Chinese Drywall Bill Passes Congress

The U.S. House of Representatives voted 378-37 in favor of the Drywall Safety Act, sending the bill to President Barack Obama for final approval.

The U.S. House of Representatives passed legislation on Jan. 1 banning the sale of contaminated drywall imported from China and insisting that the Chinese government force manufacturers to compensate American homeowners who have faced property damage and health problems caused by the tainted product.

The U.S. House of Representatives voted 378–37 in favor of the Drywall Safety Act during a holiday session convened to address the fiscal cliff stalemate, sending the bill to President Barack Obama for final approval.

Citing studies showing contaminated drywall imported from China creates a corrosive environment for fire-safety alarm devices, electrical components, gas-service piping and fire-suppression sprinkler systems installed in affected homes, the bill stipulates that contaminated drywall be treated as a banned hazardous substance under the Federal Hazardous Substances Act and as an imminent hazard under the Consumer Product Safety Act.

The legislation also requires the secretary of Commerce to urge the Chinese government to facilitate a meeting between the companies that produced and exported the shoddy product and U.S. government representatives in order to provide relief for American consumers who bought the drywall. The Secretary of Commerce must also demand that China direct those companies to submit to U.S. court jurisdiction and comply with federal rulings.

Rep. Ted Deutch, D-Fla., who introduced the bill on March 19, 2012, with Rep. Scott Rigell, R-Va., said the legislation should rectify at least some of the damage done to U.S. homeowners and prevent more contaminated drywall from entering the market in the future. Rigell is the co-chair of the bi-partisan Contaminated Drywall Bill, which would create a labeling system so any more contaminated drywall could be traced directly to the manufacturer. It would also set a limit on the amount of sulfur in drywall.

The House passed the original bill by voice vote in September. That version called for Secretary of State Hillary Clinton to issue the demands on the Chinese government, but the Senate amended the bill to hand that duty over to the Commerce Department. The Senate passed the bill unanimously on Dec. 21, and the House approved the Senate version by a 341-vote margin. The 37 nay votes all came from the Republican side of the aisle, and included House Majority Whip Kevin McCarthy, R-Calif.

The legislation sets new labeling provisions for drywall, requiring each sheet to include the name of the manufacturer and the month and year that the product was produced. The labeling rule goes into effect six months after the bill becomes law. The bill also forces the Consumer Product Safety Commission to set tighter restrictions on the sulfur content of imported drywall, requiring the new standards no more than two years after the bill is enacted.

Problems with Chinese drywall came to light early in 2009. The importation of drywall surged during the housing boom in the mid-2000s and in the wake of hurricanes Katrina and Rita in 2005. Since Hurricane Katrina, many homes in Louisiana were rebuilt with toxic Chinese drywall, leaving homeowners with few options to remedy the situation. A sprawling multi-district litigation — which includes some 10,000 or more cases — is pending in the Eastern District of Louisiana.

Chinese drywall manufacturer Knauf Plasterboard Tianjin Co. agreed in December 2011 to pay for remediation and personal injury claims in a settlement worth between $800 million and $1 billion. The deal covers the remediation of about 4,500 homes..