[Senate Hearing 108-362]
[From the U.S. Government Publishing Office]
S. Hrg. 108-362
IMPLEMENTATION OF THE CLEAN WATER ACT
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON FISHERIES, WILDLIFE, AND WATER
OF THE
COMMITTEE ON
ENVIRONMENT AND PUBLIC WORKS
UNITED STATES SENATE
ONE HUNDRED EIGHTH CONGRESS
FIRST SESSION
__________
SEPTEMBER 16, 2003
__________
ON
THE TOTAL MAXIMUM DAILY LOAD (TMDL) PROGRAM, SPILL PREVENTION CONTROL
AND COUNTERMEASURE PLANS, STORM WATER ISSUES, WATER QUALITY TRADING AND
THE NEGLIGENT VIOLATION SECTION OF THE ACT
Printed for the use of the Committee on Environment and Public Works
______
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COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS
one hundred eighth congress
first session
JAMES M. INHOFE, Oklahoma, Chairman
JOHN W. WARNER, Virginia JAMES M. JEFFORDS, Vermont
CHRISTOPHER S. BOND, Missouri MAX BAUCUS, Montana
GEORGE V. VOINOVICH, Ohio HARRY REID, Nevada
MICHAEL D. CRAPO, Idaho BOB GRAHAM, Florida
LINCOLN CHAFEE, Rhode Island JOSEPH I. LIEBERMAN, Connecticut
JOHN CORNYN, Texas BARBARA BOXER, California
LISA MURKOWSKI, Alaska RON WYDEN, Oregon
CRAIG THOMAS, Wyoming THOMAS R. CARPER, Delaware
WAYNE ALLARD, Colorado HILLARY RODHAM CLINTON, New York
Andrew Wheeler, Majority Staff Director
Ken Connolly, Minority Staff Director
------
Subcommittee on Fisheries, Wildlife, and Water
MICHAEL D. CRAPO, Idaho, Chairman
JOHN W. WARNER, Virginia BOB GRAHAM, Florida
LISA MURKOWSKI, Alaska MAX BAUCUS, Montana
CRAIG THOMAS, Wyoming RON WYDEN, Oregon
WAYNE ALLARD, Colorado HILLARY RODHAM CLINTON, New York
(ii)
C O N T E N T S
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Page
SEPTEMBER 16, 2003
OPENING STATEMENTS
Chafee, Hon. Lincoln, U.S. Senator from the State of Rhode
Island, prepared statement..................................... 51
Crapo, Hon. Michael D., U.S. Senator from the State of Idaho..... 1
Graham, Hon. Bob, U.S. Senator from the State of Florida,
prepared statement............................................. 52
Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma... 2
Jeffords, Hon. James M., U.S. Senator from the State of Vermont.. 5
Thomas, Hon. Craig, U.S. Senator from the State of Wyoming....... 6
Wyden, Hon. Ron, U.S. Senator from the State of Oregon........... 20
WITNESSES
Fuller, Lee, vice president, Government Relations, Independent
Petroleum Association of America............................... 35
Prepared statement........................................... 114
Response to additional question from Senator Inhofe.......... 119
Hall, Jim, principal partner, Hall and Associates................ 38
Prepared statement........................................... 155
Hoover, Julie Beth, Director of Planning and Zoning, City of
South Burlington, VT........................................... 25
Prepared statement........................................... 79
Responses to additional questions from Senator Jeffords...... 88
Kouplen, Steve, president, Oklahoma Farm Bureau.................. 31
Prepared statement........................................... 100
Lozeau, Michael R., attorney, Earthjustice....................... 33
Prepared statement........................................... 103
Responses to additional questions from Senator Jeffords...... 111
Mabe, David, Administrator, Water Quality Division, Idaho
Department of Environmental Quality............................ 23
Prepared statement........................................... 77
Responses to additional questions from Senator Inhofe........ 78
Mehan, G. Tracy, Assistant Administrator for Water, U.S.
Environmental Protection Agency................................ 7
Prepared statement........................................... 54
Responses to additional questions from:
Senator Chafee........................................... 60
Senator Inhofe...........................................61, 63
Senator Jeffords......................................... 64
Senator Wyden............................................ 75
Samoviski, Michael, city manager, City of Hamilton, OH........... 26
Prepared statement........................................... 88
Responses to additional questions from:
Senator Inhofe........................................... 97
Senator Voinovich........................................ 98
Steinzor, Rena, professor and director, Environmental Law Clinic,
University of Maryland School of Law........................... 36
Prepared statement........................................... 120
Responses to additional questions from Senator Jeffords...... 131
ADDITIONAL MATERIAL
Articles:
ELR, News & Analysis, Criminal Negligence Prosecutions Under
the Federal Clean Water Act: A Statistical Analysis and an
Evaluation of the Impact of Hanousek and Hong.............169-173
Charts:
Bartlett Brook Stormwater Treatment System, City of South
Burlington................................................. 82-83
Englesby Brook Construction Wetland Treatment, City of
Burlington................................................. 84-87
EPA Civil Enforcement Judicial Settlements Fiscal Years 1999-
2002....................................................... 130
Number of Overflow Events.................................... 97
Storm Water Utility Projected Income Statement, City of
Hamilton, OH............................................... 90
The Decline of Environmental Enforcement at EPA Under the
Bush Administration, January 2003.......................... 127
Federal Register, Friday, December 22, 1995, Part III,
Environmental Protection Agency, Incentives for Self-Policing:
Discovery, Disclosure, Correction and Prevention of Violations;
Notice........................................................147-154
Letters to:
Boehner, Hon. John, U.S. Representative from the State of
Ohio....................................................... 95
Horinko, Hon. Marianne, Acting Administrator, Environmental
Protection Agency.....................................18, 96, 244
Jeffords, Hon. James M., U.S. Senator from the State of
Vermont........................................227, 238, 243, 247
Olivas, Hon. Adolf, Mayor, City of Hamilton, June 8, 2001.... 93
Robertson, Joseph C., Ohio Department of Development, May 10,
2001....................................................... 92
Todd-Whitman, Hon. Christine, Administrator, Environmental
Protection Agency...................................224, 229, 240
Voinovich, Hon. George V., U.S. Senator from the State of
Ohio....................................................... 94
Memorandum, The Exercise of Investigative Discretion, U.S.
Environmental Protection Agency...............................134-140
Reports:
A Pilot for Performance Analysis of Selected Components of
the National Enforcement and Compliance Assurance Program.174-223
Source of Impairment......................................... 15
Use of Immunity and Evidentiary Privileges to Encourage
Voluntary Disclosure of Self-Discovered Regulatory
Violations, Spring 2000, U.S. Department of Justice.......141-146
Resolution, R2001-4-23, Requesting the Ohio Department of
Development to designate the city of Hamilton, OH, as
``situationally distressed'' under the guidelines of the Ohio
manufacturing machinery & equipment investment tax credit
program........................................................ 90
Statements:
American Society of Civil Engineers.......................... 159
American Waterways Operators................................. 157
Greenwald, Robin, clinical professor of law, Rutgers School
of Law, Newark, NJ; Former Assistant Chief, Environmental
Crimes Section, Department of Justice; Assistant U.S.
Attorney, Eastern District of New York, October 20, 2002... 166
IMPLEMENTATION OF THE CLEAN
WATER ACT
----------
TUESDAY, SEPTEMBER 16, 2003
U.S. Senate,
Subcommittee on Fisheries, Wildlife, and Water,
Committee on Environment and Public Works,
Washington, DC.
The subcommittee met, pursuant to notice, at 9:30 a.m. in
room 406, Senate Dirksen Building, Hon. Michael D. Crapo
(chairman of the subcommittee) presiding.
Present: Senators Crapo, Thomas, Wyden, Inhofe [ex officio]
and Jeffords [ex officio].
OPENING STATEMENT OF HON. MICHAEL D. CRAPO, U.S. SENATOR FROM
THE STATE OF IDAHO
Senator Crapo. Good morning. The hearing will come to
order.
This is a hearing of the Subcommittee on Fisheries,
Wildlife, and Water on the Implementation of the Clean Water
Act.
I would like to welcome everyone here, especially our
Chairman of the full committee, Senator Inhofe. At the outset,
I would like to recognize one of our witnesses, Dave Mabe, who
is here from Idaho. David is the administrator of the Water
Quality Programs for the Idaho Department of Environmental
Quality. Senator Inhofe, Dave, and I worked together way back
when I was in the State Senate in Idaho on issues of this kind.
He brings a very high level of expertise to these issues. We
welcome him here today.
Today, we are going to discuss a number of the aspects of
the Clean Water Act. I will alert everybody at the outset that
we expected to have votes this morning. We are going to try to
keep everybody moving along appropriately so that we can get
through all of the testimony and the questions that the members
of the Senate have here today.
Although we all understand the fundamental importance of
water, I do not think we should gloss over the importance of
the Clean Water Act to our efforts. We should begin our
discussion today by remembering that our shared goal is to
continue improving the cleanliness of water throughout the
United States, and do it by focusing on action and results
instead of the endless arguments that sometimes I think we get
into as a result of the implementation of some of the statutes.
The Clean Water Act is one of the statutes that allows a
productive State and Federal relationship. It is important that
we protect the basis for that relationship in the law, and that
we use that relationship fully. By working together, State and
Federal Government can accomplish more and can discover more
and better ways of sharing responsibility on all aspects of
conservation.
To protect the State/Federal partnership, we should attend
especially to whether and how the Federal partner should
approve or disapprove of State decisions. In developing TMDLs,
for example, State decisions, in my opinion, should be
respected on which water body should be listed and what order
they should be acted upon. On this and other specific issues,
the Federal program should accept responsibility for
difficulties we face in those contexts. By confusing effort
with results, we often waste idle resources and gravely delay
progress.
Today, as I believe everybody knows, we are going to go
over four or five issues dealing with the Clean Water Act,
TMDLs, pollution trading, storm water management, spill
containment, and negligence standards. We expect to have many
interesting perspectives on these issues raised to us by our
witnesses who are here today. We look forward to their
testimony.
With that, I will turn to our Chairman, Senator Inhofe, for
his statement.
OPENING STATEMENT OF HON. JAMES M. INHOFE, U.S. SENATOR FROM
THE STATE OF OKLAHOMA
Senator Inhofe. Thank you, Mr. Chairman.
First of all, good morning. I welcome everyone to this
hearing today. I am very proud that we are joined, Mr.
Chairman, by Steve Kouplen, who is the president of the
Oklahoma Farm Bureau. He and I have had a chance to visit. He
has a commercial Hereford cow/calf operation. He also grows
wheat, alfalfa, and a few other things. He represents 140,000
Farm Bureau members in my State of Oklahoma.
Today's hearing will focus on several pressing clean water
issues, some of which have been the subject of recent EPA
actions. Of particular importance to my State, as you brought
out, Mr. Chairman, is the future of the TMDL program, as well
as how oil and gas sites are treated under the Storm Water
Rule.
This Administration is absolutely correct in withdrawing
the TMDL proposal of the Clinton administration. Many
stakeholders, including the States, were concerned about a
number of its provisions, including the requirement that an
implementation plan be submitted along with the TMDL. The TMDL
rule has the potential to severely limit local and individual
land use decisions. A TMDL is a number. It is the maximum
amount of a particular pollutant in a water body can sustain
and meet the water quality standards. That number is then
divided among the contributors of the water body.
The rule can be perceived in one of two ways: It gives the
EPA authority to approve just the TMDL number with States
deciding how to distribute it. Or, they could give the EPA the
authority to approve how the State divides that number among
its contributors. I have to say: What does it matter if they
conform with the number? The States are probably in a better
position to do that than we would be here in Washington. There
is this prevailing mentality here, though, that no good
decisions are made unless they are made in Washington.
Just imagine a farmer, like Steve Kouplen, who has been
assigned a certain pollutant reduction to achieve. If he wants
to change his crop or sell his land--all those actions may have
a water quality impact and may cause him to exceed his
pollutant allocation. The decision on what to do can be made
between him, the State, and others, on the water body. But if
the EPA has the authority over how the TMDL obligation is
divided, that decision will be made by the EPA.
My message on the TMDLs is this: We need a new rule, but it
must be a rule that outright prohibits any EPA role in local
and land use decisions. We must give the EPA the authority to
approve just the TMDL number itself and let the States handle
the rest of it, along with the land owners.
Assistant Administrator Mehan has been a strong proponent
of trading the EPA issued guidance earlier this year to help
the States create trading programs. Trading allows one source
to meet its obligation under the Clean Water Act by using
pollution reductions created by another source that has lowered
costs and, thus, can reduce pollution beyond its obligation
under the Act.
A key objective to the trading guidance, and any trading
program, is to meet water quality standards and to ensure that
at the end of the day the water is cleaner and safer. That is
what we want to accomplish. States have successfully developed
programs to meet this objective, but also reduce costs. I
believe trading will help reduce costs without affecting the
water quality. Therefore, we should do all we can to promote
it. We need to give the regulated more tools and not just more
requirements.
Today we are also going to hear about two other issues that
are very important to the small oil and gas producers in my
State of Oklahoma. The Clean Water Act exempts uncontaminated
runoff from oil and gas sites from the Storm Water Program.
Contaminated runoff is still covered. The Act is silent on
contaminated runoff. EPA, on a technicality, has included all
runoff from oil and gas sites in the construction side of its
Storm Water Program because the term ``construction'' is not in
Section 402(l).
EPA made two mistakes. The first was failing to recognize
that construction is not a separate part of developing oil and
gas sites, and was never intended to be covered by the program.
The second mistake was in underestimating the number of oil and
gas sites that would be impacted by the rule. I am pleased that
EPA realized the latter of their two errors and correctly
proposed a 2-year delay, in part because their cost benefit
analysis did not include the nearly 30,000 oil and gas sites
impacted by the rule.
It is also important that we take a very close look at the
Spill Prevention Control Program. Everyone must understand the
SPCC Plans are required for any facility that houses large
amounts of oil. This includes the Nation's farms. The new rule
increases the number of facilities that need a plan by reducing
the amount of oil that can be housed on a site before the
requirement kicks in. The EPA granted an 18-month extension for
facilities to comply because facilities were struggling to meet
the new requirements, including how to address secondary
containment at loading operations. I think it is very important
that you keep in mind. I can see this going to the extent that
every farmer out there would be faced with this type of a site.
Another issue that will be raised today will be the
unintended consequence of Section 309 of the Clean Water Act.
Unlike other environmental statutes, including the Air Act, to
be convicted of a negligent violation, a person does not have
to be guilty of an intentional or reckless act. Such person,
entirely by accident, without any force thought, and without
any malice or intent, may have caused an accidental spill of
some type and end up having to serve jail time. This is
something that we do not want to allow.
I would like to ask unanimous consent to submit. One is a
colloquy that Senators Breaux, Domenici, and I had during the
floor debate on the Energy bill.
Senator Crapo. Without objection, so ordered.
[Material supplied follows:]
Colloquy between Senators Domenici, Inhofe and Breaux
Senator Inhofe. I would like to engage the gentlemen in a colloquy
and draw the Senate's attention to several statutes which have been,
through litigation, expanded beyond what we believe was the intent of
Congress.
Senator Domenici. Is the gentleman referring to the criminal
negligence provision of the Clean Water Act and the strict criminal
liability provision of the Migratory Bird Act and the Refuse Act which
can be triggered by a simple accident?
Senator Inhofe. Precisely. Now, I want to be clear that I do not
want to suggest for a minute that we should make it easier for
polluters to damage the environment or put the public at risk.
Senator Domenici. Out the situation you are talking about refers to
clear accidents involving ordinary people, correct?
Senator Inhofe. Yes. Recent court decisions have made it clear that
employees, at any level, who are involved in environmental accidents,
can be prosecuted criminally, and potentially imprisoned. These are
non-deliberate environmental accidents that do not threaten or harm
others.
Senator Breaux. Mr. President, I am also concerned about criminal
liability as it applies to oil spills. In fact, during the 106th
Congress, I introduced legislation to address a long-standing problem
which adversely affects the safe and reliable maritime transport of oil
products. The legislation was aimed at eliminating the application and
use of strict criminal liability statutes, statutes that do not require
a showing of criminal intent or even the slightest degree of
negligence, for maritime transportation-related oil spill incidents.
As stated in the Coast Guard's environmental enforcement directive
of 1997, a company, its officers, employees, and mariners, in the event
of an oil spill ``could be convicted and sentenced, to a criminal fine
even where [they] took all reasonable precautions to avoid the
discharge''. Accordingly, responsible operators in my home state', of
Louisiana and elsewhere in the United States who transport oil are
unavoidably exposed to potentially immeasurable criminal fines and, in
the worst case scenario, jail time. Not only is this situation unfairly
targeting an industry that plays an extremely important role in our
national economy, but it also works contrary to the public welfare.
To preserve the environment, safeguard the public welfare, and
promote the safe transportation of oil, we need to eliminate
inappropriate criminal liability that otherwise undermines spill
prevention and response activities. I pledge my support to work with my
colleagues to address these environmental liability issues.
Senator Inhofe. The American Waterways Operators have devoted a
great deal of time to training mariners and vessel operators. Clearly,
the Coast Guard goes to great lengths to ensure its officers and staff
are well trained. However, unfortunately, accidents--true accidents--
happen.
Senator Domenici. My colleagues are clearly describing a legal
minefield where employees involved in an accident become less likely to
cooperate with accident investigations because they are being advised
by counsel not to potentially incriminate themselves.
Senator Inhofe. That is absolutely correct.
Senator Domenici. And as Chairman of the Environment and Public
Works Committee, is it the Senator from Oklahoma's position that this
leads to less environmental safety instead of more?
Senator Inhofe. Indeed. I also wish to draw the gentleman's
attention to the Clean Air Act, which has a different, and I suggest,
more appropriate provision of negligent endangerment.
Senator Domenici. I am familiar with the provision--it requires
risk of physical harm to the public for an accident to trigger criminal
prosecution.
Senator Inhofe. Yes, That is the type of activity for which we
should reserve criminal prosecution. I also remind my colleague that
the Clean Water Act clearly allows prosecution for deceitful or
purposeful environmental damage, or for fraudulent efforts to conceal
such damage--a provision we would not change.
Senator Domenici. I agree with the gentlemen's assessment, share
their concern, and look forward to working with them to address this
important issue.
Senator Inhofe. With that, I look forward to the hearing
today.
Again, as the Chairman said, ``We will be interrupted for
awhile.'' We have three panels. We will make it as contiguous
as possible.
Senator Crapo. Thank you very much, Mr. Chairman.
Senator Jeffords.
OPENING STATEMENT OF HON. JAMES M. JEFFORDS, U.S. SENATOR FROM
THE STATE OF VERMONT
Senator Jeffords. Mr. Chairman, I want to thank you for
holding this hearing. Clean water is one of the most basic
needs and one of our greatest luxuries. We are reminded time
and time again of the role of clean water in our society as we
see new coverages of the situation in Iraq.
In our own country, just a month ago, the effects of an
unreliable power grid spilled over into the water industry as
waste water treatment plants in Ohio dumped 60 million gallons
of untreated sewage into receiving waters, closing beaches to
swimming. Multiple cities were under boil water notices for
days.
During the 107th Congress, as Chairman of this committee, I
held a Clean Water Act oversight hearing on the 30th
anniversary of the Act. We heard from the EPA that 45 percent
of our waters cannot meet water quality standards. Since our
hearing in October 2002, the Administration has chosen to go
backward on clean water protections rather than forward. Rather
than step up to the challenge of cleaning up our remaining
waters, the Administration is both failing to maintain the
progress we have made since 1970, and failing to move forward
on the remaining challenges that we all identified just 1 year
ago.
Today, we will review in detail the Administration's
actions on TMDLs, Storm Water, SPCC, and water quality trading.
We will also be covering the effect of Section 309(c)(1) which,
Mr. Chairman, I understand that you have a special interest in
that.
I ask unanimous consent, Mr. Chairman, that the testimony
from Ms. Robin Greenwald in the October 20, 2002 article from
the Environmental Law Reporter on this topic be included in the
hearing record.
Senator Crapo. Without objection, so ordered.
Senator Jeffords. I am pleased that we have agreed, at your
suggestion, to address enforcement issues in general as a broad
hearing on EPA enforcement in the near future.
I want to take a few minutes to provide some context for
today's discussion on this limited number of actions the
Administration has taken under the guise of protecting our
water quality. On January 15, 2003, the Bush administration
began a rulemaking process that threatens the integrity of the
Clean Water Act by severely reducing the water that it
protects.
In June 2003, reports surfaced that Clean Water Act
enforcement was faltering under the Bush administration. An
internal analysis performed by the EPA documented extensive
noncompliance with the discharge permits and a decline in
enforcement activities. For example, there was a 45 percent
decrease in EPA formal enforcement actions between 1999 and
2001.
Since President Bush took office, he has pursued
significant reductions in the enforcement capacity at the EPA.
Enforcement personnel have been reduced by 100. In January
2003, the President submitted his fiscal year 2004 budget. It
reduced clean water infrastructure spending by 40 percent from
the prior year funding level.
In March 2003, the Bush administration withdrew the
existing rule on Total Maximum Daily Load, or TMDL, without
producing an alternative. Today, we will review the
Administration's latest draft regulation which weaken
protections by the dirtiest waters. On March 7, 2003, the EPA
issued a final rule that extended the permit deadline for storm
water discharges for oil and gas construction activity that
disturbs 1 to 5 acres of land by 2 years.
The EPA's action gives a regulatory free ride to the oil
and gas industry while thousands of small communities and
industries building construction projects struggle to comply
with the same rule.
In a similar action to benefit the oil and gas industry,
the EPA extended the compliance deadline for spill prevention
control and countermeasures planned. We will discuss this in
more detail today.
Mr. Chairman, I could continue with a longer list, but I
will end there. Each time I review this list, I am dumbfounded
by the casual attitude of this Administration toward the future
of our country. It seems that the choices we witness each day
are choices made with one thing in mind--immediate
gratification to special interests at the expense of the
environment. History will demonstrate that the changes I
mentioned, taken as a group, will have been the largest step
backward in clean water protection in our Nation's history.
Thank you, Mr. Chairman.
Senator Crapo. Thank you.
Senator Thomas.
OPENING STATEMENT OF HON. CRAIG THOMAS, U.S. SENATOR FROM THE
STATE OF WYOMING
Senator Thomas. Thank you, Mr. Chairman.
I will not take very long. I do appreciate your having this
hearing. I think it is very important. Seldom have I ever been
optimistic about what we are doing with TMDLs. I think we need
to be very watchful and careful about the storm water rule. I
think we are headed in the right direction.
Thank you, Mr. Chairman.
[The prepared statement of Senator Thomas follows:]
Statement of Senator Craig Thomas, U.S. Senator from the
State of Wyoming
Mr. Chairman, thank you for holding today's hearing. I appreciate
your commitment in allowing this subcommittee, which has jurisdiction
over the Clean Water Act, the opportunity to discuss the implementation
of that law particularly the rule on Total Maximum Daily Loads (TMDLs).
Mr. Chairman, I've sat behind this dais many times and rarely had
the opportunity or reason to applaud EPA especially thinking back to
the 2000 rule on TMDL's (that has since been repealed). But with
respect to TMDL's and the existing rule, EPA has been helpful to my
State of Wyoming. The national TMDL coordinator has worked with my
state to achieve success through the local watershed process. Wyoming
has been using a local approach to address our impaired waters rather
than a top down approach. When EPA Region 8 was sued over Wyoming's
alleged failure to comply with the TMDL program, the State prevailed.
The local approach is working. It is my hope the new rule will
embrace this sort of an approach and allow other flexibilities to get
the job done. If the end result is the same, I should not think a one-
size-fits-all approach should matter. We have seen more than once that
what works in one region in the country does not necessarily work in
the other. Thank you, Mr. Chairman, and I look forward to hearing from
the witnesses.
Senator Crapo. With that, we will now move to our first
panelist. Mr. Tracy Mehan is the Assistant Administrator for
Water for the U.S. Environmental Protection Agency.
As Mr. Mehan is taking his seat, I would like to remind all
of the witnesses today that we, as usual, are under a tight
timeframe that will be impacted by votes. We will remind the
witnesses that we would like you to pay attention to the clocks
that are in front of you and keep your oral testimony to 5
minutes. That gives us time for questions from the Senators. We
assure you that we will carefully review your written
testimony.
Like I always say, you will never get everything you want
to say in the 5 minutes, but we ask you to pay attention. For
those of you that get involved and do not quite notice when you
time is up, I will just lightly tap the gavel as a reminder
that you should pay attention to the clock. We will try to keep
ourselves moving along.
With that, Mr. Mehan, please proceed.
STATEMENT OF G. TRACY MEHAN, ASSISTANT ADMINISTRATOR FOR WATER,
U.S. ENVIRONMENTAL PROTECTION AGENCY
Mr. Mehan. Thank you, Mr. Chairman.
It is a pleasure to be here. My written testimony deals
with a broad array of watershed issues as well as the storm
water issue, including TMDLs, watershed-based permitting,
monitoring, and water quality trading.
I am going to focus in my 5 minutes on monitoring and water
quality trading. While monitoring may not have been a top-of-
the-mind issue for many, I think where we are today in trying
to move to the watershed approach is crucial. You will be
hearing a lot more of it as we move into the fiscal year 2005
budget process on this.
Again, we are in a period where we are trying to transition
from a purely technology based approach to a water quality
based approach, and to reorient all our water programs on a
watershed basis. We think it is imperative to strengthen our
water quality monitoring and assessment programs.
In the 1970's, monitoring was primarily carried out at or
near the end of pipe to measure effectively individual permits
and whether they were working. However, today we need to
monitor and assess the inputs of millions of diffuse sources of
pollution--from sediments, from agricultural sources, from
construction sites, fertilizer, and pollutants coming from the
air. This is going to require more innovative tools and
flexible approaches such as trading. But we need baseline
monitoring to better implement these new innovative approaches.
We currently have site-specific information that tells us
about many localized and regional conditions. But as stated in
EPA's Draft Report on the Environment 2003, ``At this time,
there is not sufficient information to provide a national
answer to this basic question on water quality status and
trends with confidence and scientific credibility.''
Working with State, Federal, tribal, and local agencies,
with the private sector and nonprofit organizations, we must be
able to provide answers to some very fundamental questions: How
clean is the water? Is it getting cleaner? Are our management
actions working?
Without answers to these questions, we run the risk of
flying blind when it comes to making decisions on how best to
address water quality problems and to allocate limited
resources. One recent example is the data we are assembling for
our report to Congress under the Wet Weather Act on sewer
overflow. When I came to Washington 2 years ago, we were
talking about 500 billion gallons of overflow year. Based on a
statistically valid inventory and sampling process, it looks
like that number is dropping to 10 billion gallons per year.
That has a big impact on how we decide how we are going to deal
with these challenges. That is the kind of information we have
to have.
Currently, most States are doing monitoring at that level.
That is all to the good, but we need to integrate that as part
of a national scale water quality monitoring program. Again, my
testimony deals with some of the specifics on that. I hope in
future hearings next year, that we will spend much more time on
water quality monitoring because it is fundamental to
innovation and the watershed approach.
Let me say a few words about water quality trading. EPA
believes that water quality trading, which allows sources to
find the least cost alternative to achieving clean water, can
be a critically important tool for restoring impaired
watersheds efficiently and cost effectively. In its analysis of
the Clinton administration's Clean Water Initiative, EPA
concluded that the total potential savings from all types of
trading--point-to-point, point-to-nonpoint, and pretreatment
trading--ranges from $650 million to $7.5 billion annually.
Another study of three watersheds in the upper Midwest by
the World Resources Institute, found that controlling
phosphorous loadings from point and nonpoint sources, the cost
could be reduced by 40 percent in watersheds in Wisconsin and
more than 80 percent in watersheds in Michigan where trading
was applied between point and nonpoint sources. These examples,
where differential costs can be used to the benefit of
achieving water quality gain, illustrate the potential for
water quality trading.
In January, EPA issued its Water Quality Trading Policy.
The policy provides guidance on aligning trading programs with
the Clean Water Act and implementing regulations. It identifies
common elements of credible trading programs. The policy
supports trading to improve or preserve water quality in a
variety of circumstances.
In unimpaired waters, trading may be used to preserve water
quality by offsetting new or increased discharges of
pollutants, thereby allowing for economic growth in a
watershed. In waters impaired by pollutants, trading may be
used to achieve earlier pollutant reductions, and progress
toward water quality standards even in advance of the
development of a TMDL.
Trading, of course, may be used to reduce the cost of
achieving reductions established by a TMDL. The policy
highlights existing Clean Water Act flexibility that can
facilitate trading programs, and emphasizes the need for
accountability and safeguards to ensure the trading programs
protect our resources and keep advancing toward water quality
standards.
I am happy to note what I think is really growing support
for the policy. We had a national forum on trading in Chicago
this summer. Three hundred people showed up for several days.
They came early and stayed late and explored a whole raft of
case studies and lessons learned from trading pilots around the
country. Recently, we received a letter from the U.S.
Conference of Mayors endorsing our policy.
A number of core principles and environmental safeguards
form the foundation of our policy. These principles help ensure
the trading programs create actual pollutant reductions, avoid
hot spots, provide accountability for trading activity, and
involve the public. I am going to name just a few that are set
out in the policy.
First, trading programs operate within the existing
regulatory structure and are consistent with all aspects of the
Clean Water Act. Trading programs are designed to meet water
quality goals, including TMDLs. Water quality standards or
goals are our polestar, that is, the end point, the object of
all these efforts. Trading programs ensure that water quality
standards are not exceeded. Trading programs retain
enforceability of NPDES permit limits. Trading is not used to
meet point source technology-based limits, but may be used to
achieve water quality-based limits consistent with the Clean
Water Act.
We already see evidence that water quality trading programs
work. For example, the State of Connecticut's Nitrogen Credit
Exchange Program is expected to save the State an estimated
$200 million in control costs through trading, while also
making significant gains in cleaning up pollutants in Long
Island Sound, saving several years off the cleanup schedule.
In the Cherry Creek watershed in Colorado, a trading
program conducted in conjunction with a TMDL has reduced
phosphorous loads to Cherry Creek watershed by approximately
450 pounds per year. The nonpoint source projects that were
implemented to create the phosphorous credits have provided
ancillary environmental benefits, such as flood control and
wildlife habitat in recreational areas.
A partnership trading effort in Illinois' Piasa Creek along
the Mississippi River will save several million dollars in
capital improvements for a drinking water treatment facility,
while reducing sediment loads to the Mississippi River. The
Grasslands selenium trading program in California, which was
led by the Environmental Defense, was the Nation's first
nonpoint source cap-and-trade program. It utilized an
innovative penalty and rebate system to create economic
incentives to substantially reduce selenium in Kesteron
Reservoir that was adversely harming bird populations. I am
also happy to recognize the project in Idaho along the Lower
Boise that we are very excited about.
Experience with trading has also taught us that trading
will not work everywhere. It is just one tool in the tool box.
For example, the level of pollutant reductions that would need
to be achieved from all sources in a given watershed may be
such that additional or surplus reductions cannot be achieved
so as to allow trading. Certain watersheds may not have the
number and mix of sources necessary for trading to be
successful. In addition, trading programs that work in one
State or tribal area may not be successful in others.
Generally, Mr. Chairman, we are exited about the
experimentation that is going on. We look forward to working
with the committee to see that this policy is successfully
implemented.
Thank you. I would ask that my complete testimony be
included in the record in its entirety.
Senator Crapo. Without objection, so ordered.
Thank you very much, Mr. Mehan. We appreciate your
testimony.
For my questions, I want to focus on the TMDL program. You
and I have had discussions on this in the past. As you know, I
was very concerned with the rule that was first proposed by the
EPA under the Clinton administration. The testimony we had in
the hearing was that it would not only impose significant
increased cost burdens on the States, but not necessarily
increase the effectively of the activities already underway at
the State level. Therefore, I strongly supported the EPA's
decision to withdraw that rule and start again.
Now, however, I am very anxious to see that a new rule come
out. As we have discussed, the regulatory uncertainty that we
face in the absence of a rule is itself creating a significant
amount of problems.
In that context, my first question is this. Do you have a
time line that you can give us as to how soon we can expect
that the EPA will issue a new rule?
Mr. Mehan. Senator, I am not in a position to give you a
precise time line. I can tell you we are in an interagency
process. There was a little bit of a quietus after the Fourth
of July. I can assure you that we are back into long and steady
negotiations and discussions with our other Federal Agencies.
We are hopeful that we will be able to move forward in the not-
too-distant future.
Senator Crapo. In the context of the new rule, particularly
in the context of the nonpoint sources, it seems to me that it
is important for us to recognize the roles of the State in
being able to allocate the total load to various sources within
a watershed. The EPA should be primarily involved in
determining what the total load level should be, but should let
the States make decisions about how that is allocated and how
accomplishment of the purposes of the rule is achieved. Is that
the direction in which we are headed?
Mr. Mehan. We, I think we would view it as somewhat of a
more complex challenge. In approving the total load, it is like
approving a budget. You cannot really look at the bottom line
without looking at all the elements that go into creating the
budget, whether it is a pollution budget or a financial budget.
There has to be some mechanism for EPA to meet its
statutory responsibilities to approve the TMDL to ensure that
the allocations, both the waste load allocation to point
sources and the load allocations to nonpoint sources, are
actually put together in a technically and scientifically
defensible way in order to justify our approval.
So we are wrestling with this issue of how to respect State
prerogatives who at the first instance have the responsibility
to put together the TMDL, but at the same time allow us to make
an informed technical evaluation of the final work product.
Senator Crapo. Are you saying that the EPA has to basically
be in charge of every minute decision in terms of the
allocation of the load throughout a watershed in order for them
to make a decision about the total load for the watershed?
Mr. Mehan. It comes down to what degree of specificity you
need. You obviously have to have great specificity when you are
talking about point sources because those waste load
allocations to point sources will be written into NPDES
permits. It would not require anywhere near the same kind of
specificity for load allocations to nonpoint sources where you
could do things through categorizations or sub-categorizations
without necessarily worrying about specifics, say in the case
of an agricultural producer or sources like that.
The issue is: How much specificity do you need to ensure a
fair and credible technical review of the overall pollution
budget in the TMDL?
Senator Crapo. Well, my time is up. I will encourage you to
work as much flexibility as possible into the program for the
States and have the EPA mainly administering at the broader
level and let our States do their jobs. I think they can.
Mr. Mehan. Thank you, sir.
Senator Crapo. Senator Jeffords.
Senator Jeffords. Has the EPA done any written analysis
showing what the effect of the proposed changes, the TMDL rule,
will be on water quality? In other words, does EPA's analysis
show that a new rule will make the waters dirtier or cleaner,
and sooner or later than the existing TMDL?
Mr. Mehan. At least as I understand what you are asking,
Senator, I do not think we have that kind of an analysis or
document at the present time. The TMDL contemplated rule right
now in many ways accomplishes several things. We are responding
to criticisms from the National Academy of Sciences. We are
trying to accommodate State practical implementation concerns.
We are trying to optimize the performance of an existing
program.
In other words, in many respects you can say that the cost
of meeting the water quality standards of the Clean Water Act
are already sunk costs, but now we are coming along with a new,
proposed, or contemplated TMDL rule to just make the whole
thing work more efficiently toward ends that are already set
out by Congress and by our regulations.
We look at it as a way to better optimize the existing
program. I hasten to add that the TMDL program is a very robust
program right now. We have done 8,000 TMDLs to date and are
spending quite a bit of time in the continuous improvement mode
to continue to perfect the program while we are also going
through the interagency discussions about a possible new rule.
Senator Jeffords. On March 10, 2003, the day the Storm
Water Phase II regulations took effect, the EPA extended the
compliance deadline for the oil and gas industry. We have
corresponded extensively on the details of this issue.
I ask unanimous consent that several pieces of
correspondence between the members of the committee and the
Agency's responses be included in the hearing record.
Senator Crapo. Without objection, so ordered.
Senator Jeffords. Your final rule extending the deadline
for the oil and gas industry states that you have received
information that 30,000 oil and gas sites could be affected. Is
that number accurate?
Mr. Mehan. That is our understanding.
Senator Jeffords. The final Storm Water Phase II regulation
issued in 1999 states that ``EPA believes that the
implementation of Best Management Practices, BMP, controls at
small construction sites will also result in a significant
reduction in the pollutant discharges and an improvement in
surface water quality.''
Is that statement still accurate? If so, how will the
removal of 30,000 sites from the regulation change the water
quality benefits EPA expects to achieve?
Mr. Mehan. Senator, taking the second question first, there
is no decision to remove 30,000 sites from the rule. We simply
deferred action on that sector in light of newer information
received from the Department of Energy, from members of the
industry, and through other sources that were inventoried as to
extent of the potential regulatory universe that we previously
had not fully understood or comprehended.
Generally, the imposition of BMPs on sources of storm water
will have beneficial environmental impacts. But obviously
issues of costs and benefits and issues in terms of regulatory
feasibility are all relevant. We need to learn more about this
sector. We also need to learn more about what the industry is
already doing by way of best management practices under, say,
State regulatory regimes at the present time.
Senator Jeffords. On the Storm Water EPA No. 3, can you
describe the relative contribution of storm water versus other
sources of pollution to the 45 percent of the Nation's waters
that remain impaired, including a description of the types of
pollutants normally found in storm water, and the change in
pollutant content that could be expected in cold water
climates? What role does transportation infrastructures play in
generating storm water run off?
Mr. Mehan. Obviously there are a number of points in your
question, Senator, that I would request the opportunity to
respond in writing in a very detailed technical review.
Basically, in the latest reports that we have seen from the
States, urban run off was cited as the source of impairments
for 34,871 miles of rivers and streams, 7.7 million acres of
lakes, and over 5,000 estuary square miles.
Clearly, speaking again at the broader level, this has
impacts. All the wet weather issues do, whether it is CSOs,
SSOs, or storm water. You can go down the list. To some degree
there is a hierarchy in there. Clearly, storm water run off is
part of that. I would be happy to get back to you with more
detail as to which sector contributes to which degree of
impairments.
Senator Jeffords. We would appreciate that.
Senator Crapo. Without objection, so ordered.
Senator Jeffords. Thank you, Mr. Chairman.
Senator Crapo. Thank you very much, Senator Jeffords.
Senator Thomas.
Senator Thomas. Thank you. I will be brief.
What if EPA's role was to reject indefensible State
decisions rather than specifically approving all the decisions
they make?
Mr. Mehan. Senator, the present system set up under the
Clean Water Act, and not unlike any other provisions of other
laws, is really environmental federalism. Forty-five States
presently have delegated authority to carry out the Clean Water
programs. We do have an oversight role, but with the delegation
of that program, primary responsibility for things like the
NPDES program and the TMDL program, where quality standards are
specifically recognized as State prerogative in Section 510 of
the Act, the States are in the driver's seat.
We do have oversight responsibility. In some cases, say, in
the water quality standards, the law requires us to approve
those standards. We view the water program, compared to many
programs in Government, and even in the EPA, as the
quintessential environmental Federalist program with 45
delegated States in the Clean Water program and 49 States
delegated under the Safe Drinking Water program.
There are obviously professional disagreements that will
happen from time-to-time, but for 30 years, that has been the
way we have carried out the program. We are seeing more and
more reliance on State programs, even in the face of some
financial challenges of late. You have to get to cases. There
are going to be given circumstances where people are going to
come down on different sides of any given decision.
Senator Thomas. This is aside from your statement. But one
of the things we run into quite often is a lack of coordination
among Agencies; for instances, on permitting. One Agency will
go ahead and say, ``Yes, we are ready to go.'' Then the next
thing you know, the EPA has challenged that. They have a
perfect right to challenge it, but it seems to me that it would
be appropriate if the Agencies work together so that when the
permitting was finalized, then it is finalized, and someone
does not come back in again and stop the whole thing because
their opinions are not represented apparently.
Mr. Mehan. Well, I think it is certainly just generally
good practice that the further upstream you can get on any
regulatory decision in terms of interactions, you are better
off rather than sort of a late hit, so to speak. We do try. We
spend a lot of time with our State agencies, whether it is
under ECOS' or under ASIWPCA's umbrella, working with them on
programs, trying to continually do a horizon scan of where we
are going to see areas of potential disagreement or areas for
potential cooperation and synergies. There is no question that
we need to stay in a mode of continually trying to revisit
these.
Senator Thomas. I am not talking about the State. I am
talking about Federal Agencies. I am talking about the BLM and
the EPA who do not seem to be able to be in accord when the
permitting is out there. It does not seem to me that there is
any excuse for that.
Mr. Mehan. The problem is that we are all creatures of the
various laws that establish our Agencies. We do not have one
comprehensive organic statute that cuts across all
environmental and resource issues. We have different Agencies
responding to different statutory and legal regimes. That
inevitably results in some stove-piping. We are trying to
improve on that at every opportunity. We have an oversight
panel we have established with the Fish and Wildlife Service to
look at the review of water quality standards under the
Endangered Species Act, trying to again proactively work to
streamline that effort. But again, you have two different
statutory regimens.
Senator Thomas. I understand that. But there is no reason
why the final decision cannot encompass the decisions of both
or all three of those Agencies. You always have reasons and
excuses because of the law. But I am afraid I do not understand
why it cannot be implemented in such a way that the final
decision embraces the role of all the appropriate Agencies. But
that does not happen.
Mr. Mehan. I agree we need to make it happen, Senator.
Senator Thomas. Thank you. I appreciate it.
Thank you, Mr. Chairman.
Senator Crapo. Thank you.
Senator Jeffords has a few more questions.
Senator Jeffords. The trading policy states that EPA would
consider pilot projects to obtain more information regarding
the trading of persistent bio-accumulative toxics, PBTs, such
as mercury. What are your plans with regard to these pilot
projects? How could it be possible to increase the
concentration of PBTs in one location without impairing water
quality and putting human health at risk?
Mr. Mehan. Well, Senator, we have no proactive plans or
agenda to promote or push any trading involving persistent bio-
accumulative toxics. That statement in the policy really is
more of an in-box position that if someone comes forward, we
would certainly examine it. We have one on the Sacramento River
involving mercury. We intentionally put that statement in the
policy to show that we were not hanging out a sign to
necessarily promote this.
On the other hand, under the Clean Water Act, we do not
have a handle under some of the primary sources, which are air
depositions. That is the same analogy to row crop agriculture.
One of the advantages of trading is that it presents an
opportunity to address unregulated sources through least-cost
and incentive-based practices in a watershed context. We just
did not want to foreclose the opportunity that someone out
there might have a very creative idea dealing with a multimedia
problem like mercury. Certainly in places like Michigan or the
Southeastern United States, 90 percent of the mercury is coming
from an unregulated source, at least from the Clean Water Act
perspective; that is, air deposition. There are other areas,
too, where it is coming from runoff and other things that are
not subject to the traditional NPDES regulatory tools.
We have not had any new proposals come in other than the
one we announced back in January in the Sacramento which is
still more in a scoping stage. If one comes in, we will take a
look at it on its merits and decide whether it is worth
pursuing.
Senator Jeffords. The Storm Water Phase II final rule
extending the compliance deadline for oil and gas states that
EPA will analyze and evaluate the scope and effect of Section
1342(l)(2) of the Clean Water Act which allows certain types of
discharges from oil and gas activities to occur within a
permit.
I have several questions with respect to that. What is
EPA's current policy on the applicability of Sections
1342(l)(2) to oil and gas construction sites? How long has that
been in place?
Mr. Mehan. I think you are referring to the 1992 decision
by EPA to distinguish between runoff from the operations itself
versus the construction. There has been no change on that
policy as of this date.
Senator Jeffords. How has the Storm Water Phase I
regulation covering large municipalities and large construction
sites impacted water quality?
Mr. Mehan. I have only anecdotal evidence. I would be happy
to check to see what more systematic information we have on
that, Senator. We are talking obviously larger operations on a
watershed basis that could be significant.
Ms. Benita Best-Wang [accompanying Mr. Mehan]. We have done
some work evaluating monitoring data from large municipalities.
We do have some work on construction sites.
Mr. Mehan. Again, I would be happy to assemble that
information and present it to you, Senator.
Senator Jeffords. Thank you.
Senator Crapo. Without objection, so ordered.
[Material supplied by the witness follows:]
Sources of Impairment
EPA compiles data on water quality impairments and sources of
impairments consistent with the requirements of Section 305(b) of the
Clean Water Act. The most recent biennial report for which data are
available is from calendar year 2000 (2000 National Water Quality
Inventory Report). In that report, EPA presents data independently for
three significant types of waterbodies: rivers and streams, lakes and
reservoirs, and coastal resources. The report defines number of
categories for sources of waterbody impairments. Many of these are
storm water management related. Following is impairment data for each
of the waterbody types:
RIVERS AND STREAMS
Of miles assessed, 39 percent are impaired (a total of 269,258
miles out of the 699,946 miles assessed). Of the total, following is
the percent of the impairment due to the identified source:
------------------------------------------------------------------------
------------------------------------------------------------------------
Agriculture................................................ 48 percent
Hydrologic Modification.................................... 20 percent
Habitat Modification....................................... 14 percent
Urban Runoff/Storm Sewers.................................. 13 percent
Forestry................................................... 11 percent
Municipal Point Sources.................................... 10 percent
Resource Extraction........................................ 10 percent
------------------------------------------------------------------------
While not clearly delineated as storm water sources, other than the
municipal point sources, all of the other sources are likely heavily
influenced by storm water runoff.
LAKES
Of the acres assessed, 45 percent are impaired (a total of 7.7
million acres out of the 17.3 million acres assessed). Impairment
sources are as follows:
------------------------------------------------------------------------
------------------------------------------------------------------------
Agriculture................................................ 41 percent
Hydrologic Modifications................................... 18 percent
Urban Runoff/Storm Sewers.................................. 18 percent
Nonpoint Sources........................................... 14 percent
Atmospheric Deposition..................................... 13 percent
Municipal Point Sources.................................... 12 percent
Land Disposal.............................................. 11 percent
------------------------------------------------------------------------
COASTAL RESOURCES
Of the square miles assessed, 51 percent are impaired (15,676
square miles out of 31,072 square miles assessed). Impairment sources
are as follows:
------------------------------------------------------------------------
------------------------------------------------------------------------
Municipal Point Sources.................................... 37 percent
Urban Runoff/Storm Sewers.................................. 32 percent
Industrial Discharges...................................... 26 percent
Atmospheric Deposition..................................... 24 percent
Agriculture................................................ 18 percent
Hydrologic Modifications................................... 14 percent
Resource Extraction........................................ 12 percent
------------------------------------------------------------------------
Common pollutants found in storm water include pathogens,
nutrients, sediment, oil and grease, toxic metals, and debris. In cold
weather climates, road salts are an additional pollutant of concern
that have been shown to impact water quality.
Transportation infrastructure plays a significant role in storm
water runoff. Annual pollutant loads generated from roads and
associated facilities were estimated as part of the Agency's ongoing
effort to develop national guidelines for the construction and
development industry (FHWA 1996, 2001, HUD 2002, USDA 2000, NWS). These
estimates do not account for inplace management practices to control
storm water runoff, but are for uncontrolled pollutant loads delivered
to the nation's waterways. Some representative parameter estimates
include:
------------------------------------------------------------------------
Annual loading (1,000
Parameter metric tons/yr)
------------------------------------------------------------------------
Total Suspended Solids......................... 4,000-64,000
Phosphorus..................................... 9-80
Oil and Grease................................. 200-2,000
Mercury........................................ 260
Zinc........................................... 4.5-74
Cadmium........................................ 0-3
Arsenic........................................ 4.6-5
Copper......................................... 2-560
Iron........................................... 190-820
Lead........................................... 6-140
Chromium....................................... 0-3
Magnesium...................................... 85
Total Kjeldahl Nitrogen........................ 28-4,400
Chemical Oxygen Demand......................... 1,200-22,000
------------------------------------------------------------------------
These national estimates are appropriate for assessing the overall
magnitude of the potential problems generated by runoff from roads,
highways, and related facilities. Nevertheless, it should be recognized
that different pollutants are considered more significant based on the
designated use of the receiving water body, among other factors.
