHORIZATION ACT OF 2003

                               __________

                              R E P O R T

                                 OF THE

           COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                                   on

                                S. 1261



                                     

                August 26, 2003.--Ordered to be printed

     Filed, under authority of the order of the Senate of July 29 
                    (legislative day, July 21), 2003



                     U.S. GOVERNMENT PRINTING OFFICE
                            WASHINGTON : 2003



       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
                      one hundred eighth congress
                             first session

                     JOHN McCAIN, Arizona, Chairman
TED STEVENS, Alaska                  ERNEST F. HOLLINGS, South Carolina
CONRAD BURNS, Montana                DANIEL K. INOUYE, Hawaii
TRENT LOTT, Mississippi              JOHN D. ROCKEFELLER IV, West 
KAY BAILEY HUTCHISON, Texas              Virginia
OLYMPIA J. SNOWE, Maine              JOHN F. KERRY, Massachusetts
SAM BROWNBACK, Kansas                JOHN B. BREAUX, Louisiana
GORDON SMITH, Oregon                 BYRON L. DORGAN, North Dakota
PETER G. FITZGERALD, Illinois        RON WYDEN, Oregon
JOHN ENSIGN, Nevada                  BARBARA BOXER, California
GEORGE ALLEN, Virginia               BILL NELSON, Florida
JOHN E. SUNUNU, New Hampshire        MARIA CANTWELL, Washington
                                     FRANK LAUTENBERG, New Jersey
           Jeanne Bumpus, Staff Director and General Counsel
                   Ann Begeman, Deputy Staff Director
                  Robert W. Chamberlin, Chief Counsel
      Kevin D. Kayes, Democratic Staff Director and Chief Counsel
                Gregg Elias, Democratic General Counsel



                                                       Calendar No. 252
108th Congress                                                   Report
                                 SENATE
 1st Session                                                    108-128
======================================================================

   THE CONSUMER PRODUCT SAFETY COMMISSION REAUTHORIZATION ACT OF 2003

                                _______
                                

                August 26, 2003.--Ordered to be printed

     Filed, under authority of the order of the Senate of July 29 
                    (legislative day, July 21), 2003

                                _______
                                

       Mr. McCain, from the Committee on Commerce, Science, and 
                Transportation, submitted the following

                              R E P O R T

                         [To accompany S. 1261]

    The Committee on Commerce, Science, and Transportation, to 
which was referred the bill (S. 1261) ``A Bill To reauthorize 
the Consumer Product Safety Commission, and for other 
purposes'', having considered the same, reports favorably 
thereon with an amendment in the nature of a substitute and 
recommends that the bill (as amended) do pass.

                          Purpose of the Bill

  S. 1261 would amend the Consumer Product Safety Act (CPSA) 
(15 U.S.C. 41 et seq.) and authorize appropriations for the 
Consumer Product Safety Commission (CPSC) for Fiscal Years 2004 
through 2007. In addition, S. 1261 would increase the 
Commission's statutory civil penalties cap and enable the CPSC 
to provide recall notification to consumers regarding certain 
hazardous products in the event that the Commission determines 
that a manufacturer is unable to do so.

