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January 29, 1996 01:00 AM

CONGRESSIONAL PANEL PLUGS DEMANUFACTURING

Roger King
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    WASHINGTON - Some call it a new name for recycling, and to some it's freeing the valuable parts of a valueless item. But Rep. Bob Franks, R-N.J., sees demanufacturing as both an urban employment booster and a ``great opportunity to expand manufacturing in America.'' Franks, co-chairman of the Congressional Task Force on Manufacturing, declined to say whether he would change the federal Resource Conservation and Recovery Act to reduce what he termed as regulatory barriers to demanufacturing.

    Franks led a panel Jan. 17 promoting demanufacturing, which he described as ``the process of locating, collecting, dismantling, selling and reusing valuable components of discarded products.''

    Doing so, however, sometimes brings collected components - especially chemicals - under environmental regulations that might not apply to the manufactured product itself.

    ``The one major advantage of demanufacturing is that waste becomes more environmentally friendly by removing many of the hazardous materials that often leach into the soil and ground water,'' Franks said.

    Automobile recycling is a demanufacturing success story, but panel member William Steinkuller, president of the Washington-based Automotive Recyclers Association, said auto-motive plastics pose problems because of limited markets and high processing costs.

    Another advantage is the employment prospect, according to Gene Slowinski, a Rutgers University school of management professor in Gladstone, N.J.

    ``Demanufacturing is ripe for urban areas. It is the first blue-collar industry that has emerged in my lifetime,'' Slowinski said.

    But he said major firms will not form new demanufacturing divisions because it will not produce enough revenue.

    But panel members agreed changes to the national regulatory structure would have to be made to encourage the process.

    Panel member Jeffrey Calla-han, director of the Union County Utilities Authority in Elizabeth, N.J., called for a relaxation of universal waste rules to permit demanufacturing, instead of only destruction or disposal of hazardous materials.

    And until demand for demanufactured components is great enough, the process will require subsidies, said Herschel Cutler, president of the Institute of Scrap Recycling Industries. ``Creating a supply does not its own market make,'' Cutler noted.

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