Aquatic life protection in streams will generally emphasize oxygen
demand or metals; the effect of phosphorus is often the most important
consideration in lakes. In general, the impacts of any typical runoff
constituent have to be considered in conjunction with the type of
receiving water, its use, and overall ecological health.\1\
---------------------------------------------------------------------------
\1\ U.S. Department of Housing and Urban Development (HUD). 2002.
Housing Completions (as reported by the U.S. Census Bureau) Washington,
DC. Available at www.census.gov.
U.S. Department of Transportation, Federal Highway Administration
(FHWA). June 1996. Evaluation and Management of Highway Runoff Water
Quality. FHWA Office of Environment and Planning. Washington, DC.
Publication Number FHWA-PD-96-032.
U.S. Department of Transportation, Federal Highway Administration
(FHWA). 2001. Highway Statistics 2000. FHWA Office of Highway Policy
Information, Washington, DC. Publication Number FHWA-PL-01-1011.
National Weather Service (NWS). Hourly rainfall data, collected for
selected sites within each of the 19 U.S. Ecoregions for the past 30
years.
U.S. Department of Agriculture (USDA), National Resources
Conservation Service. 2000. 1997 National Resources Inventory.
Washington, DC.
Senator Jeffords. If EPA expands the application of this
section to exempt the oil and gas industry, how will permit
holders in the industry that have been regulated since 1990 be
affected?
Mr. Mehan. That is a hypothetical question, Senator. At
this point, no such decision has been made. I am not in a
position to speculate.
Senator Jeffords. With respect to TMDLs, what environmental
effects would result from allocating a lump sum of gross load
to nonpoint sources of water pollution instead of the more
specific allocations?
Mr. Mehan. Again, keep in mind that a TMDL does not create
any new regulatory authorities, whether it is on air
deposition, or row crop agriculture, or even the operation of
dams. The power of a TMDL is in the information that it
provides to stakeholders at a watershed level to be able to
understand what is contributing the impairment of those waters.
My own preference, if I were back in the State government
where I did spend 13 years, would be to have as finely
differentiated data set as I could get so I could have a road
map as to what needs to be done, either through voluntary
approaches on the nonpoint source side, or subsidy approaches,
or regulatory on the point-source side.
We could do a TMDL using strictly lump sum allocations to
nonpoint sources. The problem is that you would not know if it
were good or bad without at least some degree of sub-
categorization. That may not have to be in the TMDL itself. It
could be in a sidebar submittal, if you will, or some other
document that gives us the technical background. Many people
are nervous about putting things in the TMDL because of
regulatory consequences.
Again, I would come back to my initial comments. What we
are wrestling with is what degree of specificity do we need to
be able to make an informed technical evaluation of the quality
of the pollution budget in the TMDL. Hopefully, we would keep
in mind that it is utility to local stakeholders.
If we just only had a lump sum allocation for all point
sources, we might be able to approve the TMDL, but it would be
hard without some understanding of how that lump sum budget was
put together from the bottom up, so to speak.
Senator Jeffords. Mr. Chairman, I ask unanimous consent
that the letter that Senator Graham and I sent to the EPA on
trading on July 17th of this year, and EPA's response be
inserted into the record.
Senator Crapo. Without objection, so ordered.
[Material supplied follows:]
October 6, 2003.
Hon. Marianne Horinko, Acting Administrator,
Environmental Protection Agency,
Washington, DC.
Dear Acting Administrator Horinko: Thank you for your July 17, 2003
response to our letter raising concerns regarding the Agency's failure
to effectively enforce Clean Water Act requirements. We appreciate your
detailed response to our questions regarding the Agency's plans to
respond to the Environmental Protection Agency (EPA) Inspector General
and the Office of Enforcement and Compliance Assistance (OECA)
recommendations for improving the EPA's performance in enforcing the
Clean Water Act.
We are concerned that your letter does not present a more
aggressive approach to dealing with the substantial rate of non-
compliance with NPDES permits. Your letter dismisses the 45 percent
reduction in EPA formal enforcement actions by citing an undocumented
redirection of resources to wet weather enforcement actions. The only
significant step described in your letter to increase or change the
enforcement program is the creation of a Facility Watch List, a useful
tool, if it is actually used by decisionmakers to take enforcement
actions. Below we are requesting answers to specific questions on the
degree to which the Watch List has actually been implemented.
We are concerned that although the EPA provided a detailed response
to our questions regarding the Agency's enforcement of the Clean Water
Act, the EPA is not taking the steps that are needed to bring our
Nation closer to the goal of clean, safe water.
WET WEATHER ENFORCEMENT
In your response, your letter indicates that the 45 percent
reduction in EPA formal enforcement actions is, ``due to the focus on
wet weather related cases. . . .'' In EPA briefings immediately
following the release of the OECA report, the Agency indicated that it
believed this to be the case and that the Agency would be conducting an
analysis to gather data and information to support this belief. Based
on the conclusions presented in the Agency's letter, we are assuming
that the analysis is complete. Please provide a copy of the analysis,
including a description of the wet weather enforcement cases pursued
during the 1999-2001 period that led to the diversion of resources from
the NPDES majors program and a comparison in terms of FTEs and other
resources required to conduct an NPDES major enforcement action versus
a wet weather enforcement action. In your letter, the Agency also
states that it will be looking at the impact of wet weather events on
CAFOs, CSOs, SSOs, and Storm Water, and the relative impact of these
wet weather events on environmental degradation when compared to the
noncompliance of NPDES major permitholders. Please describe the results
of this study if it has been completed, its scope, your methodology,
and the intended use of the results.
State Role in Enforcement
Your letter describes the 9 percent increase in state formal
enforcement actions as ``encouraging.'' What analysis is the Agency
conducting to determine the cause of this increase, and if this is a
trend or an anomaly? What has the Agency done to encourage formal
enforcement actions at the state level--for example, will the EPA seek
to provide additional resources to states to increase formal
enforcement actions? Has the EPA made a policy decision to pursue
formal enforcement actions at the state level and informal enforcement
actions at the Federal level? If so, please provide a copy of the
decision documents. On a related issue, your letter states that during
performance reviews, EPA will evaluate whether or not states are
escalating enforcement actions and penalties over time. Has this
occurred? If so, please describe the results of EPA's review.
FACILITY WATCH LIST
One of the major corrective actions that your letter states the EPA
will be taking to improve enforcement is the creation of a Facility
Watch List that will be used to target resources and enforcement
actions at serious violators. We believe that this tool has the
potential to improve enforcement if the decisionmakers who receive the
watch list actually use it to prioritize enforcement actions. We
understand that the first version of this list was scheduled for
distribution to EPA Regions during the first 2 weeks in September.
Please provide a copy of this list and a description of the enforcement
actions that have begun since the Watch List was distributed. In
addition, please provide a description of the difference between the
Watch List and the Exceptions List previously in use at the Agency.
While the creation of the Watch List may address high profile,
serious violators, it does not necessarily address the 51 percent of
the facilities in Significant Non-Compliance (SNC) that do not recover
without a formal action. Please describe how you will ensure that the
full 51 percent of facilities in SNC that require a formal enforcement
action to return to compliance actually receive one. For example, does
the Agency intend to request additional funds in its Fiscal Year 2005
budget for this purpose?
Types of Significant Non-Compliance
Your letter makes an effort to distinguish between the different
types of significant noncompliance as effluent-related, reporting, or
schedule violations. In a system of compliance based wholly on self-
reporting, it seems evident that the integrity of the system depends on
the equivalent treatment of reporting violations and other types of
violations. Does the Agency have a policy to treat different types of
SNC violators differently? If not, is EPA considering adopting one?
DATA QUALITY
In addition, your letter describes the data quality problems that
exist in the Permit Compliance System (PCS) data base. You state that
EPA will encourage states to report penalty data prior to the
implementation of the modernized PCS. What actions has the Agency taken
to encourage the reporting of penalty data by states?
CHANGING PERMIT LIMITS TO IMPROVE COMPLIANCE
In a repeat of a pattern that is becoming all too familiar, your
letter states that OECA intends to ``have a dialog'' with the Office of
Water to explore the ``problem'' of extremely high exceedances of
permit limits by pollutant dischargers that hold NPDES permits. The
OECA report recognized that permit limits are established based on
human health protections, but it also indicated that a dialog would
address the question of whether permit limits are currently too high.
Has this dialog begun and if so, what are your results to date?
FEDERAL FACILITIES' LACK OF COMPLIANCE
In response to recommendation #10 of the OECA report, you indicate
that OECA will begin working with the Federal Facilities Enforcement
Office to determine the root cause and possible solutions of the
proportionately higher rate of non-compliance with NPDES permits among
Federal facilities. Has this work begun and what are your results to
date?
PROGRESS ON RECIDIVISTS
In response to recommendation #12 of the OECA report, your letter
indicates that OECA has already begun reviewing the Agency's existing
information on recidivists. Please describe the results of this
effort--what behavior patterns among recidivists has the Agency
identified and how do they compare to other types of violators?
PCS Modernization Effort
What is the status of the EPA's decision to potentially modify the
scope of the modernized PCS data base?
There are several actions related to the PCS data base
modernization that you identified in your letter as items to be
completed by the end of September 2003. What is the status of the
Agency's efforts to develop a realistic cost estimate for the PCS
modernization effort, a cost-benefit analysis, and a plan for fully
funding the PCS modernization effort?
Your letter indicates that 2 FTEs will be added to the PCS
modernization effort. What is the timing for this change and what is
the source of these FTEs?
Thank you for your prompt attention to this matter, and we look
forward to your timely response.
Sincerely,
James M. Jeffords, Charles Schumer, Frank
Lautenberg, Jon S. Corzine, Bob Graham,
Joseph I. Lieberman, Hillary Rodham
Clinton, John Kerry, Ron Wyden, Joseph
Biden, Christopher Dodd, Russell Feingold,
Max Baucus, Barbara Boxer.
Senator Jeffords. I have one more question.
Trading has been used successfully to achieve pollution
reduction caps that are reduced incrementally and that have
been used to create value in the credits, and to ensure that
the overall result of the trading application of the program is
a reduction in pollution. Because the water quality trading
policy does not use caps, and you allow trading outside of a
TMDL, how to do you intend to ensure that the cleaner water is
a result of using the trading policy?
Mr. Mehan. In the context of the Clean Water Act, the caps
are the water quality standards. Some people are looking for
the word ``cap'' in there. That may disappoint some. But the
whole drift of the policy is to use, as I said, water quality
standards, as our pulse star, as our object, as our limit our
cap, if you will.
Whether or not you have a TMDL, you still have to respect
and deal with the water quality standards. The analogous
problem is trying to write a NPDES permit without a TMDL. If
you have a narrative standard, you still can write a NPDES
permit. It would be easier with a TMDL allocation. I will grant
you that. But you can still do it.
We are not contemplating trading without the limitation of
the water quality-based standard. Again, we do not allow
trading just to meet the technology-based standard, but only to
achieve the water quality-based standard.
Senator Jeffords. Thank you.
Thank you, Mr. Chairman.
Senator Crapo. Thank you.
Senator Thomas, do you have any further questions?
Senator Thomas. No, Mr. Chairman.
Senator Crapo. Senator Wyden, do you want to ask any
questions?
OPENING STATEMENT OF HON. RON WYDEN, U.S. SENATOR FROM THE
STATE OF OREGON
Senator Wyden. I do, Mr. Chairman. This is a matter of
enormous importance to my hometown of Portland. I think Mr.
Mehan is aware of it. I will tell you, Mr. Mehan, I think the
most charitable thing that I can say with respect to your
policies in this area is that they are just absolutely
incoherent. I want to see if we can make a little sense out of
exactly what is going on.
We looked at the new report, the February 2003 report, on
major facilities with waste water permit violations. The report
that was done by the EPA Office of Enforcement and Compliance
found that EPA frequently has tolerated significant violations
of clean water permits by industrial polluters even in the case
of repeat offenders. Your Agency, the EPA, found that in the
past 2 years only 24 percent of the facilities in significant
noncompliance received formal 25 enforcement actions.
This is what your Agency found with respect to major
violators. At the same time, you are going gangbusters to come
after our hometown that is working very hard to deal with
enforcing the law and with your Agency. The city of Portland
has had in place an enforceable agreement with the State of
Oregon for more than a decade. Our city is already more than
halfway toward meeting its goal of 96 percent reduction in
sewer overflows. It is a more stringent standard than your
enforcement guidelines. Our rate payers have spent more than
$500 million to address the sewer overflow. We are getting
clobbered in terms of these rates.
For the life of me, I cannot figure out when your own
office is saying that you will not go after major violators,
significant recidivists, with respect to Clean Water
violations. Instead of targeting them, you are going after the
people in my hometown. As you can probably tell, I have pretty
strong feelings about this.
With the Chair's permission, I am going to ask you some
detailed questions. This is of such importance to my
constituents. Maybe you can just tell us generally this. What
is the philosophy behind letting so many repeat significant
violators off the hook, and then going after my hometown with
hobnail boots when they are working so hard to be in
compliance?
Mr. Mehan. First of all, I do not mean to be the Artful
Dodger here. I am in the Office of Water and am not in the
Office of Enforcement. I will communicate your sentiments to my
colleague, J.P. Suarez, the Assistant Administrator for
Enforcement.
I am really not in a position to discuss the Portland
issue. It is subject to litigation. It has been referred to the
Department of Justice. I understand negotiations are ongoing.
Again, this is carried on by our Office of Enforcement and not
by the Office of Water.
As to your general point, we are concerned about the
overall integrity of the NPDES program. Enforcement does begin
with the NPDES permit. We are in the middle now of working with
the States to put in place what we are calling a permit
integrity program to begin to shore up the program which is
getting a little frayed at the edges. We have 19 administrative
petitions challenging our delegation of the NPDES authority
around the country. We have had five lawsuits. We had a Federal
judge in Indiana who was about ready to return the CAFO
program. We have problems with Louisiana that we are working
through.
Again, in the face of really financial stressful times with
our State partners, we still need to return to the basics and
shore up the NPDES program. As to the decisions on enforcement,
I must respectfully refer you to my colleague, Mr. Suarez on
those.
Senator Wyden. Just out of curiosity, are you telling the
subcommittee, then, for the record, that EPA's Assistant
Administrator for Water does not have anything to do at all--
not from a policy standpoint, and not from any standpoint--with
respect to how the Clean Water Act is enforced? Is that what
you want to communicate today?
Mr. Mehan. I deal with it at the front end in terms of the
issues in terms of the functioning of the NPDES program. But I
am never consulted on an enforcement action.
Senator Wyden. I was expecting that you might say that this
is not exclusively your providence, but do you not think it
would be useful at the front end to say, ``We are going to go
after major violators,'' if the policy is to be to go after
repeat major violators rather than to chase down a city that
has an outstanding record in the environment and is doing
somersaults to work with all of you to be in compliance?
That is a front-end judgment. It is my view that your
office and the Agency has a stilted set of priorities,
priorities that seem to me to just be incoherent. I would hope
that using your front-end authority, as you could characterize
it, you could send a message that it is time to go after major
violators when people are trying to meet you more than halfway,
that that be considered.
Mr. Mehan. Let me clarify this. There is another front-end
role that we play in the Office of Water in conjunction with
our colleagues in Enforcement of setting overall priorities.
While you can define a major violator in a lot of different
ways--whether they are in or out of compliance or how many
violations--we prefer to use a relative risk screen. Where we
are in total agreement with the Office of Enforcement is that
wet weather issues, specifically combined sewer overflow
issues, rank at the top of the pyramid in terms of enforcement
priorities. Without getting into the details of the Portland
case, that is what is at issue in Portland.
Senator Wyden. My time is up. I would only say that in your
February 2003 report, you said, ``Target polluters with the
worst compliance records and without enforcement action.''
By any stretch of the imagination, that is not my hometown.
That is not. You can say that they have enforcement issues. We
are not disputing that. That is why we are working hard to meet
the Agency more than halfway.
But by your own report and by the own kind of central
recommendation, you are honoring it more in the breach than in
the observance.
I thank you for the time, Mr. Chairman.
Senator Crapo. Thank you very much.
Mr. Mehan, we thank you for the time and effort you have
made to be here before us today. We appreciate your attention
to these critical issues.
Mr. Mehan. Thank you, Mr. Chairman.
Senator Crapo. Thank you.
We will call up our second panel. Dave Mabe, administrator,
Water Quality Division, Idaho Department of Environmental
Quality; Juli Beth Hoover, AICP, director of planning and
zoning, city of South Burlington, VT; and Michael Samoviski,
city manager, city of Hamilton, OH.
While these witnesses are coming forward, let me remind you
that we are probably going to be interrupted by a vote here. We
are trying to keep everybody on time. Please pay attention to
the clocks.
I have already introduced Mr. Mabe from Idaho. David, it is
good to have you with us. Please proceed.
STATEMENT OF DAVID MABE, ADMINISTRATOR, WATER QUALITY DIVISION,
IDAHO DEPARTMENT OF ENVIRONMENTAL QUALITY
Mr. Mabe. Thank you, Mr. Chairman.
My name is David Mabe. I am the administrator of Water
Quality Programs at the Idaho Department of Environmental
Quality in Boise. I bring greetings to you, Mr. Chairman, from
Governor Kempthorne and from Director Allred.
I am testifying today to share with you the perspectives of
the State of Idaho regarding the challenges that we face
implementing the Clean Water Act and the need for regulatory or
statutory changes to the program.
As background for what I am about to present, I would like
to give just a brief overview of the implementation in Idaho of
Clean Water Act programs. We have completed 484 TMDLs,
primarily involving sediments, nutrients, and temperature, but
we have also written TMDLs for other pollutants.
Next month, we will submit to the Environmental Protection
Agency a revised 303(d) list done in the integrated report
form, as per EPA's new guidance. It is set up in accordance
with the EPA's new guidance regarding a five-part list. The
call for data, public comment, and review was accomplished
electronically. Our 305(b) report was submitted in electronic
format. We are allowed now greater public access to this
process than ever before.
Our monitoring program is designed to cover the State in a
5-year period using a probabilistic monitoring approach. This
involves the development of random sites and then refines the
areas in progressive years until the fifth year when we focus
all the monitoring in those areas that we think have the
highest probability of being impaired.
We are making the Clean Water Act TMDL process work in
Idaho, but I believe there are some fairly simple changes to be
made that could lower costs, make the process be more sensible
on the ground, provide better environmental protection, and
allow public participation in a more meaningful way.
The first of those is the listing, the delisting, or the
303(d)/305(b) process. We would like to support a longer
schedule to comply more with our monitoring approach in the
State of Idaho. We are suggesting a 5-year timeframe for
reporting using the integrated report format. It is very
difficult and expensive for us to do our monitoring in a
timeframe less than a 5-year period.
Simply put, we do not have the budget to accomplish a
statewide monitoring program in a timeframe of less than 5
years. In addition, many of the improvements that we look for
in impaired waters are not going to be apparent in a 2-year
timeframe. To report on this shorter timeframe is not just
meaningless. It is also becomes a burden to the process and to
public participation in the process.
To give an example, in our first 2-year cycle, we would
still be very early in the process of probabilistic monitoring.
We would have no new data to report. At the end of the 4-years,
the second 2-year cycle, we still have not completed the 5-year
probabilistic monitoring timeframe and have no new data to
report.
In the 6-year of a 2-year cycle, we have waited, in
essence, 1 year longer than necessary to get the data out and
report to the public on the changes in Idaho's water quality.
Valuable staff time and resources are diverted to make two
reporting cycles that really are relatively meaningless. By the
time we do get around to that third reporting cycle where we
have some things to say, I think public interest is going to be
waning.
In recent rulemaking and guidance efforts, EPA has also
supported a very important concept in reporting and
differentiating between pollutants and pollution. We think that
this help create a report to the public that focuses them on
the issues that we can resolve with the TMDL process. These are
pollutants that can be allocated and can be improved upon using
the TMDL process.
Idaho is a State that is blessed with surplus water that we
are able to use for irrigation purposes, and periodically those
diversions can cause water quality problems. But those
diversions are not something that can be quantified and solved
through the TMDL process.
So the new listing and reporting format does give us an
ability to report those problems, but not in the context of
confusing the public that these are issues for which TMDLs can
be completed.
It does, then, make the public aware of those issues. They
can work with our Department of Water Resources, or agencies
that do have authority to deal with those problems in resolving
water concerns in those areas.
Another concept that is very important to us is to allow
more flexibility in how pollutant loads are allocated.
Currently, in both statute and rules, TMDL stands from Total
Maximum Daily Loading. The rules have bent that just a little
bit, trying to create a process that really works more sensibly
on the ground. But I think that at some point we are going to
be subject to legal challenges regarding that.
Pollutants, like sediment, are not loaded on a daily basis.
Nonpoint source loadings are generally not occurring on a daily
basis. They occur during storm events and occur periodically.
The definition of a TMDL makes it very difficult to work with
them.
The approval process is another issue that probably causes
a great deal of waste in administration of the program.
Currently, in the system EPA has to affirmatively act on
standards, on TMDLs, and on other listing processes. I think
that it is very important that each Agency involved in these
listing processes is trying to create an administrative record.
They are all subject to legal challenge. We are duplicating a
great deal of work at the State and Federal level in creating
administrative records.
In Idaho, industry challenges, or challenges from groups
that want to see TMDLs that are less stringent, generally occur
in State court. Challenges that think we have not done enough
will occur in Federal court. We are allowing different groups
the kind of venue shop by having all these different agencies
have an affirmative duty to approve. We would really like to
see a process that changes slightly so that we can allow the
Federal Agencies to object to issues where they feel there are
concerns.
Thank you very much, Mr. Chairman, for the opportunity to
testify. I look forward to working with the committee to
resolve some of these issues. I would ask that my complete
testimony be included in the record in its entirety.
Senator Crapo. Without objection, so ordered. Thank you
very much, Mr. Mabe.
Ms. Hoover.
STATEMENT OF JULI BETH HOOVER, DIRECTOR OF PLANNING AND ZONING,
CITY OF SOUTH BURLINGTON, VT
Ms. Hoover. Good morning, Senators.
I am Juli Beth Hoover. I am the director of planning and
zoning for the city of South Burlington, VT. Among my other
storm water hats, I am the director of our Water Quality
programs in South Burlington, and also the Chittenden County
demonstration project through EPA's National Decentralized
Water Resource Demonstration Grant Program.
Storm water pollution has become a major economic problem
for Northwest Vermont. Basically everything that is subject to
the Phase II regulations in Vermont drains into Lake Champlain.
Whatever pollutants we put into Lake Champlain we then turn
around and pay the Champlain Water District to filter and treat
before it becomes our drinking water.
Therefore, with the cost to our recreation-based economy,
and the cost of filtration, we are really finding in Vermont
that implementing the Phase II program is a good investment,
especially considering what we are investing in the GASB
accounting standards. Spending between $4 and $12 per capita
per year is really making sense, given the economic impact of
storm water pollution on Lake Champlain and on our water
filtration costs.
Being good Vermonters, we have aggressively looked for cost
savings and achieved them largely through the use of inter-
municipal agreements on everything from the legal work required
to implement the program, to storm water mapping and planning,
and also, very importantly, meeting the public education and
public outreach standards.
We were concerned about the potential costs and drain on
staff resources from that component of Phase II. We are pleased
to say that we have managed to meet that in what we think will
be a far more effective and certainly cost-effective manner
through this inter-municipal agreement.
Our biggest initiative on storm water treatment, besides
Phase II, is the use of decentralized or distributed storm
water systems to deal with some of our most difficult and
challenging storm water problems and economic problems.
Basically, decentralized or distributed systems, take land
that no one really wants to build on, or could build on, and
retool it to do something useful for water quality and for
development. Last year, Congress directed the EPA to try to
spend $75 million of the over $1 billion in State revolving
fund moneys on this type of distributed approach was to both
storm water and to onsite septic systems.
I would like to encourage you to do more for this program
which is extremely cost effective, extremely good for
municipalities and businesses, and really terrific for clean
water.
The picture on the left is the frozen tundra of Bill
Shearer's Chevrolet on Route 7. Here it is on the left. This is
not a picture we put on the postcards of Vermont. This is where
we go to get our snow tires put on. Basically, Bill Shearer
needed some capacity for storm water so he could expand his
business, as did two of his neighbors.
The City and the Champlain Water District had a pressing
interest in stopping the petroleum hydrocarbons and the other
polluted run off from these auto dealerships and gas stations
on Shelburne Road from getting into the Lake right near the
intake for the water district.
So, with some creative head-scratching and engineering,
Bill Shearer's back yard has become a 4-acre constructed
wetland treatment system. We did not lose land for development
and business growth. Instead, we gained the opportunity to grow
Bill's business. Our monitoring this season has shown that we
are getting excellent removal of these pollutants.
The problem is that this system cost $300,000. We had to
scrape up 13 different grant sources to pay for it. Trying to
administer 13 different grants will dissuade anyone from trying
with this approach. Being stubborn, we are trying three more of
these systems in other problem spots; nonetheless, through our
demonstration grant through the EPA national program. This one
will deal with runoff from commercial plazas at the interchange
with the Southern Connector, using land that is currently used
for the cloverleafs.
This one will use the land by an interstate on-ramp to
support development of our city center. This one is planned in
the city of Burlington on Engelsby Brook to remove pollutants
that we know are causing chronic beach closures at Oakledge
Park, which happens to be a block from my house. I am very
tired of that ``Area Not Recommended for Swimming'' sign,
especially in the middle of the summer.
Senators, we know that we have the ability through these
decentralized systems to do a great job on water quality. We
need a consistent, predicable, funding stream to do this,
whether it is through a set-aside in the SRF, or expansion of
storm water funding through the demonstration projects or other
means.
Thank you. I look forward to your questions. I would ask
that my complete testimony be included in the record in its
entirety.
Senator Crapo. Without objection, so ordered. Thank you
very much, Ms. Hoover.
Mr. Samoviski.
STATEMENT OF MICHAEL SAMOVISKI, CITY MANAGER, CITY OF HAMILTON,
OH
Mr. Samoviski. Good morning. It is a pleasure to be here. I
am Michael Samoviski, city manager for the city of Hamilton,
OH.
Hamilton is located in Southwestern Ohio. It has a
population of 62,000 people. We operate our own treatment works
and a separate storm water collection system. In compliance
with the promulgated Phase II storm water rules, Hamilton did
receive, under the NPDES, a general storm water discharge from
it in April 2003.
To obtain this permit, we did develop a necessary storm
water management plan which was submitted to the regulatory
Agency in March 2003. The plan does encompass the six minimum
controls mandated by the Phase II rules.
Hamilton's Council is seriously concerned about
implementation and enforcement of this recently issued permit,
especially in light of our very challenging local and State
economic climates. As the City prepared its storm water
management plan, it became apparent to the City Council that
the costs associated with this implementation will have to be
assumed by our local government, that is, our citizens and
businesses since surplus municipal moneys for this purpose are
nonexistent.
The City anticipates having to form and implement a storm
water utility to achieve the necessary revenues to implement
our plan. The charges will be based upon the amounts of
impervious areas on various parcels of land. In Ohio, according
to the Ohio Supreme Court, storm water fees of this sort, since
they are utility charges, must be applied evenly and
consistently without regard to tax status or land use. This
means that all residents, businesses, schools, governmental and
institutional complexes will be subject to these charges
without exception.
Each residential unit would certainly pay a flat monthly
charge, but the nonresidential units would pay a much higher
charge based on the larger expanse of impervious areas.
Hamilton's projected annual expense attributable with complying
with the Phase II program is an additional $1.6 million over
the $800,000 that the City now spends on storm water
activities.
Since Phase II is a federally unfunded mandate, the City
expects to have to raise this revenue by imposing a monthly fee
of up to $550 on residential customers, and a multiplier effect
on nonresidential users.
A few examples will illustrate our point. Hamilton's First
Baptist Church was determined to have an impervious factor of
68 times that of a single equivalent residential unit, or ERU.
The Church's expected storm water utility charge would be $374
per month.
The Smart Paper Company, a manufacturer of high quality
papers, has an impervious factor 912 ERUs. Its monthly charge
would be $5,017 per month. Our local high school has an
impervious area equal to 243 ERUs. Its monthly charge would be
$1,338. It goes on with other related examples.
The federally unfunded mandate is being imposed upon local
communities at a time when our economies are stagnant and our
Nation is facing huge deficits. Hamilton is no exception. Local
budget deficits are already predicted for 2004, and the State's
budget is in such distress that no funding for cities is
available for Phase II compliance.
Now is not the time for distressed cities, such as
Hamilton, to impose a new monthly storm water utility charge
across our community to achieve Phase II compliance. When the
local economy improves, Hamilton's businesses and citizens may
be better able to absorb this type of fee.
In our currently flagging economy, however, our local
businesses cannot afford this additional expense, nor can our
citizens who have very recently been called upon to take on
more of the public safety burden by paying higher taxes for
police and fire fighter staffing.
Accordingly, the city of Hamilton respectfully asks that
you, our elected Federal representatives in Washington,
commence action before Congress to enact a 5-year moratorium.
This moratorium could postpone the unfunded mandate to a time
better suited for requiring communities, such as our distressed
city, to step forward and implement the Phase II rules.
The city of Hamilton is not seeking to avoid serving as a
good steward of its river and receiving waters, but we are
concerned public officials seeking to strike a reasonable
balance between the stark reality of our current depressed
local economy and continuing environmental improvement.
Thank you again for your attention and courtesy in allowing
us to address this committee. We were honored to receive your
invitation to appear and present our concerns. I would ask that
my complete testimony be included in the record in its
entirety.
Senator Crapo. Without objection, so ordered. Thank you
very much, Mr. Samoviski.
I will advise everybody that the vote that was going to be
at 10:30 a.m. has been delayed until 11 a.m. We have a reprieve
for a short time, but it is still going to happen to us.
Let me start out with a question with you, Mr. Mabe.
Mr. Mabe, as I listened to your testimony, it became
evident to me that a number of the concerns that the State of
Idaho sees with the implementation of the TMDL process have to
do with process--the monitoring process, the approval process,
and the like.
Could you just quickly summarize what the best income
outcome would be in terms of improvements? Please hit just
three or four of these things. Please summarize them so we have
a short list of what really needs to be done in terms of
improvements in the process.
Mr. Mabe. Mr. Chairman, I would be happy to. I think if I
could make the changes in the new rule that we would look
forward to effectively operate the program, we would change the
listing cycle to a 5-year cycle. We would clarify the concept
of pollutant loading so that it is not a daily load; that it is
just any qualified load that fits the pollutant and the
situation within the watershed. Then we would change from an
affirmative duty to approve standards, TMDLs, and reports to
give EPA the ability to object to a scenario that they do not
think is being protective or implementing the Clean Water Act,
to try to remove some of that administrative burden.
It is the process that tends to bog us down and cause most
of the disagreements in getting watershed planning done and
getting it implemented on the ground.
Senator Crapo. Thank you. You heard the questions I asked
of Tracy Mehan about the new rule and the context of the EPA
being involved more at the level of determining the overall
load for a watershed, or for an area under discussion, and
letting the States then allocate properly.
I am sure you heard his answer as well. As I heard him, he
said, ``that is hard to do because in order to determine the
overall load, they have to determine how it is allocated.''
Could you comment on that issue?
Mr. Mabe. Mr. Chairman, I think there are clear roles for
EPA and for the States. EPA has, I believe, four staff in the
State of Idaho. The State of Idaho has about 200 staff working
in the water quality program. The actual on-the-ground work
with stakeholders needs to be done at the State level--to
develop those allocations, to do the monitoring, to determine
what standards should be applicable. Those should be worked on
by the State. That should be subject to EPA approval and should
be subject to appropriate schedules. But in order to actually
accomplish the work of writing TMDLs, and of implementing
TMDLs, the State is really the only logical entity to perform
that.
Senator Crapo. How would we respond to the EPA? Let us take
the fact that right now they have four employees who are going
to have essentially approve the work of 200 people working at
the State level. It seems to me that there has to be some point
at which the EPA adopts or delegates in some context so that
the work of the State is accepted.
Is that happening now?
Mr. Mabe. Mr. Chairman, it is an improving relationship,
but still a very difficult one. They are trying to create an
administrative record on every decision that they can defend.
So if we submit 12 or 14 TMDLs a year, that small number of
staff are trying to review and approve each of those TMDLs and
create an administrative record where they can defend the
challenge.
That, I think, is the main point that I would bring today.
If we could shift that burden a little bit and let them focus
on what they think the priorities are, and a scenario where
they could object to work that they find substandard, and not
have to go through the motions of approving and creating
substandard, and not have to go through the motions of
approving and creating administrative records for the work
which they believe is adequate.
Senator Crapo. So for the purposes of preparing against
potential litigation, they have to make it a reality that they
redo the work of the State of Idaho?
Mr. Mabe. They have to create an administrative record upon
which to base their decision and be able to defend that in
court. I think that really is the rub. They start to question a
great deal work that has been done. They start to redo or
reanalyze decisions that have been made. It really slows the
process down. They are just not staffed to make decisions at
that level.
Senator Crapo. All right. Thank you very much.
I would just like to say to Ms. Hoover and Mr. Samoviski my
time is up. I really appreciate your testimony. You have raised
very interesting options that we need to pursue here more
aggressively. These are interesting and disturbing issues that
we need to address. I just want to let you know that we are
paying very close attention to the issues that you have raised.
Senator Jeffords.
Senator Jeffords. Thank you, Mr. Chairman.
Ms. Hoover, thank you for an excellent presentation. There
was a lot of work putting that together. I deeply appreciate
what you have done and your community for what they have done.
Can you describe the impact of storm water runoff from
transportation infrastructure on your community's overall storm
water program? Do you believe that your situation in Vermont is
similar throughout the country?
Ms. Hoover. The impact of transportation infrastructure is
huge, just in terms of the sheer amount of imperious surface
and runoff and the nature of the runoff it creates. South
Burlington, of course, as you know, is one of the more heavily
urbanized areas. The impact is consistent throughout Chittenden
County, and probably a little less so in the rest of Vermont,
except with places with an interstate highway running through
it.
The good news is that the land associated with our
transportation infrastructure--cloverleafs, on-ramps--tends to
be outstanding for use for decentralized storm water treatment.
The transportation enhancement program is starting to fund the
use of transportation enhancement dollars to do storm water
management in these transportation-related lands. That is a
trend that we would like to see continued to really deal with
the impact of transportation on our communities.
Senator Jeffords. How do the costs described by your
colleague from Ohio for storm water management compare with the
costs you are projecting for South Burlington? What are some of
the possible reasons for the differences?
Ms. Hoover. Among the towns in Vermont subject to Phase II,
only South Burlington is looking at a utility. Our projected
costs at this point are about one-third of what my colleague
from Ohio is projecting.
I suspect that the State enabling legislation for utilities
and utility fees has a great deal to do with that. Storm water
utilities tend to be a different animal from conventional
centralized water and sewer utilities where the user rate gets
applied across the board. We certainly have been working with
the Vermont legislature to deal with that in an appropriate way
to make sure that we can keep the costs down and exempt those
properties that need to be exempted.
Senator Jeffords. Thank you very much. It was very
wonderful testimony.
Mr. Samoviski, did you use a contractor to develop your
storm water management plan? What role is that contractor
playing in the implementation of your plan?
Mr. Samoviski. Yes, we did hire a consultant to advise us
and to work through the planning of the storm water management
plan. They developed a comprehensive program identifying the
issues for our community which is an aging industrial
community. The consultant has advised us continuously through
the process and has been working with our Department of Public
Works to oversee the implementation of the program.
We intend to use a variety of consultant services as we get
into the necessary steps of monitoring our local commitments to
the storm water regulations and controls. We will continually
use that consultant to upgrade our plan and to evaluate some of
its effectiveness.
Senator Jeffords. Mr. Mabe, I want to compliment you for
your testimony, too. I do not have a question for you.
Thank you, Mr. Chairman.
Senator Crapo. Thank you very much. I appreciate this
panel's testimony. Again, as I said, your written testimony
will be a part of the record. You have provided some very
valuable insights as we look at how we can approach this
legislatively and through our oversight. Thank you very much.
Mr. Mabe. Thank you.
Ms. Hoover. Thank you.
Mr. Samoviski. Thank you.
Senator Crapo. We will call up our third panel now. We will
try to get through as much of the panel as we can before the
vote is called.
We have Steve Kouplen, president, Oklahoma Farm Bureau;
Michael R. Lozeau, attorney, Earthjustice; Lee Fuller, vice
president, Government Relations, Independent Petroleum
Association of America; Rena Steinzor, professor and director,
Environmental Law Clinic, University of Maryland School of Law;
and Jim Hall, principal partner, Hall and Associates.
Let us go ahead and begin with the testimony.
Mr. Kouplen, would you please begin?
STATEMENT OF STEVE KOUPLEN, PRESIDENT, OKLAHOMA FARM BUREAU
Mr. Kouplen. Thank you, Mr. Chairman, and members of the
subcommittee. My name is Steve Kouplen and I am the president
of the Oklahoma Farm Bureau. It is a pleasure to be here with
you today and talk with you about a couple of issues that are
important to agriculture and dealing with water.
On July 13, 2000, the EPA published final regulatory
requirements for establishing Total Maximum Daily Loads under
the Clean Water Act. The Farm Bureau strongly opposed those
regulations, as we believe that they exceed the Agency's
authority under the Clean Water Act.
One of the most disturbing aspects of the now-withdrawn
July 2000 rule was the Agency's conversion of the TMDL program
into a nationwide enforcement mechanism for all sources of
pollution, both point and nonpoint sources. We believe that the
TMDL program should respect the practical and legal differences
between point and nonpoint sources.
As the Clean Water Act has recognized for 30 years, the
availability of endo-pipe technologies for point sources has
made a precise command-and-control strategy feasible. Nonpoint
sources, on the other hand, cannot rely on any comparable
technologies and must, therefore, use less precise and more
subjective best management practices to achieve load
reductions. Given the inherently less predictable results of
the measures available to nonpoint sources, a command-and-
control strategy for nonpoint sources has never made any sense.
Congress went to great lengths in the Clean Water Act to
ensure that the EPA did not mettle in local land use decisions
by delegating nonpoint source control to the States in Sections
208 and 319. The 2000 rules undercut this approach and allow
EPA to prepare implementation plans that dictate how and when
nonpoint sources can use their land. States should have the
freedom to implement their TMDL programs at their discretion.
The fundamental balance of State and Federal control
requires that EPA ensure that the ultimate goal is properly
defined, but that the States alone determine how the goal will
be achieved. Thus, States, not EPA, must determine how loading
capacity will be allocated among the various pollutant sources.
Such highly subjective decisions necessarily require balancing
the needs of competing land uses based on considerations of
equity, economy, and public welfare.
As such, allocation decisions are the essence of
implementation planning that has been strictly reserved for the
States. We urge EPA to address this issue and the rulemaking on
the TMDL rule.
In relation to the oil spill final rule impact on
agriculture, EPA's July 17, 2002, Oil Spill Prevention Control
and Countermeasures Rule will negatively impact farmers and
ranchers and their cooperatives across the country. While the
subsequent January 9, 2003, rule providing an 18-month delay in
the implementation allows for more time to prepare, it does not
reduce the overall cost or impact.
There is now a growing realization across the country that
the oil spill rule and program will greatly affect agriculture.
Farmers and ranchers need to store fuel on their farms in order
to control costs and to fulfill time-sensitive production
operations. Many farms, especially in the Western States,
require more than the regulatory threshold of 1,320 gallons of
fuel storage for their operations.
On many larger farms, the fuel storage is not in one single
location. Above-ground tanks are placed where needed on the
farm for efficient equipment operation. These may be miles
apart. Given the dispersed nature of the farm fuel storage and
the costs associated with following the rule requirements for
containment, integrity testing, security, and plan development.
We believe that the threshold level is inappropriate for
the family farm and for those storages where a spill would have
no impact on water quality. In addition, the aggregation of
many smaller tanks, often in dispersed locations across farms
and farmland, must also be addressed so as not to place farms
in a costly regulatory program where there is no threat to
water quality.
The concerns about the impacts of oil spill rules warrant a
complete review of the final rule as it impacts agriculture.
EPA should address agricultural storage differences in a manner
that allows the farm and ranch community to protect water
quality in an economically and environmentally sound and
effective manner. EPA should look to the USDA for appropriate
conservation practices and technical support to address the oil
spill issue and other water quality issues with Agriculture.
We support using our U.S. Department of Agriculture
Conservation Programs, such as Environmental Quality Incentives
Program and the Conservation Security Program, to help the
agriculture protect and improve our water quality.
Mr. Chairman, I thank you for the opportunity to be here. I
would ask that my complete testimony be included in the record
in its entirety.
Senator Crapo. Without objection, so ordered. Thank you
very much, Mr. Kouplen.
Mr. Lozeau, please proceed.
STATEMENT OF MICHAEL R. LOZEAU, ATTORNEY, EARTHJUSTICE
Mr. Lozeau. Thank you, Mr. Chairman. Good morning, Mr.
Chairman, and Senator Jeffords. I thank you for inviting me
here today to testify to assist the committee in overseeing the
current Administration's implementation of the Clean Water Act.
I would like to discuss the latest in a series of efforts
by the current Administration, described earlier by Senator
Jeffords, of weakening the effectiveness of the Clean Water Act
and providing us some insight as to the full scope of the
Administration's efforts to undermine one of our most critical
and most successful environmental laws.
I will be discussing Total Maximum Daily Loads for the most
part, which is a key part of the Act's comprehensive program,
and an essential element of how Congress envisioned the Act
would work. It is based on common sense, focusing all the Clean
Water Act's tools on a particular threatened or impaired water
volume, and having them work in concert to effectively and
efficiently protect that water body.
The TMDL program currently is the best hope to eventually
achieve these as yet unattained goals of the Clean Water Act
only by addressing all sources of pollution and assuring that
every source control their share of the pollution. Will water
quality be restored and protected?
The existing TMDL regs, which were put in place by the
Reagan Administration and the first Bush administration, as
late as 1992, have begun paying off. The rate of TMDLs being
established is accelerating. The 1992 regulations have created
considerable certainty in the TMDL program. The States are
beginning to understand how the process works, as well as the
dischargers. However, EPA's draft TMDL rule now threatens to
undermine that progress and undermine the certainty that was
achieved over the last decade.
EPA's draft TMDL rule, if enacted, will undermine the TMDL
program in clean water by eliminating large number of waters
from the benefits of the TMDL program. For those impaired
waters left on the left, it would transform the TMDLs into
meaningless numbers, devoid of specifics, and with only a vague
relationship to the water body and pollution sources it claims
to be cleaning up.
EPA proposes, for example, to limit the waters to be
protected by TMDLs by suggesting a complicated mix of five
categories of waters, only one category of which would require
TMDLs. The other four, in essence, exempt waters from the TMDL
program. Unfortunately, EPA's listing scheme would exempt
waters that Congress intended to be included in the mandatory
TMDL program.
I would just focus on Category 4(b) which is a category of
waters that is identified by the Agency as impaired, but for
which EPA or the State has identified some programs other than
a TMDL that they claim will cleanup those waters. As a legal
matter, these impaired waters meet the criteria for listing and
must be slated for TMDLs.
Second, the open invitation for EPA to the States to
rationalize not listing these impaired waters based on
alternative programs invites confusion and invites challenges
from all sides. These are programs that as of that listing
decision obviously were not working. That is why the water was
impaired.
This is the exception that may have swallowed the rule. I
think we will find States trying to fit as many impaired waters
as they possibly can into this one category in the hopes of
getting out from the TMDL obligation.
In regards to the substance of the TMDLs, EPA claims that
the Agency does not have to review TMDL's pollutant loading
allocations, and that these unreviewable allocations can be
done by the States as gross allocations.
Without reviewing and approving TMDL's allocations of
pollutant loadings for specific sources, there is simply no way
for EPA to say in any rational way that it is implementing the
standard created in the statute. That standard is that the TMDL
must be established at a level necessary to implement
applicable water quality standards. Those standards apply
throughout a watershed, not just at some arbitrary downstream
point.
Also, by lumping together a bunch of discrete sources and
treating them as one through a gross allocation, EPA will
render any efforts at trading within that watershed ineffective
without discrete credits. For discrete individual sources, no
trading will be possible.
EPA claims to be clarifying the TMDL program. I believe the
opposite is true. If enacted, widespread uncertainty will
result and we will see more and more challenges to TMDLs by
both dischargers and by citizens. The rules would undermine
existing permits that have been the most notable success story
under the Act. For the many water bodies that have yet to
achieve even the fishable and swimmable standard, in essence
the rule would have us go back to the 1960's, before the 1972
amendments, to programs that have not worked in the past.
History shows us that that is the road to increased pollution
and increased impaired waters.
I would like to mention quickly two other issues that are
before the committee today. One is the oil and gas extension,
the 2-year extension from the Storm Water Phase II regs for oil
and gas drill sites. I believe that decision was a mistake.
Section 1342(l)(2) clearly does not create any kind of blanket
exemption for that kind of drilling or for the pollutants that
are discharged. Sediment and erosion from such sites affects
our waters in the same way as sediment and erosion from any
site.
In terms of the SPCC rules, we certainly are concerned,
especially with the apparent conversations going on and
negotiations stemming from the challenges the oil and gas
industry filed to those rules regarding the extent of
jurisdiction of the regulations to waters of the States. I
would certainly voice our concern there, as well.
Thank you, very much. I would ask that my complete
testimony be included in the record in its entirety.
Senator Crapo. Without objection, so ordered. Thank you
very much, Mr. Lozeau.
Mr. Fuller.
STATEMENT OF LEE FULLER, VICE PRESIDENT, GOVERNMENT RELATIONS,
INDEPENDENT PETROLEUM ASSOCIATION OF AMERICA
Mr. Fuller. Thank you, Mr. Chairman. Today I would like to
address two issues under the Clean Water Act--storm water
permitting requirements and new SPCC Plan requirements.
However, before addressing these regulations, I want to discuss
the role of the independent producer in domestic production
because these producers are the most significantly affected.
Independent producers are engaged essentially only in the
exploration and production, or E&P phase, of the industry.
There are about 7,000 of them, and they average 12 employees.
Over the past 15 or more years, the domestic E&P industry has
changed significantly. Independent producers now develop about
85 percent of the wells in the United States, producing 75
percent of domestic natural gas and about 60 percent of the
crude oil in the lower 48 States. This role will continue to
grow.
Another important issue is recognizing the role of marginal
wells. Marginal oil wells average about 2.2 barrels per day.
However, collectively they produce about 20 percent of our
domestic oil, an amount roughly equal to what we have been
importing from Saudi Arabia. Marginal natural gas wells account
for roughly 10 percent of domestic production. Of the 876,000
producing oil and natural gas wells in the United States, about
650,000 are marginal wells. These wells are the most
economically vulnerable to price reductions or cost increases.
Consequently, when independent producers look at these EPA
regulations, at issue is the effect that they will have on
reducing new production, or shutting down existing production.
Turning first to the issue of storm water permitting for
facility construction, independent producers believe EPA
incorrectly interpreted the Clean Water Act. The 1987 Act Storm
Water provisions have become inappropriately intertwined.