                          Background and Needs

  The CPSC is an independent regulatory agency that was created 
in 1972 under the CPSA, which became effective in 1973. While 
the CPSC is authorized to have five commissioners under the 
CPSA, Congress has only appropriated funding for three 
commissioners since 1987. All commissioners are appointed by 
the President for staggered seven-year terms with the consent 
and approval of the Senate. The chairman of the Commission is 
designated by the President. Currently, the Commission is 
comprised of two Republican commissioners, Chairman Hal 
Stratton and Commissioner Mary Sheila Gall, and one Democrat, 
Commissioner Thomas Moore.
  The CPSC has jurisdiction over more than 15,000 consumer 
products (e.g., household products, sporting goods) and is 
charged under the CPSA with the duty to protect consumers 
``against unreasonable risks of injuries associated with 
consumer products.'' The Commission fulfills its statutory 
responsibilities by developing voluntary standards with 
industry, issuing mandatory standards, researching potential 
product hazards, banning products, obtaining recalls of 
products or ensuring their repair, and informing and educating 
consumers. The Commission administers four statutes: the CPSA, 
the Federal Hazardous Substances Act (FHSA),\1\ the Poison 
Prevention Packaging Act,\2\ and the Flammable Fabrics Act 
(FFA).\3\
---------------------------------------------------------------------------
    \1\  15 U.S.C. 1261 et seq.
    \2\  15 U.S.C. 1471 et seq.
    \3\  15 U.S.C. 1191 et seq.
---------------------------------------------------------------------------
  The CPSC employs approximately 471 full-time employees. Most 
are located at the Commission's headquarters in Bethesda, MD. 
There are about 130 CPSC investigators, compliance officers, 
and consumer information specialists throughout the country. 
Six offices report directly to the Chairman, including: 
Congressional Affairs, Equal Employment and Minority 
Enterprise, General Counsel, Inspector General, Secretary, and 
Executive Director. The Executive Director directs and oversees 
Commission policy and administration, which are implemented by 
the offices that report to the Executive Director: Compliance, 
Hazard Identification and Reduction, Field Operations, 
Administration, Budget, Human Resources, Information and Public 
Affairs, Information Services, and Planning and Evaluation.
  S. 1261 would authorize funding for the Commission to carry 
out its functions, powers, and duties in amounts not to exceed 
$60,000,000 for fiscal year 2004, $66,800,000 for fiscal year 
2005, $70,000,000 for fiscal year 2006, and $73,600,000 for 
fiscal year 2007. The bill would allow the Commission to 
maintain its current staffing level of up to 471 throughout the 
authorization period.
  S. 1261 also would authorize an increase in the Commission's 
current statutory cap on civil penalties from $1,250,000 to 
$20,000,000, and it would provide authority for the CPSC to 
notify consumers of defects of hazardous products in the event 
that the Commission determines that the manufacturer of such 
products is not able to perform its statutory obligation to 
provide recall notification.

                          Legislative History

  The CPSC was last reauthorized in the Consumer Product Safety 
Improvement Act of 1990 (1990 Act) (P.L. 101-608), which 
authorized funding for Fiscal Years 1991 ($42,000,000) and 1992 
($45,000,000). Since the expiration of that authorization, the 
CPSC's funding has increased by approximately five to six 
percent each year through appropriations acts.
  In the 1990 Act, Congress amended the CPSA to: (1) require, 
among other things, that the President consider individuals 
with consumer product safety backgrounds when making 
appointments to the Commission; (2) allow a three-member 
Commission to constitute a quorum; (3) revise and add to the 
list of personnel to be appointed exclusively by the Chairman; 
and (4) direct the Commission to establish an agenda and 
priorities for its actions prior to each fiscal year.
  The 1990 Act also amended the CPSA, the FHSA, and the FFA to 
require the Commission to devise procedures to monitor 
compliance with certain voluntary safety standards, and to 
prohibit the termination of proceedings to promulgate a 
consumer product safety rule when a voluntary standard has been 
first approved by the Commission.
  In addition, the 1990 Act amended the CPSA to obligate a 
manufacturer to provide notice to the Commission when: (1) the 
manufacturer becomes aware of its failure to comply with a 
voluntary standard; (2) the manufacturer becomes aware of its 
creation of an unreasonable risk of serious injury or death; or 
(3) the manufacturer becomes party to certain civil actions for 
death or grievous bodily injury. These were in addition to 
then-existing triggers for providing notice to the CPSC. The 
1990 Act declared that the reporting of a civil action shall 
not constitute an admission of liability under any statute or 
common law and prohibited the Commission from disclosing 
information about a civil action, including under legal 
process, except if requested by specified congressional 
committees.
  On June 17, 2003, the Consumer Affairs and Product Safety 
Subcommittee held a reauthorization hearing to examine possible 
changes to the CPSA, and to discuss key issues before the CPSC. 
Senator Fitzgerald presided. The hearing witnesses were: CPSC 
Chairman Hal Stratton and CPSC Commissioners Mary Sheila Gall 
and Thomas Moore; Dr. R. David Pittle, Senior Vice President, 
Technical Operations, Consumers Union; Ms. Rachel Weintraub, 
Assistant General Counsel, Consumer Federation of America; Mr. 
Alan Korn, Director of Public Policy, National SAFE Kids; Mr. 
Stephen Gold, Vice President, National Association of 
Manufacturers; and Mr. Gary Kline, Senior Vice President, 
Government Legal and Regulatory Affairs, Toy Industry 
Association. Senators McCain and Fitzgerald introduced S. 1261, 
the Consumer Product Safety Commission Reauthorization Act of 
2003, on June 13, 2003.
  On June 19, 2003, the Committee met in open executive session 
to consider an amendment in the nature of a substitute to S. 
1261 offered by Senators McCain and Hollings. The substitute 
amendment contained the authorization provisions regarding both 
the civil penalty increase and CPSC recall notification when a 
manufacturer is unable to meet its recall responsibilities.

