The chairman of the Consumer Product Safety Commission says his agency has suspended efforts to develop a mandatory safety standard for home insulation by itself, choosing instead to work with Congress.

In testimony this week during House Commerce subcommittee hearings on home insulation, S. John Byington said that the commission will instead work for and help with final drafting of proposed legislation that would mandate a standard within 120 days of passage. Passage of such legislation would allow the agency to shortcut several time-consuming procedures mandated by its bylaws.

He said the CPSC would now "devote all available resources" to redraft the House bill, but that under its present restrictions, it would take too much time to pursue a standard when legislation is so close.

A bill giving the agency 120 days to develop a standard has already passed the Senate, but the House version of the bill calls for a standard to be set within 45 days.

Byington said that 45 days would not be enough, but "a 120-day effective date would give the commission a more reasonable time to properly plan its program."

The proposed legislation grew out of congressional dissatisfaction with the amount of time the CPSC was taking to develop safety standards for cellulose home insulation, which is being used with increasing frequency.

Both proposals serve to eliminate many time-consuming steps involving outside scrutiny in the CPSC standards-development process, thus allowing the agency to move faster in developing a standard.

The cellulose insulation problems first were brought to the attention of the commission almost three years ago by its Denver field office, which has information on a number of house fires allegedly caused by improperly treated cellulose insulation.

But it wasn't until last November that the commission authorized its staff to seek a mandatory safety standard.

Now the commission appears willing to adopt temporarily a General Services Administration safety standard in effect for any government purchases of cellulose insulation, with the proviso that the commission easily can change that standard as more test results and information becomes available.

Problems began in the cellulose insulation industry after many new manufacturers started selling flammable insulation to capitalize on the booming demand for any home insulation, so long as it is treated with a flame retardant.

According to one Federal Trade Commission estimate, 6 million Americans insulated or reinsulated their homes in the past year. Because resources of traditional insulators such as fiber glass and mineral wool are limited, cellulose insulation has become increasingly popular. The FTC estimates that the number of firms making cellulose insulation has increased from 140 to 750 since last August.

The commission recently recalled several television and radio spot advertisements warning of the danger of certain home insulation because of legal action taken by the industry. The ads are being done over.

Byington said that a proposal by Rep. John Moss (D-Calif.) calling for third-party certification of industry safety efforts was unreasonable because of the "considerable time and resources needed to develop, implement, and operate such a program at this time."

That proposal would have a certified testing operation, such as Underwriters Laboratories Inc. monitory the 750-some manufacturers' plants to see if they are observing safety standards. Byington said the CPSC should handle monitoring.

Byington told the hearings that his agency would need 40 more staffers and another $2 million in the budget for the first year alone if it were to enforce a mandatory standard.

Under the suggestion calling for a third-party testing and inspection program, the government would establish criteria for certifying independent laboratories to test cellulose for flammability and corrosiveness and to make inspections of cellulose manufacturing plants, perhaps as often as four times a month.

Laboratories would apply to the government for certification as third parties, and cellulose manufacturers would have to, in effect, hire a certified lab, at the manufacturer's expense, to do the official testing, and make sure that the plant is producing the same cellulose insulation that was originally tested and approved.

One problem with the proposal, according to Hill sources, is that most of the insulation manufacturers are small businesses, the cost of paying the laboratories might be an unfair competitive burden, since the larger firms could more easily absorb the costs. There are also fears that by the time an independent testing program would be set up and approved, the demand for cellulose might peak out.