Section 402(p) directs EPA to require permits for storm water
discharges under the NPDES permitting program. At the same
time, Section 402(l)(2) specifically excludes discharges of
storm water runoff from the E&P facilities unless the discharge
is contaminated by contact with, for example, products,
byproducts, or wastes.
IPAA believes that EPA has erred in its interpretation of
the Clean Water Act with regard to the relationship between
these sections. Congress spoke directly to the exclusion of
storm water related to E&P facilities in Section 402(l), the
specific statutory exclusion it should control.
Nevertheless, through a series of disconnected events, EPA
has pulled E&P construction into the scope of its storm water
permitting program. As a matter of law and policy, EPA should
evaluate the environmental risks and regulatory burdens created
by its actions. In this case, IPAA does not believe that EPA
made a reasonable assessment of either the risk or the burden.
No where in the information that IPAA has reviewed, is
there is an indication of significant environmental risks
associated with E&P facility construction, nor is there any
indication that EPA understood the burdens this program would
impose. Recently, EPA deferred until March 2005, the Phase II
Storm Water permit deadline for E&P facilities that disturb
less than 5 acres of land area.
In the meantime, EPA will have an opportunity to consider
whether there are alternative approaches that might be
consistent with EPA's statutory authority and that would be
consistent with the environmental impacts of construction of
these facilities and minimizing the regulatory burden. IPAA
believes this action is essential.
Finally, let me turn to the SPCC Plan regulations. SPCC
Plans have been required for several decades. Those Plans are
in place. Moreover, the Plan requirement is separate from any
spill reporting and response requirements. Those
responsibilities exist whether the facility has a SPCC Plan or
not.
So at issue is whether the new requirements are necessary,
appropriate, and cost effective. From an IPAA perspective, IPAA
believes they are not.
IPAA is unaware of any extensive information indicating
that existing SPCC Plans have systemically failed. But the new
regulations would require extensive and costly plan revisions.
IPAA believes that if there are elements of E&P operations
where the planning process can be improved, those should be
identified and a cost-effective method should be developed to
address them.
This is far different from the current regulations that are
prescriptive regarding specific planning actions, including
construction of certain containment structures. EPA has
extended the compliance date for its new SPCC Plan regulations
for 18 months. IPAA supports this extension and hopes that it
will be used to reconsider both the scope and the approach to
SPCC Plan development.
The Clean Water Act generates many regulations to improve
water quality in the United States. But it is essential that
regulations target issues where action is truly needed and that
they are cost effective. These regulations do not meet these
tests. Moreover, they pose a significant risk to the
development of new domestic oil and natural gas resources and
the continued operation of existing production. In each case,
EPA needs to reconsider its actions.
Thank you very much. I would ask that my complete testimony
be included in the record in its entirety.
Senator Crapo. Without objection, so ordered. Thank you
very much, Mr. Fuller.
Ms. Steinzor.
STATEMENT OF RENA STEINZOR, PROFESSOR AND DIRECTOR,
ENVIRONMENTAL LAW CLINIC, UNIVERSITY OF MARYLAND SCHOOL OF LAW
Ms. Steinzor. Mr. Chairman and members of the committee,
thank you for the opportunity to appear before you today on
behalf of the Center for Progressive Regulation to testify
regarding EPA's implementation of the Clean Water Act.
CPR is an organization of academics specializing in the
legal, economic, and scientific issues that surround health,
safety, and environmental regulation. This committee deserves
much credit for recognizing the importance of the topics you
consider today, especially environmental enforcement.
Deterrence-based enforcement lies at the core of an
effective regulatory program designed to maintain and improve
water quality. Yet, congressional oversight of EPA's
enforcement record has been sporadic, and without such
oversight, it is difficult to hold the Agency accountable for
keeping the environmental cop on the beat.
There are ample signs that the environmental cop is not
only off the beat; he is asleep in his cruiser. The latest
numbers indicate a precipitous decline in every measure of
enforcement effectiveness from cases brought and penalties paid
to staffing levels. The number of EPA inspection and
enforcement staff has fallen to its lowest level since the
establishment of the Agency, dropping by more than 12 percent
since the Bush administration took office.
Violators have paid 64 percent less in fines for breaking
environmental laws during the first 2 years of the Bush
administration than they did under the Clinton administration.
The average civil penalty paid by polluters has dropped more
than 50 percent, and the money spent on supplemental
environmental projects has dropped by 77 percent.
In the Clean Water Act area alone, the number of
inspections declined by 8 percent. There was a 50 percent
decrease in the number of informal enforcement actions, and a
45 percent decrease in formal actions. Despite this disgraceful
track record, as Senator Jeffords mentioned earlier, the
Administration's 2003 budget request eliminates 200 enforcement
personnel.
These changes are not abstract. They directly threaten
water quality and hurt people. As just one example, an EPA
analysis concluded that 13 percent of major sources emitting
toxic pollutants into the Nation's surface waters exceeded
their permit limits by more than 1,000 percent. In that same
report, EPA reported that significant noncompliance by major
polluters was on the rise, increasing by 8 percent between 1994
and 2001, to a grand total of one-quarter of all such sources
engaged in blatant violations of the law.
Today you will hear a witness challenge the wisdom of one
small subset of criminal enforcement under the Clean Water Act
that is typically used to punish oil and gas companies that
cause disastrous spills. The oil and gas industry has already
urged you to consider amendments to undercut these provisions,
adding insult to the gross injury already visited on EPA's
enforcement program.
Not only do I disagree with the reasoning that underlies
these complaints, I believe they can be best characterized as
fiddling while Rome burns. They distract attention from the
much more important point that EPA's entire enforcement program
is on the ropes.
These complaints are based on a false premise. The most
respectable argument for weakening the law in this area is the
concern that the possibility of criminal enforcement has made
witnesses reluctant to speak frankly with an Agency's
investigators.
Much the same argument could be made in any area where
criminal prosecutions are possible. Yet, it is difficult to
imagine any serious person arguing that we should repeal
criminal laws because they make potential witnesses
uncomfortable.
The cases pursued by the Department of Justice involved
very careless, egregious conduct. The question before you is:
Which is more effective, creating a strong incentive to prevent
such spills, or gaining some undocumented additional
cooperation after the fact?
The Nation faces many challenges at home and abroad. The
economy is worsening and the funding for domestic programs
continues to shrink. In this environment, deterrence-based
enforcement is crucial because the only alternative is the far
more expensive practice of cajoling law breakers back into
compliance.
Thank you. I would ask that my complete testimony and the
chart be included in the record in its entirety.
Senator Crapo. Without objection, so ordered. Thank you
very much, Ms. Steinzor.
Before you begin, Mr. Hall, let me tell you that a vote is
underway. However, our Chairman, Senator Inhofe, I understand
is voting and coming this way so he can take the Chair when I
go vote. Hopefully, we will be able to continue the hearing
uninterrupted. If he does not arrive before I have to leave,
then there will be a very short break. We encourage everyone to
stay here and be ready.
Mr. Hall, please begin.
STATEMENT OF JIM HALL, PRINCIPAL PARTNER, HALL
AND ASSOCIATES
Mr. Hall. Mr. Chairman, Senator Jeffords, thank you for the
invitation to testify before you today on a matter I believe is
important to transportation safety.
On my background, I was nominated as a member of the
National Transportation Safety Board by President Bill Clinton
in 1993, and served as the Board's Chairman from June 1994 to
January 2001. I presently serve as the president of Hall and
Associates where I advise a number of government and private
clients on transportation safety and security issues. Although
I do represent oil industry interests who have an interest in
the provision I will discuss, my testimony is my own and
reflects my experience on the Safety Board.
The Safety Board serves as the eyes and ears of the
American people whenever there is a significant transportation
incident. Its mission is to impartially and thoroughly
investigate accidents to determine their cause, with the
primary goal of preventing future accidents. NTSB
investigations rely, in large part, on the voluntary and unpaid
assistance of companies involved in accidents to understand
what went wrong and how to fix it.
This system of voluntary cooperation works exceedingly well
and has succeeded in its goal of a safer transportation system.
However, the threat of criminal sanction for purely accidental
behavior has the real potential to stifle this voluntary
cooperation, to stifle the development of information necessary
to understand an occurrence and to prevent its repetition.
Every mode of transportation is regulated for safety
purposes under a variety of statutes. Each of these provides
for both civil and criminal sanction for some classes of
regulatory violation. Typically, criminal violations are
reserved for knowing violations. Activities such as
falsification of records or safety tests, the deliberate
violation of regulatory standards, or willful or reckless
behavior that leads to injury, death, or destruction of
property.
However, one statute, the Clean Water Act, provides
criminal penalties including fines and imprisonment for simple
negligence. Simple negligence does not require criminal intent
or knowledge, or even willful or reckless disregard of norms.
Potentially, an entity believing that it is exercising due
caution and using current technology and modern procedures may
still find that the company, its operating employees, and its
supervisors will be charged criminally if a water source
becomes polluted. The implication for safety investigations,
and ultimately safe regulation under the Clean Water Act are
problematical, at best.
During my tenure at the NTSB, I became increasingly
concerned with the trend toward the criminalization of any or
all transportation accidents. Let me be clear. There are
accidents where criminal prosecution is warranted, and even the
preferred course of action. While traditional criminal law
theory requires a finding that one intended the consequences of
the criminal act, it has long been accepted--and I accept the
proposition--that wanton disregard of behavioral norm suffices
to sustain a criminal prosecution, even if the consequences of
the behavior were not intended, indeed, even if they were as
horrifying to the perpetrator as to the rest of us.
At a symposium on Transportation Safety and the Law that
the NTSB convened under my direction in April 2000, several
themes emerged that bear repeating. Transportation safety is
increasingly dependent on being able to spot trends, to see
problems as they arise, to anticipate failures from
sophisticated data mining, and from the sometimes not so
sophisticated self-disclosure of near misses.
That is exactly the issue with the Clean Water Act. Since
simple negligence can be treated as a criminal act, punishable
by imprisonment when an accident investigator arrives on the
scene, prevention and understanding takes a back seat to legal
maneuvering.
While criminal enforcement can be an important tool, it
should be directed toward intention or reckless behavior rather
than non-intentional conduct. Criminal penalties do deter
intentional conduct, but have a much diminished or unproven
relationship to preventing purely accidental behavior, and can
deny safety regulators the very information they need to decide
how to prevent similar accidents in the future. The intent
should be to promote cooperation rather than to threaten
parties with punishment for things over which they have no
control.
In conclusion, it is my conviction that the balance between
appropriately pursuing individual wrongdoers on the one hand
and the broader purpose of accident investigation and
prevention on the other, tips more and more aware from a focus
on prevention. We follow that road at our long-term peril.
Thank you, Mr. Chairman. I would ask that my complete
testimony be included in the record in its entirety.
Senator Crapo. Without objection, so ordered.
Senator Inhofe [assuming the chair]. Thank you very much,
Mr. Hall.
Let me apologize to the witnesses, and particularly to the
previous panel. This happens to be a day that happens once a
year that the Oklahoma State Chamber of Commerce comes to
Washington. With them, come all the organizations--the farmers,
the bankers, and the rest. That is why Mr. Kouplen is here. It
also makes it for a very busy day. On top of that, we have
Senate Armed Services hearings taking place right now.
I think it is important to talk a little bit how about the
SPCC Plans are going to affect the agricultural community. Most
of my colleagues will read any concerns about the rule that
would be coming from industry or coming from the oil industry.
It should be emphasized that this is also going to impact
family farmers.
In your testimony, Steve, you provide some information
about the use and storage of oil and fuel on farms. You also
indicated that the EPA did not fully consider the impact of the
rule, and what impact it would have on farms. What else should
the EPA know about how farms use and store fuel and the efforts
of this rule that you have?
I would ask you to answer that question by drawing upon
your background. I think you represent some 140,000 farmers in
our State of Oklahoma. Every time something like this comes up,
they always talk about industry. They always talk about the
energy industry, or about electricity generation. How does it
affect you?
Mr. Kouplen. Well, to begin with Senator, let me say that
we really did not realize we had a problem in the agricultural
sector with this issue. We think that we do a good job of being
very careful with how we handle fuel and oils on our
properties. We have come to the table realizing that if this
rule goes into effect, that the possible cost--and these are
projections--could run as high as $25,000 to the individual
farm family. If they have separate fuel locations in more than
one place on their operation, it could go even higher than
that.
We probably have come late to the game with this issue. But
we really realize now that it could drastically affect the
family farmer. With that low of a threshold of fuel, 1,320
gallons, that is not very much. It would affect a great number
of our producers, not only in Oklahoma, but in this country.
Senator Inhofe. Would you give a similar response on TMDLs
and how this could affect the land owners and land rights?
Mr. Kouplen. Well, there again, as agricultural producers,
we try to be good stewards of the land and definitely not be
polluters. We have done all we can through conservation
practices to make sure we are not. Anytime you have any type of
a regulatory program put on you, that puts a cost on your
business. We do not have a way to push that cost through as
farmers. We just absorb that. It does create a cost problem to
producers, and especially to the family farmers who are in a
very bad position right now as far as trying to stay in
business in this country.
Senator Inhofe. I think a lot of people are not aware of
the effect that a lot of these things have on the agricultural
community. Certainly, we are an agricultural State in Oklahoma.
I remember when we were debating the use of propane, as to
should be treated as hazardous waste. I remember it so well.
One of the persons is in the audience right now that was there
at that subcommittee hearing that I chaired back 5 or 6 years
ago.
The response was, ``Well, do not worry. It only costs about
$600 or $700 a year to your average farmer.'' That was right
after the Endangered Species suggestion on the Silver Shiner.
It would also cost another $700. I think it is easy for people
who are not out there and realizing how tough things are in
what I call the real world. These things really do add up.
Mr. Lozeau, in this world that we are living in of limited
resources, if we want States to put their money and staff
toward waters that are impaired, why list waters which meet
water quality standards and are clean, by your own testimony,
just because they met standards by some means other than the
BPT, or secondary treatment? Why waste resources that could be
put toward waters that do not meet the standards?
Mr. Lozeau. Because in addition to cleaning up the impaired
waters, Mr. Chairman, it is important to protect the waters
that are currently meeting the standards. Many of the waters in
that category would be threatened. I think it would be very
inefficient for a program like the TMDL program certainly not
to apply to a water body that currently is still meeting
standards, but degrading.
The proposal that EPA has put forward would eliminate
consideration of the anti-degradation policies that the States
have in place. It would eliminate those kinds of threatened
waters from the list. Certainly, I would think those are high
priority waters, in many ways for many States. Other waters
that are less threatened could be lower priority, certainly,
for the State. But I think Congress had in mind to have TMDLs
in place to protect all waters, to make sure that the gains
that are in place now have been achieved. It will stay that way
for the coming decades, and not just for the moment.
Senator Inhofe. Were you here during my opening statement?
Mr. Lozeau. Yes, I was.
Senator Inhofe. I commented on what difference does it make
whether the EPA would issue a figure, a number, as opposed to
issuing the way that they have reached that number. Maybe I am
not wording that right. Do you have any thoughts you would like
to share with us on that?
If you achieve it, what difference does it make if the EPA
is supervising it or if it is done by the State and by the land
owner himself in cooperation with each other?
Mr. Lozeau. Well, we are talking about water quality
standards that would apply throughout a watershed. If you
create a loading capacity that is going to meet those
standards, you would have to know where the loads are coming in
and who is putting those loads in, where they hit that water
body, and whether in that particular area you are going to have
a violation of the standards.
The gross allocations would make believe that you only
measure success at one point low in the watershed, for example,
of some arbitrary downstream point. In order to know if a TMDL
is going to work, you have to make sure it works throughout the
watershed. You would have to know where it is coming in, where
the allocations are occurring, and whether there is a smaller
tributary that is more burden, perhaps, than the mainstem river
downstream.
Senator Inhofe. Would any of the rest of you like to
address that?
Ms. Steinzor.
Ms. Steinzor. Mr. Chairman, I would like to address that.
Mr. Mehan was telling the committee about his great confidence
in trading as an alternative, a less expensive method for
achieving greater water quality. If the only total burden that
is calculated is done on a watershed-wide basis, as opposed to
an individual facility basis, the trading program becomes
virtually impossible.
I must admit to being very puzzled. It would seem as if EPA
is on a course that is completely inconsistent. It would
allocate one single total load for all sources in a watershed,
at the same time that it is touting trading as the solution to
many of our problems.
I surely agree with you that the best way to approach
nonpoint sources is through a trading program. But we have to
have one that is not based on paper trades or sham trades that
do not achieve real reductions.
Senator Inhofe. Does anyone else have any thoughts on that?
All right.
I would only comment that as a general rule they think that
a federally regulated mandate is better just by virtually the
fact that it done from the Federal Government. There is a basic
difference of opinion on that.
Mr. Hall, did anyone talk about the liability, the criminal
punishments? Did you visit about that during your opening
statement?
Mr. Hall. I addressed that in my opening statement, sir. I
think Ms. Steinzor alluded to it. That was the only other
conversation.
Senator Inhofe. Well, I would like to ask each one of you.
Do you believe that Congress, when it enacted the Clean Water
Act, the criminal negligence provisions intended, to cause
citizens to refuse to cooperate with the NTSB and other
accident investigators due to potential criminal liability? In
other words, I am getting around the unintended, accidental,
consequences.
Would anyone like to address this?
Mr. Hall?
Mr. Hall. Mr. Chairman, my feeling, of course, and the
purpose for my being here today, is that I do not believe that
Congress intended at the time that this Act was passed, to set
up a situation where individuals who did not knowingly or
willingly commit an act, and truly accidental behavior, would
face criminal penalties for an act that obviously impacted
transportation safety, and in this case, of course, water
quality.
That is why I am here today to ask the committee, in its
judgment, to relook again at this policy. I think it is not an
effective policy for achieving the goal of transportation
safety. I do not think the Justice Department should be put in
the position of substituting for what should be a regulatory
framework to protect the environment.
Senator Inhofe. I was in the House at the time that the Act
passed. I remember the discussion on this. I guess what you are
saying is that there are cases that you know of, and all of us
in this room know of, where something was done. But it was done
accidentally, where they actually went through the process, and
maybe even served time.
Would either of you, on the other side of this issue, like
to comment on this? Do you think that if something is done, it
is done not with intent, and just through negligence, that
there should be that type of punishment?
Ms. Steinzor.
Ms. Steinzor. Mr. Chairman, I believe that I am the one
that is supposed to take this issue. I think that the question
really does not make much sense outside the context of the
specific facts of the cases that have brought.
Let me just describe the facts of supervision of pipeline
maintenance of them, the Hanousack case. This was a gentleman
who took over from another person. Mr. Hunz was the first man
and Mr. Hanousack was the second. He was a road master, out of
sight, where there was a lot of blasting going on right near an
oil pipeline.
Mr. Hunz had established procedures for protecting the
pipeline, making it very clear where the pipeline was located,
building protective covering over it, and fencing it off, so
that there would be no accident, that these boulders that were
being blown up by dynamite would not fall on the pipeline and
crack it.
When Mr. Hanousack came on the job, he abandoned all of
that precaution and removed the barricades, removed the
protective covering, and proceeded to allow his crew to push
these big rocks around until one day when Mr. Hanasack was not
on the site, somebody dropped a big boulder on the pipeline and
there was a huge spill.
This is not an innocent accident. This is a person who was
acting in reckless disregard of the basic safety needs that
happen when you work near a pipeline. He cost not just the
environment, but the pipeline company, lots of money and caused
tremendous trouble.
I guess the question would be--and, of course, you would
know this much better than I because you were in the Congress
at the time--did you intend to make people who are so reckless
and so careless, did you intend to give them the comfort that
no matter what they did, they would escape prosecution?
Senator Inhofe. Well, I would only respond that you have
cited one case, Ms. Steinzor, where perhaps it was reckless. I
am not talking about those cases. I am talking about when an
accident occurs.
Does anyone have any kind of anecdotal thing they would
like to put as an example of something that was purely
accidental that ended up with the type of punishment that I
outlined?
OK. All right. I think that we are in the process of votes
right now. Unfortunately, that does happen sometimes. I
appreciate very much your coming to testify. Your entire
statements will be considered by this committee as we are
making these formulations. Your interests will be attended to.
Let us do this. Let us go ahead and recess, subject to the
call of the Chair. If no one gets back in about 10 minutes,
then we will go ahead and adjourn this meeting.
[Recess.]
Senator Inhofe. I would ask the meeting to come back to
order.
Senator Jeffords has returned and has some questions for
our witnesses.
Senator Jeffords, you are recognized to question the
witnesses.
Senator Jeffords. Mr. Lozeau, as someone who has worked on
TMDLs, what do you think will be the real world effect of the
proposed new TMDL rule on water quality if it were enacted?
Mr. Lozeau. Well, in the version of the draft that we have
seen were enacted, I think the rule would not guarantee or
assure that any water that is currently on any of the TMDL
lists, would ever comply with standards. I think it would
create a program that would cede so much control to individual
discharges ultimately, and that it would have no real
provisions for the EPA to guarantee that pollution coming into
a water body would be controlled at its source, and that it is
going to lead to widespread water quality degradation.
I do think that many threatened waters which we would hope
would be protected before they become impaired, will fall by
the wayside, and that we are going to see the lists of impaired
waters growing in the same rate they are currently growing. We
are going to see no effect of the program to prevent those
additional pollutants and the additional costs that come from
that by waiting to clean up these waters.
Senator Jeffords. Instead of the rewrite of the TMDL rule,
what would you propose that EPA and the Bush administration do
to clean up the Nation's waters?
Mr. Lozeau. Well, I think they should certainly vigorously
implement the existing rules and continue to provide them an
opportunity to work. I think over time, certainly, those rules
can be improved, and can bring more waters into the program and
realize the benefits of the program. I think that would be the
obvious first step, albeit hopefully the program, over time,
will continue to improve.
That would be my suggestion. Obviously, funding is
important to assist the States and other stakeholders in making
sure that the TMDLs that ultimately are being developed
actually work. Certainly, I would hope that the quality of
TMDLs will continue to improve over time. Certainly, there are
some TMDLs out there, I suspect, are not very effective. Over
time, I would hope that the frame work that is in place would
continue to improve those and that we would realize the
benefits that Congress hoped for back in 1972.
Senator Jeffords. Thank you.
Mr. Hall, in your testimony, you state that if the NTSB can
do a thorough investigation, completed, and have cooperation,
larger problems can be corrected before they cause future
accidents or incidents.
One of the accident investigations you completed while you
were at the NTSB is the Olympic Pipeline case in which three
youths were killed in Bellingham, WA. In December 1999, as
Chairman of the NTSB, when speaking of the Olympic Pipeline
explosion and oil spill, you said, ``We will not be surprised
to find that some of the factors in this accident reflect
lessons that have gone unlearned.''
The NTSB had for years recommended improvements, such as a
rapid shutdown of ruptured pipelines, periodic inspection and
testing of old pipelines, and improved employee training. You
went on to say, ``Pipeline industry reaction to these
recommendations has been tepid, if not hostile.''
In December 2002, Olympic and Shell agreed to pay $112
million to settle criminal charges. Much of that money will be
spent on pipeline safety improvements. Today, less than a year
after paying this seemingly large sum of money, Olympic is
embroiled in a dispute with the city of Seattle over the
company's efforts to avoid conducting a high-pressure water
test for the portion of the pipeline running through Seattle
and close to two elementary schools.
It seems that testing a pipeline for weakness in a highly
populated area could be one of the solutions you mentioned in
your testimony that could avoid a future accident. Much of your
argument seems to depend on the assumption that given no
potential for the criminal enforcement under the Clean Water
Act, companies will voluntarily cooperate with the NTSB and
voluntarily improve their safety records.
Your comments in 1999 suggest that you have very little
confidence that the industry will voluntarily make any safety
improvements, even in the urging of the NTSB. It seems that the
Olympic case would disprove the theory that you have presented
to the committee today.
Can you explain this kind of contradiction?
Mr. Hall. Yes, sir, Senator. Let me first make just one
clarification. I was Chairman during the majority of that
investigation. However, that investigation was completed and
the final report was issued after I had left the National
Transportation Safety Board.
My interest in this issue goes from observations I had over
7 years as Chairman of the National Transportation Safety Board
in trying to obviously advance safe transportation policies in
the United States.
Where I saw failures, either by the industry or by the
Government, to put in place safe regulatory frameworks for
which the safe operation of transportation systems could then
be completed, I was very vocal and spoke out. I felt very
strongly about the statements you read. I felt very strongly
about that. It correctly reflects my feelings at that time.
As a result of that tragedy--and I think the Board's
investigation--we have seen Congress now move to put in place a
regulatory framework for pipeline safety that requires
training, that requires periodic testing, and that requires
education, a number of the things that were not in place in the
safety system at that time.
I have observed, and we have in our country and should be
proud of t, the safest aviation transportation system in the
world. That has been built, I believe, out of the voluntary
compliance that we have seen in the aviation community with
NTSB investigations. Programs like FOQWA and the Aviation
Safety Reporting System Program run by NASA, have put us in a
situation where I believe now we are almost close to 2 years
without a major aviation transportation accident in our
country.
I am speaking today on the basis of policy. I believe in a
policy that includes obviously industry compliance, voluntary
reporting systems, and a sound regulatory framework in this
situation obviously at the State and Federal level. I think
there is certainly an appropriate place for criminal penalties,
but it is my belief--based on my own experience--that the
present trend toward the criminalization in the Clean Water Act
for a criminal penalty, without knowing or willing conduct,
will have a chilling effect on the Board's investigations, and
will not achieve what Ms. Steinzor and others in the
environmental community might want by substituting the Justice
Department as the regulatory authority in terms of pipeline or
clean water safety.
Senator Jeffords. Thank you.
Thank you, Mr. Chairman.
Senator Crapo [resuming the chair]. Thank you very much,
Senator Jeffords.
Senator Inhofe.
Senator Inhofe. Thank you, Mr. Chairman.
Mr. Fuller, I have two very short questions.
First of all, welcome back. I always enjoy your testimony,
although I was not here to hear your opening statement. You
were minority staff under Lloyd Bentsen back during the
formulation of all this.
Under 407(l) dealing with uncontaminated water in terms of
storm water runoff, would you characterize what you felt at
that time was the intent of the legislation as it was
formulated?
Mr. Fuller. That issue is one that arose in the context of
dealing with storm water generally. My recollection of it was
that because we were dealing with essentially water flows over
ground, that the effort was designed to try to say we did not
want to add another permitting burden to the process of
developing and producing oil and natural gas without there
being some contamination that needed to be addressed.
There had been issues that had been raised about the
application of the NPDES program broadly to that activity. Our
intent was, as we were working on it, to try to come up with a
cut-point that basically said, ``Well, if it is contaminated,
then----''
Senator Inhofe. The test was whether or not it was
contaminated?
Mr. Fuller. Yes, sir; it would be captured under the NPDES
permit under that section. If it was not, then it would not
require a permit.
Senator Inhofe. I notice in my notes here that Mr. Lozeau's
testimony accuses the oil industry of being in back room
negotiations with the EPA on the SPCC rules and definition of
waters of the United States. Mr. Fuller, would you are to
characterize those negotiations?
Mr. Fuller. Well, I think the reference in the testimony
has to do with litigation that was filed by some parts of the
oil industry with respect to the SPCC Plan requirement, the new
rules and regulations. IPAA was not a part of that litigation
so I do not know any of the details there.
What I can say is that one of the issues in developing a
SPCC Plan is whether it has an effect on navigable waters.
There are two tests. You have to be a facility and you have to
have an effect on navigable waters. That is what triggers the
need to do a plan.
When these regulations were put together--they were
actually put together over a decade or more--and became
finalized, during that same period of time the issue of the so-
called SWANCC decision arose which called into question exactly
what the scope of navigable waters are.
Another process is underway to try to address that
question, to try to come up with a clear definition and a
consistent one of what constitutes navigable waters. If you are
a producer, and particularly a small producer like my members
are, you now are looking at this requirement that says that you
have to have a new Plan requirement. If it goes forward under
the structure that it is currently written, you have an effect
on navigable waters.
But what constitutes a navigable water while this other
issue remains is unsettled. From our perspective, we believe
that the first issue needs to be settled in some clear fashion
before we try to then broadly apply new plan requirements based
on an uninformed sense of what navigable waters are.
The reason why that becomes important to somebody like my
members is that these plans are costly. They can cost $20,000.
Just to give you an idea, a marginal well has a break-even
point of about $19.50 a barrel. So, where prices are now, that
means that the average well makes about $20 a day. If it costs
$20,000 to do an SPCC Plan, that is 1,000 days worth of profit
from that well.
I do not believe that our members want to spend that kind
of money for something that turns out to be unneeded because
the definition is different. So it is the definition of
navigable waters that is driving what happens with SPCC, and
not the other way around.
Senator Inhofe. I appreciate that very much.
I have one last thing, Mr. Chairman. In my State of
Oklahoma, approximately .00126 of the oil produced in Oklahoma
was spilled in 2002. That statistic, I think, is supposed to be
pretty accurate. That is not a very high spill rate.
I would just like to ask you, Mr. Fuller, in your opinion,
is there a problem with oil spills that was not being met with
the existing rule because no great improvements were made
during that time?
Mr. Fuller. Those are all based on procedures that had been
in place for decades. The SPCC requirement has been around
since shortly after the Clean Water Act was passed in 1972.
Plans had been in place. These new requirements are all changes
to those plans.
What that spill data says, and what we have been trying to
say for a long time, is that the existing program has worked.
Apart from that, whether there are Plans or not, we still have
a responsibility to respond to oil spills if they occur.
What we are dealing with here is really a planning
requirement, not a response requirement. I think the record in
Oklahoma and other States demonstrates that the existing
planning requirements have been successful. We have not seen
the type of need to make these changes that we would expect if
they were a logical change.
Senator Inhofe. That is a very good answer. Thank you very
much, Mr. Fuller.
Thank you, Mr. Chairman.
Senator Crapo. Thank you very much.
In the interest of time, I am going to forego my questions.
Does anybody have any further questions?
Senator Jeffords. I do.
Senator Crapo. Senator Jeffords.
Senator Jeffords. Mr. Hall, and Ms. Steinzor, your
testimony implies that the Clean Water Act precludes the use of
the same tools used by other Agencies to elicit testimony from
people who may be criminally liable in an event.
Is the Government somehow precluded from offering immunity
under the criminal negligence section of the Clean Water Act?
Mr. Hall.
Mr. Hall. In terms of the NTSB, the NTSB does not have the
authority to grant immunity in our investigations. We rely on
voluntary compliance. Again, I believe that criminal penalties,
where again it is for simple negligence, and not a knowing or
willing act, such as in the Clean Water Act, does not work as
an effective deterrent in terms of preventing future events.
The success, Senator,--and I know you are familiar with a
great deal of this as well--in accident investigation, and
particularly where we are entering this age of technology, is
to understand obviously the various change in the accident
sequence, whether it be technology or whether it be human
factors so that we can put in place effective deterrents to
better protect our society.
For example, we had a recent accident in California with a
very elderly driver who probably, with an unintentional act. A
number of individuals were killed in an open air market where
they had been no barriers and no protections put in place for
separation between the motorists and the pedestrians.
To criminalize these types of investigations as far as the
NTSB is concerned, I believe is going to end up in a situation
where we are going to be unable to learn from accidents, and
therefore, create statutory responses and appropriate standards
and policies within the industry.
Let me say very clearly that where there are intentional
acts, intentional wrongdoing, I would be the very first to say
that the use of criminal penalties are necessary and
appropriate. I respectfully believe that this is having
unintended consequences. My purpose of being here today is to
ask the wisdom of this committee and this Congress and look at
that to see if they agree.
Certainly, on any issue of this nature, there are two sides
of any discussion. I am here today to speak to you based on my
experience at the National Transportation Safety Board over 7
years in trying to work in this area to advance transportation
safety.
Senator Jeffords. Ms. Steinzor.
Ms. Steinzor. Senator Jeffords, I appreciate an opportunity
to respond. While you were voting we had a conversation about
specific cases that have been brought under 309. Mr. Hall says
he is closely reading this statute.
It is worth noting that there is not a single case that he
can raise that has actually been brought under this provision
where an innocent person who had a simple accident was
prosecuted. I think that is very telling.
The cases that have come up that we have discussed involve
very willful carelessness, and in fact, have involved deaths
and great tragedies for the environment. For example, the Exxon
Valdez case was premised on negligence because great damage was
caused to the environment and there was a belief that the
company had been very careless in screening its employees in
that case.
As for voluntary compliance, I am confused here. When Mr.
Hall was with the NTSB, as your question to him before
suggested, he was decrying the lack of cooperation by the oil
industry with these investigations. It is also true that you in
your wisdom enacted very strong legislation regulating pipeline
safety. I do not think there is anyone here who would say that
all we need to do is leave folks alone and they will
voluntarily choose to do the right thing. That was not the
reaction to the Olympic incident which caused very serious
damage.
Finally, the Justice Department has complete authority to
grant immunity to witnesses that it feels it needs to pursue an
investigation, or if its sister Agency, the NTSB needs to have
a witness granted immunity, this is one Government. People talk
with each other. Immunity is always an option. There are also
ample policies that encourage people to come forward
voluntarily. If they cooperate, they are given special
consideration in the way that they are punished, civilly or
criminally.
After listening today, I think I understand the arguments
here less well than I did when I read a lot of materials about
them. I am quite perplexed.
Senator Jeffords. Mr. Hall.
Mr. Hall. Senator, Ms. Steinzor may be confused. I am not.
Let me say that I believe she misspoke. I did not say that the
industry did not cooperate with the investigations of the NTSB.
What I stated was that there had been a failure to act by both
the Congress and the industry on some 14 years of
recommendations the Board had made for simple basic things such
as regulatory requirements for training and testing that needed
to be put in place.
Regretfully, because of that horrible tragedy at Olympic,
we do have a new Pipeline Safety Act. Congress has addressed,
and the industry has, I believe, put in place, a number of the
Board's recommendations.
I am speaking here, Senator, on the basis of what I believe
is good policy. That is my purpose. I have spoken on this
issue. I held a symposium while I was Chairman of the NTSB on
this issue. This is not an issue that I have not raised as much
concern about as I did at the time I spoke very forthrightly. I
thought about the industry and the Government's responsibility
and actions in the pipeline area.
I have also spoken out on my concern about the
criminalization and having the Justice Department become the
regulatory in this Nation for transportation safety, and
putting citizens that are not in a willing or knowing act, at
peril for the whim of a criminal prosecution by whoever a local
prosecutor might be.
Senator Jeffords. Thank you.
Thank you, Mr. Chairman.
Senator Crapo. Thank you very much, Senator Jeffords.
Our time for the hearing is rapidly expiring but I did want
to ask one followup question on this interchange right here.
This will be both to Ms. Steinzor and to Mr. Hall.
Ms. Steinzor, if I understand your testimony correctly, you
have pointed out that there are no prosecutions of a purely
negligent conduct under this statute. If I understand Mr.
Hall's testimony correctly, he is saying that the threat of
such a prosecution is having a chilling effect on people
bringing forward information.
I would like both of you to just discuss that for a moment.
Is there, in fact, a chilling effect taking place here on the
ability of the Government to get adequate information and to
get the kind of compliance that is necessary?
Ms. Steinzor. I believe that what I said was that there is
no case that Mr. Hall is willing to describe to you that has
happened in the real world where people are totally innocent,
who never did anything wrong, were prosecuted criminally. I do
not know how you measure whether it is having a chilling
effect. I do know that when I look at the prosecutions of the
people that were involved in these cases, I do not care if it
chilled them from cooperating because they were punished for
very bad acts.
What Mr. Hall seems to be asking you to do is to remove any
penalty for behavior that is grossly careless. That is what the
cases show.
I think you would be more comfortable considering an
amendment of the law if there was one case that had been
brought forward here where when you looked into the facts. All
of these convictions have been upheld through the Court of
Appeals. The Supreme Court has resisted reviewing them for
whatever reason. These cases have been litigated very heavily.
As the facts were developed, not one single case of all of
these is worth describing to you as an example of some innocent
sympathetic person who just wandered into accident. I would
suggest that is telling.
Senator Crapo. Mr. Hall.
Mr. Hall. Well, Mr. Chairman, let me say that I came here
today to discuss the policy. That was my concern. I think that
is reflected in both my oral and written testimony to the
Board. It has been my personal experience that it is having a
chilling effect on the NTSB investigations. That is why I
convened the symposium on this subject. That is why I have
chosen to come here today to make this testimony to all of you.
I worked on Senator Muskie's staff at the time the Clean
Air Act and the Clean Water Act were being written. I worked
for 7 years in the State of Tennessee in Governor McWhorter's
office trying to work on environmental issues and concerns. I
worked 7 years at the Board.
I also believe, however, in the fundamental fairness of our
Government and our country as it pertains to the treatment of
individuals. Since Ms. Steinzor is relying on a case, I will
just close by quoting a citation from the Supreme Court in
which the Court said, ``in 1952 that the contention that an
injury can amount to a crime only when inflicted by intention,
is as universal and persistent in mature systems as law, as
belief in freedom of the human will and a consequent ability of
the normal individual to choose between good and evil.''
Where someone knowingly and willingly performs an act, I do
think there is an appropriate place for criminal law. I do
think that this provision can have a chilling effect. I think
that the nose under the camel's tent of having the Justice
Department become the regulator for transportation safety in
our country, is bad public policy. That is my personal opinion.
I appreciate very much the Senator's patience and time in
listening to my opinions.
Senator Crapo. Thank you very much.
We thank everyone on the panel.
Senator Jeffords. Mr. Chairman, I would like to have just
one further question.
Senator Crapo. Senator Jeffords?
Senator Jeffords. Mr. Lozeau, what will be the impact on
clean water protections if the oil industry lawsuit on SPCC
Plans results in a settlement agreement that modifies the
definition of the waters of the United States?
Mr. Lozeau. Obviously, Senator, first of all, we are
worried that the 10-year policy we heard about is now being
replaced with a back room discussion which the environmental
organizations are not invited to. Out of that will come some
indication by EPA that industries exaggerated interpretation of
the Supreme Court's discussion of the waters of the United
States issue in the solid waste case has some merit of some
kind.
We would be worried that the EPA would make a decision in
that back room that would withdraw a definition of waters which
has been in place in other parts of the regulations for the
past 30 years.
There is no issue as to the definition of navigable waters.
What we have is industry exaggerating the import of the Supreme
Court's decision, trying to expand it beyond the terms that the
Court laid down on paper, and now using that argument to set up
these discussions out of earshot and short circuit what was a
long and thoughtful process, to come up with that regulation in
the first place.
That is what we are worried about.
Senator Jeffords. Thank you.
Thank you, Mr. Chairman.
Senator Crapo. Thank you very much.
Again, we want to thank all the panelists for the time and
effort you have put in, not just to come here and testify in
person, but also in preparing your written testimony. Even
before the hearing began with the benefit of all the written
testimony, we have had a significant amount of activity and
evaluation going on with regard to the suggestions of the
members of these three panels.
We are very concerned about the Clean Water Act and the
proper implementation of the Act. We want to get to the right
public policy as we move forward. Your testimony here today has
helped us. We again thank everybody for their participation.
With that, this hearing is adjourned.
[Whereupon, at 12:05 p.m., the subcommittee was adjourned,
to reconvene at the call of the chair.]
[Additional statements submitted for the record follow:]
Statement of Hon. Lincoln Chafee, U.S. Senator from the State of
Rhode Island
Thank you Chairman Crapo and Senator Graham for holding this
important oversight hearing on implementation of the Clean Water Act. I
appreciate the opportunity to raise an issue of great concern for my
state and region--the availability of Clean Water Act Section 319
funding for development and implementation of the Phase II Storm Water
Program.
Yesterday, I visited the site of a devastating fish kill in Rhode
Island, caused by the absence of dissolved oxygen--an anoxic event--in
an area known as Greenwich Bay. As the former Mayor of the city of
Warwick, which encompasses Greenwich Bay, I had undertaken a massive
bond issue several years ago to provide funding for improving septic
systems and restoring the water quality of this area. Visiting the fish
kill site yesterday, I was disheartened to learn how much more needed
to be done. In combination with other factors--including the ongoing
deficiencies of private septic systems--stormwater has been found to be
a significant contributor to the nutrient loads entering Greenwich Bay
and disrupting its natural balance.
In Rhode Island, as well as many other highly urbanized areas,
stormwater ranks high on the list of top-priority pollution sources
impacting the water quality of our lakes, rivers, streams, and bays. As
states proceed with development of the federally mandated Phase II
Storm Water Program, the costs of implementing the requirements of the
program are becoming a major concern for states and municipalities.
At issue is whether funds provided to states through Section 319 of
the Clean Water Act may be used for the purposes of developing and
implementing the Phase II Storm Water Rule that went into effect in
March 2003. Last year, this Committee approved an amendment, signed
into law as part of the Great Lakes and Lake Champlain Act of 2002,
that provided a 1-year fix, during fiscal year 2003, for states to
retain maximum flexibility in utlizing 319 funding for addressing their
stormwater concerns.
In recent years, the EPA Nonpoint Source Program has increasingly
focused on impaired waters and stormwater-related impairments. Although
the Clean Water Act appears silent on the eligibility of Section 319
funding to address storm water or NPDES-related issues, EPA has thus
far interpreted the Act to prohibit 319 funds from being used for
implementation of the Phase II Storm Water Program. In recent months, a
lack of clarity also exists on the use of Section 319 funding in
geographic areas covered by the Phase II Program. Phase II applies to
all populated areas of 1000 people or greater per square mile. In Rhode
Island, nearly all of the state's impaired waters are included in Phase
II areas. Given a strict EPA interpretation of the law, Section 319
funds could not be used in any of these areas.
In the weeks ahead, I will be exploring the idea of introducing a
bill to provide permanent authority for states to utilize Section 319
moneys for development and implementation of the Phase II Storm Water
Program. I look forward to working with my committee colleagues and EPA
on this legislation.
__________
Statement of Hon. Bob Graham, U.S. Senator from the
State of Florida
Clean water. Mankind, and virtually every other living thing on
this planet, needs clean water to survive. And yet, after 30 years of
progress, our clean water programs are under assault once again. Under
this administration, pollution restrictions are being rolled-back,
enforcement of the remaining regulations is being curtailed, and much
of the fresh water in the arid west is being handed over to a small
circle of industrial interests. All of this will harm the average
American.
There is no question that clean water is one of our most important
resources. For human beings, water is actually more important than
food. A person will die from dehydration more quickly than from
starvation. The harmful effects of sewage in drinking water has been
known for many years. And even though they are less obvious in the
short-term, the harmful effects of industrial and chemical pollutants
were well known long before Congress passed the Clean Water Act in
1972.
But we humans have a long history of misusing our water resources.
Historically, we have used our rivers, our streams and even the oceans
as a free disposal system for every imaginable type of waste. Abuse of
our waters reached new heights during the industrial revolution. The
industrial revolution was one of the principal factors that made our
modern civilization possible, but it was also a chief source of new
pollution problems. It led to population growth and concentration, it
exacerbated existing pollution problems, and it created new types of
pollution, such as massively concentrated natural pollutants and a host
of artificial pollutants, all on a scale never before imaginable. In
retrospect, we now know that our industrial prowess developed much more
quickly than our environmental awareness.
Once upon a time we believed that swamps and wetlands were the
sources of disease, and that it was a lofty goal to drain them or fill
them. Now we now that these lands are incubators for many marine
species that are critical elements of the food chain, and that they act
as filters to remove countless tons of pollutants from the land and
water every year.
Once upon a time, large pipes discharging tons of untreated waste
into the rivers were a sign of economic strength. Now we realize that
it is unacceptable for a river to be so polluted it can catch fire.
Once upon a time we thought the oceans were the ultimate disposal
system--that they were so large that they could absorb any amount of
waste we dumped into them. Now we know that even the oceans have their
limits. We have seen the beach closings. We have seen whales that died
after eating plastic bags or balloons. We have seen fish, birds and
other animals that died after getting entangled in carriers from six-
packs of drinks and other trash. And we know now that many of the fish
in the oceans are contaminated by mercury and other chemicals that we
have produced.
Once upon a time we thought that only large ``navigable'' waters
were worth protecting. Now we know that dumping pollution in small
streams and ponds is often more harmful. There is less water to dilute
the pollution, the types of fish and animals in those waters are often
less tolerant of pollution, and eventually it will find its way into
the navigable waters.
The modern era of water protection was born in the 1940's and 50's
when the Federal Government began providing financial assistance for
local jurisdictions to construct sewage treatment plants. The current
basis for most of our water pollution control efforts is the Clean
Water Act of 1972, which had a stated goal of making most waters
``fishable and swimmable'' by 1983, and to eliminate the discharge of
pollutants to ``navigable'' waters by 1985.
We have fallen short of those lofty goals. There has been progress,
but not enough. According to EPA, the percentage of our nation's waters
that meet water quality standards has increased by one-third to two-
thirds since the Clean Water Act went into effect. But EPA also says
approximately forty percent of our stream miles and forty-five percent
our lake acres are still impaired, and forty-four states have some sort
of fish-consumption advisory in effect.
After 30 years of work, and billions of dollars, why haven't we
been more successful? There are many factors, but I believe a major
factor is that Congress has been inconsistent in its demand for water
quality improvement. Rather than demanding that EPA enforce the Clean
Water Act, Congress has more often undercut it. Authorizations for
several provisions, including assistance to states, research, and
general EPA support, were allowed to expire in 1987. Authorization of
wastewater treatment funding, the program that started it all, expired
in 1994. The fact that Congress allowed these authorizations to expire,
but continues to appropriate funds for them, suggests that Congress
would like to abandon these critically important programs but is afraid
of the public's reaction. So it is not surprising that EPA and the
states have been hesitant to enforce the Clean Water Act consistently.
That is why some states refused to make water quality determinations
until the courts told them to. That is why some states fall behind on
their discharge permit reviews and do not always enforce even the
outdated permits that they have issued.
And all of this is why our citizens are compelled to use their time
an money to sue the states and the Federal Government demanding
implementation of the laws Congress enacted. And what is the government
response? Too often, government sides with the polluters, against the
citizens. Although the Clean Water Act explicitly provides for citizen
suits, all too often government's first action is to ask the court to
deny citizens the standing to sue. The result is that with each case it
becomes harder for citizens, the very people the laws should protect,
to play a role in ensuring that Federal and state governments to do
what was promised with such fanfare when the laws were passed.
Its time for Congress to step up to the plate. This Congress
should:
Recognize that every citizen of this country has a right
to clean water;
Recognize that the hidden costs of water pollution far
exceed the cost of prevention;
Ensure that wastewater funding programs are strengthened
and made permanent;
Set a new schedule to eliminate the discharge of
pollutants into waterways from point sources;
End the debate about ``navigable'' waters by expressing
the Congress' intent to prohibit the discharge pollutants into any
waters or water courses, including aquifers;
Set procedures for periodically updating the list of
regulated pollutants to keep pace with new scientific findings;
Take steps to protect groundwater recharge areas; and
Get serious about addressing nonpoint water pollution.
Once upon a time, United States common law held that it was a
nuisance or tort for one person to emit pollution that harmed another.
That long-standing legal precept was another casualty of the industrial
revolution because judges were looking for ways to allow economic
expansion. We suffer from that legacy today. Rather that saying our
citizen's have the right to be free from pollution caused by others,
our environmental regulations operate more like it is the businesses
that have a right to pollute.
It is time to reassess our national policy on water pollution. We
need to decide which ``right'' is more important. Who's rights should
we be protecting, citizens that want to have safe water to drink and
swim in, or industries that want permission to continue polluting the
environment?
I do not profess to know the best way to resolve these issues. But
I do know that limiting the ``intensity'' of emissions will result in
more pollution, not less. We cannot continue down that path if we want
our children to be able to swim in the local pond or eat the fish they
catch. We need to cap, and then reduce, the total aggregate amount of
pollution from all sources.