                            Estimated Costs

  In compliance with subsection (a)(3) of paragraph 11 of rule 
XXVI of the Standing Rules of the Senate, the Committee states 
that, in its opinion, it is necessary to dispense with the 
requirements of paragraphs (1) and (2) of that subsection in 
order to expedite the business of the Senate.

                      Regulatory Impact Statement

  
  
  In accordance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee provides the 
following evaluation of the regulatory impact of the 
legislation, as reported:

                       NUMBER OF PERSONS COVERED

  The legislation would make no material change to the number 
of persons as already affected by the Commission's authority.

                            ECONOMIC IMPACT

  The economic impact of this legislation would be minimal.

                                PRIVACY

  The impact on the personal privacy of the persons covered by 
this legislation is expected to be minimal.

                               PAPERWORK

  The impact on paperwork is expected to be minimal.

                      Section-by-Section Analysis

Section 1. Short Title
  This section would designate the legislation as the 
``Consumer Product Safety Commission Reauthorization Act of 
2003.''
Section 2. Authorization of Appropriations
  This section would amend section 32(a) of the CPSA to 
authorize appropriations for the CPSC not to exceed $60,000,000 
for fiscal year 2004, $66,800,000 for fiscal year 2005, 
$70,000,000 for fiscal year 2006, and $73,600,000 for fiscal 
year 2007.
Section 3. FTE Staffing Levels
  This section would amend section 4(g) of the CPSA to 
authorize the Commission to hire and maintain a full-time 
equivalent staff of 471 persons throughout the reauthorization 
period.
Section 4. Executive Director and Officers
  This section would amend section 4(g) of the CPSA to conform 
the Commission's employee position titles that currently exist 
but that have not been formally authorized. No staff title 
changes entail the re-designation of career staff as political 
staff, or vice versa.
Section 5. Substantial Product Hazard Recalls
  This section would amend section 15 of the CPSA to authorize 
the Commission to conduct defective product recall notification 
otherwise required of a manufacturer, retailer, or distributor 
under the CPSA. Pursuant to this section, in the event that the 
Commission makes a preliminary hazard determination that there 
exists a Class A or B product hazard (as defined in the CPSC 
handbook), and the Commission finds that the manufacturer, 
retailer, or distributor is financially unable to provide 
adequate notification to the consumers of the product as 
required by the CPSA and that such notification is the public 
interest, then the Commission may provide notification. This 
section would require that within 120 days of enactment, the 
Commission prescribe strict standards for determining when a 
manufacturer is financially unable to effect adequate 
notifications required by the CPSA.

                        Changes in Existing Law

  
  In compliance with paragraph 12 of rule XXVI of the Standing 
Rules of the Senate, changes in existing law made by the bill, 
as reported, are shown as follows (existing law proposed to be 
omitted is enclosed in black brackets, new material is printed 
in italic, existing law in which no change is proposed is shown 
in roman):
  

                      CONSUMER PRODUCT SAFETY ACT

SEC. 4. CONSUMER PRODUCT SAFETY COMMISSION.

                            [15 U.S.C. 2053]

  (a) Establishment; Chairman.--An independent regulatory 
commission is hereby established, to be known as the Consumer 
Product Safety Commission, consisting of five Commissioners who 
shall be appointed by the President, by and with the advice and 
consent of the Senate. In making such appointments, the 
President shall consider individuals who, by reason of their 
background and expertise in areas related to consumer products 
and protection of the public from risks to safety, are 
qualified to serve as members of the Commission. The Chairman 
shall be appointed by the President, by and with the advice and 
consent of the Senate, from among the members of the 
Commission. An individual may be appointed as a member of the 
Commission and as Chairman at the same time. Any member of the 
Commission may be removed by the President for neglect of duty 
or malfeasance in office but for no other cause.
  (b) Term; Vacancies.--
          (1) Except as provided in paragraph (2), (A) the 
        Commissioners first appointed under this section shall 
        be appointed for terms ending three, four, five, six, 
        and seven years, respectively, after the date of the 
        enactment of this Act, the term of each to be 
        designated by the President at the time of nomination; 
        and (B) each of their successors shall be appointed for 
        a term of seven years from the date of the expiration 
        of the term for which his predecessor was appointed.
          (2) Any Commissioner appointed to fill a vacancy 
        occuring prior to the expiration of the term for which 
        his predecessor was appointed shall be appointed only 
        for the remainder of such term. A Commissioner may 
        continue to serve after the expiration of his term 
        until his successor has taken office, except that he 
        may not so continue to serve more than one year after 
        the date on which his term would otherwise expire under 
        this subsection.
  (c) Restrictions on Commissioner's Outside Activities.--Not 
more than three of the Commissioners shall be affiliated with 
the same political party. No individual (1) in the employ of, 
or holding any official relation to, any person engaged in 
selling or manufacturing consumer products, or (2) owning stock 
or bonds of substantial value in a person so engaged, or (3) 
who is in any other manner pecuniarily interested in such a 
person, or in a substantial supplier of such a person, shall 
hold the office of Commissioner. A Commissioner may not engage 
in any other business, vocation, or employment.
  (d) Quorum; Seal; Vice Chairman.--No vacancy in the 
Commission shall impair the right of the remaining 
Commissioners to exercise all the powers of the Commission, but 
three members of the Commission shall constitute a quorum for 
the transaction of business, except that if there are only 
three members serving on the Commission because of vacancies in 
the Commission, two members of the Commission shall constitute 
a quorum for the transaction of business, and if there are only 
two members serving on the Commission because of vacancies in 
the Commission, two members shall constitute a quorum for the 
six month period beginning on the date of the vacancy which 
caused the number of Commission members to decline to two. The 
Commission shall have an official seal of which judicial notice 
shall be taken. The Commission shall annually elect a Vice 
Chairman to act in the absence or disability of the Chairman or 
in case of a vacancy in the office of the Chairman.
  (e) Offices.--The Commission shall maintain a principal 
office and such field offices as it deems necessary and may 
meet and exercise any of its powers at any other place.
  (f) Functions of Chairman; Request for Appropriations.--
          (1) The Chairman of the Commission shall be the 
        principal executive officer of the Commission, and he 
        shall exercise all of the executive and administrative 
        functions of the Commission, including functions of the 
        Commission with respect to (A) the appointment and 
        supervision of personnel employed under the Commission 
        (other than personnel employed regularly and full time 
        in the immediate offices of commissioners other than 
        the Chairman), (B) the distribution of business among 
        personnel appointed and supervised by the Chairman and 
        among administrative units of the Commission, and (C) 
        the use and expenditure of funds.
          (2) In carrying out any of his functions under the 
        provisions of this subsection the Chairman shall be 
        governed by general policies of the Commission and by 
        such regulatory decisions, findings, and determinations 
        as the Commission may by law be authorized to make.
          (3) Requests or estimates for regular, supplemental, 
        or deficiency appropriations on behalf of the 
        Commission may not be submitted by the Chairman without 
        the prior approval of the Commission.
  [(g) Executive Director; Officers and Employees.--(1)(A) The 
Chairman, subject to the approval of the Commission, shall 
appoint as officers of the Commission an Executive Director, a 
General Counsel, an Associate Executive Director for 
Engineering Sciences, an Associate Executive Director for 