We made significant progress during the past 30 years, and we grew
the economy at the same time. I believe we can continue doing both. I
ask the members of this committee, and the entire Congress to join me
in embracing these goals.
__________
Statement of G. Tracy Mehan III, Assistant Administrator for Water,
U.S. Environmental Protection Agency
Good morning, Mr. Chairman and Members of the Subcommittee. I am
Tracy Mehan, Assistant Administrator for Water at the U.S.
Environmental Protection Agency (EPA). I appreciate this opportunity to
discuss today's water quality challenges, and the Bush Administration's
vision for protecting and restoring our Nation's watersheds.
INTRODUCTION
Last year, in a hearing on the 30th anniversary of the Clean Water
Act (CWA), I testified before the full Committee regarding the
tremendous progress that our Nation has made over the past three
decades in addressing water pollution problems. Thanks to the
investment of many local, Tribal, State, Federal, public and private
partners we have successfully controlled the most egregious sources of
pollution from municipal sewage treatment plants and industry. Many
communities now enjoy the environmental and economic benefits of
cleaner water, such as thriving lakefront communities in Cleveland and
Chicago, restored fisheries in Lake Erie and the Potomac River, and
increased revenues from real estate investment, recreation and tourism
in many coastal communities such as Boston.
Despite those success stories, we recognize that many challenges
remain. There are signs that some of our waters are in distress. States
are reporting increases in beach closures and fish consumption
advisories, and a large zone of low dissolved oxygen in the Gulf of
Mexico.
Our water programs are at a historic turning point. Today I first
want to share with you our vision for the future and to discuss some of
our top priorities: our efforts to reorient our programs toward a
watershed approach; establishment of a national-scale water quality
monitoring and assessment program; better implementation of the Total
Maximum Daily Load (TMDL) program; and, greater reliance on innovative
tools such as trading and watershed-based permitting. All of these
activities are critical in addressing today's water quality challenges
more effectively and efficiently. Finally, I will address our efforts
to control stormwater runoff.
THE WATERSHED APPROACH
Now that we have largely addressed problems from discrete point
sources of pollution, we need to turn our attention to threats that are
much more difficult to control, such as: nutrient over-enrichment,
urban runnoff, groundwater/surface water interactions, invasive
species, microbes in drinking water, and atmospheric deposition. These
complex problems demand a more comprehensive or watershed-based
approach that focuses less on the ``end of pipe'' and instead targets
pollutants coming from the land--nonpoint source pollution or diffuse
runoff. This approach to environmental management brings together
public and private sector efforts to address the highest priority
problems, looking at all sources of pollution within hydrologically
defined geographic areas. The approach is grounded in sound science,
characterized by robust stakeholder involvement, and focused on
environmental results.
Because most water quality problems are best solved at the
watershed level rather than at the individual waterbody or discharger
level, we need to examine how we can best integrate the efforts of
local watershed groups. Over the past decade and a half, we have seen
the rise of literally thousands of citizen-based watershed
organizations working to protect and restore their lakes, rivers,
wetlands, and estuaries.
To provide support for these locally driven watershed protection
efforts, in May EPA announced nearly $15 million in grants to 20
watershed organizations selected as part of President Bush's new
Watershed Initiative. The grants will support community-driven
initiatives to improve water quality and enhance outdoor recreation.
EPA intends to announce a solicitation for new Watershed Initiative
nominations for fiscal year 2004. We are confident that these projects
will result in cleaner water for these communities and will serve as
models for other communities. We are grateful for Congress' enthusiasm
for this Initiative and ask support for the President's request of $21
million for the Initiative for next fiscal year.
MONITORING AND ASSESSMENT PROGRAMS
As we transition from a technology-based approach to a water-
quality based-approach, and begin to reorient our programs on a
watershed basis, it is imperative that we strengthen our water quality
monitoring and assessment programs. In the 1970's, monitoring was
primarily carried out at or near the end of the pipe, to measure how
effectively individual permits were working. Today, however, we must be
able to assess the inputs of millions of diffuse sources of pollution,
such as sediments from construction sites, fertilizers from
agricultural lands, and even pollutants coming from the air. And, to
enable the use of more innovative tools and flexible approaches, such
as trading between pollution sources, we need better baseline
monitoring data to help us keep score.
How clean is the water? We currently have enough information to
allow us to know what the conditions are in some site-specific areas,
but as stated in EPA's Draft Report on the Environment 2003, ``At this
time, there is not sufficient information to provide a national answer
to this question with confidence and scientific credibility.''
Working with State, Federal, tribal, and local agencies, with the
private sector, with universities and with the public, we must be able
to provide answers to some very fundamental questions such as: How
clean is the water? Is it getting any better? Are our management
actions working? Without answers to these questions, we are challenged
when it comes to making decisions about how best to address water
quality problems and allocate our limited resources for cleanup,
pollution prevention, and restoration.
Currently, most States monitor only a portion of their waters.
While some States are using new approaches like statistically based
surveys to characterize the overall condition of waters from a
representative sample, many are still in the beginning stages of using
these tools. And, because State standards and assessment methods vary
across State lines, we find we cannot add up the data. In varying
degrees, States are working to improve their monitoring systems, and
EPA is working with them to help them identify and implement the key
tenets of good monitoring programs.
Many Federal Agencies have, over the years, conducted a range of
monitoring programs that have yielded valuable water quality data.
However, none of them were designed to characterize the overall
national condition of the waters of the U.S. in a comprehensive,
statistically valid fashion. Because of the lack of comprehensive,
national-level data, we cannot yet systematically document whether or
not our pollution programs are effectively improving water quality on a
national scale.
Besides EPA's recent Draft Report on the Environment 2003, the
Heinz Center Report on the State of the Nation's Ecosystems, and
various reports from the General Accounting Office, the National
Academy of Public Administration and others show that there are major
gaps in aggregate nationwide data on water quality and overall
ecosystem health. These reports call for a national investment to build
a cost-effective, scientifically sound foundation for our water quality
management decisions.
We need, therefore, to take four critically important steps to
achieve our goal of better monitoring for better management. First, we
need to work with States to improve and strengthen State monitoring
programs so that they can generate credible, comparable, comprehensive
information. EPA is currently working with the States to ensure that
they all achieve, for the first time, a set of basic monitoring
elements including a common set of core water quality indicators that
can be compared over time and across State boundaries. In March 2003,
EPA provided States guidance on such elements for a State monitoring
and assessment program. Second, we must promote the use of multiple
monitoring tools such as statistically based surveys, predictive
monitoring, and remote sensing to support the full range of water
quality decisions. Statistically based surveys, such as EPA's
Environmental Monitoring and Assessment Program for example, provide a
scientifically rigorous way to sample a subset of waters and then
provide an estimate of the quality of all waters, along with a
statement about the uncertainty surrounding that estimate. Third, we
must manage our electronic data systems to share and improve
compatibility of monitoring information and make data more accessible
to the public. And fourth, perhaps most importantly, we must build
stronger partnerships at the Federal, State, Tribal, and local levels
to facilitate the sharing of comparable data and the use of multiple
monitoring tools.
We need to continue working with States, Tribes, and our Federal
partners to identify what investments are needed for long-term
improvements in water quality monitoring. We need to look for
efficiencies through new monitoring approaches, such as statistically
based surveys or the use of models, through better collaboration, and
through data sharing. And, we need to secure commitment from all
stakeholders to better monitoring for better management of our water
resources. We will be able to target our control actions wisely, and
achieve the level of protection we need.
THE TOTAL MAXIMUM DAILY LOAD PROGRAM
As we look to manage our watersheds more holistically, the Total
Maximum Daily Load (TMDL) program is one of our key CWA tools. In
enacting Section 303(d), Congress retained a water quality-based
approach for waters that remained polluted after the application of
technology-based and other controls. TMDLs do not themselves require
compliance; they simply establish a pollution budget for impaired
waters. This information is key to determining what actions should be
taken in a watershed to address ongoing water quality problems. The
TMDL is then translated into permit requirements for point sources. For
other pollution sources, the program relies on local, State, Tribe and
Federal watershed plans and programs to achieve implementation of the
TMDL.
This part of the CWA was not a priority for about 20 years while
EPA focused primarily on industrial and municipal dischargers. Few
States were addressing the TMDL requirements in the CWA until the wave
of litigation began in the early 1990's, when environmental groups,
anxious to get the program off the ground, filed lawsuits in a total of
40 States. EPA and States now operate the TMDL program pursuant to
judicial settlements or decrees in 22 States. Prior to 1999 fewer than
1,000 TMDLs were completed. As of today, States and EPA have approved
or established about 8,000 TMDLs. States and EPA continue to work to
improve the quality of TMDLs and use TMDLs to achieve water quality
goals on a watershed-basis.
Because TMDLs are water-quality based, they can be information-
intensive, sometimes prompting widespread and systematic monitoring to
identify and characterize problems and priorities, and to track
progress in solving them. Public involvement can contribute to this
information process both directly and through increased visibility for
problem-solving. In addition, such public involvement can help make
sure that TMDLs get translated from allocations into action, because
information brought before the public is itself a driver for action.
WATER QUALITY TRADING
EPA believes that water quality trading, which allows sources to
find the least cost alternative to achieving clean water, can be a
critically important tool for restoring impaired watersheds efficiently
and cost effectively. In its analysis of the Clinton Administration's
Clean Water Initiative, EPA concluded that the total potential savings
from all types of trading (point to point, point to nonpoint, and
pretreatment) ranges from $658 million to $7.5 billion annually.
Another study of three watersheds in the Midwest found that the cost of
controlling phosphorus loadings from point and nonpoint sources could
be reduced by 40 percent in Wisconsin and by more than 80 percent in
Michigan when trading was applied between point and nonpoint sources.
These examples illustrate the potential for water quality trading to
reduce pollution with greater efficiency and to achieve significant
water quality and environmental benefits.
Market-based approaches to improving the quality of the environment
are not new. Air emissions trading programs date back to the Acid Rain
program and the lead-in-gasoline phase-down programs implemented under
the Clean Air Act. These and other programs have clearly demonstrated
that market-based approaches can dramatically and quickly reduce
emissions at substantially lower costs.
In January, EPA issued its 2003 Water Quality Trading Policy. The
Policy provides guidance on aligning trading programs with the Clean
Water Act and implementing regulations and identifies common elements
of credible trading programs. The Policy supports trading to improve or
preserve water quality in a variety of circumstances. In unimpaired
waters, trading may be used to preserve water quality by offsetting new
or increased discharges of pollutants. In waters impaired by
pollutants, trading may be used to achieve earlier pollutant reductions
and progress toward water quality standards in advance of the
development of a TMDL. And, trading may be used to reduce the cost of
achieving reductions contemplated by a TMDL. The Policy highlights
existing Clean Water Act flexibility that can facilitate trading
programs and emphasizes the need for accountability and safeguards to
ensure that trading programs protect our resources and maintain
progress toward attaining water quality standards.
Key Principles and Safeguards for Water Quality Trading
A number of core principles and environmental safeguards form the
foundation of EPA's Water Quality Trading Policy, and these principles
help ensure that trading programs create actual pollutant reductions,
avoid hotspots, provide accountability for trading activity, and
involve the public:
Trading programs operate within the existing regulatory
structure and are consistent with all aspects of the Clean Water Act.
Trading programs are designed to meet water quality goals
including TMDLs.
Trading programs ensure that water quality standards are
not exceeded.
Trading programs retain enforceability of National
Pollutant Discharge Elimination System (NPDES) permits.
Trading can be used to comply with water quality-based
effluent limitations; however, EPA does not support trading to comply
with existing technology-based effluent limitations except as expressly
authorized by Federal regulations.
Trading programs include accountability mechanisms for
nonpoint sources that trade to ensure that promised pollutant
reductions actions are taken.
Trading programs are visible and engage the public in
program design.
Trading programs monitor to ensure anticipated load
reductions are achieved, or to take corrective action if loads are not
adequately reduced.
Trading is voluntary and based on collaboration among
watershed stakeholders. States and Tribes may choose to establish
trading programs in accordance with EPA's Policy. There is no
requirement to implement or participate in a trading program.
Water Quality Trading: Examples of Environmental Innovation
We already see evidence that water quality trading programs work.
For example, the State of Connecticut's nitrogen credit exchange
program is expected to save the State an estimated $200 million in
control costs through trading, while also making significant gains in
cleaning up pollutants in Long Island Sound.
In the Cherry Creek watershed in Colorado, a trading program
conducted in conjunction with a TMDL has reduced phosphorus loads to
the Cherry Creek watershed by approximately 450 pounds per year. The
nonpoint source projects that were implemented to create the phosphorus
credits have provided ancillary environmental benefits such as flood
control and wildlife habitat. A partnership trading effort in Illinois'
Piasa Creek along the Mississippi River will save several millions in
capital improvements to an aging drinking water treatment facility,
while reducing sediment loads to the Mississippi River. The Grasslands
selenium trading program in California, the nation's first nonpoint
source cap and trade program, utilized an innovative penalty and rebate
system to create economic incentives to substantially reduce selenium
levels in Kesteron reservoir that were adversely harming bird
populations.
Experience with trading has also taught us that trading will not
work everywhere. For example, the level of pollutant reductions that
would need to be achieved from all sources in a given watershed may be
such that additional, or surplus, reductions cannot be achieved so as
to allow trading. Certain watersheds may not have the number and mix of
sources necessary for trading to be successful. In addition, trading
programs that work in one State or Tribal area may not be successful in
others. Just as each watershed has unique characteristics and needs,
each trading program will be tailored by State agencies and
stakeholders to meet environmental goals. EPA recognizes that States
and Tribes face diverse water quality issues, sociological and economic
factors and political considerations. EPA's Trading Policy is intended
to provide consistent guidance, while allowing sufficient flexibility
for States and watershed stakeholders to create workable solutions.
EPA believes that water quality trading programs, where carefully
designed and implemented, can be powerful and effective tools for
States, Tribes, local governments and citizens to use in achieving the
goals of the Clean Water Act, while also saving taxpayer dollars.
WATERSHED-BASED PERMITTING
An important part of the watershed approach includes fostering
innovations that provide data and information in ways that allow
stakeholders at the local level to better assess and address their
unique problems. Watershed-based permitting is one such innovation. To
clearly communicate support for watershed-based permitting, on January
7, 2003, we issued the Watershed-based Permitting Policy.
Watershed-based NPDES permitting is an approach to developing NPDES
permits for multiple point sources located within a defined geographic
area (watershed boundaries). Through this approach, NPDES permitting
authorities consider watershed goals and the impact of multiple
pollutant sources and stressors, including nonpoint source
contributions. Watershed-based permitting may encompass a variety of
activities ranging from synchronizing permit issuance within a basin to
developing water quality-based effluent limits using a multiple-
discharger modeling analysis.
To better understand how watershed-based permitting approaches
work, EPA is working with permit holders and State agencies to document
different approaches currently being implemented. The lessons learned
from these approaches are documented in a series of case studies
featuring watersheds across the country. The case studies provide
background information on the watershed, give an overview of the
permitting strategy or project goals, and describe the expected
outcomes and measures of success. These case studies will provide
stakeholders with the information and lessons learned necessary for
implementing this approach in other watersheds. Current case studies
include: the State of Connecticut and the Long Island Sound; State of
North Carolina and the Neuse River; and ConocoPhillips in Colorado.
Municipal case studies include Louisville-Jefferson County, Kentucky;
Sanitation District #1 in Kentucky; and Clean Water Services in Oregon.
These case studies are available on EPA's web site at www.epa.gov/
npdes. EPA has also been working with municipalities through the CWA
section 104(b)(3) grants program to investigate additional ideas and
approaches.
To help interested parties implement watershed-based approaches,
EPA published draft Implementation Guidance in the Federal Register on
August 25, 2003 (we are soliciting comments until Sept. 24th).
Technical Guidance, which will focus on developing permit requirements
and procedural issues for permit development and issuance, will be
issued later this Fall. In addition, EPA is providing training course
materials, brochures, speaking at conferences and meetings all designed
to create a network for sharing lessons learned, and innovative
approaches to NPDES permitting.
STORMWATER
I am informed that the Subcommittee is interested in the stormwater
program, particularly our efforts to implement the Phase II Rule that
became effective on March 10, 2003. Stormwater runoff from urban,
agricultural, and industrial areas is the most common problem affecting
our nation's rivers, lakes and coastal waters. In the latest reports
from the States, urban runoff was cited as the source of impairments on
34,871 miles of rivers and streams, 7.7 million acres of lakes, and
5,045 estuary square miles. EPA's NPDES program addresses stormwater
runoff from urban as well as industrial areas.
Stormwater Phase I
The Clean Water Act directs EPA to address stormwater from urban
and industrial sources, including construction sites. In 1990, EPA
promulgated Phase I of the stormwater program. That rule requires
permits for the control of stormwater discharges for communities with
populations over 100,000, construction sites disturbing more than five
acres, and many categories of industrial facilities. Over the last 13
years, EPA has worked closely with the States and municipalities to
implement the stormwater program. Many have risen to the challenge and
developed excellent, comprehensive programs. San Diego's ``Think Blue''
campaign is a highly successful effort that educates local citizenry on
the impact of daily life on one of the City's most precious resources:
the Pacific Ocean. The city of Austin, Texas has developed a
comprehensive program to protect the Edwards Aquifer and the famous
Barton Springs recreational area that includes local ordinances and
comprehensive educational and voluntary efforts and involves a wide
spectrum of homeowners, developers, and industry. Another successful
effort involved the cleanup of the lower Charles River that runs
through Boston. The city of Boston focused on detecting and eliminating
illicit discharges to its storm sewer system. This effort has lead to
the discovery and removal of dozens of illicit discharges and prevented
over 1 million gallons of contaminated flows from entering the River.
Stormwater Phase II Implementation
Phase II of the stormwater program requires smaller communities
located in urbanized areas to develop and implement storm water
controls to restore and maintain local water resources. Phase II also
extends permitting requirements to construction activities that disturb
between one and five acres of land.
At present, 45 States are authorized to administer the NPDES
program and thus issue permits, including storm water permits, in their
respective States. These States are also responsible for working with
communities to implement the Phase II requirements. Unfortunately,
implementation of this program happens to coincide with one of the most
serious economic crises facing State and municipal governments. State
governments are reducing their budgets and their staffs and are also
reducing the funds they normally provide to communities. These budget
problems are affecting the ability of States and communities to
implement these new stormwater requirements. In short, implementation
is going a bit slower than expected.
There are two important milestones that are good indicators of
State progress in implementing the Phase II program--issuance of NPDES
permits to municipal separate storm sewer systems (MS4s) and to
construction sites disturbing 1 to 5 acres. EPA has encouraged States
to use general permits to cover all activity within a regulated
category for the entire State--issuing one general permit for
construction and one for MS4s. To date, approximately 28 of the
authorized States have issued permits for MS4s and approximately 34
have issued permits for construction activity. Indications are that the
other States are working hard to finalize these permits and all are
expected to have them finalized within the next year.
EPA was behind schedule in reissuing its construction general
permit (issued on July 1, 2003), and several of the EPA Regional
offices (Regions II, VI, IX, X) still have not issued permits for MS4s
in those handful of States where EPA remains the permitting authority.
However, two of these Regions (VI, and IX) have proposed permits.
We have anecdotal information that many communities did not meet
the deadline for applying for and obtaining permit coverage, often due
to the fact that there was no State permit in place under which they
could apply for coverage. Because of the real economic problems causing
delays, EPA is taking a supportive approach to helping States and
communities come into compliance with these requirements. It is also
important to keep in mind that the Phase II regulation allows
communities 5 years to develop and implement their programs; therefore,
full implementation is not expected until 2008.
To assist States and communities, EPA is working on a number of
fronts. First, financing is critically important. As you know, the 1987
Amendments to the Clean Water Act created the State Revolving Fund
(SRF) system. Every State and Puerto Rico now operates a successful
revolving fund that provides low-interest loans to fund a wide variety
of projects to clean up rivers, lakes, coastal waters. The President's
fiscal year 2004 Budget extends the Federal commitment to capitalize
the CWSRF through fiscal year 2011, providing an additional $21 billion
in loans over the next 20 years. We continue to work with each State
and are encouraging them to target their financing toward important
water quality efforts, including stormwater projects.
EPA has been working to develop useful tools to assist States and
communities as they implement this new program. EPA has developed a
comprehensive ``Menu of Best Management Practices'' to help communities
plan design all aspects of their stormwater programs. In addition, EPA
has produced guidance on developing measurable goals to help States and
communities evaluate the effectiveness of their programs. Finally, EPA
has invested considerable effort in its stormwater website
(www.epa.gov/npdes/stormwater) to ensure that States and communities
have the tools and information they need.
Oil and Gas Extension
I understand that the committee is also interested in hearing about
the extension EPA recently finalized for oil and gas construction
activities. When EPA wrote the Phase II regulation over 5 years ago, we
significantly underestimated the number of oil and gas sites that would
be affected. Since that time, EPA has become aware of new information
on the impact of the regulation on this industry indicating that it may
impact as many as 30,000 facilities. Additionally, questions have been
raised about the appropriateness of some aspects of the program for
these sites. Considering these factors, EPA decided to postpone the
effective date of these requirements until March 10, 2005. Over the
next 2 years, we intend to analyze the impact of these regulations on
the oil and gas industry and to evaluate the appropriateness of the
program requirements.
CONCLUSION
All of the tools I have been discussing represent a major
programmatic shift that is necessary to make further progress in
cleaning up America's waters. It is time to expand our focus: from an
almost exclusively point source orientation to one that examines all
sources of pollution, including nonpoint; from relying largely on
technology-based standards to a water quality-based approach; and, from
emphasizing inputs to focusing on environmental outcomes. We have made
tremendous progress in cleaning up our waters over the past three
decades--an achievement that is even more remarkable in view of
substantial increases in our population. As a Nation, we can be proud
of how far we have come. These successes should strengthen our resolve
to complete the hard work ahead.
Thank you. I look forward to your questions.
______
Responses by Tracy Mehan to Additional Questions from Senator Chafee
Question 1a. In March 2003, the Phase II Storm Water Rule went into
effect, requiring States and municipalities to begin developing and
implementing management plans and general permits for stormwater runoff
in urbanized areas. Last year, this Committee approved an amendment,
signed into law as part of the Great Lakes and Lake Champlain Act of
2002, that provided a 1-year fix for States to retain maximum
flexibility in utilizing Section 319 funding for addressing stormwater
concerns. What is the current status of a State's ability to utilize
319 funds for Phase II programs and activities? What will the status be
at the start of the fiscal year 2004 budget cycle?
Response. Under the Great Lakes Legacy Act of 2002, States may use
Section 319 funds that are appropriated in fiscal year 2003 ``to carry
out projects and activities in the State related to the development or
implementation of Phase II of the storm water program.'' Therefore,
States may use fiscal year 2003 Section 319 funds for that broad set of
purposes. So long as fiscal year 2003 funds are being used, EPA
understands the law to provide that they may continue to be used for
these stormwater Phase II purposes even in fiscal year 2004 and beyond.
In contrast, any funds that are appropriated in fiscal year 2004 and
beyond must be utilized consistent with Section 319 of the Clean Water
Act.
Question 1b. If Congress does not provide another temporary
extension providing States with flexibility to utilize 319 funds for
Phase II activities, will 319 funds be eligible for use in Phase II
geographic jurisdictions in the future?
Response. EPA described the extent to which stormwater activities
may be eligible for Section 319 funding in guidance, originally issued
in May 1996 and re-issued in October 2003. This guidance provides that
Section 319 funds may be used to fund any urban storm water activities
that are not specifically required by a draft Phase I or II permit. EPA
based this guidance on Congress' direction in Section 319(h) that the
funds be used by States to implement their nonpoint source management
programs approved under Section 319(b), which by its terms addresses
only nonpoint sources and not permitted point sources.
The guidance provides some examples of stormwater activities that
may be funded under Section 319. These include:
Technical assistance to State and local stormwater
programs;
Monitoring needed to design and evaluate
effectiveness of implementation strategies;
BMP's ``except for BMPs required by a draft or final
NPDES permit'';
Information and education programs;
Technology transfer and training; and
Development and implementation of regulations,
policies, and local ordinances to address stormwater runoff
(which may apply to areas covered by NPDES permits, provided
that they apply to non-permitted areas as well).
In addition, EPA notes that a variety of watershed restoration
activities fall outside the scope of Phase II permit requirements and
are thus also fundable under Section 319 in all areas.
Question 1c. During an EPA briefing with Committee staff, the
agency indicated a list of stormwater activities that would be eligible
to receive Section 319 funding, including ``monitoring and
evaluation'', information and education'', and development of
enforceable policies''. As many of these items are specifically
required to be included in Phase II NPDES permits under the rule's six
minimum control measures, would you identify what guidance the agency
is providing to States to clarify 319 uses as they proceed with
development and implementation of their Phase II programs?
Response. As indicated in the response to the preceding question,
EPA believes that it is appropriate to recognize that some activities
which generally support implementation efforts should logically be
implemented in a consistent manner across both permitted and non-
permitted areas. Monitoring and evaluation, information and education,
and the development of enforceable policies are good examples of this.
EPA believes that if a State wishes to establish a State-wide program
for such general purposes as to promote monitoring and evaluation of
urban stormwater controls or to provide information and education to
citizens, such activities will equally benefit both the municipal
separate storm sewer systems subject to NPDES permits and those other
areas of the State that remain subject to the NPS program. For this
reason, EPA believes that such activities are 319-eligible even though
they may apply to areas covered by NPDES permits, provided that they
apply to non-permitted areas as well.
______
Responses by Tracy Mehan to Additional Questions from Senator Inhofe
Question 1. One of the later witness' testimony expresses concern
about trading in mercury. You have a pilot project in San Diego that
addresses mercury trading. Can you describe this project for the
Committee?
Response. The pilot project referred to is taking place in the
Sacramento River basin and is exploring whether trading could be used
to offset a future discharge of mercury from the Sacramento Regional
Wastewater Treatment Plant. The plant's NPDES permit, issued by the
State of California, requires the plant owner and operator, Sacramento
Regional County Sanitation District, to perform a feasibility study to
identify possible opportunities for mercury offsets (e.g., reduction of
mercury loads from abandoned mine sites). If the State approves the
study, it could choose to reopen the permit and allow the plant to
offset the plant's discharge above its current limit of 5.1 pounds per
year. The plant's discharge is currently lower than 5.1 pounds per
year, but may exceed 5.1 pounds per year in the future due to increased
flows resulting from population growth. In 2002, EPA provided $50,000
in project funding to the U.S. Geological Survey for the development of
a decision support tool to assist in determining if mercury offsets are
feasible. We have not received requests to review any such project
other than the Sacramento offset pilot. EPA's 2003 Water Quality
Trading Policy generally does not support the trading of
bioaccumulative toxic pollutants except within a pilot project.
Question 2. As I mentioned in my opening statement, I am very
concerned about giving EPA authority, through the TMDL program, to veto
local land use decisions. If EPA is given authority to approve more
than just the TMDL number itself, including individual allocations to
categories and subcategories of users, how do you anticipate the TMDL
program working without hindering local and individual land use
decisions?
Response. Under the current (1992) TMDL program regulations, EPA
approves the loading capacity for a waterbody and the initial
allocations for sources of pollutants including point sources
(wasteload allocations) and nonpoint sources (load allocations). EPA
believes that the TMDLs must include adequate information to show that
the allocations will result in attainment of water quality standards.
EPA does not approve or disapprove implementation plans as part of the
TMDL and therefore does not get involved in local decisions, but relies
on the States to identify the best methods and approaches for achieving
the load allocations. Once the TMDL's initial allocations are approved,
States have a significant degree of flexibility to work with
stakeholders in a watershed to use a range of different approaches to
implement these allocations in the TMDL and, if appropriate, adjust
them to achieve water quality standards more efficiently.
Question 3a. The House Report for the Water Quality Renewal Act of
1984 explains that Section 402(I)(2) of the Clean Water Act was
``developed . . . in recognition of the fact that there are numerous
situations in the mining and oil and gas industries where storm water
is channeled around plants and operations through a series of ditches
and similar devices in order to prevent pollution contamination of the
storm water.'' During his testimony, Mr. Lee Fuller--minority staff
director to the Committee on Environment and Public Works during the
drafting of the 1987 amendments--further explained Congressional intent
to distinguish between contaminated and uncontaminated runoff. Congress
had not anticipated the agency would attempt to regulate all
uncontaminated runoff through the industrial portion of the storm water
program.
Can you explain what EPA believes Congress' intent was when it
wrote Section 402(l)(2) of the Clean Water Act and where it believes it
derives the authority to regulate uncontaminated runoff from oil and
gas sites?
Response. CWA section 402(l)(2) exempts from NPDES permitting
requirements storm water runoff from oil and gas facilities that is
composed entirely of flows from conveyances used for collecting and
conveying runoff that are not contaminated by contact with raw
materials, petroleum products or wastes located at the site. EPA
requires permit coverage for a long list of industries and focuses the
permit requirements on the likely pollutants from each specific
industry. Oil and gas is one of the industries included in EPA's multi-
sector general permit (MSGP). However, due to the CWA section 402(l)(2)
exemption, oil and gas facilities need to apply for permit coverage
only if they discharge waste water or storm water that does not meet
the requirements of the exemption. EPA believes that Congress's intent
was to exempt from permit coverage only uncontaminated runoff, not
contaminated discharges of oil or hazardous substances.
Question 3b. Will you please then explain the history behind EPA's
decision to provide oil and gas sites with a 2-year delay to comply?
For instance, what information did EPA have, and when did they have it,
about the impact the rule would have on oil and gas sites?
Response. When EPA finalized the Storm Water Phase II rule in
December 1999 (64 FR 68722), we thought that very few oil and gas
facilities would be subject to the Phase II rule because information
the Agency received through a member of the storm water subcommittee of
the Urban Wet Weather Federal Advisory Committee suggested that most
oil and gas sites were either over five acres or under one acre. In the
summer of 2002, EPA learned through data submitted by States and
industry representatives that the number of oil and gas sites that
would be subject to the Phase II rule was significantly greater than
originally estimated. In order to verify the information submitted by
States and the oil and gas industry, EPA requested and used data from
the Energy Information Administration (EIA). The EIA is a statistical
agency of the U.S. Department of Energy that serves as the primary
clearinghouse for all energy-related data in the U.S., including data
pertaining to the oil and gas industry. The EIA data confirmed that the
number of oil and gas sites potentially subject to the rule was
significantly more than what we had assumed during development of the
Phase II rule. EPA is using the 2-years to more thoroughly understand
and consider the impacts of the construction requirements on oil and
gas sites. EPA is also evaluating the applicability of the 402(l)(2)
exemption to oil and gas construction sites.
Question 4a. Does the Office of Water review and approve the design
plans for treatment works that receive EPA funds? Has EPA ever funded
plants that have included blending during infrequent wet weather events
in their designs?
Response. The Office of Water provides funds for treatment works
through the Clean Water State Revolving Funds (CWSRF), the Clean Water
Act Title II Construction Grants Program (Construction Grants) and/or
Special Project grants (Special Projects) appropriated by Congress.
States, not EPA, have the responsibility for reviewing and approving
nearly all design plans for treatment works that receive these funds.
The CWSRF is the Federal Government's primary funding source for
municipal wastewater treatment works. EPA provides CWSRF capitalization
grants to States which, in turn, contribute matching funds and make
project funding loans. The CWSRF is authorized as a State-run program.
The Construction Grants program was, prior to 1987, the Federal
Government's primary funding source for municipal wastewater treatment
works and its operation, including review and approval of all design
plans for treatment works, was entirely delegated to States under
authority of the Clean Water Act.
Special Projects are individually designated by Congress each
Fiscal Year. Congress has not required EPA to review and approve the
design plans for these projects.
It is possible that the CWSRF, Construction Grants program and/or
Special Projects appropriations have provided funds for facilities or
components of facilities that have included in their designs blending
of primary treated wastewater with biologically treated wastewater to
protect the integrity of the treatment system during wet weather while
still ensuring that discharges meet established secondary treatment
limits. The Agency does not centrally track this type of information.
Question 4b. In a recent briefing of Committee staff,
representatives for the environmental community claim EPA has not
allowed municipalities to ``blend'' at their treatment plants. They
further claim that if EPA permits blending, this would be a new
position for the agency. What has the Office of Water's position been
on allowing treatment works to blend water during peak storm events?
Response. Reducing the frequency and volume of collection system
overflows and backups of sewage into buildings, and improving the
structural integrity of collection systems have been some of the major
objectives of EPA's emphasis on wet weather discharges over the last
decade. Typically, an important component of strategies to reduce
collection system overflows and backups into buildings is to increase
the delivery of wet weather flows to the treatment plant. The volume of
wet weather flows delivered to treatment facilities can also be
increased by measures that reduce exfiltration of wastewater out of a
collection system. Increased wet weather flow volumes at treatment
plants, along with increased attention to water quality problems caused
by wet weather flows have lead to increased attention to the manner by
which publicly owned treatment works (POTWs) manage wet weather flows.
As these issues received greater attention, regulatory agencies,
municipal operators of POTWs, and representatives of environmental
advocacy groups have expressed confusion over and requested
clarification regarding the proper interpretation of certain regulatory
provisions in the context of wet weather flow management at POTW
treatment plants. Of particular concern are National Pollutant
Discharge Elimination System (NPDES) permit requirements for peak wet
weather discharges from a treatment plant when those discharges are
comprised of peak wet weather flows (i.e., incoming sanitary
wastewaters are more dilute due to wet weather influences) that are
routed around biological treatment units and blended with the flows
from the biological units (or other advanced treatment units) prior to
discharge. Such re-routing where the capacity of biological (or other
advanced) treatment units is exceeded might be necessary to avoid
damaging the treatment units. Questions have focused primarily on the
situation where the final discharge of these blended waste streams
would meet effluent limitations based upon the secondary treatment
regulations and any more stringent limitations necessary to meet water
quality standards. EPA's proposed clarification of its interpretation
of these regulations, along with draft implementation guidance, was
published in the Federal Register for public comment on November 7,
2003. EPA intends its policy would provide a framework that:
(1) ensures appropriate management of wet weather flows at a
POTW consistent with generally accepted good engineering
practices and criteria for long-term design,
(2) clarifies technology-based requirements
(3) uses water quality-based effluent limitations to address
residual site-specific health and environmental risks, and
(4) provides appropriate safeguards, including a monitoring
scheme and protection for sensitive waters.
The draft policy addresses only the limited situations where
blended wet weather POTW effluent meets permit limitations. EPA's
intention is to ensure that NPDES requirements be applied in a
nationally consistent manner that improves the capacity, management,
operation and maintenance of POTW treatment plants and collection
systems and protects human health and the environment.
______
Responses by EPA's Office of Solid Waste and Emergency Response to
Additional Questions from Senator Inhofe
Question 1. EPA had cited several aviation fuel providers for not
having secondary containment for their trucks. Aviation fuel providers
were shocked at the application of these regulations to their vehicles.
It had long been the understanding of the industry that the secondary
containment requirement of the SPCC rules did not apply to aviation
fuel trucks used on airports. This had been confirmed by approval of
many airport SPCC Plans that do not address this requirement for
aviation fuel trucks. The aviation industry has sought to work with the
EPA to provide the agency with an understanding of the
inappropriateness of imposing this requirement on aviation fuel trucks,
yet the agency has been slow to respond to these concerns and seems
little interested in recognizing the unique nature of airport fueling
operations. What steps will the EPA take to ensure that aviation fuel
providers, particularly those at smaller non-commercial airports, are
not unduly burdened by imposing secondary containment requirements on
fuel trucks used only to transport and deliver such products?
Response. EPA has been involved in an active dialog with the
aviation industry, including fuelers, on the applicability of the SPCC
requirements to this industry sector. We have discussed their concerns
within EPA and intend to provide guidance on these activities. EPA is
currently focusing primarily on resolving litigation related to the
2002 final rule, but expects to address questions regarding the
applicability of containment requirements by February 2004, in time to
allow the development of revised SPCC Plans by the August 17, 2004
compliance deadline. We plan to discuss issues associated with revised
SPCC plans with the regulated community, including representatives of
smaller airport fuel providers, before any guidance is communicated in
final form.
Additional Background: The Spill Prevention Control and
Countermeasures (SPCC) regulation (40 CFR Sec. 112) which has been in
effect since 1974 was recently amended in a 2002 final rule. The
regulation applies to non-transportation-related facilities with a
total aboveground (i.e., not completely buried) oil storage capacity of
greater than 1,320 gallons. To be regulated, in addition to the storage
capacity criteria, a facility must due to its location reasonably be
expected to discharge oil into navigable waters of the U.S. or
adjoining shorelines.
The main requirement of facilities subject to the regulation is the
preparation and implementation of a Plan to prevent the discharge of
oil into waters of the United States. These Plans are certified by a
professional engineer and not subject to Agency approval. Mobile
fuelers operating exclusively within the confines of a facility (such
as an airport) are considered non-transportation related and,
therefore, subject to SPCC requirements which must be addressed in the
airport SPCC Plan or in a separately maintained SPCC Plan.
Question 2. What is the basis for EPA determining that the previous
rule was incapable of planning for spill prevention at loading
operations for oil and natural gas exploration and production
facilities and that these facilities needed to provide secondary
containment around the loading area rather than another approach, such
as a simple mechanism to capture any spilled product? Many of these
loadings are done infrequently because of the low production volumes of
these marginal wells.
Response. This question appears to be directly related to the
``loading rack'' issue currently subject to litigation. EPA is actively
involved in settlement discussions in the hopes of resolving that
litigation. Additionally, EPA has met with stakeholders outside of the
litigation on this, as well as other, issues. We expect to be able to
discuss this issue more fully within the next one or 2 months.
Question 3. The USDA Natural Resource Conservation Service (NRCS)
fully understands how farms impact their environment and works very
closely with farmers to minimize those impacts through best management
practices, not heavy-handed Federal regulation. The Farmers in my State
of Oklahoma correctly believe the NRCS has a much better appreciation
for the daily struggle of maintaining a farm in today's economy than
EPA does while keeping the environment always in mind. Is there a means
by which EPA could work through or with the NRCS to help farmers
address any pollution problems--which have not been documented--with
their tanks?
Response. Over the past 6 months we have initiated dialog with
representatives of the agricultural sector regarding the SPCC
regulation. We are aware of the concerns of this sector and are
committed to working with them in partnership with the United States
Department of Agriculture (USDA) to address their concerns. We plan to
work with USDA to develop guidance to help farmers effectively meet the
SPCC spill prevention requirements. We believe the performance-based
nature of the SPCC rule (which allows waivers of most requirements when
``equivalent environmental protection'' is provided) allows for the
flexibility needed by small businesses such as farms.
______
Responses by Tracy Mehan to Additional Questions from Senator Jeffords
Question 1. Can you describe the relative contribution of storm
water versus other sources of pollution to the 45 percent of the
nation's waters that remain impaired, including a description of the
types of pollutants normally found in storm water and the change in
pollutant content that could be expected in cold weather climates? What
role does transportation infrastructure play in generating storm water
runoff.
Response. EPA compiles data on water quality impairments and
sources of impairments consistent with the requirements of Section
305(b) of the Clean Water Act. The most recent biennial report for
which data are available is from calendar year 2000 (2000 National
Water Quality Inventory Report). In that report, EPA presents data
independently for three significant types of waterbodies: rivers and
streams, lakes and reservoirs, and coastal resources. The report
defines a number of categories for sources of waterbody impairments.
Many of these are storm water management related. Following is
impairment data for each of the waterbody types:
Rivers and Streams.--Of miles assessed, 39 percent are impaired (a
total of 269,258 miles out of the 699,946 miles assessed). Of the
total, following is the percent of the impairment due to the identified
source: Agriculture 48 percent, Hydrologic Modification 20 percent,
Habitat Modification 14 percent, Urban Runoff/Storm Sewers 13 percent,
Forestry 11 percent, Municipal Point Sources 10 percent, Resource
Extraction 10 percent.
While not clearly delineated as storm water sources, other than the
municipal point sources, all of the other sources are likely heavily
influenced by storm water runoff.
Lakes.--Of the acres assessed, 45 percent are impaired (a total of
7.7 million acres out of the 17.3 million acres assessed). Impairment
sources are as follows: Agriculture 41 percent; Hydrologic
Modifications 18 percent; Urban Runoff/Storm Sewers 18 percent;
Nonpoint Sources 14 percent; Atmospheric Deposition 13 percent;
Municipal Point Sources 12 percent; Land Disposal 11 percent.
Coastal Resources.--Of the square miles assessed, 51 percent are
impaired (15,676 square miles out of 31,072 square miles assessed).
Impairment sources are as follows: Municipal Point Sources 37 percent;
Urban Runoff/Storm Sewers 32 percent; Industrial Discharges 26 percent;
Atmospheric Deposition 24; percent; Agriculture 18 percent; Hydrologic
Modifications 14 percent; Resource Extraction 12 percent.
Common pollutants found in storm water include pathogens,
nutrients, sediment, oil and grease, toxic metals, and debris. In cold
weather climates, road salts are an additional pollutant of concern
that have been shown to impact water quality.
Transportation infrastructure can play a significant role in storm
water runoff. Annual pollutant loads generated from roads and
associated facilities were estimated as part of the Agency's ongoing
effort to develop national guidelines for the construction and
development industry (FHWA 1996, 2001, HUD 2002, USDA 2000, NWS),
however they are likely overestimates because they do not account for
in-place management practices to control storm water runoff.
Question 2. What is EPA's cost estimate for mitigating the impact
of storm water runoff?
Response. It is very difficult to reliably estimate the cost to
mitigate the impact of storm water runoff. EPA's Clean Watersheds Needs
Survey 2000 Report to Congress developed a modeled estimate for
municipal storm water management programs. This total capital cost of
$8.4 billion represents the estimated Clean Water State Revolving Fund-
eligible portion of costs to develop and implement storm water programs
for municipal separate storm sewer systems (MS4s).
Question 3. What is EPA doing to ensure that post-construction
storm water discharges are addressed?
Response. EPA has several regulations that address the impacts of
post-construction runoff on water quality. The medium and large
municipal separate storm sewer systems (MS4s), covered by the
regulations promulgated in November 1990, must develop, implement, and
enforce programs to reduce the discharge of pollutants from areas of
new development and significant redevelopment. Specifically, these
programs are to address controls to reduce pollutants in discharges
from MS4s after construction is completed. The small MS4s, covered by
the regulations promulgated in December 1999, must develop, implement
and enforce a program to address storm water runoff from new
development and redevelopment projects that disturb one acre or more.
These programs must include strategies appropriate for the communities
and are to: include both structural and non-structural controls; use an
ordinance or other regulatory mechanism; and ensure adequate long-term
operation and maintenance of BMPs.
Additionally, EPA's recently reissued construction general permit
(July 1, 2003), applicable to construction projects disturbing one acre
or greater, requires construction site operators to identify all post-
construction storm water management measures that will be installed
during the construction process to control pollutants in storm water
discharges after construction activities have been completed. Such
measures are to be designed and installed in compliance with any
applicable Federal, State, tribal, or local requirements.
Question 4. Can you describe some of the cases in which EPA and/or
the Department of Justice have used section 309(c)(1) to prosecute
cases that involved primarily environmental harm?
Response. Please note that the response to this question regarding
the CWA negligence provision was prepared by EPA'S Office of
Enforcement and Compliance Assurance.
The Clean Water Act negligence criminal offense, 33 USC
Sec. 1319(c)(1)(A), is an essential enforcement tool that reaches
illegal conduct resulting in significant and avoidable environmental
harm that would likely otherwise go unprosecuted, such as in the case
of the Exxon Valdez oil spill (see case summary, below). The Agency, in
concert with Federal prosecutors, has reserved the use of this
provision for appropriate circumstances, including violations where
corporations or their employees have failed to take proper measures to
prevent discharges of substantial quantities of pollutants into our
nation's waters despite the fact that such discharges were reasonably
foreseeable. The Agency stands behind its record of using this
provision in a fair and just manner that promotes prevention of such
pollution in the future, while ensuring that no entity or individual is
punished for a mere accident.
Some of the CWA negligence prosecutions that were initiated
primarily because of environmental harm are described below:
Recent examples
U.S. v. Omar Mining (S.D. W. Va. 2003).--On February 24, 2003, Omar
Mining was sentenced for negligent violations of the Clean Water Act,
33 U.S.C. Sec. 1319 (c)(1)(A). The company was sentenced to 60 months
of probation and ordered to pay a criminal fine of $200,000. Omar
Mining was also required to implement an environmental management
system and undergo annual third-party environmental audits.
On August 12, 2001, a 15,000-gallon black water spill occurred at
the Omar Mining facility. The spill resulted from the company's failure
to monitor underground water levels during the underground injection of
waste water. The West Virginia Department of Environmental Protection
(``WVDEP'') allowed the excess water from the mine to be pumped out
through a permitted discharge point.
On August 23, 2001, WVDEP detected a fish kill in the creek
downstream from Omar Mining. The fish kill was traced back to Omar
Mining where it was discovered that the company had re-routed the mine
pumping operation to an unpermitted holding pond discharge point
formerly used to settle out heavy metals from mine runoff.
Subsequently, an Omar Mining supervisor activated a water treatment
facility connected to the pond, but failed to monitor the amount of
treatment material flowing into the pond. These actions resulted in the
fish kill.
Prior to the initiation of the criminal negligence prosecution,
Omar Mining was the subject of a large number of civil enforcement and
administrative actions by WVDEP.
U.S. v. Richard Anthony (W.D. Va. 2002).--On January 29, 2002,
Richard Anthony, owner and president of Sanville Utilities, Inc., in
Bassett, Virginia, was criminally charged for negligently discharging
pollutants without an NPDES permit into Blackberry Creek, a water of
the United States, in violation of 33 U.S.C. Sec. 1319(c)(1)(A).
Sanville Utilities operated the Fairway Acres wastewater treatment
plant (``WWTP'') which provided sewage treatment services for a small
apartment complex and single-family home community. Richard Anthony
served as the sole operator of the WWTP for a period of years, however,
he abandoned the plant in September 1999 after its NPDES permit
expired, leaving the plant to discharge untreated sewage into
Blackberry Creek--an estimated 1.2 million gallons of raw sewage per
day for a minimum of 1 month. The Virginia Department of Health issued
a health emergency notice in response to the sewage discharge which
occurred between September 8, 1999 and September 27, 1999. On April 23,
2002, Richard Anthony pled guilty to one count of negligently violating
the Clean Water Act. On July 11, 2002, Anthony was sentenced to serve
the maximum 12 months in prison, followed by 12 months of supervised
release. Restitution was ordered in the amount of $31,068.73.
U.S. v. Koch Petroleum Group, L.P. (D. Minn. 2000).--On September
28, 1999, Koch Petroleum Group, L.P. (``Koch''), was charged in a two
count information with negligently violating the Clean Water Act, 33
USC Sec. Sec. 1321(b)(3) & 1318(a) & 1319(c)(1). Koch admitted that it
negligently discharged oil into a wetland area and an adjoining
navigable water near Spring Lake Park Reserve, an area next to the
Mississippi River in Dakota County, Minnesota. In early 1993, Koch knew
that a tank had lost between 200,000 and 600,000 gallons of aviation
fuel and that the fuel would reach surface water, but the company did
not develop a plan to recover the fuel until June, 1997. While
establishing a system to recover the fuel, Koch installed a one-half
mile long trench and booms in a wetland to prevent the jet fuel from
reaching the Mississippi River, which had the effect of destroying a
portion of the surrounding ecosystem and wildlife habitat. On March 1,
2000, Koch pled guilty to the information and was sentenced to 36
months of probation and was ordered to pay a criminal fine of
$6,000,000. Koch was also ordered to pay $2,000,000 to Dakota County,
Minnesota, for remediation of the Spring Lake Park Reserve.