Epidemiology, an Associate Executive Director for Compliance 
and Administrative Litigation, an Associate Executive Director 
for Health Sciences, an Associate Executive Director for 
Economic Analysis, an Associate Executive Director for 
Administration, an Associate Executive Director for Field 
Operations, a Director for Office of Program, Management, and 
Budget, and a Director for Office of Information and Public 
Affairs. Any other individual appointed to a position 
designated as an Associate Executive Director shall be 
appointed by the Chairman, subject to the approval of the 
Commission. The Chairman may only appoint an attorney to the 
position of Associate Executive Director of Compliance and 
Administrative Litigation except the position of acting 
Associate Executive Director of Compliance and Administrative 
Litigation.]
  (g) Executive Director; Officers and Employees.--(1)(A)The 
Chairman, subject to the approval of the Commission, shall 
appoint as officers of the Commission an Executive Director, a 
General Counsel, an Associate Executive Director for 
Engineering Sciences, an Associate Executive Director for 
Laboratory Sciences, an Associate Executive Director for 
Epidemiology, an Associate Executive Director for Health 
Sciences, an Assistant Executive Director for Compliance, an 
Associate Executive Director for Economic Analysis, an 
Associate Executive Director for Administration, an Associate 
Executive Director for Field Operations, an Assistant Executive 
Director for Office of hazard Identification and Reduction, an 
Assistant Executive Director for Information Services, and a 
Director for Office of Information and Public Affairs. Any 
other individual appointed to a position designated as an 
Assistant or Associate Executive Director shall be appointed by 
the Chairman, subject to the approval of the Commission. The 
Chairman may only appoint an attorney to the position of 
Assistant Executive Director for Compliance, but this 
restriction does not apply to the position of Acting Assistant 
Executive Director for Compliance.
  (B)(i) No individual may be appointed to such a position on 
an acting basis for a period longer than 90 days unless such 
appointment is approved by the Commission.
  (ii) The Chairman, with the approval of the Commission, may 
remove any individual serving in a position appointed under 
subparagraph (A).
  (C) Subparagraph (A) shall not be construed to prohibit 
appropriate reorganizations or changes in classification.
  (2) The Chairman, subject to subsection (f)(2), may employ 
such other officers and employees (including attorneys) as are 
necessary in the execution of the Commission's functions.
  (3) In addition to the number of positions authorized by 
section 5108(a) of title 5, United States Code, the Chairman, 
subject to the approval of the Commission, and subject to the 
standards and procedures prescribed by chapter 51 of title 5, 
United States Code, may place a total of twelve positions in 
grades GS-16, GS-17, and GS-18.
  (4) The appointment of any officer (other than a 
Commissioner) or employee of the Commission shall not be 
subject, directly or indirectly, to review or approval by any 
officer or entity within the Executive Office of the President.
  (5) The Commission is authorized to hire and maintain a full 
time equivalent staff of 471 persons in each of fiscal years 
2004 through 2007.
  (h) [Omitted]
  (i) Civil Action Against the United States.--Subsections (a) 
and (h) of section 2680 of title 28, United States Code, do not 
prohibit the bringing of a civil action on a claim against the 
United States which--
          (1) is based upon--
                  (A) misrepresentation or deceit on the part 
                of the Commission or any employee thereof, or
                  (B) any exercise or performance, or failure 
                to exercise or perform, a discretionary 
                function on the part of the Commission or any 
                employee thereof, which exercise, performance, 
                or failure was grossly negligent; and
          (2) is not made with respect to any agency action (as 
        defined in section 551(13) of title 5, United States 
        Code. In the case of a civil action on a claim based 
        upon the exercise or performance of, or failure to 
        exercise or perform, a discretionary function, no 
        judgment may be entered against the United States 
        unless the court in which such action was brought 
        determines (based upon consideration of all the 
        relevant circumstances, including the statutory 
        responsibility of the Commission and the public 
        interest in encouraging rather than inhibiting the 
        exercise of discretion) that such exercise, 
        performance, or failure to exercise or perform was 
        unreasonable.
  (j) Agenda and Priorities; Establishment and Comments.--At 
least 30 days before the beginning of each fiscal year, the 
Commission shall establish an agenda for Commission action 
under the Acts under its jurisdiction and, to the extent 
feasible, shall establish priorities for such actions. Before 
establishing such agenda and priorities, the Commission shall 
conduct a public hearing on the agenda and priorities and shall 
provide reasonable opportunity for the submission of comments.

SEC. 15. SUBSTANTIAL PRODUCT HAZARDS.

                            [15 U.S.C. 2064]

  (a) ``Substantial Product Hazard'' Defined.--For purposes of 
this section, the term ``substantial product hazard'' means--
          (1) a failure to comply with an applicable consumer 
        product safety rule which creates a substantial risk of 
        injury to the public, or
          (2) a product defect which (because of the pattern of 
        defect, the number of defective products distributed in 
        commerce, the severity of the risk, or otherwise) 
        creates a substantial risk of injury to the public.
  (b) Noncompliance With Applicable Consumer Product Safety 
Rules; Product Defects; Notice to Commission by Manufacturer, 
Distributor, or Retailer.--Every manufacturer of a consumer 
product distributed in commerce, and every distributor and 
retailer of such product, who obtains information which 
reasonably supports the conclusion that such product--
          (1) fails to comply with an applicable consumer 
        product safety rule or with a voluntary consumer 
        product safety standard upon which the Commission has 
        relied under section 9;
          (2) contains a defect which could create a 
        substantial product hazard described in subsection 
        (a)(2); or
          (3) creates unreasonable risk of serious injury or 
        death, shall immediately inform the Commission of such 
        failure to comply, of such defect, or of such risk, 
        unless such manufacturer, distributor, or retailer has 
        actual knowledge that the Commission has been 
        adequately informed of such defect, failure to comply, 
        or such risk.
  (c) Public Notice of Defect or Failure To Comply; Mail 
Notice.--If the Commission determines (after affording 
interested persons, including consumers and consumer 
organizations, an opportunity for a hearing in accordance with 
subsection (f) of this section) that a product distributed in 
commerce presents a substantial product hazard and that 
notification is required in order to adequately protect the 
public from such substantial product hazard, the Commission may 
order the manufacturer or any distributor or retailer of the 
product to take any one or more of the following actions:
          (1) To give public notice of the defect or failure to 
        comply.
          (2) To mail notice to each person who is a 
        manufacturer, distributor, or retailer of such product.
          (3) To mail notice to every person to whom the person 
        required to give notice knows such product was 
        delivered or sold. Any such order shall specify the 
        form and content of any notice required to be given 
        under such order.
  (d) Repair; Replacement; Refunds; Action Plan.--If the 
Commission determines (after affording interested parties, 
including consumers and consumer organizations, an opportunity 
for a hearing in accordance with subsection (f)) that a product 
distributed in commerce presents a substantial product hazard 
and that action under this subsection is in the public 
interest, it may order the manufacturer or any distributor or 
retailer of such product to take whichever of the following 
actions the person to whom the order is directed elects:
          (1) To bring such product into conformity with the 
        requirements of the applicable consumer product safety 
        rule or to repair the defect in such product.
          (2) To replace such product with a like or equivalent 
        product which complies with the applicable consumer 
        product safety rule or which does not contain the 
        defect.
          (3) To refund the purchase price of such product 
        (less a reasonable allowance for use, if such product 
        has been in the possession of a consumer for one year 
        or more (A) at the time of public notice under 
        subsection (c), or (B) at the time the consumer 
        receives actual notice of the defect or noncompliance, 
        whichever first occurs). An order under this subsection 
        may also require the person to whom it applies to 
        submit a plan, satisfactory to the Commission, for 
        taking action under whichever of the preceding 
        paragraphs of this subsection under which such person 
        has elected to act. The Commission shall specify in the 
        order the persons to whom refunds must be made if the 
        person to whom the order is directed elects to take the 
        action described in paragraph (3). If an order under 
        this subsection is directed to more than one person, 
        the Commission shall specify which person has the 
        election under this subsection. An order under this 
        subsection may prohibit the person to whom it applies 
        from manufacturing for sale, offering for sale, 
        distributing in commerce, or importing into the customs 
        territory of the United States (as defined in general 
        note 2 of the Harmonized Tariff Schedule of the United 
        States), or from doing any combination of such actions, 
        the product with respect to which the order was issued.
  (e) Reimbursement.--
          (1) No charge shall be made to any person (other than 
        a manufacturer, distributor, or retailer) who avails 
        himself of any remedy provided under an order issued 
        under subsection (d), and the person subject to the 
        order shall reimburse each person (other than a 
        manufacturer, distributor, or retailer) who is entitled 
        to such a remedy for any reasonable and foreseeable 
        expenses incurred by such person in availing himself of 
        such remedy.
          (2) An order issued under subsection (c) or (d) with 
        respect to a product may require any person who is a 
        manufacturer, distributor, or retailer of the product 
        to reimburse any other person who is a manufacturer, 
        distributor, or retailer of such product for such other 
        person's expenses in connection with carrying out the 
        order, if the Commission determines such reimbursement 
        to be in the public interest.
  (f) Hearing.--An order under subsection (c) or (d) may be 
issued only after an opportunity for a hearing in accordance 
with section 554 of title 5, United States Code, except that, 
if the Commission determines that any person who wishes to 
participate in such hearing is a part of a class of 
participants who share an identity of interest, the Commission 
may limit such person's participation in such hearing to 
participation through a single representative designated by 
such class (or by the Commission if such class fails to 
designate such a representative). Any settlement offer which is 
submitted to the presiding officer at a hearing under this 
subsection shall be transmitted by the officer to the 
Commission for its consideration unless the settlement offer is 
clearly frivolous or duplicative of offers previously made.
  (g) Preliminary Injunction.--
          (1) If the Commission has initiated a proceeding 
        under this section for the issuance of an order under 
        subsection (d) with respect to a product which the 
        Commission has reason to believe presents a substantial 
        product hazard, the Commission (without regard to 
        section 27(b)(7)) or the Attorney General may, in 
        accordance with section 12(d)(1), apply to a district 
        court of the United States for the issuance of a 
        preliminary injunction to restrain the distribution in 
        commerce of such product pending the completion of such 
        proceeding. If such a preliminary injunction has been 
        issued, the Commission (or the Attorney General if the 
        preliminary injunction was issued upon an application 
        of Attorney General) may apply to the issuing court for 
        extensions of such preliminary injunction.
          (2) Any preliminary injunction, and any extension of 
        a preliminary injunction, issued under this subsection 
        with respect to a product shall be in effect for such 
        period as the issuing court prescribes not to exceed a 
        period which extends beyond the thirtieth day from the 
        date of the issuance of the preliminary injunction (or, 
        in the case of a preliminary injunction which has been 
        extended, the date of its extension) or the date of the 
        completion or termination of the proceeding under this 
        section respecting such product, whichever date occurs 
        first.
          (3) The amount in controversy requirement of section 
        1331 of title 28, United States Code, does not apply 
        with respect to the jurisdiction of a district court of 
        the United States to issue or exend a preliminary 
        injunction under this subsection.
  (h) Cost-Benefit Analysis of Notification or Other Action Not 
Required.--Nothing in this section shall be construed to 
require the Commission, in determining that a product 
distributed in commerce presents a substantial product hazard 
and that notification or other action under this section should 
be taken, to prepare a comparison of the costs that would be 
incurred in providing notification or taking other action under 
this section with the benefits from such notification or 
action.
  (i) Commission-Financed Recalls.--
          (1) In general.--The Commission may take the actions 
        otherwise required of a manufacturer, retailer, or 
        distributor under subsection (c)(1), (2), and (3) with 
        respect to a product if the Commission--
                  (A) staff makes a preliminary hazard 
                determination that a product presents a 
                substantial product hazard classified as a 
                Class A or B product hazard (as defined in the 
                Commission's Recall Handbook) or the Commission 
                makes a substantial product hazard 
                determination classified as a Class A or B 
                product hazard (as defined in the Commission's 
                Recall Handbook) with respect to such a 
                product; and
                  (B) finds that--
                          (i) notification of the hazard is in 
                        the public interest; and
                          (ii) the manufacturer, retailer, or 
                        distributor is financially unable to 
                        provide adequate notification.
          (2) Implementing regulations.--Not more than 120 days 
        after the date of enactment of the Consumer Product 
        Safety Commission Reauthorization Act of 2003, the 
        Commission shall prescribe regulations to implement 
        paragraph (1). In promulgating such regulations, the 
        Commission shall establish strict standards for 
        ensuring that Commission funding is expended only on 
        the product recall notifications of manufacturers, 
        retailers, or distributors that are financially unable 
        to effect adequate notifications required by this 
        section.
          (3) Authorization of appropriations.--There are 
        authorized to be appropriated to the Commission for 
        each fiscal year $2,000,000 to carry out this 
        subsection.