U.S. v. Plummer Excavating, Inc. (D. Minn. 2000).--On April 21,
1999, Randy Lee Konickson, vice president of Plummer Excavating, Inc.,
and Plummer Excavating, Inc., were each indicted and charged with a
misdemeanor count under the Clean Water Act, 33 USC Sec. 1319(c)(1),
for negligently discharging oil from a crude oil pipeline into waters
of the United States. In September 1998, Konickson directed an employee
to bury rocks in a field adjacent to the company's Plummer, Minnesota
facility. Konickson knew the field contained buried pipelines. When the
employee struck a crude oil pipeline with a backhoe, Konickson failed
to notify the appropriate authorities. The pipeline ruptured and caused
nearly 5,200 barrels or 218,000 gallons of crude oil to spill into the
field and eventually into a county drainage ditch that flows into the
Clearwater River. As a result of the spill, authorities evacuated the
town of Plummer. On December 10, 1999, Konickson was sentenced to 2
years of probation and 100 hours of community service. On January 7,
2000, Plummer Excavating was sentenced to 36 months probation, and
ordered to pay a criminal fine of $50,000.
Selected ``historical''examples
U.S. v. Puerto Rico Electric Power Authority (D.P.R. 1998).--The
Puerto Rico Electric Power Authority (PREPA) pled guilty to criminal
negligence violations of the Clean Water Act, 33 USC
Sec. 1319(c)(1)(A), on June 1, 1998. The company's guilty plea followed
an investigation by the Environmental Protection Agency in conjunction
with the Federal Bureau of Investigation of a September 1995 sulphuric
acid spill into the Bayamon River, on the north coast of Puerto Rico.
The acid had been transferred to a wastewater storage tank that was not
designed to withstand acid. As a result, about 270,000 gallons of
highly acidic water spilled, contaminating the river and killing marine
life.
PREPA was placed on a 2-year probation. Under its probation, PREPA
agreed to establish environmental procedures and file quarterly reports
in court showing that it is complying with environmental standards.
U.S. v. Eklof Marine Corp. (D.R.I. 1997)
On September 25, 1997, a three count information was filed charging
defendants Eklof Marine Corporation, Thor Towing Corporation, Odin
Marine Corporation, Leslie Wallin and Gregory R. Aitke with a negligent
Clean Water Act count, and only the corporate defendants with a Rivers
and Harbors Act count and a Migratory Bird Treaty Act count. This case
involved a spill of approximately 828,000 gallons of heating oil being
transported by barge off the coast of Rhode Island. The spill resulted
from the confluence of four factors: (1) a severe winter storm, the
forecast of which was disregarded--although other ships in the area had
sought safe harbor; (2) an engine room fire on the tug, which the crew
were not equipped to handle; (3) a jury-rigged anchor on the barge that
was missing the necessary anchor winch because it was removed 2 weeks
earlier for repair; and (4) poor maintenance of the tug and barge. The
spill, by far the worst in Rhode Island history, killed hundreds of
thousands of lobsters and other marine life, as well as hundreds of
migratory birds. As a result of the spill, Rhode Island waters were
closed to fishermen for months. Moreover, the oil washed up on
Moonstone Beach, a federally protected marine sanctuary, and other
fragile coastal areas.
As a result of the violations, the corporate defendants were
ordered to pay a $7 million fine, an additional $1.5 million to the
Nature Conservancy to purchase and preserve land in the area of the
spill, and make an additional $1 million worth of remedial safety
measures to its fleet of vessels. The vessel's captain, Gregory Aitken,
was sentenced to 2 years probation and a $10,000 fine. Eklof Marine
Corporation president, Leslie Wallin, was sentenced to 3 years
probation and a $100,000 fine.
U.S. v. Exxon Corp. (D. Alaska 1991)
On March 24, 1989, the Exxon Valdez ran aground on Bligh Reef,
spilling approximately 11 million gallons of oil into Alaska's Prince
William Sound, affecting approximately 1,300 miles shoreline, with 200
miles considered ``heavily or moderately oiled.'' The wildlife death
toll from the immediate impact of the spill was estimated to be:
250,000 seabirds, 2,800 sea otters, 300 harbor seals, 250 bald eagles,
up to 22 killer whales, and billions of salmon and herring eggs. As a
result of this spill, the United States charged Exxon Shipping Company,
the owner of the Exxon Valdez, and its parent, Exxon Corporation, with
five criminal counts each, with the lead count being under the Clean
Water Act for negligent discharge of a pollutant without a permit in
violation of 33 U.S.C. Sec. 1319 (c)(1)(A). In March 1991, Exxon
Shipping agreed to plead guilty to three misdemeanor counts, include
the Clean Water Act violation and lesser charges under the Refuse Act
and the Migratory Bird Treaty Act. Exxon Corporation pleaded guilty
only to a violation of the Migratory Bird Treaty Act. The criminal
fines and restitution totaled $125,000,000 ($25,000,000 of which was
straight fine) still the largest amount in U.S. environmental history.
U.S. v. Ashland Oil, Inc. (W. D. Pa. 1988)
On January 2, 1988, one of Ashland Oil's storage tanks collapsed,
spilling more than 500,000 gallons of oil into the Monongahela River
outside of Pittsburgh. On September 15, 1988, a Federal grand jury
indicted Ashland for negligently violating the Clean Water Act, 33 USC
Sec. 1319(c)(1)(A). The criminal investigation determined that routine
tests were not conducted on the tank and that following proper,
industry-standard procedures might have prevented the vessel from
rupturing. Ashland Oil was ordered to pay a criminal fine of $2.25
million.
U.S. v. Pennwalt Corp. (W.D. Wash. 1988)
A tank owned and operated by Pennwalt Corp. containing chemicals
collapsed and spilled more than 75,000 gallons into an adjacent tidal
waterway. A grand jury returned indictments against both the
corporation and three corporate officers, charging them with
``negligently . . . discharging . . . certain hazardous chemicals . . .
as the result of the collapse of a . . . poorly maintained . . . steel
storage tank.'' The chief executive of Pennwalt entered a guilty plea
on behalf of the corporation, acknowledging that Pennwalt had a duty to
anticipate and perform such maintenance and take other appropriate
steps as reasonably necessary to prevent releases of chemicals into the
waters of the United States. The corporation paid a $1.1 million fine.
Question 5. The EPA website includes an extensive list of funding
programs associated with storm water management. Can you identify which
of those programs are explicitly for the purpose of storm water
management? Please identify how much money in each of those programs
has ever been spent on storm water management.
Response. Of the 32 funding programs associated with storm water
management, none are exclusively for providing funds for storm water
projects. Three of the most prominent funding programs that provide
money for storm water projects are the Clean Water State Revolving
Fund, Water Quality Cooperative Agreements (CWA section 104(b)(3)), and
Nonpoint Source Implementation Grants (CWA section 319). EPA does not
track funding specifically for storm water management in all grant
programs, mainly because of the multi-faceted nature of storm water
management. EPA does have data indicating that between 1991 and 2002,
the Clean Water State Revolving Fund has spent $193 million on Storm
Sewers. This investment excludes the investment in combined sewer
overflow (CSO) and sanitary sewer overflow (SSO) correction. The Clean
Water State Revolving Fund also spent over $1.6 billion on nonpoint
source projects between 1990 and 2002, many of which addressed storm
water runoff from urban and rural areas. For Section 319 grants, EPA
estimates that from FY 1994 to FY 2002, at least $100 million was used
for urban runoff projects. Additionally, EPA regularly funds research
and demonstration projects to address storm water under Section
104(b)(3) cooperative agreements and in recent years has funded more
than $5 million in storm water management projects.
Question 6. What is the implementation status of the storm water
phase II program--how many States have completed their general permits?
Response. Phase II Municipal Separate Storm Sewer (MS4) permits--28
of the 45 States required to issue small MS4 permits have completed
those efforts. Of the remaining 17 States, 4 have public noticed their
draft permits, but several of these States have not finalized the
permits because of the concerns about the impact of the recent 9th
circuit ruling that requires some changes to EPA's small MS4 general
permitting provisions. EPA was sued on 22 different aspects of the 1999
storm water phase II rule. The 9th circuit recently issued a final
decision that supported EPA on all issues, except three aspects of the
small MS4 general permit program. The court said that the Notices of
Intent (NOIs) for small MS4s had to be public noticed; the public must
have the opportunity to request a public hearing on the NOI; and the
NOIs must be reviewed by the permitting authority. EPA is still
reviewing the court decision to determine what actions EPA and the
authorized States should take to comply. Three States plan to issue
individual permits to small MS4s, and one has in fact issued some of
those required permits. EPA Regions 1, 6, and 10 are responsible for
issuing small MS4 general permits to cover the remaining five States.
Region 1 has issued its permit, which covers two States. Region 6
proposed its permit, which covers one State, but has not finalized it
due to concerns about the 9th circuit ruling mentioned above. Region 10
has obtained individual permit applications from small MS4s in its two
States and is in the process of trying to decide how to proceed due to
the 9th circuit ruling.
Phase II Construction permits--33 of the 45 States required to
issue small construction permits have completed those efforts. The EPA
Regions have issued small construction general permits that are
applicable in all five States where EPA is the permitting authority.
Question 7. The Agency's information provided in the public docket
on this rulemaking cites only data from the Energy Information
Administration, specifically Table 5.2 of the Monthly Energy Review, as
the source for the estimate of 30,000 sites that will be affected--
data, which has been collected by EIA since 1973. Why did EPA not
review this data in 1999 when developing the original regulation?
Response. When EPA developed the Economic Analysis for the Phase II
rule, the information obtained for the analysis showed that most sites
were either over five acres, and therefore already regulated, or less
than one acre, and therefore would not be covered by the construction
permitting requirements of the rule. In developing this rule, we worked
to obtain information with a wide range of stakeholders through the
Federal Advisory Committee Act (FACA).
Question 8. In the Agency's correspondence with me, you also
reference estimates of the number of wells being drilled each year from
States with oil and gas activity and industry representatives. Which
States provided input to the Agency? What industry representatives
provided input to the Agency? Were the industry estimates validated in
any manner before the 2-year exemption was adopted? Was any input
sought from industry watchdog or environmental organizations prior to
issuing a proposed rule?
Response. We obtained information from Texas and Oklahoma through
our Regional Office. We received input from numerous industry
representatives, including the Texas Independent Producers and Royalty
Association, the Louisiana Independent Oil and Gas Association, the
Oklahoma Independent Petroleum Association, and the Independent
Petroleum Association of America. Industry representatives, affected
States, and EPA Regional staff all agreed that there were large numbers
of oil and gas sites potentially affected by our storm water rules. We
have an obligation to consider the impact of our regulations on all
affected industries. There could be many more sites than even the
industry has estimated, but we may find that they are not significantly
impacted. The 2-year postponement rule provides EPA with the time to
make this determination. Environmental organizations were informed
about this situation before the rule was issued.
Question 9. I have attached two reports by the EIA regarding its
drilling estimates. Are you aware that the EIA data is not collected by
the government, but is instead compiled from industry sources? Are you
aware that the EIA itself has identified accuracy problems with its own
data used in developing the reports that EPA relied on to support this
2 year exemption for the oil and gas industry? If so, why has the
Agency depended so heavily on this data to support its actions in
support of the oil and gas industry.
Response. EPA is aware that the EIA is not the primary data
collector for oil and gas exploration activity. However, EPA recognizes
EIA as the preeminent source of national estimates of drilling
activities, having compiled these data for 25 years. EPA considers the
EIA data to be the best data currently available, notwithstanding the
issues of accuracy and completeness raised by EIA in its review of its
own data. EPA does not consider these potential problems to be
significant in making its determination to extend the compliance date
for oil and gas related construction activity. In fact, many of the
corrections listed in the EIA reports actually increase the number of
drill sites reported previously, suggesting that EIA's data may
actually underestimate the total number of drill sites potentially
affected by the 2-year exemption. In addition, as mentioned in the
answer to Question 8, additional data from industry were used to
supplement EIA estimates.
Question 10. Clean Water Act section 402(l), and the legislative
history that accompanies it, is explicit in its application to
particular types of discharges from particular types of systems.
Clearly, the intent was to exempt uncontaminated flows from conveyances
or systems of conveyances already in place that are used for collecting
runoff. In the letter that I sent to you with five other members of the
Senate on February 20 of this year, we asked a question on this topic
that was not answered--what is the difference between uncontaminated
flows from conveyances or systems of conveyances and the discharges
resulting from a small construction project at an oil and gas site?
Response. CWA section 402(l)(2) exempts from Federal permitting
requirements storm water runoff from oil and gas facilities that is
composed entirely of flows from conveyances used for collecting and
conveying runoff that are not contaminated by contact with raw
materials, petroleum products or wastes located at the site. EPA has
extended the permit coverage deadline until March 10, 2005, for small
construction activity associated with oil and gas exploration,
production, processing, or treatment operations or transmission
facilities. EPA is currently assessing the applicability of the
402(l)(2) exemption to such activities.
Question 11. Does the EPA's proposed rule on TMDLs comply with EO
12866 requirements regarding the consideration of the benefits and
costs to the natural environment of a ``significant regulatory
action?'' If so, please describe the results of your cost-benefit
analysis. If not, please explain why EPA has not complied with EO
12866.
Response. EPA's draft proposed watershed rule is under informal
review among Federal agencies, CEQ and OMB. EPA will wait until the
conclusion of that process to decide whether to go forward with a
formal proposal. If EPA does go forward with a proposed rule, we will
comply with all the requirements set forth under EO 12866.
Question 12. I understand that the EPA is planning to re-interpret
the bypass rule for sewage treatment plants so as to allow sewage to be
discharged without aerobic treatment during rain events. How would this
change impact the concentration of viruses and parasites, like
cryptosporidium and giardia, in wastewater effluent? What analysis did
EPA conduct to reach those conclusions?
Response. As EPA has focused greater attention on wet weather
issues, regulatory agencies, municipal operators of POTWs, and
representatives of environmental advocacy groups have expressed
confusion over and requested clarification of the proper interpretation
of certain regulatory provisions in the context of wet weather flow
management at treatment plants. As part of the Agency's effort to
ensure appropriate management of wet weather flows at a POTW, EPA is
evaluating the applicability of the bypass provision at 40 CFR
122.41(m) to diversions of a portion of peak wet weather flow at POTWs.
We have prepared a draft policy document which was published in the
Federal Register on November 7, 2003, requesting public comment. EPA
intends its policy would provide a framework that:
(1) ensures appropriate management of wet weather flows at a
POTW consistent with generally accepted good engineering
practices and criteria for long-term design,
(2) clarifies technology-based requirements,
(3) uses water quality-based effluent limitations to address
residual site-specific health and environmental risks, and
(4) provides appropriate safeguards, including a monitoring
scheme and protection for sensitive waters.
The draft policy addresses only the limited situations where
blended wet weather POTW effluent meets permit limitations. The NPDES
regulations require that NPDES permits, including those for blended
discharges, must include water quality-based effluent limitations to
control all pollutants or pollutant parameters which the Director of
the NPDES program determines are or may be discharged at a level which
will cause, have the reasonable potential to cause, or contribute to a
non-attainment of any water quality standard. EPA's 1986 water quality
criteria for pathogens provides a relevant tool for establishing water
quality-based effluent limitations for infrequent blended discharges.
The 1986 criteria serve as an indicator for a wide range of pathogens
in wastewater, including viruses and parasites, that can produce acute
gastrointestinal disease symptoms. The data supporting the 1986
bacteria water quality criteria were obtained from a series of
epidemiological studies that examined the relationship between
swimming-associated illness (namely, acute gastrointestinal illness)
and the microbiological quality of the waters used by recreational
bathers. The wastewater sources affecting the recreational waters
evaluated during the studies for the 1986 criteria received a variety
of treatment, including no treatment, partial treatment and secondary
treatment. Discharges occurring under the draft policy would be within
the range of treatment scenarios considered during the epidemiological
studies used to develop the 1986 criteria. Hence, we believe the 1986
criteria is a relevant indicator for protecting against
gastrointestinal disease associated with potential exposure to ambient
waters. However, the 1986 criteria is not a direct measure of Giardia
or Cryptosporidium. The Beaches Environmental Assessment and Coastal
Health (BEACH) Act, enacted on October 10, 2000, P.L. No. 106-284 Stat.
870, address pathogens and pathogen indicators in coastal recreation
waters. Among other things, the BEACH Act added section 303(i) to the
Clean Water Act to require States and Tribes with coastal (and Great
Lakes) recreation waters to adopt new or revised water quality
standards by April 10, 2004, for pathogens and pathogen indicators for
which EPA has published criteria under section 304(a). The BEACH Act
also directs EPA to promulgate standards for States and Tribes that
fail to adopt standards for pathogens and pathogen indicators for
coastal recreation waters that are as protective of human health as
those published by EPA.
Question 13. What requirements has EPA put in place to ensure that
there is public participation in trading programs?
Response. Requirements for public notice, comment and opportunity
for hearing on all NPDES permits and TMDLs, including those that have
provisions for trading, are established by the Clean Water Act and its
implementing regulations. In addition to the opportunity for public
participation in trading already provided through NPDES permits and
TMDLs, EPA's 2003 Water Quality Trading Policy encourages States and
tribes to involve the public at the earliest stages of trading program
development and to provide easy and timely public access to trading
information. As a practical matter, States wishing to develop a trading
program will need to do so by incorporating provisions for trading into
core water quality management programs such as watershed plans, water
quality standards, TMDLs, and NPDES permits. Some States choose to
incorporate trading provisions in rulemaking. The mechanism a State
uses is a matter of State law and policy. EPA's trading policy does not
specify which approach a State must use; rather it provides flexibility
for States to develop trading programs while advising consultation with
the public on trading program design and ready access to information on
trades. As a practical matter, virtually any mechanism a State chooses
would require public notice and comment under State and/or Federal law.
Question 14. Your staff referenced some monitoring data that EPA
has evaluated from large municipalities and large construction sites
regarding the effect of the storm water phase I regulations on water
quality. Please provide this information to the committee in response
to the question of how has the storm water phase I regulation, covering
large municipalities and large construction sites, impacted water
quality.
Response. In accordance with section 431(b) of the Department of
Veteran Affairs and Housing and Urban Development and Independent
Agencies Appropriations Act of 2000, Public Law 106-74 (1999), EPA
conducted an evaluation of the Phase I Storm Water Program to provide
``a detailed explanation of the impact, if any, that the Phase I
program has had in improving water quality in the United States.'' EPA
presented its Report to Congress on the Phase I Storm Water Regulations
to the Committee on Environment and Public Works and the Committee on
Transportation and Infrastructure on March 1, 2000 (EPA833-R-00-001,
February 2000). That report led the Agency to the following findings:
Although information on the water quality impacts of
Phase I is unavailable at the national level, loading
reductions and subsequent water quality impacts have been
documented at specific sites.
The fundamental approach for addressing storm water
discharges involves the use of site specific pollution
prevention and best management practices. These measures can be
implemented cost-effectively.
The flexible nature of the program has encouraged
innovation on the part of municipalities, construction
operators, and industrial facilities and allowed them to tailor
control programs to their own unique circumstances.
Further improvements can be made in both program
design and implementation to enhance effectiveness.
At present, EPA has funded a number of 104(b)(3) cooperative
agreements to evaluate storm water Phase I monitoring data to further
evaluate the impacts of the program. Funds have been awarded to the
University of South Florida, the University of Alabama, and the
California State Water Resources Control Board to summarize and
evaluate those data. Results of those efforts are expected in FY04 and
FY05.
Please note that the responses to the questions regarding EPA's
investigative discretion and the Colonial and Olympic Pipeline cases
were prepared by EPA's Office of Enforcement and Compliance Assurance.
Question 15. Mr. Chairman, I ask unanimous consent that the EPA's
investigative discretion memorandum of January 12, 1994 be included in
the hearing record. Mr. Mehan, can you articulate the standard that EPA
uses to determine when to criminally prosecute cases? I understand that
this memorandum was issued by the Office of Enforcement. Please
coordinate with your counterpart to provide a complete answer to this
question.
Response. As the title of the January 12, 1994 memorandum suggests,
``The Exercise of Investigative Discretion'' (``investigative
discretion memorandum''), EPA does not engage in the exercise of
prosecutorial discretion. That is the province of prosecutors in the
United States Department of Justice, including the Office of the United
States Attorney in each Federal judicial district. EPA does, however,
exercise its discretion by determining when to criminally investigate
cases involving potential violations of Federal environmental laws.
This is much the same as is the case with other Federal law enforcement
agencies, and is a reflection of, among other things, the fact that
enforcement resources are not unlimited and good management dictates
prioritizing the Agency's investigatory work.
In order to ensure the investigations undertaken by the Criminal
Investigation Division reflect an appropriate use of the Agency's
authority, the Office of Criminal Enforcement (the predecessor of the
Office of Criminal Enforcement, Forensics and Training) articulated the
factors which govern its selection of cases to criminally investigate
in the investigative discretion memorandum. That guidance remains the
touchstone for case initiation by the Criminal Investigation Division
(CID).
At the risk of over-simplifying what is already a rather succinct
six page guidance, the CID's investigative discretion policy may be
briefly summarized as follows: The criminal case selection process is
guided by two general measures--significant environmental harm and
culpable conduct. Criminal investigations may be initiated for
instances of actual harm--demonstrated by illegal discharge, release,
or emission--that has identifiable and significant harmful impact on
human health or the environment, or instances where there is a threat
of such impact. Criminal investigations may also be warranted when
there is culpable conduct, as evidenced by: (1) a history by the
offender of violations, (2) deliberate misconduct resulting in a
violation, (3) a failure to report a discharge, release, or emission
required to be reported, or falsification of records within the
Agency's jurisdiction, especially when coupled with actual or
threatened environmental harm, (4) tampering with monitoring or control
equipment and (5) operation of a business without a required permit or
other necessary documentation.
As noted in the policy, this is not to suggest that all cases
meeting the case selection criteria will proceed to prosecution.
Indeed, the exercise of investigative discretion must be clearly
distinguished from the exercise of prosecutorial discretion. The
employment of EPA's investigative discretion to dedicate its
investigative authority is, however, a critical precursor to the
prosecutorial discretion later exercised by the Department of Justice.
The Agency continues to operate on the general principle that less
flagrant violations with lesser environmental consequences should be
addressed through administrative or civil monetary penalties and
remedial orders, while the most serious environmental violations ought
to be investigated criminally.
Question 16. Can you describe the recent cases that EPA and DOJ
successfully prosecuted against Colonial Pipeline and Olympic Pipeline
Companies including a description of the environmental damage and the
penalties paid?
Response. U.S. v. Colonial Pipeline Company (D.S.C. 1999).--
Colonial Pipeline Company (Colonial) of Atlanta, Georgia, operator of
the largest-volume pipeline carrying refined petroleum products in the
world, pled guilty to criminal charges in connection with a spill of
almost one million gallons of oil into the Reedy River in South
Carolina. Colonial was ordered to pay a fine of $7 million and serve a
5-year term of probation.
Colonial is owned by several of the world's largest oil companies.
Colonial pled guilty on February 25, 1999, to a misdemeanor charge of
violating the Clean Water Act, 33 U.S.C. Sec. 1319(c)(1)(A), when it
failed to exercise reasonable care leading to the rupture of its
pipeline where it crosses the Reedy River near Simpsonville, South
Carolina. Among other things, Colonial: (1) failed to properly train
its employees who worked on pipeline, (2) failed to conduct required
pipeline tests, or conducted them but disregarded or improperly
interpreted the results, and (3) disregarded the advice of its own
engineers regarding the appropriate throughput of the pipeline that
ruptured.
Colonial acknowledged that its actions led to spill of about
960,000 gallons of diesel fuel, affecting a 23-mile segment of the
Reedy River. The spill killed about 35,000 fish and also affected
wildlife such as beaver, muskrat and turtles, which died as a result of
direct contact with the spilled oil.
During the 5-year term of probation, Colonial must develop and
implement an extensive environmental compliance program to prevent and
detect further violations of the CWA on the entire pipeline--over
5,500--miles that runs from Houston, Texas, to Linden, New Jersey. The
court also required the company to make presentations to national
pipeline associations regarding the obligations such pipelines have
under the CWA.
On April 1, 2003, in a related matter, EPA and DOJ settled a civil
case in significant part concerning the aforementioned Reedy River
spill and six others, with Colonial. Under the civil agreement,
Colonial will upgrade environmental protection on the pipeline at an
estimated cost of at least $30 million, and pay $34 million, the
largest civil penalty a company has paid in EPA history. The $34
million civil penalty will go to the United States' Oil Spill Liability
Trust Fund, which underwrites nationwide oil spill cleanup activities.
The government found Colonial violated the CWA on seven recent
occasions by spilling 1.45 millions gallons of oil from its 5,500 mile
pipeline in five States and the company's pipeline corrosion,
mechanical damage, excavation damage, operator error and other
operation and maintenance deficiencies resulted in chronic releases
from the pipeline over decades.
The civil settlement required Colonial to designate its entire
pipeline as potentially affecting ``high consequence areas,''
subjecting the entire 5,500-mile pipeline to the pipeline integrity
regulations of the U.S. Department of Transportation's Office of
Pipeline Safety (OPS). Moreover, the settlement requires Colonial to
follow enhanced inspection, repair and maintenance procedures beyond
those required by Federal regulations, and to pay for an independent
monitoring contractor, approved by EPA, to ensure that the company
incorporates these requirements into its existing programs.
U.S. v. Olympic Pipeline Company (W.D. Wash. 2003)
On June 18, 2003, the Olympic Pipeline Company (``Olympic''), the
Equilon Pipeline Company LLC (``Equilon''), former Olympic Manager,
Frank Hopf, Jr., Olympic Supervisor of Product Movement, Ronald Dean
Brentson, and Olympic Control Operator, Kevin Scott Dyvig were
sentenced for criminal violations arising from rupture of the Olympic
petroleum pipeline and subsequent gasoline explosion in Bellingham,
Washington on June 10, 1999. The rupture resulted in the release of
approximately 236,000 gallons of gasoline into nearby Hannah Creek and
Whatcom Creek, where the gasoline ignited leading to the deaths three
individuals and causing extensive damage to the waters, shorelines and
other natural resources.
Specifically, two 10-year-old boys died as a result of the burns
they sustained from the fire. An 18-year-old was overcome by fumes,
drowned and then burned. The fire resulting from the release of
gasoline destroyed all living organisms in over 1\1/2\ miles of a
salmon spawning stream in a city park. The trees and vegetation
surrounding the creek were also destroyed. Over $26 million needed to
be spent to address this damage and to remove the gasoline that had
soaked into the soils in this area as a result of the spill. There was
also damage to the city of Bellingham water supply system and a house
was destroyed.
On September 13, 2001, the Federal grand jury in Seattle indicted
Olympic, Equilon, Hopf, Jr., Brentson, and Dyvig on misdemeanor
negligence charges under the Clean Water Act and various charges under
the Federal Hazardous Liquid Pipeline Safety Act.
Olympic pleaded guilty to three criminal counts, specifically: (1)
knowingly and willfully violating a regulation under the Hazardous
Liquid Pipeline Safety Act, setting forth minimum safety standards for
interstate pipelines carrying hazardous liquids relating to training of
its operating personnel, a felony; (2) negligently causing the
discharge of a harmful quantity of gasoline into a navigable water of
the United States in violation of the Clean Water Act; and (3)
unlawfully discharging refuse matter into a navigable water and
tributary of a navigable water of the United States without a permit,
in violation of Rivers and Harbors Act, a misdemeanor.
In accordance with Olympic's plea agreement, the court sentenced
Olympic to: (1) a criminal fine of $6 million, (2) an additional civil
penalty of $5 million to resolve pending State and Federal civil
proceedings, (3) 5 years of corporate probation, and (4) comply with
the terms and conditions of a consent decree and an injunctive relief
program in the Federal civil enforcement case. The injunctive relief
program required that Olympic undertake specific inspection and damage
prevention measures on Olympic's 400 miles of petroleum pipeline in
Washington State. The United States estimated that this injunctive
relief program would require over $15 million in new spending by
Olympic, over $5 million of which was not otherwise required by any
regulation.
Equilon, through the Shell Pipeline Company LP (``Shell''),
Equilon's successor-in-interest, pleaded nolo contendere to two
criminal counts, specifically: (1) knowingly and willfully violating a
regulation under the Hazardous Liquid Pipeline Safety Act, setting
forth minimum safety standards for interstate pipelines carrying
hazardous liquids relating to training of its operating personnel, a
felony and (2) negligently causing the discharge of a harmful quantity
of gasoline into a navigable water, a misdemeanor. The nolo, or ``no
contest,'' plea has the same effect as a guilty plea in the criminal
case in which it is entered, although it is generally not admissible in
subsequent civil litigation.
In accordance with Equilon's plea agreement the court sentenced
Equilon to: (1) a criminal fine of $15 million (with up to $5 million
of the criminal fine being applied to United States' approved community
service projects in the Bellingham area), (2) a civil penalty of $10
million to resolve pending State and Federal civil proceedings, (3) 5
years of corporate probation and (4) comply with the terms and
conditions of a consent decree and pipeline integrity/spill mitigation
program entered in the Federal civil enforcement case. The pipeline
integrity/spill mitigation program required that Shell undertake
specific inspection and damage prevention measures on 2100-plus miles
of Shell's petroleum products pipelines throughout the United States.
The United States estimated that this pipeline integrity/spill
mitigation program would mandate over $61 million in new spending by
Shell, more than $40 million of which was not otherwise required by any
regulation.
Hopf was ordered to serve 6 months in prison, followed by 3 years
of supervised release. He also was ordered to pay a fine of $1,000, and
to perform 200 hours of community service. Hopf had pleaded guilty to
knowingly and willfully violating a regulation under the Hazardous
Liquid Pipeline Safety Act, setting forth minimum safety standards for
interstate pipelines carrying hazardous liquids relating to training
Olympic's operating personnel.
Brentson, was ordered to serve 30 days in prison, 30 days of home
detention with electronic monitoring, and 2 years of supervised
release. He also was ordered to pay a fine of $1,000, and to perform
150 hours of community service. Brentson had pleaded guilty to the same
charge as Hopf.
Dyvig, was placed on probation for 1 year, and ordered to perform
100 hours of community service. Dyvig had pleaded guilty to negligently
causing the discharge of a harmful quantity of gasoline into a
navigable water.
Question 17. EPA has postponed a rule regarding sanitary sewer
overflows that is based on consensus recommendations of a Federal
advisory committee. The proposed rule would, among other things,
require sewer operators to monitor for sewer overflows and notify
public health authorities and the general public of overflows that
could make people sick. Beachgoers across the country would benefit
from early detection and minimization of overflows and from having the
beach closed before the sewage reaches the beach, not after it is
already in the water and they are (literally) swimming in it. Although
some portions of the rule no longer have the support of the sewer
operators, the monitoring, reporting, and public notification
provisions are not opposed by any of the stakeholders. Will you commit
to moving those provisions separately in a rulemaking so as to provide
immediate protection to the American public while the other portions of
the rule are debated?
Response. SSOs are covered by the Clean Water Act and are generally
prohibited as unpermitted discharges. We are evaluating options for
proceeding with improvements to NPDES permit requirements for SSOs and
municipal sanitary sewer collection systems. The Agency received
extensive comments and suggestions in response to its January 2001
draft proposed regulations. We are reviewing those comments, as well as
the data we have collected to prepare a Report to Congress on the
impacts and control of CSOs and SSOs, in order to determine the best
way to address this environmental issue. We have also met extensively
with our stakeholders on this issue. Based on the information
collected, we will consider a range of options to address SSOs,
including rulemaking. In the meantime, EPA and States are continuing to
address SSO problems with compliance assistance and enforcement in
accordance with the EPA's April 27, 2000, Compliance and Enforcement
Strategy Addressing Combined Sewer Overflows and Sanitary Sewer
Overflows.
Question 18. EPA is moving forward a new policy that would allow
sewer operators to divert sewage around (bypass) secondary treatment
units when it is raining. Will you commit to studying the public health
impacts of this proposed policy change before moving it forward?
Response. EPA is evaluating the applicability of the bypass
provision at 40 CFR 122.41(m) to diversions of a portion of peak wet
weather flow at POTWs. We are requesting public comment on a proposed
policy which was published in the Federal Register on November 7, 2003.
The framework of the draft policy is described in question 12 of this
response. EPA intends that the permit framework described by its policy
should ensure that permittees develop information to assess potential
water quality impacts associated with blended effluent.
______
Responses by Tracy Mehan to Additional Questions from Senator Wyden
Question 1(a). There are 15 communities in Region 10 that have
combined sewers. Knowing that all the communities in Oregon have
enforceable orders with the State to control combined sewer overflows
(CSOs), why was the city of Portland targeted for investigation?
(b) The U.S. Environmental Protection Agency (EPA) received copies
of the agreements entered into between the City and the State of Oregon
back in 1991 and again when the agreement was amended in 1994. EPA
began looking into Portland's efforts in February 2001, 10 years after
the City had first signed an enforceable order with the Oregon
Department of Environmental Quality. Why did the agency wait for 10
years to ask questions about the city of Portland's program?
(c) The city of Portland is more than halfway toward meeting its
goal of a 96 percent reduction in combined sewer overflow volumes. This
is a more stringent reduction level than many communities around the
country are committed to achieve, and more stringent than EPA guidance.
Why would EPA spend scarce resources to pursue a community already on
schedule to go beyond what EPA has approved elsewhere?
(d) The city of Portland has spent over $100,000 in expenses and
staff time to respond to your requests for information, visits, tours,
and meetings. How much money has EPA spent on staff time, travel and
the use of consultants to undertake this two and a half year effort?
(e) The July 7, 2003 letter from Department of Justice claims EPA
finds the City to have violated the Clean Water Act because they have
had hundreds of CSO events during the past 5 years. How is it possible
given that the order signed by the State and the City expressly
contemplates CSOs will continue until the abatement program is
completed in 2011? Does this mean that the Federal Government does not
recognize the CSO abatement orders issued by the State of Oregon?
(f) The July 7, 2003 letter discusses the need for the Federal
Government to collect penalties from the City. The Portland community
has already spent over $500,000,000 of local ratepayer money since 1991
to attack the CSO problem. They will undoubtedly spend at least that
much during the next 8 years to finish the job they have already begun.
What purpose would a financial penalty serve? What is the economic
benefit the City has enjoyed during the past 10 years when sewer rates
have tripled to address the very problems all of us are interested in
solving?
(g) In order to evaluate EPA's actions in connection with the city
of Portland's Combined Sewer Overflow program, I am requesting the
following documents concerning this matter:
All correspondence, including electronic mail, regarding
the Environmental Protection Agency's and your consultants' 2001-2003
inquiry into the city of Portland's Bureau of Environmental Services'
operation of its wastewater treatment and collection system; compliance
with the Combined Sewer Overflow and Separate Sewer Overflow provisions
of the City's National Pollution Discharge Elimination System (NPDES)
permits (Columbia Boulevard and Tryon Creek Wastewater Treatment
Plants); and compliance with Department of Environmental Quality (DEQ)
Amended Stipulation and Final Order, No. WQ-NWR-91-75, dated August 11,
1994 regarding the city of Portland's combined sewer system.
All notes, summaries, communications, meeting schedules,
requests for information and documents regarding Portland's compliance
with requirements for combined sewer overflow control.
All correspondence, guidance, initiatives, memoranda,
enforcement initiatives or other materials related to EPA's request of
the city of Portland for information regarding operation of wastewater
treatment and collection systems and compliance with the Combined Sewer
Overflow and Separate Sewer Overflow provisions of NPDES permits,
within the past 3 years.
All correspondence, including electronic mail, guidance,
initiative, memoranda, and documents or other materials relating to
national, regional or local policies regarding the administration of
the Underground Injection Control (UIC) program within the State of
Oregon within the past 3 years. Underground Injection Control (UIC)
program within the State of Oregon within the past 3 years.
Response. For EPA's responses to the questions from Senator Wyden
requesting information and documents on the U.S. Environmental
Protection Agency's investigation of the city of Portland's sewer
collections system, please see the attached letter, dated October 14,
2003, from Acting Administrator Horinko to Senator Wyden.
______
U.S. Environmental Protection Agency,
Washington, DC, October 14, 2003.
Hon. Ron Wyden,
U.S. Senate,
Washington, DC.
Dear Senator Wyden: Thank you for your letters of August 6 and
August 28, 2003, requesting information and documents on the United
States Environmental Protection Agency's (EPA's) investigation of the
City of Portland's sewer collection system. I share your concern on
this very important matter, and I remain hopeful that we can work
cooperatively with the City and the State to resolve this matter
expeditiously.
As noted in your letter, you have asked several questions regarding
Federal involvement in this matter. Although we agree that Federal
environmental programs are often best administered at the State and
local level, EPA retains the authority and responsibility to assure
consistent implementation of Federal laws nationally. EPA continues to
exercise that authority judiciously.
With regards to the City of Portland, EPA is attempting to address
significant environmental problems resulting from continuing and new
violations of the Clean Water Act (CWA) and Safe Drinking Water Act.
While EPA recognizes that the City has entered into earlier agreements
with the State of Oregon, it is important to note that it appears the
City of Portland continues to experience illegal CSO discharges, even
in areas where construction work on CSO controls has been completed.
The City has also experienced many significant sewage releases that are
not CSOs and not addressed in the prior state agreements. Finally, EPA
is concerned that the City uses over 9,000 underground injection wells
as part of its overall storm water management program and that some of
those wells may violate the Safe Drinking Water Act. EPA hopes to work
with the City of Portland to address any risks posed by the use of
these underground injection wells.
In addition to the foregoing, EPA is concerned that the City of
Portland may have committed numerous violations of the Clean Water Act
and Safe Drinking Water Act that were not addressed by the earlier
state settlements. EPA's review of these instances indicates that these
violations may include the failure to control the discharge of solid
and floatable materials from the CSO outfalls, the uncontrolled
overflows of raw sewage from manholes, cracked pipes, and elsewhere in
the collection system that have flowed into public streets, private
yards, and surface waters, and the placement of storm water injection
wells within 500 feet of domestic water supply wells, which poses a
potential health threat to those using the wells.
This final point is a key one. The City relies heavily on
underground injection wells for storm water control. While many of
these 9,000 wells may be found to be an appropriate part of the City's
overall storm water management program, they have not been permitted or
authorized by any entity as required by the Safe Drinking Water Act,
and little information is available as to whether storm water injection
in the Portland area is safe and adequately protective of the local
aquifer, which is an underground source of drinking water. EPA hopes to
work with the City to resolve these issues as quickly as possible.
EPA does recognize that the timing of our investigation is
unfortunate, and we acknowledge the City and State's previous
commitments to address Portland's sewage problems. We hope that our
current investigation will not unduly interfere with the City's ongoing
efforts, and we remain committed to working with City and State
officials as we progress forward.
Finally, your letters also requested copies of documents concerning
EPA's inquiry into the City of Portland's CSO program. We are working
with your staff to identify which of the documents that are not
enforcement sensitive or confidential would be most helpful to you. As
I am sure you can appreciate, it would be inappropriate to release
enforcement sensitive and confidential documents at this time, given
the on-going nature of EPA's investigation and settlement negotiations
with the City of Portland.
Again, thank you for your letter and support of EPA's enforcement
and compliance assurance program. Should you have any further questions
or concerns, please contact James McDonald in EPA's Office of
Congressional and Intergovernmental Relations at (202) 564-9942.
Sincerely yours,
Marianne L. Horinko,
Acting Administrator.
Statement of David Mabe, Administrator, Idaho Water Quality Programs,
State of Idaho, Idaho Department of Environmental Quality
Mr. Chairman and Members of the Committee: My name is David Mabe
and I am the Administrator of Water Quality Programs at the Idaho
Department of Environmental Quality in Boise, Idaho. I bring greetings
to you, Mr. Chairman, from Governor Kempthorne and Director, Steve
Allred.
I am testifying to share with you the perspectives of Idaho
regarding the challenges that we face implementing the Clean Water Act
and the need for regulatory or statutory changes to the program.
STATUS OF OUR PROGRAM
As background for what I am about to present, I would like to give
a very brief overview of the status of Idaho's water quality program.
We have completed four hundred eighty four TMDLs (Total Maximum Daily
Loads) primarily involving sediment, nutrients and temperature; but we
have also written TMDLs for metals, oil and grease, and other
pollutants.
Next month we will submit to the Environmental Protection Agency
(``EPA'') a revised 303(d) list done in the integrated report form. It
is set up in accordance with the EPA's new guidance regarding a five-
part list. The call for data, public comment and review was
accomplished electronically. Our 305(b) report was submitted in
electronic format.
Our monitoring program is designed to cover the state in a 5-year
period using a probabilistic approach. This involves development of a
random list of sites, and then refines the areas based on each year's
monitoring results until we are focused in the areas having the highest
chance of impairment in the fifth year to do more detailed monitoring.
Other types of monitoring are done to assess progress in impaired
waters, effectiveness of Best Management Practices, or to determine
progress of TMDLs in improving water quality.
We are making the Clean Water Act TMDL process work in Idaho, but I
believe that there are some fairly simple changes to be made that will
lower costs of compliance for all parties involved, make more sense on
the ground, and provide better environmental protection.
SUGGESTED CHANGES TO THE LISTING AND DE-LISTING PROCESS
The water quality reporting/listing process under section 303(d)
for impaired waters and under 305(b) for all waters needs to occur on a
longer schedule. I suggest a 5-year timeframe for mandatory reporting
using an integrated reporting format. It is very difficult and
expensive to do meaningful reporting with public involvement on a
shorter timeframe. Simply put, we do not have the budget to accomplish
a ``statewide'' monitoring program on a timeframe less than 5 years. In
addition, many of the improvements in impaired waters will not be
apparent in 2 years. To report on a shorter timeframe is not
meaningful. For example, using a 2-year reporting schedule Idaho would
show very little change in the first two reporting periods (the first
four yeas), then the meaningful information we complete in year five
would be delayed until the third reporting period (year six) before it
becomes public. Valuable staff time and resources are diverted to make
two reports in which we have little to say and the public begins to pay
less attention to our reporting.
In recent rulemaking and guidance efforts, the EPA has supported a
very important concept in differentiating between pollutants and
pollution. This allowed creation of a section of the 303(d) list where
the waters are not fully supporting the uses, but a TMDL will not fix
the problem. Issues like water diversion are identified in the new
format, but there is not an expectation that a TMDL will fix an
underlying problem that is not water quality based. The new format does
allow other agencies, the Idaho Department of Water Resources using the
water diversion example, to be put on notice that there is a problem.
SUGGESTED CHANGES TO THE TMDL PROCESS
Another concept that is very important is to allow more flexibility
in how pollutant loads are allocated. The current rules envision that
loads will be allocated on a daily basis to attain numeric goals.
Unfortunately, the real world does not function in this simple fashion.
The vast majority of Idaho's TMDLs are to correct problems caused by
nutrients or sediments that violate narrative standards. These
pollutants are frequently not loaded on a daily basis. Often the
majority of the loading occurs in only a few days of runoff over the
course of the entire year. A very important concept that has been
discussed in recent EPA rulemakings is to allow additional flexibility
in pollutant loading and recognize that daily numeric loads will not
work in all cases. A TMDL needs to become a Pollutant Control Plan
(PCP) with the flexibility to allow for numeric allocations for those
pollutants where this situation fits, or to allow for a problem
assessment and identification of specific water quality goals to be
achieved when a daily load does not fit. Trying to describe and
quantify what needs to happen is desirable, trying to allocate loads
daily between sources for some pollutants, is not possible.
Finally, the approval process we go through for our water quality
reports, our standards, and our TMDLs desperately needs to be
revisited. The Clean Water Act requires that each of these actions be
approved by EPA within a 30 or 60 day timeframe. If they do not act,
they are subject to legal action. The fact that they must take
affirmative action also makes each of these actions subject to
consultation. This system creates a tremendous workload for all parties
involved. It favors those who wish to litigate, and it creates a
situation where different standards may be in place at the state and
Federal level simultaneously. I believe the solution is simple, change
the requirement for the Federal agencies to affirmatively approve each
plan, standard or water quality report to a system where they have
discretion to reject items they do not believe meet the goals of the
Clean Water Act.
This change will place the burden of defending a work product on
the agency that created it. It will limit the number of venues where a
challenge can be made. Currently, a challenge that we were overly
protective is made in state court against the state, and a challenge
that we were under protective is made in Federal court against EPA.
This causes both agencies to create separate administrative records to
defend the same work product and if NOAA Fisheries or Fish and Wildlife
Service are involved there can be as many as four separate
administrative records created. This will result in less duplication
between agencies and allow each agency to focus on their priorities
rather than try to be a generalist defending everything.
SUPPORT FOR POLLUTANT TRADING
Idaho has two watersheds set up to pursue pollutant trading. The
first is the Lower Boise River Drainage, the most populous area of our
state. The second is in the Mid Snake River, which supports a very
large aquaculture industry. In both areas we have designed programs in
conjunction with active watershed advisory groups over a multiyear
period that should result in dynamic trading for nutrients. In order to
begin in the Mid Snake River we need the final NPDES permit language
from EPA Region 10 for issuing NPDES permits in the state of Idaho. In
the Lower Boise River, the state has just finished the final nutrient
allocation for Hells Canyon TMDL, which now must be translated into
waste load allocation in the lower Boise Watershed. I have trading
partners waiting to begin in both cases. EPA has been an excellent
partner in establishing both of these trading areas.
Thank you, Mr. Chairman and Members of the Committee, for this
opportunity to comment on this important issue to Idaho and all of the
stakeholders participating in Idaho's TMDL process.
______
Responses of David Mabe to Additional Questions from Senator Inhofe
Question 1. Do you believe the current TMDL regulations are clear
enough to protect states from unnecessary lawsuits? In not, what are
the most important issues a new rule should address to assure a
workable, legally defensible program?
Response. The 40 plus legal challenges against EPA and states
Nation wide in the last 6 years are evidence that the rules need
clarification. I believe the following changes would improve the TMDL
program and help focus resources on water quality problems rather than
legal and administrative actions.
Extend listing cycle to 4 or 5 years
Incorporation of the current 5 part Integrated Report
listing process
Clearly separating 303(d) requirements for TMDLs from
303(e) for implementation plans via the continuing planning process.
Question 2. Identification and listing of impaired waters under
Section 303(d) of the Clean Water Act continues to be a source of
controversy between EPA and the states, even after the issuance of
listing guidance. Can you explain, from a state perspective, the source
of the problem and what might be done to resolve it?
Response. The 2002 and 2004 listing guidance has helped overcome
some of the problems that plague section 303(d) of the Clean WaterAct.
To help minimize future litigation it would be helpful to put the
provisions of this guidance into rule. Many of the unanswered questions
that remain are really policy level or even philosophical questions
about how to interpret the clean water act or a state's water quality
standards.
I believe there is still a fair amount of debate about the purpose
of section 303(d) of the Clean Water Act. Is it a stream list from
which water quality plans are developed, or is it a tool to stop new or
modified activities from occurring until it is demonstrated that there
will be no impact to water quality. Obviously, the environmental groups
and industries view these two potential interpretations very
differently. Another example is which type error should be made when
making listing decisions. Some parties support a high probability that
any impaired water be listed (resulting in many streams being listed
that are not impaired), while others are more concerned that the
streams on the list be impaired (resulting in some impaired streams not
being listed).