SEC. 20. CIVIL PENALTIES.

                            [15 U.S.C. 2069]

  (a) Amount of Penalty.--
          (1) Any person who knowingly violates section 19 of 
        this Act shall be subject to a civil penalty not to 
        exceed $5,000 for each such violation. Subject to 
        paragraph (2), a violation of section 19(a)(1), (2), 
        (4), (5), (6), (7), (8), (9), (10), or (11) shall 
        constitute a separate offense with respect to each 
        consumer product involved, except that the maximum 
        civil penalty shall not exceed [$1,250,000] $20,000,000 
        for any related series of violations. A violation of 
        section 19(a)(3) shall constitute a separate violation 
        with respect to each failure or refusal to allow or 
        perform an act required thereby; and, if such violation 
        is a continuing one, each day of such violation shall 
        constitute a separate offense, except that the maximum 
        civil penalty shall not exceed [$1,250,000] $20,000,000 
        for any related series of violations.
          (2) The second sentence of paragraph (1) of this 
        subsection shall not apply to violations of paragraph 
        (1) or (2) of section 19(a)--
                  (A) if the person who violated such 
                paragraphs is not the manufacturer or private 
                labeler or a distributor of the products 
                involved, and
                  (B) if such person did not have either (i) 
                actual knowledge that his distribution or sale 
                of the product violated such paragraphs or (ii) 
                notice from the Commission that such 
                distribution or sale would be a violation of 
                such paragraphs.
          (3)(A) The maximum penalty amounts authorized in 
        paragraph (1) shall be adjusted for inflation as 
        provided in this paragraph.
          (B) Not later than December 1, 1994, and December 1 
        of each fifth calendar year thereafter, the Commission 
        shall prescribe and publish in the Federal Register a 
        schedule of maximum authorized penalties that shall 
        apply for violations that occur after January 1 of the 
        year immediately following such publication.
          (C) The schedule of maximum authorized penalties 
        shall be prescribed by increasing each of the amounts 
        referred to in paragraph (1) by the cost-of-living 
        adjustment for the preceding five years. Any increase 
        determined under the preceding sentence shall be 
        rounded to--
                  (i) in the case of penalties greater than 
                $1,000 but less than or equal to $10,000, the 
                nearest multiple of $1,000;
                  (ii) in the case of penalties greater than 
                $10,000 but less than or equal to $100,000, the 
                nearest multiple of $5,000;
                  (iii) in the case of penalties greater than 
                $100,000 but less than or equal to $200,000, 
                the nearest multiple of $10,000; and
                  (iv) in the case of penalties greater than 
                $200,000, the nearest multiple of $25,000.
          (D) For purposes of this subsection:
                  (i) The term ``Consumer Price Index'' means 
                the Consumer Price Index for all-urban 
                consumers published by the Department of Labor.
                  (ii) The term ``cost-of-living adjustment for 
                the preceding five years'' means the percentage 
                by which--
                          (I) the Consumer Price Index for the 
                        month of June of the calendar year 
                        preceding the adjustment; exceeds
                          (II) the Consumer Price Index for the 
                        month of June preceding the date on 
                        which the maximum authorized penalty 
                        was last adjusted.
  (b) Relevant Factors in Determining Amount of Penalty.--In 
determining the amount of any penalty to be sought upon 
commencing an action seeking to assess a penalty for a 
violation of section 19(a), the Commission shall consider the 
nature of the product defect, the severity of the risk of 
injury, the occurrence or absence of injury, the number of 
defective products distributed, and the appropriateness of such 
penalty in relation to the size of the business of the person 
charged.
  (c) Compromise of Penalty; Deductions From Penalty.--Any 
civil penalty under this section may be compromised by the 
Commission. In determining the amount of such penalty or 
whether it should be remitted or mitigated and in what amount, 
the Commission shall consider the appropriateness of such 
penalty to the size of the business of the person charged, the 
nature of the product defect, the severity of the risk of 
injury, the occurrence or absence of injury, and the number of 
defective products distributed. The amount of such penalty when 
finally determined, or the amount agreed on compromise, may be 
deducted from any sums owing by the United States to the person 
charged.
  (d) ``Knowingly'' Defined.--As used in the first sentence of 
subsection (a)(1) of this section, the term ``knowingly'' means 
(1) the having of actual knowledge, or (2) the presumed having 
of knowledge deemed to be possessed by a reasonable man who 
acts in the circumstances, including knowledge obtainable upon 
the exercise of due care to ascertain the truth of 
representations.

SEC. 32. AUTHORIZATION OF APPROPRIATIONS.

                            [15 U.S.C. 2081]

  (a) There are authorized to be appropriated for the purposes 
of carrying out the provisions of this Act (other than the 
provisions of section 27(h) which authorize the planning and 
construction of research, development, and testing facilities) 
and for the purpose of carrying out the functions, powers, and 
duties transferred to the Commission under section 30, not to 
exceed--
          [(1) $42,000,000 for fiscal year 1991, and
          [(2) $45,000,000 for fiscal year 1992. For payment of 
        accumulated and accrued leave under section 5551 of 
        title 5, United States Code, severance pay under 
        section 5595 under such title, and any other expense 
        related to a reduction in force in the Commission, 
        there are authorized to be appropriated such sums as 
        may be necessary.]
          (1) $60,000,000 for fiscal Year 2004;
          (2) $66,800,000 for fiscal year 2005;
          (3) $70,100,000 for fiscal year 2006; and
          (4) $73,600,000 for fiscal year 2007.
  (b)(1) There are authorized to be appropriated such sums as 
may be necessary for the planning and construction of research, 
development and testing facilities described in section 27(h); 
except that no appropriation shall be made for any such 
planning or construction involving an expenditure in excess of 
$100,000 if such planning or construction has not been approved 
by resolutions adopted in substantially the same form by the 
Committee on Energy and Commerce of the House of 
Representatives, and by the Committee on Commerce, Science, and 
Transportation of the Senate. For the purpose of securing 
consideration of such approval the Commission shall transmit to 
Congress a prospectus of the proposed facility including (but 
not limited to)--
          (A) a brief description of the facility to be planned 
        or constructed;
          (B) the location of the facility, and an estimate of 
        the maximum cost of the facility;
          (C) a statement of those agencies, private and 
        public, which will use such facility, together with the 
        contribution to be made by each such agency toward the 
        cost of such facility; and
          (D) a statement of justification of the need for such 
        facility.
  (2) The estimated maximum cost of any facility approved under 
this subsection as set forth in the prospectus may be increased 
by the amount equal to the percentage increase, if any, as 
determined by the Commission, in construction costs, from the 
date of the transmittal of such prospectus to Congress, but in 
no event shall the increase authorized by this paragraph exceed 
10 per centum of such estimated maximum cost.
  (c) No funds appropriated under subsection (a) may be used to 
pay any claim described in section 4(i) whether pursuant to a 
judgment of a court or under any award, compromise, or 
settlement of such claim made under section 2672 of title 28, 
United States Code, or under any other provision of law.