Another issue that frequently causes controversy is the
interpretation of an individual state water quality standard. Across
the United States there is a tremendous variability in climate,
vegetation, soils and human activities. This interacts to create
different and varying water quality conditions and stream potential.
The National Research Council (200) report to Congress describes this.
Additionally, there is a great deal of variability in the methods used
to assess water quality and describe the beneficial uses that are being
protected in the various states. EPA is left in the position of trying
to compare and approve each state's impaired waters list and create a
record supporting their decision that will stand up to litigation. In
reality, the states are really the only one's in a position to make
these calls and Federal approval process creates a great deal of
controversy.
Question 3. Does Idaho currently, include on its 303(d) list those
waters that meet some standards but for which there is inadequate data
for other uses? What about those waters that meet all standards but not
through best practical technology or secondary treatment? Should these
waters be listed?
Response. Idaho uses the new integrated report format so we have a
specific category that identifies all waters that do not have adequate
data to make a call. This is Part 3 of the report and a schedule should
be developed to monitor these waters. I would be opposed to putting
them on the 303(d) (part 5 of the integrated report) for 2 reasons. It
causes the list to grow substantially and in Idaho we would then be
reviewing new or modified activities to assure that they met a no net
increase standard. This can be a substantial workload in areas where
water quality is really not a problem--lack of information is. The
second reason is that delisting a stream is really difficult. It viewed
suspiciously by environmental groups and EPA--they almost always oppose
it and the amount of data it can take to delist a stream can be
substantial.
Using the integrated report also allows us to put streams fully
supporting all of the uses that have been evaluated into part 2. This
is where most Idaho streams will probably go that are outside of
wilderness boundaries because we have not figured our how to determine
is a stream is fully supporting the ``aesthetics'' one of our more
subjective beneficial uses. So if we listed all streams for which there
was insufficient data for a use--we would probably be forced to list
all streams outside wilderness boundaries.
If point sources are not using best available technology and the
data indicates that water quality is fine, the stream should not be
listed. This is simply a matter where the technology required should be
updated in the next NPDES permit cycle (within 5 years) unless other
variances or exemptions apply.
__________
Statement of Juli Beth Hoover, AICP, City of South Burlington, VT
I am testifying on behalf of the city of South Burlington, Vermont,
where I serve as Director of Planning and Zoning, and also our eight
fellow towns who are subject to EPA's Phase II NPDES stormwater
regulations. My testimony concerns our experience with the Phase II
program, some creative ways we have found to meet the Phase II
requirements, and also our expanding, highly successful program of
decentralized stormwater management projects that are showing great
promise as a cost-effective way to meet local economic and
environmental needs.
South Burlington and our fellow towns comprise the urban core of
Vermont. We are all located within the Greater Burlington area of
Chittenden County, which with its 150,000 residents is home to one-
quarter of Vermont's population and most of its major employers. Where
water and the economy are concerned, most of what happens in Chittenden
County relates to Lake Champlain. The Lake is our drinking water
source, a major driver of Northwest Vermont's tourism economy, and a
local and national treasure. It is also the endpoint for nine urban
streams that drain most of the County's urbanized area, Seven of these
are on the State's 303(d) list of waters impaired by urban stormwater
runoff. Stormwater is a major environmental concern in Vermont; some of
our beaches are plagued by bacterial-related closings, and we continue
to work to reduce phosphorus loading into our beautiful lake.
When we first began learning about the Phase II program, we said
``Ugh.'' More requirements, more paperwork, more expense. Our
experience with the program to date, 6 months after receiving
authorization under the program, has been much better than anticipated
for two principal reasons.
First, the Phase II stormwater management plan development has led
to a thorough accounting of just what the towns spend on stormwater to
begin with: in other words, what are all of the things we do and
expenses we incur because it rains, and because snow melts? The answer
is anything spent or done on flood control, catch basin cleaning,
culvert replacement, maintaining beaches and streamside recreation
areas, or ensuring that commercial sites are properly managed becomes
part of each town's Phase II Stormwater Management Plan. In short, the
Stormwater Management Plans have become a sort of gap-in-services
analysis pointing out what our stormwater actions and budgets really
are, what holes there may be, and how to pull together new and
particularly existing resources to cover those gaps.
Second, the Chittenden County towns developed a creative and cost-
effective way to meet the public education and public outreach minimum
control measures. It was apparent early in the Phase II process that
the collective public education skill level of our group of
engineering, public works, wastewater and planning geeks was absolutely
zero. Concerned that we were going to be compelled to spend staff time
and funds on ineffective and boring brochures, we did something
different. Eight towns, the Burlington Airport and the University of
Vermont hired a local marketing firm to develop a professional, highly
visible public education campaign to meet the Phase II requirements for
all of these permittees. Instead of boring brochures and wasted staff
time, we will have a professional public education campaign on how
citizens can keep the Lake clean. This approach, which will cost 33
cents per county resident per year, has had an enormous impact in King
County, Washington and Prince George's County, Maryland and we believe
it will work in Chittenden County, too.
It is South Burlington's direct experience, and my testimony, that
given the level of effort, staff time, and resources being spent to
meet the GASP-34 accounting standards for fixed-asset inventory, the
fractional share of time and resources we are spending to meet the
Phase II regulations is a far more useful, cost-effective, and publicly
beneficial program. The asset inventory doesn't prevent beach closings
and higher water filtration costs; having the authority to implement
Phase II will help us do just that.
In Chittenden County, we estimate our communities will spend
between $20,000 and $200,000 apiece per year on new expenditures
related to Phase II--including the cooperative public education program
which--is a per capita expenditure of between $4 and $12 per year. In a
recreation-based economy, and in a place where the Champlain Water
District will charge us to remove from the Lake whatever pollutants we
put into it, we are confident that this is money well spent.
The second, and very exciting, initiative for which I would ask
your support, is the our effort to use decentralized or distributed
stormwater systems to prevent pollution and support business
development. In 2000, a very creative Vermont Environmental
Conservation employee noticed three things on a piece of land in South
Burlington: a brook polluted with petroleum hydrocarbons, sediment and
phosphorus from stormwater runoff in our ``auto alley'' and which
drained, of course, directly to Lake Champlain; a Chevy dealership that
needed more stormwater capacity to expand its business; and a totally
unused piece of land behind the Chevy dealer that was part of a
railroad right-of-way.
With $300,000 from 13 separate grant sources, the cooperation of
the Chevy dealer, and a lot of head-scratching by some very talented
people, the city of South Burlington built the Bartlett Brook
Stormwater Treatment Facility. This four-acre system does three things:
It allowed Bill Shearer to expand his business; has now been shown
through scientific monitoring to be removing toxic pollutants and
nutrients from Bartlett Brook that otherwise would be dumped in the
lake; and it made use of a piece of undevelopable land to serve the
environment and the economy in an incredibly cost-effective and
attractive way.
This approach works. Distributed stormwater treatment systems using
constructed wetlands or micropool extended detention, can make use of
under-utilized and un-developable land to create capacity for new
development and cleanup even the most difficult stormwater runoff
pollution problems. They can compliment CSO and other structural
treatment systems, or in some cases, substitute for them entirely.
Within Chittenden County we have plans on the board for a half-dozen
more of these systems, all using land such as highway rights-of-way
where no one wants to build, but where we have tremendous potential to
improve water quality and create development capacity where stormwater
storage and treatment is an issue.
In Chittenden County, we have planned this type of distributed
treatment system in two transportation-related locations here in South
Burlington where commercial properties need storage and treatment area,
and we can provide that in otherwise useless cloverleafs and on-ramp
lands. From a cost standpoint, these systems typically cost between
$300,000 and $800,000 to build. When existing public lands, such as
railroad or interstate rights-of-way can be used, the cost drops
accordingly.
Burlington is proposing a wetland system just upstream of Oakledge
Beach, a beautiful beach that is plagued by closures after rain events
due to urban runoff from Engelsby Brook. A constructed wetland system
similar to Bartlett Brook is proposed just a quarter-mile upstream to
remove bacteria, toxics and sediment. The cost is close to $1 million
and again, must be funded through multiple grant sources when it should
be funded as a matter of good basic water quality infrastructure.
South Burlington is proposing two similar systems to be funded
through an EPA STAG grant and the EPA Decentralized Water Resources
Demonstration Grant, with costs of $300,000 for one that treats runoff
from our downtown in land down below an Interstate on-ramp, and
$800,000 for a system treating runoff from state and Federal highways,
three shopping centers, and a residential neighborhood just a half-mile
upstream of Lake Champlain, and South Burlington's beautiful Red Rocks
park and beach.
I would ask Congress's support for this distributed approach
through more aggressive funding for and directives to the SRF program
to make use of these funds for distributed and non-structural
stormwater treatment. Last year, Congress directed the use of $75
million of the over $1 billion in Federal funds for the SRF for
distributed, non-traditional and soft path techniques such as these. We
would greatly improve public use of funds to spend a larger share of
our traditional clean water funds on cheap, effective, distributed
stormwater strategies instead of forcing municipal staff to chase down
and administer 13 grants for such a valuable approach.
______
Distributed/Decentralized Stormwater Treatment Systems for Urban
Stormwater Management in Chittenden County, VT
Bartlett Brook Stormwater Treatment System, City of South Burlington
The Bartlett Brook Stormwater Treatment System in South Burlington,
Vermont is a state-of-the-art constructed wetland system. It
illustrates the many advantages of distributed stormwater management,
also known as decentralized or ``soft path'' systems. These utilize
land-based treatment of stormwater to clean pollutants from runoff
before the runoff enters streams and lakes.
[GRAPHIC] [TIFF OMITTED] T2384.001
Stormwater runoff from the auto-related businesses on U.S. Route 7
is diverted into a four-acre system of settling ponds and constructed
wetlands prior to discharge into Bartlett Brook and Lake Champlain.
[GRAPHIC] [TIFF OMITTED] T2384.002
The pond makes use of unused land in a railroad right-of-way, and
created enough stormwater capacity to allow expansion of Shearer
Chevrolet. Monitoring has shown the system effectively removes
petroleum hydrocarbons, sediment, and phosphorus from stormwater. The
project cost $300,000 and was funded through 13 grants.
[GRAPHIC] [TIFF OMITTED] T2384.003
Engelsby Brook Constructed Wetland Treatment, City of Burlington
The city of Burlington will build a constructed wetland similar to
the Bartlett Brook system on this land along Engelsby Brook, roughly
\1/4\ mile upstream from Oakledge Park and Lake Champlain. This system
includes a $60,000 EPA demonstration grant and funding from the EPA
Superfund settlement for the Pine Street Barge Canal.
[GRAPHIC] [TIFF OMITTED] T2384.004
The constructed wetland will remove pollutants upstream of this
stormwater outfall, which contributes to beach closures just downstream
at the popular Oakledge Park beach.
[GRAPHIC] [TIFF OMITTED] T2384.005
[GRAPHIC] [TIFF OMITTED] T2384.006
planned micropool stormwater treatment systems, city of burlington and
city of south burlington
South Burlington will be using the decentralized stormwater
treatment approach to treat runoff from its two major commercial
centers. Unused, un-developable land in highway rights-of-way will be
used to install micropool extended detention systems.
This land along Shelburne Road will treat runoff from and enable
redevelopment of three major shopping centers in Burlington and South
Burlington.
[GRAPHIC] [TIFF OMITTED] T2384.007
This interstate on-ramp's right-of-way contains the outfalls for
runoff from South Burlington's newly developing City Center area. A
micropool system, estimated to cost $300,000, will provide capacity for
development and ensure that pollutants stay out of Centennial Brook and
Lake Champlain.
[GRAPHIC] [TIFF OMITTED] T2384.008
______
Responses of Julie Beth Hoover to Additional Questions from Senator
Jeffords
Question 1. Can you comment on the interaction between stormwater
management and the amount of water that arrives at a wastewater
treatment plant during a wet weather event?
Response. There is no question that the use of decentralized or
distributed stormwater treatment and storage systems can help alleviate
wet-weather flows to wastewater treatment plants. Infiltrating
stormwater into the round, detaining it in basins or storage tanks, or
diverting it through land-based treatment systems prior to discharge
into a storm drainage system reduces the amount of water that must go
through a treatment plant, thereby reducing the potential for
overflows. Using distributed systems also reduces the impact of peak
flows by detaining stormwater and releasing it over time, rather than
flooding the storm drainage system and treatment plant all at once.
In addition to ameliorating the quantity of stormwater arriving at
a treatment plant, distributed treatment and storage also improves the
quality of the stormwater that must be treated. Techniques that detain
stormwater result in heavy particles settling out prior to discharge,
keeping these pollutants out of the wastewater treatment plant, and
land-based treatment systems also remove volatile organic compounds
from stormwater. Treating stormwater through detention or land-based
treatment thus reduces the amount of treatment that must occur in a
plant, and reduces the pollutant load found in any overflows.
Question 2. In your experience, have structural or non-structural
solutions to storm water management problems been the most effective?
Response. Structural and non-structural techniques must be used
together to create the most effective stormwater management program.
Just as a city needs developed areas and parks to create a healthy
community, stormwater infrastructure needs both structural and non-
structural or land based components to maximize pollution control and
meet water quality goals.
Structural solutions, while very costly, are essential both in
fostering urban development and meeting water quality goals. They take
very little land area and thus facilitate compact land development
patterns. Structural solutions may not, however, be necessary in very
low-density areas, or in locations where stormwater treatment can be
accomplished through land-based treatment without compromising economic
and community development goals. In all cases, non-structural solutions
should be an essential complement to structural stormwater treatment.
Land based treatment, especially in stormwater pollution ``hot spots,''
is essential for improving groundwater recharge, reducing peak flows,
and especially for achieving better pollutant removal.
But without even investing in land-based or structural treatment,
non-structural practices can have a substantial, positive impact on
water quality. Practices such as making landscaping more ``water-
friendly,'' reducing the amount of pesticides, herbicides and other
chemicals used, and changing public behaviors on such issues as car
washing and pet waste, can further improve water quality without
further investment in structural or land-based treatment.
__________
Statement of Michael Samoviski, City of Hamilton, OH, Office of the
City Manager, Department of Public Works
Mr. Chairman and Committee members, thank you for granting the City
of Hamilton this opportunity to testify before you today.
The City of Hamilton is located in the southwest portion of the
State of Ohio and has a population of somewhat more than 60,000 people.
Hamilton operates a Publicly Owned Treatment Works, including a
Wastewater Treatment Plant and 212.7 miles of sanitary sewer lines.
Hamilton also maintains a separate storm water collection system
consisting of 180.5 miles of storm sewer and 6,500 catch basins.
In 1999, the US EPA promulgated Phase II Storm Water Rules which
require covered political jurisdictions to obtain a National Pollutant
Discharge Elimination System--General Storm Water Discharge Permit,
which Hamilton received in April 2003. To obtain this Permit, Hamilton
was first required to develop a Storm Water Management Plan, which the
City submitted to Ohio EPA in March 2003. This Plan encompasses the 6
minimum controls mandated by the Phase II Rules.
Hamilton's City Council is seriously concerned about municipal
implementation and enforcement of this recently issued General Storm
Water Discharge Permit, especially in light of our very challenging
local and state economic climates. As the City prepared its Storm Water
Management Plan, it became apparent to City Council that the costs
associated with its implementation will have to be assumed by our local
government, or more likely by our citizens and businesses since surplus
municipal moneys for this purpose are non-existent.
To pay for its Phase II Program, the City of Hamilton anticipates
having to form and implement a Storm Water Utility. Storm Water Utility
charges will be based upon the amount of impervious area on parcels of
land. In this manner, each parcel of land within the City of Hamilton
would be assigned a fee determined by its runoff characteristics.
According to the Ohio Supreme Court, storm water fees of this sort,
since they are utility charges, must be applied in an even and
consistent manner without regard to tax status or land use. This means
that all residents, businesses, schools, churches, governmental and
institutional complexes, etc. will have to be subject to these charges,
without exception. Each residential unit would have to pay a flat
monthly charge; but, non-residential properties would pay a higher
amount equivalent to the relative expanse of impervious surfaces at
their locations.
The City of Hamilton's projected annual expense attributable to
having to comply with the new Phase II Program is an additional $1.6
Million over the current $800,000 that the City now spends on storm
water activities. Since Phase II is a federally unfunded mandate, the
City of Hamilton expects to have to raise this revenue by imposing a
monthly fee of up to $5.50 on residential customers. Non-residential
customers would be charged $5.50 multiplied by a factor which takes
into account the proportional increase of impervious area.
The following examples help to drive home our point: Hamilton's
First Baptist Church, with its associated parking area, was determined
to have an impervious factor of 68 times that of a single equivalent
residential unit (ERU). As a result, the Church's projected Storm Water
Utility charge is calculated to be $374 per month ($5.50 multiplied by
68). Smart Paper Company, a manufacturer of high quality papers, has an
impervious factor of 912 ERU's, and its monthly charge would be $5017.
Hamilton High School has an impervious area equal to 243 ERU's; its
monthly charge would be $1338. The local airport in Hamilton has 584
ERU's associated with its runways and other impervious areas which
results in a $3215 monthly charge. Hamilton Scrap Processors, a
privately owned recycler, with 88 ERU's would have to pay $484 monthly.
This federally unfunded mandate is being imposed upon local
communities at a time when our economies are stagnant, and our Nation
is facing huge deficits as forecast by public financial officers. The
City of Hamilton is no exception: local budget deficits are already
predicted for 2004, and the state's budget is in such distress that no
funding for cities and counties is available for Phase II compliance.
Now is not the time for distressed cities, such as the City of
Hamilton, to have to impose a new monthly Storm Water Utility charge
across the community to achieve Phase II compliance. When the local
economy improves, Hamilton's businesses and citizens may be better able
to absorb this type of fee. In our current flagging economy, however,
our local businesses cannot afford this additional expense. Nor can our
citizens who have very recently been called upon to take on more of the
municipal financial burden, specifically more of the public safety
burden, by paying more in taxes for police and firefighter staffing at
the local government level.
Please let me emphasize again that the time for implementation of
this Phase II Program is not now. Accordingly, the City of Hamilton
respectfully asks that you, as our elected Federal representatives in
Washington, commence action before Congress to enact a 5-year
moratorium. This moratorium could postpone the unfunded mandate to a
time better suited for requiring communities, such as our distressed
City, to step forward and implement the Phase II Rules and to impose
additional financial burdens on both your and our constituents.
We ask this not because the City of Hamilton is seeking to avoid
serving as a good steward of its river and receiving waters, but
because we are concerned public officials seeking to strike a
reasonable balance between the stark reality of our current depressed
local economy and continuing environmental improvement.
Thank you again for your attention and courtesy in allowing us to
address this Committee. We were honored to have received your
invitation to appear before you to present our concerns.
Storm Water Utility Projected Income Statement City of Hamilton, Ohio
----------------------------------------------------------------------------------------------------------------
FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008
----------------------------------------------------------------------------------------------------------------
Estimated Annual Billing ERUs..... 37,430 37,430 37,430 37,430 37,430 37,430
Annual Utility Fee ($/ERU/mo)... $5.50 $5.50 $5.50 $5.50 $5.50 $5.50
Program Expenses:
Regulatory Compliance............. $5,000 $100,000 $100,000 $100,000 $100,000 $100,000
Operation & Maintenance-Leaf $595,000 $610,000 $630,000 $650,000 $670,000 $690,000
Collection & Street Sweeping.....
Operation & Maintenance-Collection $150,000 $802,000 $826,000 $851,000 $877,000 $903,000
System...........................
Planning and Management........... ........... $170,000 $170,000 $170,000 $170,000 $170,000
Capital Projects-Engineering ........... $300,000 $300,000 $300,000 ........... ...........
Studies..........................
Capital Projects-As Needed System $236,000 250,000 $260,000 $270,000 $280,000 $290,000
Repair Replacement...............
Capital Projects-Engineering ........... $305,000 ........... ........... $500,000 $500,000
Projects.........................
Total Annual Expenses........... $986,000 $2,537,000 $2,286,000 $2,341,000 $2,597,000 $2,653,000
Program Revenues:
Utility Revenue (From New User $206,000 $2,470,000 $2,470,000 $2.470,000 $2,470,000 $2,470,000
Fee).............................
Revenues.......................... $206,000 $2,470,000 $2,470,000 $2,470,000 $2,470,000 $2,470,000
Revenue Breakdown:
Residential....................... $138,867 $1,665,052 $1,665,052 $1,665,052 $1,665,052 $1,665,052
Commercial........................ $30,370 $364,148 $364,148 $364,148 $364,148 $364,148
Industrial........................ $20,344 $243,935 $243,935 $243,935 $243,935 $243,935
Agricultural...................... $3,910 $46,882 $46,882 $46,882 $46,882 $46,882
Non-Residential Misc.............. $141 $1,692 $1,692 $1,692 $1,692 $1,692
Non-Residential Public............ $12,368 $148,292 $148,292 $148,292 $148,292 $148,292
Total Non Residential........... $67,133 $804,948 $804,948 $804,948 $804,948 $804,948
Revenues.......................... $206,000 $2,470,000 $2,470,000 $2,470,000 $2,470,000 $2,470,000
----------------------------------------------------------------------------------------------------------------
______
April 25, 2001
Resolution No. R2001-4-23
A RESOLUTION REQUESTING THE OHIO DEPARTMENT OF DEVELOPMENT TO DESIGNATE
THE CITY OF HAMILTON, OHIO, AS ``SITUATIONALLY DISTRESSED'' UNDER THE
GUIDELINES OF THE OHIO MANUFACTURING MACHINERY & EQUIPMENT INVESTMENT
TAX CREDIT PROGRAM
WHEREAS, until January 1999, the City had received the ``distressed
city'' designation under the Guidelines of the Ohio Manufacturing
Machinery & Equipment Investment Tax Credit Program, thereby allowing
for a investment tax credit of 13.5%, as opposed to a 7.5% investment
tax credit, on new manufacturing machinery and equipment purchased by
local manufacturing companies; and
WHEREAS, following January 1999 and based upon discussions with
Ohio Department of Development personnel, the City of Hamilton was
upgrade to a ``non-distressed'' designation based upon the improvement
of the unemployment rate within the community, and
WHEREAS, the following, recent events have had, and are likely to
continue to have, a serious impact upon employment opportunities within
the corporate limits of the City of Hamilton and upon the economic
health of the City:
1. Since 1999 several major companies have either downsized,
relocated or been sold, and have expressed intentions to leave
the City;
2. Ohio Casualty Group recently relocated its corporate
headquarters from Hamilton to Fairfield, Ohio, moving
approximately 1,000 employees out of the City;
3. Champion International Corporation, formerly the City's
largest employer, was sold to International Paper (IP) in June
2000, and:
(a) At the time of the sale, Champion had two facilities
in Hamilton, including a paper mill with 800-850 employees
and a corporate administrative complex with 550 employees.
(b) IP already owned another paper mill in the City, with
approximately 225 employees.
(c) After the sale, IP announced that it would close the
administrative complex and relocate some of the existing
550 employees to other IP sites in and out of Ohio, but not
in Hamilton, and additionally, IP announced that it was
putting the two paper mills it owned in Hamilton up for
sale;
(d) In January 2001, a prospective buyer, Smart Papers,
LLC, was identified for the former Champion paper mill, and
thereafter it has expressed the need to make serious cuts
in costs at the mill in order to make it profitable as a
stand-alone entity;
(e) While it is uncertain how these cost-cutting measures
will affect the overall short- and long-term employment
outlook, as an initial move by Smart Papers, the work force
was decreased to 550 employees;
(f) By raising the investment tax credit percentage back
up to 13.5%, an added incentive may be provided to Smart
Papers and other Hamilton manufactures to make additional
capital investments in their plants;
(g) The IP Dayton Street Mill is for sale as part of the
IP diverstiture of their entire Fine Papers Division;
(h) While the Dayton Street Mill is currently operating
profitably, paper production began at this location in 1848
and it is one of the oldest continuously operating paper
mills in the Midwest; and
(i) The long-term viability of the Dayton Street Mill and
status of the existing 225 employees is uncertain:
4. In March 2001, Mercy Health Partners announced that it was
closing its hospital in Hamilton, which will result in the
relocation of approximately 635 out of Hamilton to either other
Mercy facilities or other employers; and
5. At the end of March 2001, Thyssen Krupp Hoesch Suspensions
announced that it was permanently closing its Hamilton spring
and suspension parts plant over the next several months,
resulting in the loss of another 106 quality manufacturing jobs
in Hamilton.
WHEREAS, while the Ohio Manufacturing Machinery & Equipment
Investment Tax Credit is not seen as a panacea for development in the
City, it does provide an additional, needed incentive to locate within
the corporate limits of the City, and
WHEREAS, in total, over the last year and a half, the City of
Hamilton has experienced losses in private sector employment of
approximately 2,700 jobs, totaling almost 8% of the civilian labor
force for the City, as determined by the Ohio Department of Jobs and
Family Services.
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of
Hamilton, Ohio;
SECTION I: That based upon the evidence provided and the
circumstances that have and are presently occurring within the City of
Hamilton, Council does hereby formally request the Ohio Department of
Development to designate the City of Hamilton as ``situationally
distressed'' under the Ohio Manufacturing Machinery & Equipment
Investment Tax Credit Program.
SECTION II: That Council further requests the aforesaid
``situationally distressed'' designation take effect immediately or at
the soonest time possible and remain in effect until such time as
prevalent economic and employment conditions positively change in the
City of Hamilton.
SECTION III: That the ``situationally distressed'' designation for
the City of Hamilton, Ohio, will allow any company locating within its
corporate limits to be eligible for an investment tax credit of 13.5%,
for new manufacturing machinery and equipment.
SECTION IV: This resolution shall take effect and be in full force
from and after the earliest period allowed by law.
PASSED: April 25, 2001
Adolf Olivas, Mayor
Effective Date: Immediately
ATTEST: Ina Allen, Acting City Clerk
CERTIFICATE
I, Ina Allen, Acting Clerk of the City of Hamilton, Butler County,
Ohio, hereby certify that the foregoing Resolution No. R2001-4-23 was
duly published as provided by Section 113.01 of the Codified Ordinances
of the City of Hamilton, Ohio, by posting ten days after passage, a
copy thereof in each fire station within the city for a period of ten
days. POSTED: April 30, 2001
Ina Allen, Acting Clerk
City of Hamilton, Ohio
______
CERTIFICATE
The undersigned Acting Clerk of Council of Hamilton, Ohio does hereby
certify that the foregoing is a true and correct copy of Resolution
R2001-4-23 of the City of Hamilton, Ohio, duly adopted at the Regular
Meeting on April 25, 2001.
Ina Allen, Acting Clerk
City of Hamilton, Ohio
______
Department of Economic Development,
Hamilton, OH, May 10, 2001.
Joseph C. Robertson, Interim Director,
Ohio Department of Development,
Columbus, OH.
ATTN: Steve Kelley
Dear Joe: This letter is written as a request for reconsideration
of the City of Hamilton's designation relative to the Ohio
Manufacturing Machinery & Equipment Investment Tax Credit. Attached is
Certified Resolution from the Hamilton City Council formally requesting
this consideration.
Up until 1999, the City had received the ``distressed city''
designation under this program, allowing for the 13.5 percent as
opposed to the 7.5 percent tax credit on manufacturing machinery &
equipment investments by our local manufacturers. Based upon
discussions with Ohio Department of Development personnel at that time,
the City of Hamilton was downgraded as ``non-distressed'' based upon
the improvement of our unemployment rate in the community.
Unfortunately, recent events have and are occurring that have and
will continue to seriously affect the employment situation and the
economic health in the City of Hamilton. Since 1999, several major
companies have either downsized, relocated or been sold and expressed
intentions to leave the City.
Ohio Casualty Group (OCG) recently relocated its corporate
headquarters from Hamilton to Fairfield, moving approximately 1,000
employees out of the City. This relocation was facilitated through an
Enterprise Zone Agreement with the City of Fairfield and a Job Creation
Tax Credit from the State. (Enterprise Zone Application and Job
Creation Tax Credit Program correspondences are attached.) The City
attempted to retain OCG through a number of offered incentives,
including a sale/leaseback on their Hamilton facilities, but OCG
relocated out of Hamilton, despite our efforts.
Champion International Corporation, the City's largest employer,
was sold to International Paper (IP) in June 2000. At the time of the
sale, Champion had two facilities in Hamilton, including a paper mill
with approximately 800 employees and a corporate administrative complex
with 550 employees. (WARN Act letter to the City of Hamilton Mayor,
dated January 2, 2001, relative to the administrative complex, is
attached. Also attached are relocation notices from Butler and Clermont
Counties, relative to the relocation of these jobs out of Hamilton.
Additionally, various articles are provided outlining the job losses
and relocations.) In this case as well, various tax incentives,
including enterprise zone and job creation tax credits, have been
utilized to assist a company to relocate existing jobs out of Hamilton.
IP already owned another paper mill in the City, with approximately
225 employees. After the sale, IP announced that it would close the
administrative complex and relocate some of the existing 550 employees
to other IP sites in and out of Ohio, but not in Hamilton.
Additionally, IP then announced that it was putting the two paper mills
it owned in Hamilton up for sale.
In January 2001, a prospective buyers, Smart Papers, LLC, was
identified for the former Champion paper mill. The new buyer has
expressed the need to make serious cuts in costs at the mill in order
to make it profitable as a stand-alone entity. How these cost-cutting
measures affect overall employment in the short- and long-term is yet
to be seen. However, as an initial move by Smart Papers, the work force
was decreased to 550 employees. By raising the investment tax credit
percentage back up to 13.5 percent, an added incentive may be provided
to Smart Papers to make additional capital investments at the plant
(Attached are several articles relating the Smart Papers transaction
and the employment impact resulting from the sale.)
The other IP paper mill is being sold as part of the sale of the
entire Fine Papers Division by IP. While this mill is currently
operating profitably, paper production began at this location in 1848
and it is the oldest paper mill in the Midwest. The long-term viability
of the mill and status of the existing 225 employees is a question that
is unanswered at this time.
On January 4, 2001, the City received another relocation from an
existing company, Alba Manufacturing, looking to relocate operations
from Hamilton to Fairfield. This relocation notice resulted from an
enterprise zone application. This relocation will cost the City of
Hamilton an additional 52 quality manufacturing jobs. The relocation
waiver was granted and Enterprise Zone Agreement was extended even
though the company had an existing Enterprise Zone Agreement in place
for their last expansion in Hamilton and their first Agreement with the
City had expired only last year. (Enterprise Zone Application with
Fairfield is attached.)
In March 2001, Mercy Health Partners announced that it was closing
its hospital in Hamilton. This move by Mercy will result in the
relocation of another approximately 635 out of Hamilton to either other
Mercy facilities or other employers. (WARN Act letter to the City of
Hamilton Mayor, dated April 11, 2001, is attached.)
On March 30, 2001, Thyssen Krupp Hoesch Suspensions announced that
it was permanently closing its Hamilton spring and suspension parts
plant, resulting in the loss of another 106 quality manufacturing jobs
in Hamilton. (WARN Act letter to the City of Hamilton Mayor, dated
March 30, 2001, is attached.)
In total, over the last year and a half, the City of Hamilton has
experienced losses in private sector employment of approximately 2,700
jobs, totaling almost 8 percent of the City's civilian labor force, as
determined by the Ohio Department of Job and Family Services.
Additionally, City personnel has recently spoken to several other
medium-sized employers in the City who are also considering long-term
plans that could seriously affect their local employment complement.
These other companies combined with the already near devastating
effects that the City has felt from Ohio Casualty and IP/Champion,
Mercy and the number of other companies would nearly cripple the
financial condition of the City for the foreseeable future.
While the Ohio Manufacturing Machinery & Equipment Investment Tax
Credit is not seen alone as a development panacea for the City, it does
provide an additional incentive to locate within the City.
If you have any questions, comments, or require additional
information, please contact me.
Sincerely,
Timothy E. Bigler,
Director.
______
Ohio Department of Development,
Columbus, OH, June 8, 2001.
Hon. Adolf Olivas, Mayor,
City of Hamilton,
Hamilton, OH.
Dear Mayor Olivas: I am in receipt and have reviewed the City of
Hamilton's petition for designation as a ``Situational Distress''
Municipal Corporation. Acting under the authority granted to the
Director of the Ohio Department of Development in Amended Senate Bill
188, reference Ohio Revised Code 57733.33, A13; I am designating the
City of Hamilton in Butler County, as a Situational Distress Municipal
Corporation. This designation will be in effect from July 1, 2001
through June 30, 2004.
Effective July 1, 2001 manufacturing or refining companies located
within the political boundaries of the City of Hamilton, which make
machinery and equipment purchases in compliance with the guidelines as
outlined in Ohio Revised Code Sections 5733.33 and 5747.31, are allowed
to claim a credit against their Ohio Corporate Franchise Tax equal to
13.5 percent. This is an increase from the base of 7.5 percent, which
is available anywhere in the State of Ohio.
Sincerely,
Joseph C. Robertson,
Interim Director.
______
Office of the City Manager,
Hamilton, OH, February 27, 2003.
Hon. George V. Voinovich,
Washington, DC.
Re: Proposed Legislative Moratorium on the Implementation/Enforcement
of the NPDES Storm Water Phase II Final Rule
Dear Senator Voinovich: The City Council of the City of Hamilton,
Ohio (City) is concerned about the implementation and enforcement of
the National Pollutant Discharge Elimination System (NPDES) Storm Water
Phase II Final Rule (Phase II Rule) in this challenging local, state
and federal economic climate. As part of the Clean Water Act (CWA)
legislation, the USEPA extended the NPDES permitting program to storm
water discharges in 1990. The 1990 regulations established requirements
for permitting discharges from industries, construction sites large
than 5 acres, and drainage systems in large and medium municipalities
serving a population greater than 100,000 (Phase I program). On
December 8, 1999, USEPA promulgated the expansion of the existing NPDES
Storm Water Program to include discharges from small municipalities
with a population less than 100,000. This program, termed the Phase II
program, requires covered political jurisdictions to obtain an NPDES
storm water discharge permit by March 10, 2003. In Ohio, about 280
cities, counties, villages and townships located in urbanized areas
that own and operate municipal separate storm sewer systems (MS4s) are
required to obtain this type of permit, which includes the City of
Hamilton. To comply with this unfunded government mandate, the City has
retained the environmental engineering consulting firm of CDM to assist
the City in preparing a Storm Water Management Plan (Plan) that
outlines best management practices (BMPs) that the City must implement
over the next five years. These BMPs address the six minimum control
measures required within the Phase II Rule, and when implemented in
concert, are expected to result in significant reductions of pollutants
discharging into receiving streams.
We will not dispute that since the passage of the CWA 30 years ago,
the quality of our Nation's waters has markedly improved. The City sees
daily visual evidence of these remarkable achievements here locally
along Hamilton's major watercourse--the Great Miami River--with the
continuing presence of large numbers of wildlife, including herons,
Canada geese, wood ducks, mallards, swans, beaver, and sea gulls. To
maintain and/or improve upon this status however, will come at a
certain cost.
As the City has prepared its Phase II Plan, which we fully intend
to submit to the Ohio EPA on or before March 10, 2003, it has become
noticeably apparent to our City Council that the costs associated with
the implementation of this Plan will have to be assessed to our local
government, and alternatively and more likely, to our citizens and
businesses. This occurring at a time when our economy is stagnant and
our nation is facing huge deficits that are being forecast by both
local and state financial officers, not to mention federal fiscal
authorities. Hamilton is no exception; local budget deficits are
already predicated for the next fiscal year, and Ohio's governor has
declared the state's budget to be in such crisis that no additional
help for local communities will be forthcoming from that sector. Alas,
Hamilton, along with 279 other jurisdictions, are being asked to comply
with an unfunded government mandate at a time when we can ill afford to
be capriciously spending.
To pay for this Phase II program, the City is considering forming
and implementing a Storm Water Utility (Utility). The Utility charges
will be related to the impervious area factor (i.e., potential runoff
following a storm event from a given parcel of land). In this manner,
each parcel of land within Hamilton would be assigned a fee based on
its runoff characteristics. The state supreme courts have ruled that
all parcels must pay the storm water charge if the Utility is to pass
the rationale nexus test. No parcel can be exempted due to its tax
status or land use--only adjustments to the charge can be applied. This
means that to implement a Utility that is fair, equitable and thus
legally defensible in a court of law, all residents, businesses,
schools, churches, government and institutional complexes, etc. will be
subject to these charges. Residents would pay a flat monthly charge,
but non-residential properties would pay a higher amount equivalent to
the expanse of impervious surface at their respective locations--some
as high as hundreds or thousands of dollars per month.
Now is not the time to impose a new monthly Utility charge upon our
community in furtherance of Phase II compliance. When the economy
improves, our businesses and citizens will be better able to absorb
this type of storm water management fee. In our flagging economy
however, businesses cannot afford it; nor can our citizens who are
already being called upon to absorb more and more of the financial
burden of local and state government.
Please let me emphasize that the time for implementation of this
Phase II program is not now. Consequently, the City respectfully asks
that you, as our elected federal representatives to Washington,
commence whatever action can be promptly placed before Congress to
legislatively enact a five-year moratorium to delay the requirement
that communities such as ours step forward to implement the Phase II
Rule. This will delay the necessity that communities, such as ours,
have to impose the financial burden of Phase II compliance on your and
our constituents at this time. We ask this not because Hamilton is
seeking to avoid our responsibilities as being good stewards of our
receiving waters, but as concerned elected officials looking to strike
a balance between the best interests of our economy and the environment
during tough economic times.
Thank you for looking into this on our behalf. Our City Council,
our administrative staff, our consulting engineer and I are all
available to talk with you about this should you have any questions.
Sincerely,
Michael J. Samoviski,
City Manager,
City of Hamilton, OH.
______
Office of the City Manager,
Hamilton, OH., Feburary 27, 2003.
Hon. John Boehner,
Hamilton, OH.
Re: Proposed Legislative Moratorium on the Implementation/Enforcement
of the NPDES Storm Water Phase II Final Rule
Dear Representative Boehner: The City Council of the City of
Hamilton, Ohio (City) is concerned about the implementation and
enforcement of the National Pollutant Discharge Elimination System
(NPDES) Storm Water Phase II Final Rule (Phase II Rule) in this
challenging local, state and federal economic climate. As part of the
Clean Water Act (CWA) legislation, the USEPA extended the NPDES
permitting program to storm water discharges in 1990. The 1990
regulations established requirements for permitting discharges from
industries, construction sites large than 5 acres, and drainage systems
in large and medium municipalities serving a population greater than
100,000 (Phase I program). On December 8, 1999, USEPA promulgated the
expansion of the existing NPDES Storm Water Program to include
discharges from small municipalities with a population less than
100,000. This program, termed the Phase II program, requires covered
political jurisdictions to obtain an NPDES storm water discharge permit
by March 10, 2003. In Ohio, about 280 cities, counties, villages and
townships located in urbanized areas that own and operate municipal
separate storm sewer systems (MS4s) are required to obtain this type of
permit, which includes the City of Hamilton. To comply with this
unfunded government mandate, the City has retained the environmental
engineering consulting firm of CDM to assist the City in preparing a
Storm Water Management Plan (Plan) that outlines best management
practices (BMPs) that the City must implement over the next five years.
These BMPs address the six minimum control measures required within the
Phase II Rule, and when implemented in concert, are expected to result
in significant reductions of pollutants discharging into receiving
streams.
We will not dispute that since the passage of the CWA 30 years ago,
the quality of our Nation's waters has markedly improved. The City sees
daily visual evidence of these remarkable achievements here locally
along Hamilton's major watercourse--the Great Miami River--with the
continuing presence of large numbers of wildlife, including herons,
Canada geese, wood ducks, mallards, swans, beaver, and sea gulls. To
maintain and/or improve upon this status however, will come at a
certain cost.
As the City has prepared its Phase II Plan, which we fully intend
to submit to the Ohio EPA on or before March 10, 2003, it has become
noticeably apparent to our City Council that the costs associated with
the implementation of this Plan will have to be assessed to our local
government, and alternatively and more likely, to our citizens and
businesses. This occurring at a time when our economy is stagnant and
our nation is facing huge deficits that are being forecast by both
local and state financial officers, not to mention federal fiscal
authorities. Hamilton is no exception; local budget deficits are
already predicated for the next fiscal year, and Ohio's governor has
declared the state's budget to be in such crisis that no additional
help for local communities will be forthcoming from that sector. Alas,
Hamilton, along with 279 other jurisdictions, are being asked to comply
with an unfunded government mandate at a time when we can ill afford to
be capriciously spending.
To pay for this Phase II program, the City is considering forming
and implementing a Storm Water Utility (Utility). The Utility charges
will be related to the impervious area factor (i.e., potential runoff
following a storm event from a given parcel of land). In this manner,
each parcel of land within Hamilton would be assigned a fee based on
its runoff characteristics. The state supreme courts have ruled that
all parcels must pay the storm water charge if the Utility is to pass
the rationale nexus test. No parcel can be exempted due to its tax
status or land use--only adjustments to the charge can be applied. This
means that to implement a Utility that is fair, equitable and thus
legally defensible in a court of law, all residents, businesses,
schools, churches, government and institutional complexes, etc. will be
subject to these charges. Residents would pay a flat monthly charge,
but non-residential properties would pay a higher amount equivalent to
the expanse of impervious surface at their respective locations--some
as high as hundreds or thousands of dollars per month.
Now is not the time to impose a new monthly Utility charge upon our
community in furtherance of Phase II compliance. When the economy
improves, our businesses and citizens will be better able to absorb
this type of storm water management fee. In our flagging economy
however, businesses cannot afford it; nor can our citizens who are
already being called upon to absorb more and more of the financial
burden of local and state government.
Please let me emphasize that the time for implementation of this
Phase II program is not now. Consequently, the City respectfully asks
that you, as our elected federal representatives to Washington,
commence whatever action can be promptly placed before Congress to
legislatively enact a five-year moratorium to delay the requirement
that communities such as ours step forward to implement the Phase II
Rule. This will delay the necessity that communities, such as ours,
have to impose the financial burden of Phase II compliance on your and
our constituents at this time. We ask this not because Hamilton is
seeking to avoid our responsibilities as being good stewards of our
receiving waters, but as concerned elected officials looking to strike
a balance between the best interests of our economy and the environment
during tough economic times.
Thank you for looking into this on our behalf. Our City Council,
our administrative staff, our consulting engineer and I are all
available to talk with you about this should you have any questions.
Sincerely,
Michael J. Samoviski,
City Manager,
City of Hamilton, OH.
______
U.S. Senate,
Washington, DC, July 15, 2003.
Marianne Lamont Horinko, Acting Administrator,
U.S. Environmental Protection Agency,
Washington, DC.
Dear Acting Administrator Horinko: As the EPA is moving forward
with the implementation of National Pollution Discharge Elimination
System (NPDES) Phase II permits, I would like to share with you the
concerns of many Ohio cities and communities who are uncertain where
they will find funding to cover the costs associated with this
implementation.
As you are aware, NPDES Storm Water Run-off Permits were designed
to help reduce water and soil pollution caused by contaminated run off
from streets, roofs, buildings, residences, etc. Over the next five
years, the EPA will implement Phase II, which will add smaller metro
centers in urbanized areas. These communities have been told to expect
little help from the EPA to aid in their compliance efforts. The State
of Ohio originally planned to offer grants to help meet the
requirements, however due to budgetary constraints, the State will be
unable to assist the cities. Communities say that in order to meet the
costs of implementing Phase II, they will have to place additional tax
burdens on businesses. Given the state of today's national and state
economies, along with the rising costs of doing business, I am
concerned over the economic impact this will have in Ohio.
I would like to hear your suggestions on how to ease the financial
burden on communities as they begin implementing this mandate. I look
forward to hearing your response. If you have any questions, please
contact me or my staff assistant Elizabeth Belleville at 202-224-2315.
Very respectfully yours,
Mike DeWine,
U.S. Senator.
______
Responses of Michael J. Samoviski to Additional Questions from
Senator Inhofe
Question 1. Can you explain what role ``blending'' plays in the
City's ability to manage peak storm events and how EPA's recent
internal debate on the practice is affecting the City?
Response. In 1998, the Ohio EPA approved a Permit to Install for
the expansion of city of Hamilton's (City) Wastewater Treatment Plant
(WWTP). These plans for expansion approved and permitted the use of an
alternative wet-weather routing scenario, which includes diverting wet-
weather flows into: (1) the WWTP's pre-existing primary treatment
system and aeration tanks where it is either stored and drained back
into the primary treatment system where it receives full treatment, or
(2) blended back into the treatment scheme upstream of the chlorination
tank where it bypasses secondary treatment. The second option is used
only if the storage capacity of the pre-existing primary treatment
system and aeration tanks is reached. By allowing the second option to
occur, the City is able to eliminate overly stressing the treatment
processes at the WWTP and eliminate surcharging of the interceptor
mains conveying flow into the WWTP, which also minimizes the direct
discharge of sanitary sewage via sanitary sewer overflows (SSOs) into
the receiving stream. The ``blending'' concept allows the City to
maximize primary treatment during wet-weather flows in lieu of no
treatment should SSOs occur. Pursuant to the Ohio EPA Permit To
Install, the City first put this system in use in the Fall of 2000, and
the cost of this expansion has totaled $14.9 Million. The use of this
alternative wet-weather flow routing system and occasional blending has
reduced the total number of SSOs experienced by the City as shown on
the following chart.
[GRAPHIC] [TIFF OMITTED] T2384.009
Response. Hamilton has begun discussions with Ohio EPA concerning
the inclusion of blending in the City's discharge permit. The City is
also currently conducting water quality sampling to demonstrate the
percent removal of solids achieved through our alternative wet-weather
routing scenario. The City's WWTP effluent consistently meets permitted
discharge limits while blending. The additional storage and primary
treatment capacity that this alternative wet-weather routing scenario
provides the City results in better stream water quality by reducing
the volume and occurrence of SSOs while maximizing the conveyance of
wet-weather inflow and infiltration through the WWTP.
Question 2. In your testimony, you explain that you will now have
to levy a fee to all businesses and residents in your city. Smart Paper
will have to pay $5,000 per month. Has the company, one of the few
larger employers remaining in Hamilton, expressed concerns about the
fee with the city and whether it will impact their ability to continue
doing business in Hamilton? Are you concerned about how it will impact
your ability to attract other employers?
Response. Smart Papers is very concerned about the monthly fees
associated with the proposed Storm Water Management Program. Smart
Papers is a production paper mill owned and operated by former Champion
International Management and a group of venture capital investors, and
as additional fees adversely affect profits, the investors could have
no alternative but to close the mill.
Hamilton is considering and researching a number of fair, equitable
and lawful options to assist companies, such as Smart Paper, to apply
for adjustments and/or credits to their monthly storm water bill. For
example, Smart Paper discharges some storm water directly into the
Great Miami River through infrastructure owned, operated and maintained
by the company and not the city of Hamilton. Based on the amount of
upstream drainage area that conveys storm water through this system,
the City can potentially offer Smart Paper a storm water credit because
the City does not have to incur the expense of performing capital
improvements and operation and maintenance activities on this system;
however, the company has indicated that any credit less than 100
percent would offer insufficient relief.
The City is very concerned about how these fees may adversely
affect new businesses locating into Hamilton. In the competitive
atmosphere of the business world every applicable cost, whether it is
construction or utility rates, plays a factor as to where the business
ultimately decides to locate. Often times, our experience shows that
businesses decide upon their final destinations based on very subtle
differences in cost.
______
Responses of Michael J. Samoviski to Additional Questions from
Senator Voinovich
Question 1. What were the specific challenges the city of Hamilton
faced when preparing the Storm Water Management Plan?
Response. The City hired an environmental engineering consulting
firm to conduct Phase 1 or Gap Analysis to evaluate Hamilton's existing
storm water management programs and identify the deficiencies or gaps
that the City would need to address in order to develop an acceptable
Storm Water Management Plan. The City then authorized the consultant to
conduct Phase 2 of the Program Development, which included the
development and preparation of a Storm Water Management Plan and the
identification and selection of a funding option(s) to successfully
implement the Plan. The funds needed to pay for our consultant came
from the General Fund (largely employment taxes), which has suffered
greatly from the closing of many of the City's larger commercial and
industrial customers. Development of this Plan meant reducing the
limited amount of money available for as needed repair and replacement
of the storm water collection system. The total cost to the City for
the Gap Analysis and Program Development was $310,000.
The development of the Storm Water Management Plan and funding
option required active public involvement. Toward this goal, the City
formed a Storm Water Advisory Board (SWAB), which included
representatives from industry, small business, schools, churches,
airport, and private citizens. The City selected a diverse group from a
broad cross-section of the community, in order to obtain feedback that
would reflect the City as a whole. Hamilton's Storm Water Advisory
Board consisted of 5 citizens, 6 industrial representatives, and 4
community groups (hospital, school, metropolitan housing and
homebuilders association). A total of 8 meetings were held over an 8
month period of time. Maintaining interest in the process over this
timeframe and keeping adequate attendance at meetings was a challenge
and a huge educational process.
Another challenge was determining what level of service and which
Best Management Practices (BMPs) would satisfy the EPA Phase II
National Pollutant Discharge Elimination System (NPDES) mandate. Many
questions needed to be answered, and several examples include:
Would cleaning catch basins every 5 years result in
improved water quality or should they be cleaned every 3 years?
What BMPs should be included in the Storm Water Management
Plan?
Would the citizens of Hamilton be receptive to these
BMP's?
Question 2. Briefly describe the costs associated with the
implementation of the City's Storm Water Management Plan.
Response. The City has projected an average annual cost for the
first 3 years of the Storm Water Management Program to be $2,270,000
with the last 2 years of the program being an average annual cost of
$2,470,000. These costs were developed based on the SWAB's Level of
Service recommended to Hamilton's Council and are allocated as shown
below:
Regulatory Compliance ($100,000)--includes public education,
employee training; monitoring and detection of illicit discharges; and
program management staff salaries.
Leaf Collection/Street Sweeping ($600,000)
Operation and Maintenance of Collection System ($850,000)--includes
the hiring of 4 additional maintenance workers, 1 additional supervisor
and establishment of a routine proactive inspection and maintenance
program.
Planning and Management ($170,000)--includes funds to complete and
update current GIS mapping of stormwater system and outfalls as
required by Phase II and engineering, GIS staff salaries.
Engineering Studies ($300,000 for first 3 years)--funds to
implement system-wide planning of capital improvement projects to
ensure economy of scale and best pollutant reduction.
As Needed Repair and Replacement ($250,000)
Engineering Projects ($500,000 for the last 2 years of the 5-year
Plan)--system-wide improvements needed to improve water quality--such
as stream bank stabilization.
Question 3. Your testimony explains that the city of Hamilton's
projected annual expense attributable to the Storm Water Phase II
program is an additional $1.6 Million over the current $800,000 the
City currently spends. What storm water activities does the City
currently perform?
Response. The City currently has annual expenditures of
approximately $600,000 on Leaf Collection/Street Sweeping and $200,000
on Improvement Projects for as needed system repairs and replacement of
existing infrastructure. The City currently can only afford to employ 4
full time sewer maintenance workers who are responsible for maintaining
217.7 miles of sanitary sewer, 5600 sanitary manholes, 180.5 miles of
storm sewer and approximately 6500 storm water catch basins and inlets.
Question 4. In your testimony, you recommend that Congress should
enact a 5-year moratorium on the time or implementation of the Phase II
Storm Water program. Other than a moratorium, what other
recommendations would you make to Congress to help communities like the
city of Hamilton comply with the Phase II program?
Response. Congress could provide startup grants and low interest
loans to every city showing a need for assistance in the initial
implementation costs--such as planning, mapping and purchasing
additional equipment.
Change the implementation period from 5 years to 10 years. USEPA is
requiring cities to improve water quality and change the ingrained
habits of our citizens in an impossibly short timeframe.
Question 5. Does the State of Ohio have funding available in the
form of grants or loans to assist Ohio Communities conduct storm water
activities? Has the city of Hamilton applied for funding from the State
of Ohio?
Response. The State of Ohio has extremely limited funding available
for storm water activities. Furthermore, these sources are not
consistent with funding a comprehensive storm water management program
nor are they dedicated to storm water only projects. When applying for
these funds, the City's storm water projects must compete with sanitary
sewer projects, source water protection projects, street maintenance
projects, etc.
The City is aware of three grant and loan programs from the State
of Ohio. None of these opportunities are specific for storm water
management and do not provide the significant source of funding the
City would need to reduce the burden on the citizens and businesses in
Hamilton.
Question 6. Other than resources, what other specific challenges
does the city of Hamilton face affecting the City's ability to
implement the Phase II Storm Water program requirements?
Response. The City is required to locate and identify every storm
water system outfall. It will also be necessary to map every pipe,
catch basin, and curb inlet in our system in order to track illicit
discharges. The City's stormwater infrastructure is over 100 years old,
and complete maps do not exist for some of the older sections. Mapping
these sections will require utilizing technicians currently working on
other equally important and time sensitive projects to field check and/
or verify locations, depth and size of storm sewer lines and
appurtenances.
The City is concerned with the state of apathy the population in
general has toward storm water management. To be successful, the Storm
Water Management Plan is relying on a vast public education effort and
participation by the citizens to control storm water pollution.
Question 7. Briefly describe any wastewater or drinking water
infrastructure issues affecting the city of Hamilton resulting from a
Federal mandate.
Response. Sanitary Sewer Overflow--0 discharge prohibition.--The
City has spent $ 25.85 Million since 1994. Preproposal of SSO
regulations published in 1999 indicates USEPA is considering defining
basement back ups as sanitary sewer overflows. If enacted, this
determination would create a tremendous administrative as well as
financial burden on the City since based on the proposal, Hamilton
would be required to determine that the back up was not related to any
collection system flow restrictions.
Proposed TMDL.--The City is being required to collect additional
data (re: phosphorous, Nitrate plus Nitrite, Total Dissolved Residue)
unrelated to our wastewater operation. OEPA is requiring Hamilton to
collect this data on a monthly basis for assistance in their efforts to
develop a TMDL for the lower Great Miami River in 2013. This OEPA
requirement to collect and analyze these samples has created an
additional burden on our already limited lab staff.
Blending.--The City is very concerned about the proposed guidance
on Blending being negotiated with the various USEPA regions. As per the
Ohio EPA's Permit To Install, Hamilton invested $14.9 Million in 1999
on an approved alternative wet-weather flow routing system that was
designed and constructed to blend effluent flows during excessive wet
weather flow situations.
Consumer Confidence Reports
Water Plant Security Initiative which was totally funded by grants
from the US EPA
Wellhead (Source Water) Protection--City of Hamilton spends
approximately $150,000 annually
__________
Statement of Steve Kouplen, President, Oklahoma Farm Bureau, American
Farm Bureau Federation
Mr. Chairman and members of the subcommittee, my name is Steve
Kouplen. I am president of the Oklahoma Farm Bureau Federation. I am
pleased to be here today to offer testimony on several water issues of
importance to agriculture across the country.
On July 13, 2000, EPA published final regulatory requirements for
establishing Total Maximum Daily Loads (TMDLs) under the Clean Water
Act (CWA). Farm Bureau strongly opposed those regulations and promptly
petitioned the court and asserted that many of EPA's revisions were
unlawful under the Administrative Procedure Act or exceeded the
agency's authority under the CWA. One of the most disturbing aspects of
the July 2000 rule was the agency's conversion of the TMDL program into
an overarching, nationwide enforcement mechanism for all sources of
pollution--point and nonpoint sources. We believe that the TMDL program
should respect the practical and legal differences between point and
nonpoint sources. As the CWA has recognized for over 30 years, the
availability of end-of-pipe technologies for point sources has made a
precise control strategy feasible. Nonpoint sources, on the other hand,
cannot rely on any comparable technologies and must therefore use less
precise, more subjective ``best management practices'' to achieve load
reductions. Given the inherently less predictable results of the
measures available to nonpoint sources, a command-and-control strategy
for nonpoint sources has never been feasible. Until the July 2000
rulemaking, the agency had never formally embraced this approach to
nonpoint sources.
We opposed the 2000 regulations in large part because they required
an implementation plan as part of a TMDL. Section 303(d) provides no
authority for the preparation or establishment of an implementation
plan. It merely envisioned the translation of waste load allocations
into water quality-based effluent limitations for point sources. Since
this was the intended purpose of Section 303(d), there was no need for
a formal implementation mechanism.
But even assuming Section 303(d) required the preparation of
implementation plans, there is no authority for the July 2000 rule to
require the plans to include ``reasonable assurances'' that load
allocations be achieved. Indeed, the words ``reasonable assurances'' do
not exist in Section 303(d).
Further, Congress went to great lengths to ensure that EPA did not
prescribe in local land use decisions by delegating nonpoint source
control to the states in Sections 208 and 319. The 2000 rules undercut
this approach, allowing EPA to prepare implementation plans that
dictate how and when nonpoint sources can use their land.
Implementation of a nonpoint source TMDL is clearly an inappropriate
area for Federal management. States should have the freedom to
implement their TMDL programs at their discretion.
Farm Bureau believes a TMDL is information about the assimilative
capacity of an impaired water body. Once EPA approves a TMDL that
information should be used by the state in their Continuing Planning
Process (CPP), established under Section 303(e), for state
implementation of Waste Load Allocations (WLAs) and Load Allocations
(LAs). The CPP allows for an integrated watershed approach that brings
together and integrates the distinctive approaches contained within the
CWA for point and nonpoint sources. Specifically, point sources would
be subject to water quality-based effluent limitations that could be
incorporated into National Pollutant Discharge Elimination System
(NPDES) permits, over which EPA would exercise discretionary review and
veto authority. Nonpoint sources would be subject to state-developed
best management practices, over which EPA would exercise the power of
review and grant funds. The integrated watershed approach, conducted
under the umbrella of the CPP, allows states and local watersheds to--
--
1. Monitor and assess their needs;
2. Plan their economic development, implement water quality
management measures and even institute trading policies;
3. Achieve the goals and objectives of the watershed in a manner
consistent with the goals of the CWA; and
4. Diffuse and minimize the potential for adverse litigation that
will frustrate a cooperative and locally led watershed approach.
The CWA requires that states identify waters impaired by pollutants
and establish Total Maximum Daily Loads (TMDLs) at levels necessary to
implement applicable water quality standards. Pursuant to CWA
Sec. 303(d)(2), EPA must approve or disapprove all such TMDLs and must
directly establish TMDLs in the event of disapproval. EPA has
consistently recognized that ``the decision on how to identify the most
cost-effective or equitable means of allocating loadings is best
handled by the state.'' E.g., 65 Fed. Reg. 43,586, 43,620 (July 13,
2000) (preamble discussion of July 2000 final TMDL rule, also
commenting that states can use ``any kind of system or policy for
allocating pollutant loadings among sources, as long as the resulting
allocations will lead to attainment and maintenance of water quality
standards''). Such subjective judgments concerning equity and cost-
effectiveness--like other aspects of water quality planning--are
specifically committed to the states' discretion under the CWA, subject
to EPA guidance and support. Finally it is our understanding that the
draft watershed rule states that ``EPA is proposing that load
allocations for these sources may be expressed as allocations to
specific sources or as gross allocations without connection to
categories or subcategories or sources.'' We are concerned about the
use of individual load allocations that would be subject to EPA
approval. A gross allocation would provide the states and the
stakeholders the flexibility they need to develop reasonable limits for
both point and nonpoint sources.
In the Pronsolino v. Nastri 291 F. 3d 1123 (9th Cir. 2003) decision
the U.S. Court of Appeals for the Ninth Circuit said, ``[t]he upshot of
this intricate scheme is that the CWA leaves to the states the
responsibility of developing plans to achieve water quality standards
if the statutorily mandated point source controls will not alone
suffice, while providing Federal funding to aid in the implementation
of the state plans.'' Consistent with the primary responsibilities and
rights of the states, EPA approves state nonpoint source management
plans as a condition of establishing eligibility for CWA funding. See
CWA Sec. 319. Even in the event of ``disapproval,'' EPA lacks CWA
authority to dictate state decisionmaking by directly establishing such
plans. In contrast, TMDLs--like water quality standards themselves--may
be directly established by EPA if states fail to do so in accordance
with CWA requirements. See CWA Sec. Sec. 303(c)(3)-(4), 303 (d)(2).
This ensures that TMDLs will be available as ``informational tools that
allow the states to proceed from the identification of waters requiring
additional planning to the required plans.''
This fundamental balance of state-Federal control requires that EPA
ensure that the ultimate goal (the ``total'' load) is properly defined,
but that states alone determine how the goal will be achieved. Thus,
states--not EPA--must determine how loading capacity will be
``allocated'' among the various industrial, municipal, commercial,
residential, agricultural, silvicultural, and other pollutant sources.
Such highly subjective decisions necessarily require balancing the
needs of competing land uses based on considerations of equity,
economy, and public welfare. As such, allocation decisions are the
essence of implementation planning that has been strictly reserved for
the states.
Implementation programs will be effective only if states revise
allocations based on experience--i.e., demonstrated successes or
failures of existing programs and control measures. TMDL implementation
for nonpoint sources in particular must be a process where state
strategies evolve to expand programs that work and change or abandon
programs that fail. TMDLs will unnecessarily constrain, rather than
foster, state efforts to achieve water quality standards if allocations
to particular sources or source categories are ``locked in'' absent
submission and EPA approval of a revised TMDL.
Stakeholder participation and innovation--including nutrient
trading and other market-based approaches--will be stifled if pollutant
allocations are fixed. Where achievement of the ``total'' pollutant
load is the clear objective, states and stakeholders have the incentive
and the flexibility to achieve that goal in the most efficient and
cost-effective manner. Yet much of the incentive for such collaborative
efforts will disappear if the results are subject to disapproval at the
Federal level.
Trading Policy.--Trading policy empowers states and tribes to
implement market-based programs to achieve and go beyond the goals of
the CWA. Both point and nonpoint sources need new tools that move
beyond the existing regulatory framework. Our Nation must participate
in a highly competitive world market and our policy should reflect the
demands and efficiencies of market-based program. Trading will allow
the water program to go beyond the technological and economic
limitations of our existing regulatory framework to find solutions to
complex water quality problems. Trading is an innovative strategy that
can align with other core conservation and water programs.
Oil Spill Final Rule Impact on Agriculture.--EPA's July 17, 2002,
Oil Spill Prevention, Control and Countermeasures ( SPCC) Rule will
negatively impact farmers and ranchers, and their cooperatives across
the country. While the subsequent January 9, 2003, rule providing an
18-month delay in its implementation allows more time to prepare; it
does not reduce its overall cost or impact. The oil spill rule and
program will greatly affect agriculture.
The rule fails to take into account the nature of production
agriculture, and appears to be based on limited data or information
that is out of date. It also does not take into account the cumulative
effect of EPA's rules and regulations on agriculture.
Farmers and ranchers need to store fuel on their farms in order to
control costs and to fulfill time sensitive production operations. Many
farms, especially in the western states, require more than the
regulatory threshold of 1,320 gallons of fuel storage for their
operations. On many larger farms the fuel storage is not centrally
located. Above ground tanks are placed where needed for efficient
equipment operation and these may be miles apart.
In a letter to EPA on June 2, 2003, several agricultural
organizations and cooperatives stressed that the SPCC rule for
agriculture:
(1) underestimated the economic impact by:
a. using 1991 cost data for a 2002 rule
b. using examples of costs based on farms in the upper 9
percent income bracket
c. basing impact on inadequate survey data
d. drawing conclusions about tankage based on income and not
tank survey data
e. exempting 27,700 farms out of 2 million
(2) showed a lack of understanding of ag operations by:
a. mentioning farms only six times in the 112-page rule and
only in the preamble
b. not understanding farm layouts and oil storage operations
(3) inappropriately applied bulk terminal rules to private family
property and/or small businesses.
Given the dispersed nature of farm fuel storage and the costs
associated with following the rule requirements for containment,
integrity testing, security and plan development, we believe that the
threshold should not apply to family farms nor to those storages where
a spill would have no impact on water quality. We believe that based on
the 1971 and 1993 Memorandums of Understanding between DOT and EPA,
that SPCC rules should have been intended for commercial wholesale and
retail sales and not the private party small end user. In addition, the
aggregation of many smaller tanks, often in dispersed locations across
farms and farmland, must also be addressed so as not to place farms in
a costly regulatory program where there is no threat to water quality.
Farm Bureau has been a strong supporter of the voluntary,
incentive-based approach to working with farmers and ranchers to
improve and protect our environment. EPA should first look to the USDA
for appropriate conservation practices and technical support to address
this issue with agriculture. We support using our U.S. Department of
Agriculture conservation programs, such as the Environmental Quality
Incentives Program and the Conservation Security Program to help
agriculture address the above-ground fuel tank issue.
The concerns about the impacts of the oil spill rule warrant a
complete review of the final rule as it impacts agriculture. EPA should
address agricultural oil storage differences in a manner that allows
the farm and ranch community to protect water quality in an
economically and environmentally sound and effective manner.
Thank you for accepting our testimony.
__________
Statement of Michael R. Lozeau, Esq., Earthjustice
INTRODUCTION
Good morning Chairman Crapo, Ranking Member Graham and members of
the subcommittee. My name is Michael Lozeau. I am an attorney with
Earthjustice, a non profit environmental law firm with offices located
throughout the country. I am employed at the Earthjustice Environmental
Law Clinic at Stanford, a joint project between Earthjustice and
Stanford Law School that provides students with a real world experience
in environmental litigation and advocacy before administrative agencies
on behalf of non-profit environmental advocacy organizations. I also am
a Lecturer at Stanford Law School. It is an honor to have the
opportunity to share with you today some of my and Earthjustice's
concerns regarding several recent actions by the Environmental
Protection Agency that have or will undermine the implementation of the
Clean Water Act and allow substantially more pollution to enter our
Nation's waters and prevent the clean-up of the vast number of waters,
estimated at about 45 percent of all of the country's rivers, lakes,
streams, and coastal waters, that are too polluted for fishing,
swimming and the myriad other uses made of those waters by the American
public.
The Clean Water Act was enacted in 1972 because the water quality
laws that came before it did not work. Those laws were limited in
scope, often based on voluntary programs, and sought to enforce the few
available ambient water quality standards directly without pollution
control permits or clear requirements applicable to individual sources
of pollution. Those laws did not work. As recognized by many Members of
Congress thirty years ago, our Nation's waters were treated as little
more than open sewers for industrial and municipal wastes.
In 1972, the Congress solved this problem by enacting the Clean
Water Act--creating a comprehensive legislative program that, as
written, addresses almost every water pollution problem facing the
country. In particular, the Act's National Pollutant Discharge
Elimination System (``NPDES'') permitting program, where applied, has
been heralded as a great success in reducing pollution from sewage
plants and many industrial dischargers. In the last decade, this Clean
Water Act program has begun to have similar positive impacts on
reducing storm water pollution from municipal storm systems, many
industrial storm water pollution sources and construction sites.
Juxtaposed with the success of the Act's permitting program is the
notable absence of progress for pollution sources that have not been
brought into the NPDES program. Many of these include point source
discharges that EPA has simply failed to address or affirmatively
attempted to exempt from the NPDES program. Examples include point
source discharges associated with the logging industry. Likewise,
discharges exempted from the NPDES program created by Congress also
have grown worse over the years, despite Congress' provision of funds
and voluntary programs. The widespread toxicity of the rivers flowing
into San Francisco Bay in California's Central Valley by pesticides,
nutrients and other farming-related pollution is a depressing testament
to the ineffectiveness of Clean Water Act programs, outside of the
standard setting and NPDES program, to clean up pollution.
One very important reason no discernable progress has been made to
reduce pollution outside of the NPDES program is EPA's historic failure
to implement a common sense and core requirement established by
Congress in 1972--the Total Maximum Daily Load (``TMDL'') program. Over
the last 5 years, both EPA and the States have gone through, and are
continuing to go through, a steep learning curve, starting a program
essentially from scratch after 25 years of neglect. During those 25
years, rather than heading off well-documented water quality problems,
numerous pollution problems in our rivers and lakes that were left
unregulated by the permitting program have in many cases steadily
increased or become more intractable. The current efforts need to be
given time to determine their effectiveness at cleaning up pollution.
Implementation of the current TMDL rules should be given a chance to
work before they're abruptly changed.
Instead of aggressively implementing the TMDL program, closing
existing loopholes, and faithfully implementing and enforcing the
statute, this administration has instead taken a series of action to
weaken the tools available to protect our Nation's waters. While I will
not cover most of these today, the administration's actions in many
ways are attacking Clean Water Act safeguards that most people would
assume are firmly protected by law. For example, the administration
repealed a 25-year old regulation to authorize waste dumps in waters of
the United States; eliminated Clean Water Act protections for as many
as 20 million acres of wetlands; allowed factory farms to write their
own pollution control standards; and withdrew a regulatory proposal to
control sewer overflows and notify the public of overflows that could
make them sick.
Pending policy decisions are potentially even more damaging,
including the decision on whether to eliminate Federal jurisdiction
over more than 60 percent of the stream miles and millions more acres
of wetlands and ponds that are currently protected by the Clean Water
Act. These rollbacks often involve this administration doling out
favors to various industries to exempt them from other Clean Water Act
requirements instead of protecting the public interest. This includes
the oil industry, which has been given exceptions from storm water
regulations that apply to almost every other industrial activity in the
country and with which EPA is now engaged in private back room
discussions regarding the Act's application to preventing oil spills
into tributaries and other waters.
Earthjustice encourages the Committee to dissuade EPA from
reversing thirty years of efforts undertaken by this country to
implement the Clean Water Act and restore and preserve the integrity of
the Nation's waters. The American public feels very strongly about the
health of their rivers, streams, lakes and shorelines. Neither a weak
TMDL program nor questionable legal positions that simply invite
litigation will cleanup or protect the Nation's waters; nor will these
policies provide any certainty to businesses that must comply with
clean water laws. If the agency's administrators continue down these
and other paths aimed at weakening the Clean Water Act and its
implementation, they ultimately will not be able to convince the
American public that EPA is serving the public's rather than corporate
interests.
WERE EPA TO PROMULGATE ITS DRAFT TMDL RULE THE RESULTS WOULD BE
DEVASTATING TO CLEAN-UP EFFORTS AROUND THE COUNTRY AND UNDERMINE
CONGRESS' CLEAN WATER ACT MANDATES
Of particular concern is the Bush Administration's draft plan to
drastically amend the regulations that currently guide the development
of water quality protection plans known as Total Maximum Daily Loads
so-called TMDLs. For the last 18 months, the EPA has been working on a
proposal to rewrite the rules that implement the TMDL program--rules
that were put in place by the Reagan and previous Bush Administrations.
A draft of their rewrite of the rules was made available to the public
earlier this year. The draft is currently being considered by the
Office of Management and Budget under ``informal'' review.
This proposal, if promulgated by the administration, would
significantly weaken--if not completely derail--one of the Clean Water
Act's most important programs.
When enacted in 1972, the Clean Water Act required municipal and
industrial dischargers to comply with two levels of pollution control
treatment technology back in the late 1970's and 1980's. Industry was
required to comply with ``best practicable treatment technology'' (BPT)
by July 1, 1977. Cities were required to apply secondary treatment to
their sewage by that same date. Congress recognized from the start that
in many cases, those initial technology requirements were not going to
be sufficient to implement water quality standards in many waterbodies
throughout the country. Water quality standards are set by the States
and specify how clean a waterbody needs to be in order to be usable,
for example, for swimming, aquatic habitat, or as a drinking water
source. So Congress created the TMDL requirement to supplement the BPT
and secondary requirements. In short, this section of the law--Section
303(d)--requires States to identify all waters where BPT and/or
secondary treatment--the lowest pollution control technology
requirements--are not by themselves sufficient to implement water
quality standards. For each of those identified waters, the States, and
if they fail to do so, EPA, must prepare a TMDL.
A TMDL is just what it says, a total, maximum, daily load of a
given pollutant that assures implementation of all water quality
standards applicable to that pollutant. The current regulations define
a TMDL as ``the sum of the individual WLAs [waste load allocations] for
point sources and LAs [load allocations] for nonpoint sources and
natural background.'' 40 C.F.R. Sec. 130.2(i). Together, the waste load
and load allocations add up to a water body's ``loading capacity''
which is defined as ``[t]he greatest amount of loading that a water can
receive without violating water quality standards.'' 40 C.F.R.
Sec. 130.2(e). That safe level of pollutant loading, assuming there is
any safe level, is then allocated to each of the sources discharging
that pollutant and, using the NPDES permitting program and other
pollution control tools established by the Act or State laws, those
allocations are implemented in order to assure attainment of the TMDL.
In 1972, Congress envisioned TMDLs as an integral component of the
Act's comprehensive regulatory scheme, applied early on in the Act's
lifespan to any waters that were not fully protected or would not be
fully protected by the application of BPT and/or secondary treatment.
Wherever BPT and/or secondary treatment, by themselves, could not
assure the implementation of all water quality standards, a waterbody
had to be listed and a TMDL prepared and implemented.
That is still the law today. Historically, however, instead of
implementing Congress' clear and logical vision for ensuring all waters
were safe for fishing, swimming and other uses, EPA has served as a
barrier to implementing the TMDL program. EPA wrote and finalized
regulations for the program in 1985 and amended them in 1992, but for
over two decades EPA and the States literally did nothing to make the
program work as a tool to reduce water pollution, instead, letting it
languish on the books. During that time, waters that would have been
protected or cleaned up at much less expense by an early application of
the TMDL program were instead allowed to get dirtier and dirtier.
The 1992 EPA regulations were an attempt to get the TMDL program on
track. Although flawed, and only after encouragement by numerous
citizen enforcement efforts and provision of additional funding from
Congress and individual States, EPA has finally begun to make progress
implementing those 1992 regulations. The number of TMDLs approved or
established annually has steadily increased in the last 4 years,
jumping from 500 in 1999 to nearly 3,000 in 2002. In 2001 and 2002
combined, more than 5,000 TMDLs were approved or established under the
current TMDL rule. Granted, the quality of those TMDLs may vary
substantially at this point. But they're in place and, with
improvements that can be made under existing legal authority, these
TMDLs should over time provide an effective framework to address both
polluted waters and waters threatened by pollution, achieving the
rational and comprehensive pollution control program that Congress
envisioned to clean up dirty waters and protect our rivers, lakes, and
shorelines for generations to come. Progress is certainly being made.
However, much work remains to be done.
The adverse effects of EPA's years of neglect of this critical
component of the Clean Water Act are still being felt throughout the
country. Lists of impaired waters continue to expand--irrefutable
testimony of the need for EPA and the States to aggressively implement
the TMDL program. For example, California started with a list of 18
impaired waters in 1978-79. That list has steadily grown to 28 waters
by 1986, 77 waters in 1988, 245 impaired waters by 1991, 276 in 1992,
388 waters by 1996, 509 waters by 1998 and most recently a new high of
684 impaired waters. In short, pollution problems are growing in the
absence of TMDLs. This fact is confirmed by the most recent National
Water Quality Inventory, which shows--for the first time in many
years--that overall water quality of the Nation's rivers, lakes,
estuaries and coastal waters is getting worse.
Instead of responding to these water pollution problems by doubling
its efforts to implement the TMDL program, EPA's current managers are
considering and perhaps poised to adopt a proposal that would reverse
the progress made to date. The EPA's proposal would abruptly limit the
scope of the TMDL program and, for those lucky waters where the TMDL
program might still apply at all, turn Congress' pollution control
mechanism into a paper exercise whose only relevance to a waterbody's
water pollution control efforts is to legitimate less stringent
controls on existing discharges without any corresponding pollution
reductions by other sources. That vision of the TMDL program's purpose
directly contravenes Congress' vision.
I would like to highlight six of the key problems I find in EPA's
draft proposal to rewrite the existing TMDL regulations.
EPA'S DRAFT RULE ILLEGALLY TRUNCATES THE UNIVERSE OF WATERS CONGRESS
INTENDED TO PROTECT OR CLEAN-UP THROUGH THE IMPLEMENTATION OF TMDLS
First is the use of listing criteria that, if implemented, would
illegally and illogically restrict the use of TMDLs to a relatively
small number of waterbodies, ignoring thousands of waters that Congress
envisioned would be protected and/or cleaned up through a TMDL. Listing
decisions are critically important because whether a water is listed
and scheduled to get a TMDL is the gateway into the entire clean-up
program. If a water is not listed (or is on some list other than the
list of waters requiring a TMDL) then that water will not benefit from
the program. Therefore, it is important for the Committee to understand
the ways in which EPA is trying to close the gateway into the TMDL
program to thousands of waters across the country that Congress
required be included in the TMDL program.
EPA's draft rule completely ignores the express terms of Section
303(d)(1), the requirements put in place by Congress. Under the
statute, the only question relevant to listing a waterbody under
section 303(d)(1) is ``were BPT and secondary treatment sufficient to
implement all applicable water quality standards?'' If a waterbody is
impaired or has ever been impaired since the implementation of BPT and
secondary treatment requirements, the answer to that question is
obviously ``no.'' If a waterbody has no point source discharges to
which either BPT or secondary applied, the answer also must be ``no.''
It is as simple as that.
In contrast, EPA's draft rule proposes a complicated set of five
categories of waters, only one of which is apparently identified as a
list required by Section 303(d). None of the five categories tracks the
listing criteria established by Congress in that section. Indeed, the
criteria identified by EPA to establish the categories, in most
instances, include waters that Congress' Section 303(d)(1) criteria
mandate including on the Section 303(d) list and the preparation of a
TMDL.
Going through each of the categories described in the draft, the
draft rule places in its Category 1 waters those waters that currently
are attaining all designated uses. Although some of these waters may
not have to be listed for a TMDL under the statute, such currently
clean waters do need to be listed and a TMDL prepared if attainment
with the standards is not the result of BPT or secondary treatment. The
draft rule's Category 2 waters include those waters where only some
designated uses are attained but there is insufficient data to
determine whether other uses are being achieved. According to the
statute, all of these waters must be listed because, especially at this
late date almost 30 years after implementation of BPT and secondary
treatment requirements, it is certain that BPT and secondary treatment
were not stringent enough to implement these waters' standards. EPA's
Category 3 waters include those waters where there is insufficient
information to determine whether or not compliance with standards is
achieved. These also must be listed, again, to the extent that BPT and/
or secondary treatment were not sufficient to implement standards.
Category 4A is a list of those waters, impaired or otherwise, for which
TMDLs already have been established. Congress did not intend for waters
to be removed from the 303(d) list just because a TMDL was prepared.
Obviously, they may no longer need a TMDL but they must remain on the
list in order to implement Section 303(d)(4) and to assure the TMDL
remains intact and up to date into the future. Indeed, Section
303(d)(4) invokes the antidegradation policy ``[f]or waters identified
under paragraph [303(d)(1)(A)] where the quality of such waters equals
or exceeds levels necessary to protect the designated use for such
waters or required by applicable water quality standards,''
underscoring the fact that the criteria for listing waters under
section 303(d)(1)(A) encompasses waters that are not yet impaired and,
hopefully, will never be impaired.
Perhaps of greatest concern is Category 4B waters where it is known
that standards are not being attained but other ``enforceable''
pollutant control mechanisms are alleged to be in place and purportedly
designed to attain water quality standards within a reasonable
timeframe. These waters by definition must be listed under 303(d)(1)(A)
and TMDLs completed for them. EPA has no authority to substitute other
pollutant control mechanisms as listing and TMDL criteria to replace
those selected by Congress, i.e. BPT and secondary treatment. The
agency cannot keep a water off the 303(d) list because standards were
achieved by implementation of best available technology. Nor can EPA
refuse to list waters where a non-TMDL based water quality-based
effluent limit achieved standards. And the agency certainly cannot
eliminate waters from States' 303(d) lists based on some future,
unnamed trading programs or other untested programs.
The agency's Category 4C waters include impaired waters where the
impairment is not caused by a pollutant. Although it's difficult to
imagine what impaired waters would fit this description, this category
is apparently an effort by the agency to eliminate waters from the list
that are impaired by low flows or otherwise sensitized to pollution
discharges by disturbances other than pollution discharges. I cannot
imagine a source of impairment that does not involve either point or
nonpoint sources of pollution. Even streamside tree canopy removal that
reduces shade along a stream resulting in temperature pollution amounts
to nonpoint source pollution and can be readily addressed through a
TMDL.
The last and final category--Category 5--is the only section 303(d)
list proposed by EPA's draft rule. The list is limited to waters that
are currently impaired and that do not fit into any of the other
categories. Nothing in the statute suggests that such a truncated list
satisfies the conditions established by Congress.
Notably, EPA rejects any category, whether under section 303(d) or
not, for threatened waters. Again, by definition, waters whose
standards are threatened with exceedances are directly addressed by
Congress' listing criteria for Section 303(d). If a waterbody's
standards are threatened now in 2003, then it is clear that the
pollution control technology applied back in the late 1970's does not
have much chance of assuring the implementation of the threatened
standards today. Likewise, ignoring threatened waters will in almost
every case violate the Clean Water Act's antidegradation requirements.
EPA, apparently aware of this contradiction, simply proposes to
eliminate consideration of the Federal and State antidegradation
standards when implementing section 303(d), a cynical and underhanded
proposal addressed further below.
To summarize the listing concerns, it is clear that the draft
proposal bears little if any relationship to Congress' Section 303(d)
criteria. EPA's truncated list will prevent thousands of critical but
currently clean waterbodies from being protected by the TMDL program,
assuring a continuous supply of new impaired waters for future
agencies' to have to contend with cleaning up. In a very real way, by
truncating the list, EPA also may very well undermine the States'
ability to establish their own priorities for establishing TMDLs by not
allowing them, for example, to put a critical but threatened water
supply on the list and perhaps ahead of an impaired but less important
water.
EPA'S DRAFT RULE WILL RESULT IN INEFFECTIVE TMDLS THAT WILL UNDERMINE
ANY POTENTIAL FOR EFFECTIVE POLLUTION TRADING SCHEMES
The other five concerns address aspects of EPA's proposals to
rewrite the rules that, if implemented, would render TMDLs ineffective
at protecting water quality.
The first of these is the untenable assertion by EPA that the
agency is not required to review and approve the States' allocation of
a TMDL for a given pollutant to the various sources discharging that
pollutant as part of EPA's obligation to approve or disapprove TMDLs.
That approach entirely undermines the agency's duty, assigned to it by
Congress, to review States' TMDLs and to make sure that they are
established at a level necessary to implement the applicable water
quality standards. EPA must review the ``load established'' by each
State. 33 U.S.C. Sec. 1313(d)(2). That established load to be reviewed
by EPA ``shall be established at a level necessary to implement the
applicable water quality standards with seasonal variations and a
margin of safety which takes into account lack of knowledge concerning
the relationship between effluent limitations and water quality.'' 33
U.S.C. Sec. 1313(d)(1)(C). Hence, EPA is obliged to review any TMDL
based on that standard and based on resulting effluent limitations. As
a rational and scientific matter, EPA cannot make a finding that a TMDL
will implement standards throughout a watershed without reviewing and
approving the allocations. In addition, allocations are expressly
referenced in the Act. See section 303(d)(4), 33 U.S.C.
Sec. 1313(d)(4). EPA is wrong that allocations are not required by
section 303(d).
Second is a related problem, which is the general theme throughout
EPA's proposal--moving away from allocating pollution reductions needed
to implement a TMDL to specific, individual sources and, instead,
allocating larger portions of a TMDL to many sources, albeit perhaps
similar in nature. Hence, the proposal includes the concept of
establishing gross allocations of a TMDL to entire categories of
dischargers throughout a watershed, including, for example, all
logging, all farming, all grazing, all non-NPDES storm water, all
marinas, all dredging and all dams. Similarly, the proposal floats the
idea of a gross allocation for all future growth within a watershed,
regardless of location or localized pollution impacts or similarity of
pollution sources. Simply allocating a single load to, for example, all
logging dischargers in a watershed will not implement standards
throughout that watershed. Nor would EPA be able to find that a TMDL
allocated in such a manner will implement such standards throughout the
watershed. The agency will have no ability to determine where the
categorical logging load will be discharged and hence whether the
upstream waters will be protected. I also would think that the agency
would be concerned about not requiring a TMDL to be allocated to
specific individual sources if it hopes to ever create functional
pollution trading opportunities from this program. Lump sum allocations
as described in the draft will doom any such trading schemes from the
start because nobody will know how much loading (i.e. how many
pollution shares) they control and must reduce.
A third problem stemming from EPA's incorrect assertion that the
agency does not have to review a State's allocations in approving a
TMDL is EPA's proposal that States be allowed to reallocate its TMDL
after EPA approves it. The notion that EPA believes it can review a
TMDL and determine that it will assure implementation of water quality
standards without reviewing the TMDL's allocations in the first place
and allowing a State agency to alter those allocations however it wants
is irrational and a complete abandonment of science as well as the law.
Fourth, the draft proposal allows existing NPDES dischargers to
increase their loadings of pollutants that are still impairing a
waterbody immediately after a TMDL is drafted, even when there have
been no reductions whatsoever from other sources and no guarantee that
such reductions will ever occur. That, of course, is a recipe for
further impairment, not clean-up. Such a TMDL scheme would not
implement applicable water quality standards. Instead, for a possibly
indefinite amount of time, it would simply provide an unwarranted
excuse for existing point source discharges to expand their
contribution to a waterbody's impairment or degradation while
absolutely no pollution reductions are realized from nonpoint or other
sources. In order for Congress' goals for the Act and the TMDL program
to be realized, it is clear that existing point source pollution must
be further controlled as long as no progress is made in reducing
pollution from nonpoint sources into a waterbody that is impaired or
being degraded.
The fifth and last concern I will discuss today is EPA's suggestion
that the agency can simply ignore the Federal and state antidegradation
policies from consideration when establishing or reviewing TMDLs. EPA's
contemplated slashing of that core principle, a principle embodied by
every word of the Clean Water Act, strikes at the heart of Congress'
intent in creating the TMDL program and best exemplifies EPA's
underhanded effort to distort the purpose of the TMDL program from a
regulatory mandate to protect and restore water quality to a regulatory
shield providing dischargers cover while they continue to pollute and
degrade the Nation's waters. Every State in the country is required to
have an antidegradation policy established as one of the three mandated
components of its water quality standards. The entire scheme of the
Clean Water Act hinges on the concept that waters become less polluted
until all uses are fully protected and, indeed, all pollution is
eliminated. By thinking about removing antidegradation requirements
from the ambit of the TMDL program, EPA sentences the nation's waters
to further spoliation and sentences the States and the American public
to ever expanding lists of impaired waters.
This is not an exhaustive list of concerns. Other significant
problems exist in the EPA draft, including the agency's refusal to
acknowledge the ``daily'' loads required by Congress; the excessive
length of schedules proposed for establishing the truncated list of
TMDLs; the proposal to allow less frequent 305(b) reports despite the
Act's mandate that such reports be submitted by the State every 2 years
and, hence, the fictional assertion that allowing integrated 303(d) and
305(b) reports every 4 years will amount to significant cost savings by
the States; the questionable reading of the thermal list required by
section 303(d)(1)(B); the incorrect notion that EPA or the States have
authority to delist waters under section 303(d), and; last but perhaps
not least, the bizarre notion that ``natural background' could include
pesticides in sediments are all significant concerns. The above
concerns will be further addressed by the environmental community
should EPA's proposal ever see the light of day.
Taken together, the proposals in EPA's rewrite of the TMDL program
will virtually guarantee that this important Clean Water Act program
will be rendered entirely ineffective at protecting and cleaning up the
Nation's waters. This rewrite of the rules will condemn the over 215
million Americans who currently live within 10 miles of a polluted
waterbody to a least another generation of unsafe waters and will add
many more Americans around the country to that group as their
community's waters get more polluted from point and nonpoint sources.
Therefore, we urge the Committee to encourage EPA to withdraw the draft
proposal before expending its limited resources on a blatantly illegal
proposal.
EPA'S ARBITRARY STORM WATER EXEMPTION FOR THE OIL AND GAS INDUSTRY
While working on rulemaking that would dismantle the TMDL program,
EPA also has been busy doling out favors in the form of special
exemptions to Clean Water Act requirements for certain industries,
including the oil and gas industry. In particular, I would like to
state Earthjustice's objection to the agency's rulemaking this past
March delaying for at least 2 years the Phase II storm water permitting
rules that otherwise would have gone into effect on March 10, 2003 for
construction activities by the oil and gas industry at their
exploration and productionsites. EPA's special exemption for the oil
and gas industry was based on undocumented and last minute claims by
the industry's lobbyists that somehow that industries' construction
activities were qualitatively different from every other construction
activity in the country. Whether a 2.4 acre or 105,000 square foot site
is cleared and graded by a housing developer, an office building
developer, or an oil and gas drilling operation does not make the dirt
and sediments any less erosive or any less capable of polluting. Who
builds a road also will not alter its potential for pollution. Indeed,
the pollution threats from drilling sites go well beyond those posed by
sediment discharges and the many dischargers who are now subject to the
Phase II regulations. Storm water from drilling activities contains not
only sediments and silts, but also oil and grease, drilling compounds
and other construction related materials. The cumulative threat of
30,000 industrial construction sites cannot be ignored if Congress'
mandate that all storm water discharges be controlled through the NPDES
program and the resulting environmental benefits are to ever be
attained.
Industry argues that oil and gas exploration and production,
including pre-drilling construction activities, are exempt from NPDES
permitting pursuant to section 402(l)(2) of the Act, 33 U.S.C.
Sec. 1342(l)(2). The express language of that section does not support
industry's argument. By its terms, Section 402(l)(2) does not include
any storm water runoff that has either been ``contaminated by contact
with, or do[es] not come into contact with, any overburden, raw
material, intermediate products, finished product, byproduct, or waste
products, located on the site of such operations.'' The disturbed soils
around drilling wells are both overburden and waste products. See Sen.
Rep. No. 99-50 at 44 (May 14, 1985) (``[e]xamples of contamination
include suspended or dissolved solids from . . . disturbed soils'').
Hence, any storm water contacting the disturbed areas of a drilling
site, if discharged, is not exempt from the Act's permitting
requirements.
The legislative history makes even clearer the limited scope of the
exemption set forth at Section 402(l)(2). The final conference report
for the Water Quality Act of 1987 makes it clear that Section 402(l)(2)
``provides that permits are not required where stormwater runoff is
diverted around mining operations or oil and gas operations and does
not come in contact with overburden, raw material, product, or process
wastes. In addition, where stormwater runoff is not contaminated by
contact with such materials. . . .'' H.Rep. Conf. Rep. No. 99-1004 at
p. 152 (Oct. 15, 1986). See also H.R. Rep. No. 99-189 at p. 37 (July 2,
1985) (``The subsection was developed by the Committee in recognition
of the fact that there are numerous situations in the mining and oil
and gas industries where stormwater is channeled around plants and
operations through a series of ditches and similar devices in order to
prevent pollution contamination of the stormwater'').
Nothing in EPA's administrative record, including the numerous
industry comments, suggests that storm water is routed around such
drilling sites. Nor do any of those comments suggest that storm water
falling on or flowing through these sites are then free of sediment and
other pollutants. Indeed, the opposite appears to be true. See Letter
from Warren County Conservation District (Jan. 23, 2003) (EPA Docket
Item OW-2002-0068-0023); Letter from California State Water Resources
Control Board (Jan. 31, 2003) (EPA Docket Item OW-2002-0068-0082).
In California, I had the opportunity to work on the implementation
of the Phase I industrial and construction storm water permit and have
been involved in the past in numerous actions enforcing those general
permits. Compliance with the storm water requirements is not
complicated, relying in large part on the implementation of best
management practices, many of which have been available for years. The
oil and gas industry need merely pick the appropriate measures off of
the shelf, articulate those in a storm water management plan that, in
many cases, would be easily transferable to nearby drilling sites, and
monitor to assure compliance. This is no more than what is expected of
much smaller businesses who have been implementing the storm water
requirement for the past decade, including thousands of mom-and-pop
businesses with much fewer resources than the oil and gas industry.
Ironically, EPA's abdication of its duties may result in less
certainty for the oil and gas industry. EPA's duty to establish
regulations is separate and distinct from the Act's mandate that all
storm water point sources obtain NPDES permits. Right now, it is
certain that thousands of oil and gas drilling sites are in violation
of the Act by discharging pollutants without a permit. Rather than
assure an orderly process for issuing permits to that industrial
sector, as intended by Congress, EPA has simply ceded it to private
citizens and the courts to enforce the law. I would think the oil and
gas industry would prefer the certainty of EPA regulations to the
uncertainty of an illegal interpretation of the Clean Water Act that
exposes them to lawsuits.
EPA'S BACKROOM NEGOTIATION REGARDING LIMITING THE WATERS OF THE UNITED
STATES PROTECTED BY THE CLEAN WATER ACT
I also want to highlight a strong concern regarding legal
maneuverings that appear to be occurring in the context of litigation
filed by the American Petroleum Institute and other oil industry
representatives challenging rules promulgated by EPA in July 2002
addressing oil spill prevention and response requirements for
businesses that store large quantities of oil (greater than 1320
gallons). These rules are generally referred to as the Spill Prevention
Control and Countermeasures (``SPCC'') rules. As part of that
rulemaking, EPA updated and clarified the definition of ``waters of the
United States'' included in the SPCC rules to be consistent with the
regulatory definitions of ``waters of the United States'' included
elsewhere in the Clean Water Act regulations. The definition EPA
adopted for the SPCC rule is essentially the same definition already
promulgated throughout the Clean Water Act regulations, including at 40
C.F.R. Sec. Sec. 122.2, 230.3(s) and 33 C.F.R. Sec. 328.3(a).
The main thrust of the oil industry's challenge is an allegation
that EPA's definition of waters of the United States goes beyond those
waters protected by the Clean Water Act. Industry argues that the
requirements of the Clean Water Act are limited to discharges of
pollutants to traditionally navigable waters and wetlands adjacent to
such traditionally navigable waters. In essence, the oil industry would
like to exempt tens of thousands of facilities from the SPCC rules if,
for example, any potential oil spill would flow to a small creek or
ephemeral stream, despite those waters' clear connections to downstream
waters and the potentially devastating effects of an oil spill,
especially one beginning in the headwaters of a watershed and adversely
affecting all downstream waters.
Industry's primary basis for its assertion is an exaggerated
reading of the Supreme Court's 2001 decision in Solid Waste Agency of
Northern Cook County v. United States Army Corps of Engineers, the so-
called ``SWANCC'' decision. Industry's expansive view of SWANCC is
inconsistent with that decision's express terms. SWANCC simply ruled
that the Corps could not use the ``Migratory Bird Rule''--a portion of
a 1986 Federal Register preamble--as a sole basis to regulate waters
used by migratory birds. The decision does not suggest that intrastate
waters that are used in or affected by interstate commerce, for
example, by a group of anglers or a power plant feeding electricity to
a multi-State grid that uses a lake's waters for cooling, would not be
subject to the Clean Water Act.
Industry's wish that SWANCC was a more expansive ruling also is
inconsistent with over two dozen Federal court briefs filed on behalf
of EPA and the Army Corps by the Department of Justice and emphasizing
the limited ruling in SWANCC and the necessity of EPA's existing
definition of water of the United States in order to implement the
Clean Water Act consistent with Congress' mandate. Last, virtually
every court that has considered the scope of the holding in SWANCC has
ruled that the holding is limited to the facts and express ruling in
that case and has no effect on EPA's or the Corps' existing regulatory
definitions.
According to the industry plaintiffs, settlement discussions are
ongoing on the appeals of the SPCC rule. NRDC and the Sierra Club,
represented by Earthjustice, have sought to intervene in the case.
While awaiting the court's ruling on that request, the groups have
asked to participate in the settlement discussions but this request has
been denied. We are very concerned that the discussions going on now
behind closed doors will lead to some tacit acknowledgement by EPA that
industry's strained reading of SWANCC has some merit and that EPA may
withdraw regulations embodying a definition that the agency has stood
by for almost three decades.
I hope that EPA will vigorously defend the broad jurisdiction of
the Clean Water Act established by Congress, and not cave to the wishes
of the oil industry to create another special standard for that
industry. EPA should not resort to a cowardly retreat from decades of
clear, regulatory direction assuring broad coverage of the Act and
accompanying certainty to businesses by hiding its complicity with the
oil industry to undermine one of our country's most important
environmental laws behind closed-door settlement negotiations. If the
agency retreats from its long-established definition of waters of the
United States this would, at best, set the agency and the regulated
community on a path of uncertainty that would be easily avoided if EPA
were to simply defend its long-standing definition of waters of the
United States.
CONCLUSION
It is important to keep in mind that EPA's above-described
activities are a few of many efforts by the agency that do not bode
well for the Clean Water Act and the future health of America's rivers,
lakes, streams, wetlands, and coastal waters. The above proposals are
the most recent examples of an expanding pattern by the agency to cut
back the protections of the Clean Water Act. The thousands of polluted
lakes, rivers, and ocean waters around the country will not be cleaned
by EPA walking away from the problems, and the States taking the
agency's cue and following close behind. The gains that have been made
in protecting many of the country's waters will be lost if EPA
continues on its current path. We are the children left with cleaning
up the rivers polluted by our parents' and grandparents' generations.
If we are to avoid leaving our sons and daughters with a lot more
polluted rivers and lakes, EPA must abandon its efforts to dismantle
the current TMDL program, take more aggressive steps to implement the
current regulations, and assure that every industry, including the oil
and gas industry, abide by Congress' clear directives to protect and
cleanup our Nation's waters.
I hope my comments assist the Committee in its oversight of EPA's
current implementation of the Clean Water Act. Thank you again for this
opportunity to appear before the Committee.
______
Responses of Michael R. Lozeau to Additional Questions from
Senator Jeffords
Question 1. We heard in testimony that the EPA's proposed rewrite
of the TMDL rules could undermine effective trading. This is
interesting to me because trading is something that the EPA testified
they support. Can you describe how the TMDL proposal undermines trading
among pollution sources?
Response. EPA's proposed rewrite of the TMDL rules will undermine
the prospects for water pollution trading in at least seven ways:
i. The draft rule's built-in vagaries and conscious lack of
clarity provides no incentive for pollution sources to
contribute resources to any given TMDL and any accompanying
trading proposal. As I stated in my testimony, EPA's proposal
would allow for only ``gross allocations'' of responsibility
for sources' contributions of pollutants to a waterbody. Not
only is such a scheme illegal, in that EPA will be unable to
find that a TMDL allocated in such a manner will implement
water quality standards throughout the watershed, but these
lump sum allocations will doom trading schemes because
pollution sources will not know how much loading they must
reduce. See Response #5 below. If these sources are not
identified as the source of a pollution problem, they will have
no incentive to participate in any trade. Following the
existing law, which requires specific allocations, would
encourage buy-in and resource contributions from pollution
sources to formulate trading proposals that could subsidize the
states' generally cash-starved water quality programs.
ii. Similarly, by allowing gross allotments, the proposed
TMDL rule fails to identify a watershed's market participants.
A TMDL rule that defined the marketplace in which trades would
occur could establish one of the basic components of a trading
scheme.
iii. By allowing for gross allotments of pollution
responsibility within a TMDL, the proposed rule fails to
provide any science-based scheme for creating and distributing
pollution ``shares.'' On the other hand, if a TMDL identifies
each individual source and quantifies their individual load,
then the shares of a potential trading program would be self-
evident.
iv. Those same gross allotments will preclude EPA from
assuring that water quality standards and beneficial uses
throughout a watershed would be implemented by a TMDL. By the
same token, EPA's proposed gross allotments would prevent the
agency from procuring and reviewing the information and data
necessary to assure that any proposed trading scheme for that
watershed would not cause hot spots within the watershed. This
also is true of the proposal that EPA not review TMDL
allocations at all.
v. Obviously, identifying individual sources is a
prerequisite to monitoring their compliance with their
allocation. Without provisions for monitoring of individual
sources and the ability of market participants and others to
enforce individual pollution allocations, a legitimate and
functional trading scheme amongst individual sources will not
come to pass.
vi. By allowing the states and local agencies to alter their
general allocations without review by EPA would make those
allocations and their resulting ``market'' values less certain
and less capable of prediction, thereby discouraging
participation by potential traders.
vii. A TMDL rule that purported to encourage trading also
would not include any allocations for future growth or other
new pollution sources. Trading, if it were to have any chance
of proving effective at all, would require a firm total maximum
daily load that was fully protective of beneficial uses and
standards throughout a watershed. It also would have to include
very specific allocations to existing individual sources, not
based on their current pollution levels, but on levels
necessary to comply with the TMDL. No allocations would be
given to future sources or increased pollution from existing
sources. Those new quantities of pollution would only be
allowed if the source were to buy up existing allocations in an
amount greater than the proposed increase. The ``offset'' ratio
would presumably be determined by the schedule for achieving
the TMDL and compliance with standards.
Question 2. Why is the SPCC rule itself important, aside from the
interactions with the SWANCC decision? In other words, what protections
will be lost while implementation of the rule is delayed for the oil
and gas industry?
Response. The SPCC Rule is intended to prevent oil discharges from
reaching navigable waters of the United States or adjoining shorelines.
It applies to owners or operators of facilities that drill, produce,
gather, store, use, process, refine, transfer, distribute, or consume
oil and oil products. The SPCC rule requires facilities that store more
than 1,320 gallons of oil to prepare a spill prevention control and
countermeasure (``SPCC'') plan. These plans help prevent oil discharges
by such facilities and mitigate the damage caused by such discharges if
and when they occur. In addition to preparing SPCC plans, the rule
requires facilities to institute a number of preventative measures to
reduce the risk of spills. These measures include tank leak detection,
spill overfill protection, pipe external protection, and secondary
containment. A 1995 EPA survey demonstrated that compliance with even
one of these requirements reduces both the number of spills and the
amount of oil that migrates outside of a facility's boundaries. 62 Fed.
Reg. 63817/2 (1997).
EPA amended the SPCC rule in July 2002. The amendments generally
clarify the language and organization of the rule. The July 2002 Rule
confirmed the broad applicability of these requirements to all
navigable waters--i.e., ``waters of the United States.'' The final rule
also requires a number of improvements in the plans themselves. For
instance, it requires that all SPCC plans be reviewed and certified by
a professional engineer, that facilities evaluate potential for
brittle-fracture of aboveground containers, and that all buried piping
use a protective wrapping and coating.
Postponing the compliance date for the new rule delays
implementation of these improvements in the SPCC program, thereby
increasing the risk of oil spills from these facilities. According to
EPA, one gallon of oil can contaminate one million gallons of water.
There are approximately 24,000 oil spills each year in the United
States, with more than half of those spills occurring inland where they
contaminate streams, rivers, and wetlands.
Question 3. In your comments, you mentioned that the real effect of
the Administration's TMDL regulation on the water quality program would
be to return to pre-1972 TMDL protections. Can you provide more detail
on this point?
Response. Prior to the 1972 amendments that created the modern
Federal Water Pollution Control Act, the national water quality program
relied on the states to directly enforce their water quality standards
against individual discharges. As is emphasized in the FWPCA's
legislative history, those efforts proved ineffective and spurred the
1972 amendments' focus on establishing effluent limitations in permits
as a means of implementing the states' water quality standards. TMDLs
were part of that concept, filling in the gaps left by the point source
permitting program to identify and quantify all pollution sources to a
listed water body and, although not always requiring a NPDES permit to
address each of those sources (i.e. the nonpoint sources), at least
quantifying each sources maximum load of pollutants that they could
release to a waterbody. That load limit could then be implemented
either through the NPDES program or the various nonpoint source
programs set forth by the Act.
By rewriting the existing TMDL rule to say that states do not have
to identify specific pollution sources and can allocate pollution to
numerous sources in one lump sum, EPA essentially gives up on the
meaningful role for TMDLs contemplated by Congress and attempts to turn
them into the same unenforceable, general standards that were proven to
be ineffective in the past. In addition, because the TMDLs, even if
allocated on these gross bases, will in turn be relied upon to change
existing limitations that currently apply to point sources in listed
waterbodies, I am concerned that inaccurate TMDLs setting forth gross
allocations that cannot be ground-truthed will result in a weakening of
effluent limitations for the relevant point sources. Meaningless gross
allocations for many pollution sources coupled with less stringent
effluent limitations for point sources looks and feels a lot like the
disavowed programs from prior to 1972--programs described by the late
Senator Muskie, upon introducing the bill that was to become the Clean
Water Act, as ``inadequate in every vital aspect.'' 117 Cong. Rec.
17397 (daily ed. Nov. 2, 1971).
Question 4. In Mr. Kouplen's testimony, he states, ``Section 303(d)
provides no authority for the preparation or establishment of an
implementation plan. It merely envisioned the translation of wasteload
allocations into water quality based effluent limitations for point
sources. `` Can you comment on his interpretation of section 303(d)?
Response. To the extent Mr. Kouplen's testimony suggests that the
only meaningful limits resulting from a TMDL are the water quality-
based effluent limitations for point sources, he clearly is wrong.
TMDLs also are required to address nonpoint sources of pollution. TMDLs
must be ``established at a level necessary to implement the applicable
water quality standards with seasonal variations and a margin of
safety. . . .'' 33 U.S.C. Sec. 1313(d)(1)(C). Water quality standards
must be implemented throughout a listed waterbody, not merely at some
arbitrary downstream point or in the larger order streams within a
watershed. Upstream waters and tributaries must comply with standards.
That is the standard that EPA must apply in reviewing and approving or
disapproving a TMDL.
So, although it is true that Section 303(d) does not call for
something called an ``implementation plan,'' it does require a TMDL to
include a specific allocation of loadings for each specific pollution
source in a waterbody in order to ``implement'' the applicable water
quality standards. Without individual, source-specific allocations, it
is impossible for either a state or EPA to find that the TMDL is
``established at a level necessary to implement the applicable water
quality standards.'' The sole purpose of a TMDL, its very reason for
being, is to implement water quality standards. Given the objective,
water quality driven criteria that must be used to develop a TMDL, any
need for an additional ``implementation plan'' is hardly necessary. If
completed with the level of detail necessary to achieve Congress'
criteria, implementing a TMDL's allocations should be a relatively
simple matter of adopting the point source allocations into existing
NPDES permits and adopting the nonpoint source allocations into the
existing nonpoint source management plans.
Question 5. Can you comment on Mr. Kouplen's analysis of the
impacts of the Pronsolino case that he included in his written
testimony?
Response. I do not believe the Pronsolino decision assists Mr.
Kouplen's analysis asserting that EPA may only set an overall goal but
how that overall goal will be achieved is reserved for the States. If I
am correct, the analysis Senator Jefford's question is referring to in
Mr. Kouplen's testimony concludes by saying ``allocation decisions are
the essence of implementation planning that has been strictly reserved
for the states.'' Mr. Kouplen's assertion is not based in the statutory
language or common sense. As described above, how a TMDL is allocated
to specific pollution sources is an elementary component and cannot be
separated from the TMDL itself if the state and EPA are claiming to
establish or approve the TMDLs based on the express criteria of
Congress.
Mr. Kouplen's assertion that the formal TMDL to be reviewed and
approved by EPA consists of a single number allowing for one gross
loading figure of a pollutant into some large waterbody would not be
indicative of a loading established at a level necessary to implement
the applicable water quality standards. A TMDL cannot be established in
any realistic sense except as the sum of its component allocations and,
without knowing where and how much a TMDL's allocations occur, no
agency--no objective scientist--can say that the TMDL is established at
a protective level throughout that waterbody. In other words, Section
303(d) mandates that EPA review allocations in order to assure that a
TMDL is at a level necessary to implement standards in every part of
the waterbody, not just the one downstream point where the gross load
could theoretically be measured.
Question 6. In Mr. Fuller's testimony, he states that he believes
that Section 402(l)(2) was intended to exempt all oil and gas
activities from all storm water permit requirements. In reviewing the
legislation history on this issue, I believe that his interpretation is
incorrect. Specifically, the statute lists three main criteria to
determine if this provision applies to a particular discharge:
First, the discharge must be ``stormwater runoff from
mining operations or oil and gas exploration, production, processing,
or treatment operations or transmission facilities. . . .''
Second, the flow must be ``composed entirely of flows
which are from conveyance or systems of conveyances (including but not
limited to pipes, conduits, ditches, and channels) used for collecting
and conveying' precipitation runoff. . .''
Third, the flow must be ``not contaminated by contact
with, or do not come into contact with, any overburden, raw material,
intermediate products, finished product, byproduct or waste products
located on the site of such operations. ``Section 402(1) clearly
applies only to particular types of discharges from particular types of
systems. It does not provide authority for a blanket exemption to the
Clean Water Act NPDES permitting requirements. A number of questions
arise with regard to the application of Section 402(l) (2) to the phase
I and phase II programs. What is the difference between flows from
conveyances or systems of conveyances and the discharges resulting from
a construction project? Are flows from oil and gas construction sites
uncontaminated as envisioned by section 402(l)(2)?
Response. In short, it is clear that Section 402(l)(2) does not
exempt all oil and gas activities from the NPDES permitting program as
asserted by Mr. Fuller. There is a distinction between a construction
site and subsequently constructed conveyances. And disturbed soils and
other pollutants washed by storm water from construction sites
associated with oil and gas exploration are contaminated discharges.
If we are talking about grading and preparing a site for
construction activities, in most instances, those sites will be devoid
of any conveyances or systems of conveyances. Without such conveyances,
the exemption is not triggered. Even if there were some temporary
conveyance systems set up to collect rainwater from the construction
area, those conveyances, by definition, would not be conveying storm
water around the construction area and its polluting materials but from
it. If those discharges include pollutants, they are not exempted
pursuant to section 402(l)(2). In addition, Congress anticipated
disturbed soils, such as are encountered at any construction site, to
be one type of pollutant that would preclude the section 402(l)(2)
exemption. See Sen. Rep. No. 99-50, pp. 44-45 (May 15, 1985)
(``Examples of contamination include heavy metals or suspended or
dissolved solids from process wastes or disturbed soils, or salts,
surfactants, or solvents used or produced in the oil and gas
operations'').
Question 7. Please provide your interpretation of the legislative
history accompanying section 402(l)(2) of the Clean Water Act and its
applicability to oil and gas construction sites, both large and small.
Response. My review of the legislative history leading up to
Congress' enactment of Section 402(l)(2) shows that Congress did not
specifically address discharges of pollutants from construction
activities in anticipation of drilling an oil and gas well. Because
exemptions from the CWA's permitting program cannot be implied, that
alone is sufficient to show that Congress did not intend to exempt such
discharges. There is support in the legislative history that the
section 402(l)(2) exemption is limited in scope. 131 Cong. Rec. H
19846, 19855 (July 22, 1985) (Statement of Mr. Breaux) (Section
402(l)(2) a ``limited stormwater exemption''). The main rationale for
the exemption was to avoid discouraging voluntary efforts by the mining
and oil and gas industry to route unpolluted storm water around their
operations in order to prevent it from being contaminated:
The subsection was developed by the Committee in recognition
of the fact that there are numerous situations in the mining
and oil and gas industries where stormwater is channeled around
plants and operations through a series of ditches and similar
devices in order to prevent pollution contamination of the
stormwater. Many of these stormwater run-off devices are
voluntary means of pollution control.
See H.R. Rep. No. 99-189, p. 37. If there are no storm water
conveyances, it is clear that the exemption is not triggered. See H.
Rep. Conf. Rep. No. 99-1004, p. 150 (Oct. 15, 1986) (``To be exempted,
such discharges must be composed entirely of flows of precipitation,
runoff from conveyances or systems of conveyances used for collecting
and conveying such water''). It also is clear from the history that any
runoff polluted by the oil and gas or mining operations would not
qualify for the permitting exemption, though Congress left EPA with
some discretion to determine whether conveyed runoff that does come
into contact with overburden, raw material, product, or process wastes
is contaminated or not. See id. (``any stormwater which has come into
contact with any potential pollutant would not be eligible for the
stormwater runoff exemption''); see also H. Rep. Conf. Rep. No. 99-
1004, p. 151 (Oct. 15, 1986) (``where stormwater runoff is not
contaminated by contact with such materials, as determined by the
Administrator, permits are also not required'').
In conclusion, it is clear that section 402(l)(2) does not
expressly exempt construction activities at oil and gas or mining
sites. The legislative history does not suggest otherwise. Instead, the
legislative history supports a conclusion that, without conveyances, as
would normally be the case for a grading project, the exemption does
not apply. Moreover, even assuming that the construction phase of a
drilling site is not generally outside the scope of section 402(l)(2),
EPA has discretion to determine whether runoff from oil and gas and
indeed any construction sites is contaminated or not. It would be
entirely arbitrary if EPA were to conclude that stormwater from
construction associated with potential oil and gas exploration is not
contaminated but it is contaminated from every other construction site
of one acre or more anywhere else in the country.
__________
Statement of Lee Fuller, Vice President, Government Relations for the
Independent Petroleum Association of America (IPAA) on behalf of the
Association of Energy Service Companies; the International Association
of Drilling Contractors; the National Stripper Well Association; the
Petroleum Equipment Suppliers Association; the U.S. Oil & Gas
Association; California Independent Petroleum Association; Colorado Oil
& Gas Association; East Texas Producers & Royalty Owners Association;
Eastern Kansas Oil & Gas Association; Florida Independent Petroleum
Association; Illinois Oil & Gas Association; Independent Oil & Gas
Association of New York; Independent Oil & Gas Association of
Pennsylvania; Independent Oil & Gas Association ofWest Virginia;
Independent Oil Producers Association Tri-State; Independent Petroleum
Association of Mountain States; Independent Petroleum Association of
New Mexico; Indiana Oil & Gas Association; Kansas Independent Oil & Gas
Association; Kentucky Oil & Gas Association; Louisiana Independent Oil
& Gas Association; Michigan Oil & Gas Association; Mississippi
Independent Producers & Royalty Association; Montana Oil & Gas
Association; National Association of Royalty Owners; Nebraska
Independent Oil & Gas Association; New Mexico Oil & Gas Association;
New York State Oil Producers Association; Ohio Oil & Gas Association;
Oklahoma Independent Petroleum Association; Panhandle Producers &
Royalty Owners Association; Pennsylvania Oil & Gas Association; Permian
Basin Petroleum Association; Petroleum Association of Wyoming;
Tennessee Oil & Gas Association; Texas Alliance of Energy Producers;
Texas Independent Producers and Royalty Owners; Wyoming Independent
Producers Association
Mr. Chairman, members of the committee, I am Lee Fuller, vice
president of Government Relations for the Independent Petroleum
Association of America (IPAA). This testimony is submitted on behalf of
the IPAA, the Association of Energy Service Companies, the
International Association of Drilling Contractors (IADC), the National
Stripper Well Association (NSWA), the Petroleum Equipment Suppliers
Association (PESA), the US Oil & Gas Association (USOGA), and 33
cooperating state and regional oil and gas associations. These
organizations represent petroleum and natural gas producers, the
segment of the industry that is affected the most by regulations that
are not cost effective and do not address real environmental risks.
This hearing addresses issues associated with regulations under the
Clean Water Act. This testimony will focus on two specific issues that
have significant potential implications for domestic oil and natural
gas producers--regulations associated with the management of stormwater
during the construction of oil and natural gas exploration, production,
processing, or treatment operations or transmission facilities (E&P
facilities) and expanded regulations for Spill Prevention, Control, and
Countermeasure (SPCC) Plans.
Before presenting information on these provisions, it is important
to understand the nature of domestic oil and natural gas exploration
and production and the role of independent producers. Independent
producers are companies that explore for and develop oil and natural
gas. Typically, they only operate in these aspects of the petroleum and
natural gas industries. There are approximately 7000 independent
producers who are predominately small businesses employing an average
of 12 employees each. However, they drill approximately 85 percent of
the nation's oil and gas wells.
Domestic petroleum and natural gas production has changed over the
years, particularly since the mid-1980's. Maturing production areas in
the Lower-48 states and the need to respond to shareholder expectations
have resulted in major integrated petroleum companies shifting their
exploration and production focus toward the offshore in the United
States and into foreign countries. More and more, these large companies
must rely on large producing fields that are found only in frontier
areas. Consequently, the role of independents is increasing in both the
Lower-48 states and in the near offshore areas. For example, the
independents' share of Lower-48 states petroleum production has
increased from 45 percent in the mid-1980's to over 60 percent by
1995--and these states, despite their mature fields, still account for
60 percent of domestic oil production. Similarly, independent producers
account for 75 percent of overall domestic natural gas production.
These trends will continue. The Nation will need a strong independent
exploration and production industry to meet it future needs.
Another significant aspect of domestic production--particularly in
the context of the effects of regulations--involves the critical role
of ``marginal'' wells. Marginal oil wells are wells producing no more
than 15 barrels per day or producing heavy oil; marginal natural gas
wells are wells producing no more than 90 mcf per day. The average
marginal oil well produces only about 2.2 barrels per day. But, they
comprise 84 percent of domestic oil wells (over 400,000) and produce
over 20 percent of our domestic oil--an amount roughly equal to imports
from Saudi Arabia. Natural gas marginal wells account for about 10
percent of domestic production--or more than a third of current natural
gas imports. Taken together, these marginal oil and natural gas wells
are about 650,000 of the nation's 876,000 wells. However, they are the
most susceptible to being shutdown when prices fall or costs increase.
And, once shutdown, they are lost forever. During the low oil prices of
1998-99 domestic oil production dropped from about 6.5 million barrels
per day to less than 6.0 million barrels per day. Most of this loss is
attributable to the plugging of marginal oil wells. Average domestic
crude oil production has never exceeded 6.0 million barrels per day
since; in 2002 production averaged 5.817 million barrels per day.
This perspective is significant because the Clean Water Act
regulatory issues that will be addressed in this testimony directly
affect the development of new domestic production and the continuation
of existing domestic production.
STORMWATER CONSTRUCTION PERMITTING ISSUES
The 1987 Clean Water Act (CWA) included two stormwater provisions
that have become, through informal interpretation by EPA, intertwined
regarding their application to oil and natural gas E&P facilities.
Section 402(p) directs the Environmental Protection Agency (EPA), in
general, to require permits for stormwater discharges from municipal
and industrial activities under the National Pollutant Discharge
Elimination System (NPDES) permitting program. At the same time,
Section 402(l)(2) specifically excludes certain stormwater discharges
from this requirement, including discharges of stormwater runoff from
oil and natural gas E&P facilities, unless the discharge is
contaminated by contact with, for example, products, byproducts, or
wastes. As discussed in more detail below, EPA says that section
402(l)(2) does not to apply to clearing, grading, and excavating
activities at E&P facilities, which EPA considers to be ``construction
activities'' required to obtain a stormwater discharge permit, not E&P
activities excluded by 402(l)(2).
IPAA believes that EPA has erred in its interpretation of the Clean
Water Act with regard to the relationship between these sections as
they apply to oil and natural gas E&P facilities. Congress spoke
directly to the exclusion of stormwater related to E&P facilities in
section 402(l)(2), and this specific statutory exclusion should control
with respect to all activities normally associated with such
facilities. Section 402(p) makes no mention of its applicability to
construction activities in general, much less of an intent to undercut
the specific exemption for E&P facilities in section 402(l)(2).
However, despite this structure, EPA has--through a series of
disconnected actions--pulled E&P facilities into the stormwater
construction permitting program. Following is a summary of these
events.
In 1990, EPA promulgated stormwater permitting regulations under
Section 402(p). These regulations defined ``industrial activities'' to
include construction activities that disturb five or more acres of land
area or are part of a ``common plan of development or sale'' that
ultimately will do so. At the same time, EPA promulgated regulations
exempting stormwater discharges from E&P sites from the stormwater
permit requirement, unless such discharges are ``contaminated'' in that
they cause a reportable release of oil or hazardous substance or
contribute to a water quality standard violation. In 1999,EPA issued
Phase II stormwater regulations covering construction activities that
disturb from 1 to 5 acres or are part of a common plan that will
ultimately do so. Throughout this period, EPA's regulations exempting
uncontaminated stormwater discharges from E&P facilities remained
unchanged. Also during this period, however, EPA issued an internal,
non-binding guidance memorandum interpreting the scope of section
402(l)(2). The memorandum was issued in December 1992 in response to a
question from an enforcement coordinator in one Region. In it, EPA
stated that clearing, grading, and other land-disturbing activities at
E&P facilities were ``construction activities,'' not E&P activities
and, therefore the oil and gas exclusion in section 402(l)(2) did not
apply. IPAA believes that this guidance is inconsistent with the law.
However, industry's challenge to EPA's 1992 memorandum was dismissed in
1994because of finality constraints on the courts' authority to review
informal agency guidance.
As a matter of law and policy, EPA should evaluate the
environmental risks and regulatory burdens created by its actions. In
the case of oil and natural gas E&P facilities, IPAA does not believe
that EPA made a reasonable assessment of either the risk or the burden.
Nowhere in the information that IPAA has reviewed is there an
indication of significant environmental risks associated with oil and
natural gas E&P facility construction. Nor is there any indication that
EPA understood the burdens its program would impose. For example, in an
October 1999 report on the costs of the new Phase II requirements there
is a revealing footnote, buried in several hundred pages of background
and economic analysis, stating:
Based on public comments received on the propose rule, EPA
considered including oil and gas explorationsites but, upon
further review, determined that few, if any, such sites
actually disturb more than one acre of land.
In reality, most oil and natural gas exploration and
productionsites fall within the one to five acre range. In 2000, a
total of 31,732 exploratory and production wells were drilled over
10,000 in Texas and Oklahoma. To meet future natural gas demand, the
National Petroleum Council estimates that the number of natural gas
wells alone needs to increase to approximately 48,000 wells annually.
However, in the EPA cost analysis of the Phase II program, it estimated
that the number of construction starts would be approximately 130,000
units. But, none of these units were oil and gas facilities. Oil and
gas facilities alone would increase the number of units by 25 percent
with a third of that total coming from the two states of Texas and
Oklahoma where EPA Region 6 must handle the administrative burdens.
Overall, the ultimate economic consequences of the permit requirement
could be staggering, by one estimate as much as $8 billion annually.
Three things are clear. First, if the current level of drilling
activity presented stormwater runoff problems during construction, it
would be well known. Second, the magnitude of permitting that EPA
estimated during the regulatory development process is significantly
understated. Third, because the Agency believed that oil and gas
facilities were not affected, the final regulation is structured to
address construction of building facilities--houses and commercial
buildings.
This approach is inappropriate for oil and gas facilities. For
example, subdivisions are properties that are purchased by the
developer, go through an extensive design process, and have a
construction period that may be months or years. There is more
opportunity to build time for permitting into the schedule for a
commercial or residential construction project, and more opportunity to
respond to permit delays. In contrast, oil and gas production
operations involve the leasing of sub-surface rights, often on private
lands under oil and gas leases with short primary terms. Construction
must occur within a matter of weeks, and timing is critical because
failure to commence drilling and/or production and/or to maintain
production will cause leases, and therefore oil and gas reserves, to be
lost. Exploration and production of oil and gas reserves, moreover,
involves obtaining a drilling rig, which must be quickly and carefully
scheduled to coincide with drilling windows and lease obligations, and
is paid for based on the number of days it is in use. Disruption in
this process can place oil and gas leases, entire projects, and the
ability to develop domestic onshore oil and gas reserves--not to
mention substantial capital--at risk. These consequences are at issue
in EPA's interpretation of the scope of the oil and gas exemption under
section 402(l)(2), particularly with the impending decrease in the
acreage threshold to one acre under the Phase II stormwater
regulations.
The permitting process is further complicated by EPA's
interpretation of its ``common plan of development'' concept. This
concept requires projects to be permitted if, taken together, the
components will ultimately exceed the permitting acreage threshold. For
E&P facilities, this concept makes no sense. E&P facilities are
dependent on the success of one well before locating and drilling the
next. For the producer, there is no common plan.
In addition, EPA's existing ``common plan'' guidance is very
confusing and difficult to apply to actual E&P activities. The
definition is overly inclusive, in that activities otherwise consistent
with the ordinary course of exploration and development of an oil and
gas prospect would likely be grouped together by EPA as a ``common
plan,'' causing the (currently applicable) 5-acre threshold to be
exceeded by many common activities. Under the current guidance, even
with the 2-year deferral of the 1-acre threshold, there is great cause
for concern that EPA could conclude that the second or third or fourth
well in a field could constitute a common plan and then enforce against
a producer for failing to file for a construction permit.
Because of these concerns, IPAA believes that EPA should reconsider
its approach to stormwater construction permitting and E&P facilities.
Recently, EPA deferred until March 2005 the Phase II deadline for E&P
facilities that disturb less than five acres of land area to obtain a
stormwater permit. In the meantime, EPA will have an opportunity to
consider whether there are alternative approaches that might be
consistent with EPA's statutory authority and that would be consistent
with the environmental impacts of construction of these facilities and
minimizing the regulatory burden. IPAA believes this action is
essential. However, the issue of common plan of development remains
unclear in the recently issued Construction General Permit; failure to
clarify it could lead to unintended regulation of these small
facilities during the deferral period. Moreover, IPAA believes that EPA
should revisit its current interpretation of the CWA to address whether
it should be requiring E&P facilities of any size to be to obtain
construction permits under subsection 402(p),given the clear exclusion
in subsection 402(l).
Spill Prevention, Control, and Countermeasure Plans. The 1972 CWA
required the EPA to develop regulations to address oil spill prevention
and response. These SPCC Plans were required to be developed and
implemented in 1973.
Following a major oil spill from an Ashland oil terminal, EPA
proposed revisions to the SPCC rule on three occasions, in 1991, 1993,
and 1997. A new SPCC rule was finalized and became effective August 16,
2002. This new rule raises serious issues for E&P facilities.
An initial issue that causes concern and confusion is what triggers
the need to create an SPCC Plan. This decision must be based on whether
an operation is a ``facility'' under the regulation and whether it
could result in a release that would reach ``navigable waters''. Both
elements must be met and both pose significant questions to the
producer interpreting them.
Some sources indicate that EPA estimates that there are
approximately 144,000 oil and natural gas E&P operations that would
require SPCC Plans. However, there are approximately 876,000 producing
oil and natural gas wells in the United States. Most producers believe
that the SPCC regulation definition of a facility would capture most of
these operations. Moreover, about 650,000 of these producing wells are
marginal wells that are highly vulnerable to the impact of excessive
regulatory costs. Many of these wells could be shutdown if meeting the
new SPCC Plan requirements is too costly.
A similar fundamental issue relates to the interpretation of
navigable waters. Making a judgment regarding whether an operation
particularly one a remote area poses a threat to navigable waters has
been consistently confounding. Over the past two decades different
interpretations of the scope of the term have been complicated by
different assessments by various EPA Regional offices. Further
confusing the issue is the Supreme Court decision limiting the
definition of the term in the Solid Waste Agency of Northern Cook
County v. United States Army Corps of Engineers (``SWANCC'') case. New
guidance has been released regarding the implications of this decision
on all Federal regulations and an Advanced Notice of Proposed
Rulemaking has been published on the issue.
However, this guidance has not yet been systematically applied and
the additional regulatory action is designed to produce specific
regulations on the definition of wetlands. The outcome of these actions
significantly affects the ability of producers to determine whether an
SPCC Plan is required for their operation. Additionally, it is
essential that all EPA Regional offices consistently apply these
ultimate standards. Without some common understanding of the law,
producers will be compelled to make judgments regarding the need for
SPCC Plans that may be incorrect. They would either risk enforcement
actions or incur unnecessary costs. Neither choice is appropriate.
Moving beyond these pivotal issues, a number of other significant
issues with the new regulations must be either clarified or addressed.
Past interpretations of the SPCC Plan requirements clearly
allowed the operator to consider costs in the planning process. In the
new regulation, EPA states, ``Thus, we do not believe it is appropriate
to allow an owner or operator to consider costs or economic impacts in
any determination as to whether he can satisfy the secondary
containment requirement.'' The consequence of this approach could be
enormous for marginal wells. The costs of SPCC Plans are estimated to
range from around $5,000 to $20,000 with most of this cost associated
with secondary containment requirements. Clearly, these costs put the
economic viability of marginal wells in jeopardy.
One of the principal issues affecting these costs is a
requirement in the new regulations for secondary containment at loading
operations. A similar issue exists regarding secondary containment
related to flow lines.
EPA has concluded that produced water operations are not
exempted as wastewater treatment. This decision would subject hundreds
of thousands of produced water tanks and vessels to secondary
containment requirements when they contain only incidental amounts of
oil.
There is a significant issue regarding the availability of
licensed professional engineers to certify new SPCC Plans.
EPA has extended the compliance deadlines in the regulations 18
months. IPAA supports this extension as an opportunity to revisit the
key issues raised by the new regulation. It is important to emphasize
that the environment is not at increased risk during this extension
period. First, the SPCC Plan requirements in existence prior to the new
regulations remain in place. Second, the responsibility to report and
respond to spills is unaffected.
IPAA believes that there are three broad challenges that must be
met. First, there is a compelling need to continue the process of
developing an approach that is clearly understood by all domestic oil
and natural gas producers particularly marginal well producers. Second,
the process must yield a Plan that can be certified by licensed
professional engineers. Third, the Plan must be affordable so that both
the environmental objective of SPCC regulation can be met and domestic
production is not inappropriately impaired.
IPAA believes that EPA should develop an approach to formulating
SPCC Plans to meet the environmental risks of domestic oil and natural
gas E&P. Such an approach should be focused on addressing those
circumstances that have presented past problems. Such an approach would
assure that the limited funds available particularly for marginal well
producers are spent on areas where past experience has demonstrated a
compelling call for action.
CONCLUSION
The CWA generates many regulations to improve water quality in the
United States. But, it is essential that the CWA target issues where
regulation is truly needed and that those regulations are cost
effective. The applications of the stormwater construction permitting
requirements and the new SPCC Plan regulations to domestic oil and
natural gas E&P facilities do not meet this test. Moreover, they pose a
significant risk to the development of new domestic oil and natural gas
resources and the continued operation of existing production. In each
case, EPA needs to reconsider its actions.
IPAA appreciates the opportunity to submit this testimony.
______
Response of Lee Fuller to Additional Question from Senator Inhofe
Question. What do you believe will be the impact on clean water
protections if the oil industry lawsuit on SPCC plans results in a
clarification of the definition of the waters of the United States?
Response. Given the significant implications of the definition of
navigable waters, I do not believe that it will be resolved as a part
of the oil industry lawsuit on SPCC Plans. Earthjustice and other
groups have suggested that the Environmental Protection Agency (EPA)
and the Department of Justice (DOJ) are conducting some type of secret
negotiations to resolve the definitional question as a part of the SPCC
Plan litigation, but I do not believe that this substantial issue will
be resolved there for several reasons.
While the scope of navigable waters is essential to the
determination of whether an SPCC Plan must be prepared, the issue of
defining navigable waters after the Supreme Court decision in the
SWANNC case is far broader and extremely complicated.
The navigable waters definition confusion has been a factor in the
Clean Water Act since its initial enactment in 1972. At that time both
Houses of Congress passed Clean Water bills in 1972 with navigable
waters definitions similar to the definition used in the River and
Harbor Act. However, the final conference agreement--and ultimately the
Clean Water Act--created a new navigable waters definition. Under the
Clean Water Act, ``navigable waters'' means the waters of the United
States, including the territorial sea. However, there was little
explicit report language or debate to define the scope of the term.
Consequently, when the Clean Water Act was implemented and used an
historic navigable waters definition, litigation (Calloway) challenged
the definition and prevailed.
Since then, broad definitions of navigable waters have been used,
but different interpretations are common and problematic. The SWANNC
case precludes using migratory bird habitat as a basis for defining
navigable waters but provides little guidance beyond that. What we
really know is that the River and Harbor definition is too narrow and
migratory bird habitat is too broad.
As a result, the Bush Administration has solicited input to the EPA
and the Corps of Engineers to address the challenge of developing a
consistent, legal navigable waters definition. That effort is ongoing.
Meanwhile, several Federal court cases have been considered regarding
post-SWANNC interpretations of navigable waters. These are winding
their way through the appeals process.
Consequently, with all of these efforts and activities underway, it
is implausible that the Bush Administration would try to resolve such a
complicated and pervasive question in a settlement associated with the
SPCC Plan litigation.
__________
Statement of Professor Rena Steinzor,\1\ University of Maryland
School of Law
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\1\ I am grateful for the assistance of University of Maryland law
students Katherine Baer and Jeff Gilberg to develop the research that
forms the basis of this testimony.
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Mr. Chairman and members of the Committee, thank you for the
opportunity to appear before you today on behalf of the Center for
Progressive Regulation (CPR) to testify regarding the Environmental
Protection Agency's (EPA) implementation of the Clean Water Act.
Specifically, I plan to address EPA's enforcement record and water
quality trading policies. CPR is an organization of academics
specializing in the legal, economic, and scientific issues that
surround health, safety, and environmental regulation. The Center seeks
to provoke debate on how the government's authority and resources may
best be used to preserve collective values and hold accountable those
who ignore and trivialize them. We reject the idea that government's
only function is to increase the economic efficiency of private
markets. For further information, please see our web site at
www.progressiveregulation.org.
This Committee deserves much credit for recognizing the importance
of the topics you consider today. Deterrence-based enforcement lies at
the core of an effective regulatory program designed to maintain and
improve water quality in America. Yet congressional oversight of EPA's
enforcement record has been sporadic and, without such oversight, it is
difficult to hold the Agency accountable for keeping, so to speak, the
environmental cop on the beat.
Similarly, trading of pollution ``credits'' or ``allowances'' is
the most prominent market-based alternative to traditional regulation
now under consideration by state, Federal, and even international
governments. This hearing is one of the first to consider how best to
use trading as an innovative approach to pollution control. I
congratulate you for recognizing how crucial it is to get the design of
these initial experiments right.
That said, I am afraid I have disappointing, even alarming, news on
both fronts.
The core provisions of the Clean Water Act are under relentless
attack by powerful members of regulated industries, raising the real
possibility that the Administration will eliminate crucial protections,
squandering the gains of the last two decades. I speak here of
proposals to eliminate Federal controls on pollution for 50 to 60
percent of streams and 20 percent of wetlands. Unless and until the
states pick up the slack left by EPA and the Army Corps of Engineer
(Corps) abrupt departure from the field, these vast and irreplaceable
natural resources could be polluted, drained, or filled in by
industrial dischargers, real estate developers, and sewage treatment
plants. The cumulative impact of these changes will produce grave
erosions in water quality, not just in the affected streams and
wetlands, but in the vast bodies of water into which they feed.
In another arena, as discussed in greater detail by my colleague
Michael Lozeau, the Bush Administration is pursuing a rule on Total
Maximum Daily Loads (TMDLs) that will make it impossible for states to
establish enforceable limits for individual sources, potentially
rendering that keystone program a dead letter as a practical matter.
Ironically, these changes will undermine the state trading programs EPA
claims to support because they would also eliminate any basis for
allocating pollution allowances to individual sources.
Last but by no means least, there are ample signs that routine
enforcement is at a lower ebb than it has been in a decade. The latest
numbers indicate a precipitous decline in every measure of enforcement
effectiveness from cases brought and penalties paid to staffing levels.
But even those disconcerting statistics do not portend what may well be
in store in the next several years as EPA's ``brain trust'' of
experienced civil servants drains away. Because enforcement is such an
important measure of the Agency's effectiveness, I will consider it
first and then turn to Agency's trading policy.
ENFORCEMENT
Overall, enforcement of environmental laws has decreased
dramatically since the Bush Administration came to power. For example,
the number of EPA inspection and enforcement staff has fallen to its
lowest level since establishment of the Agency, dropping by more than
12 percent since the Administration took office.\2\ Additionally, fewer
violators pay penalties and those who do pay are paying less. Violators
have paid 64 percent less in fines for breaking environmental laws
during the first 2 years of the Bush Administration than they did under
the Clinton Administration.\3\ The average civil penalty paid by
polluters has dropped from $1.36 million to $605,455 and polluters pay
77 percent less for required supplemental environmental projects (SEPs)
as part of settlement agreements.\4\ Apparently this trend will only
continue in his 2003 budget request the President sought to eliminate
the positions of over 200 enforcement personnel.\5\
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\2\ Natural Resources Defense Council, Rewriting the Rules, Year-
End Report 2002: The Bush Administration's Assault on the Environment.
Jan.2003, p. 26.
\3\ Id. at 27.
\4\ Id.
\5\ Id. at 26.
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Despite the importance of preserving quality of the nation's
surface waters, enforcement under the CWA parallels the general decline
of environmental enforcement.\6\ As a direct result, compliance rates
are also declining. A recent report by EPA's Office of Enforcement and
Compliance Assurance (OECA) on the performance of the major National
Pollutant Discharge Elimination System (NPDES) permits reveals that
enforcement activity for these dischargers has also declined from 1999
to 2001.\7\ The percent of major NPDES permits in significant
noncompliance increased from 16 percent to 24 percent from 1994 to
2001.\8\ The number of inspections declined by 8 percent and the
percent of facilities that were inspected declined by 6 percent.\9\
There was a 50 percent decrease in the number of informal enforcement
actions and a 45 percent decrease in formal actions.\10\ Initiation of
administrative complaint orders (ACOs) declined by 31 percent, and the
initiation of administrative penalty order (APO) complaints declined by
28 percent.\11\
---------------------------------------------------------------------------
\6\ Id. at 26.
\7\ A Pilot Performance Analysis of Selected Components of the
National Enforcement and Compliance Assistance Program, OECA EPA, Feb.
2003 [hereinafter OECA Analysis].
\8\ Id. at 10.
\9\ Id. at 17.
\10\ Id.
\11\ Id. at 18.
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Yet even these statistics do not capture the implications of a
downward spiral in this arena. My fellow CPR member scholar, Joel
Mintz, a professor at Nova Southeastern University and the author of
the seminal book Enforcement at the EPA,\12\ is in the process of doing
field research on the reasons why the Bush Administration has such a
poor track record in this arena. Specifically, Professor Mintz
interviewed about 20 enforcement officials at EPA and the Department of
Justice (DOJ), both at their Washington D.C. headquarters offices and
in some of the EPA regions. Based on those conversations, he has
developed the following preliminary findings:
---------------------------------------------------------------------------
\12\ Joel A. Mintz, Enforcement at the EPA: High States and Hard
Choices (1995).
---------------------------------------------------------------------------
Most EPA enforcement cases in the past 2 years have been
directed at relatively small violations. The Agency has largely avoided
the kinds of coordinated enforcement initiatives that proved so
successful in the 1980's and 90's, under both Democratic and Republican
Administrations. The non-Superfund enforcement that EPA has been doing
is hampered by an extraordinary shortage of attorney resources at the
Justice Department.
Part of the reason for this shortage is that DOJ has
assigned a very large number of attorneys to try enforcement cases
against electric utilities based on the New Source Review provisions of
the Clean Air Act. Even as those resources are expended, other
components of the Administration have systematically undercut those
cases through public statements and policy changes.
EPA's Senior Executive Service (SES) personnel, who are
the high level, career civil servants with the greatest collective
expertise regarding EPA enforcement policies and techniques, are almost
totally isolated within the Agency. Political appointees, especially in
the Agency's regional offices, almost never consult SES people on
important policy questions. As a result, their morale, and the morale
of many who report to them, is very low.
Many senior enforcement managers at the Agency have
retired or plan to retire shortly. This trend is causing a severe loss
of the expertise and institutional memory that are crucial to the
success of vigorous EPA enforcement efforts.
Clean Water Act enforcement is crucial to protecting public health;
as just one example, as many as 13 percent of effluent violations for
major sources emitting toxic pollutants exceed regulatory limits by
more than 1,000 percent.\13\ Additionally, enforcement spurs pollution
prevention and treatment. Although the data are not complete, the
percentage of pollutant reduction, elimination, and increased treatment
that results from enforcement actions has increased as a percentage of
the total enforcement actions taken.\14\
---------------------------------------------------------------------------
\13\ OECA Analysis, supra note 10, at 6.
\14\ Id. at 7.
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Given its importance, what accounts for these disturbing
indications that EPA's enforcement program is, quite literally, falling
apart? It has become very clear that this Administration is just not
committed to deterrence-based enforcement of the nation's environmental
laws. But what are the underlying reasons or justifications for that
fact?
To be sure, the Nation faces many challenges at home and abroad
and, in the absence of a fundamental change in fiscal policies (e.g.,
the determined pursuit of recent tax cuts despite a worsening economy),
resources for domestic programs will continue to be very limited. But
deterrence-based enforcement that is, the publicized prosecution of a
few bad actors to create a disincentive for further law violations
among a regulated industry as a whole is far more important when
resources are tight because the only alternative is the far more
resource-intensive practice of cajoling lawbreakers back into
compliance.
Whatever the explanation, CPR urges this Committee to remain
focused on enforcement as a leading topic for continued oversight of
EPA.
TRADING
Overall Advantages and Principles.--Trading can be an effective, as
well as efficient, management tool under conditions where reliable
methods allow us to allocate allowances and track trades, as well as to
detect unforeseen consequences. It also has two very significant
political advantages.
First, trading has the potential to break political stalemate. The
acid rain program established by the 1990 Clean Air Act Amendments
broke a 13-year legislative stalemate regarding whether and how to
control sulfur dioxide emissions from power plants. By making the fight
about how to carve up the pie of total allowances, rather than whether
to bake the pie in the first place, trading proved an extremely
successful solution to what had become an intractable problem.
Second, regulated industrial sources perceived trading as lowering
compliance costs to the point that they were affordable, especially in
the Midwest, where the ``big dirties'' insisted they could not afford
to comply with traditional pollution requirements. Everyone involved in
the debate over environmental regulation recognizes the validity of
industry preoccupation with costs, although it is also true that pre-
implementation cost estimates are often exaggerated.
Trading works especially well when the pollutants at issue have a
cumulative, long-term effect on the environment and do not pose
immediate, short-term risks except in extraordinarily high
concentrations. Expanding the use of trading to situations where it
replaces regulatory requirements and produces localized pollution ``hot
spots'' that harm human health and the environment will only serve to
discredit it as a viable approach for environmental protection in the
new millennium.
Water quality trading policy at the Federal and state levels should
focus on control of nutrients by fostering exchanges between point and
non-point sources. Water trading programs must:Include an appropriately
low, and steadily declining, cap on total discharges;
Rely on accurate methods for measuring emissions, awarding
allowances, and reconciling the number of allocated allowances with
subsequent trades;
Prevent the formation of localized hot spots;
Involve the public in the setting of caps and the
operation of the program; and
Rest on a foundation of enforceable commitments.
For a further discussion of these issues, please see Rena I.
Steinzor, Toward Better Bubbles and Future Lives: A Progressive
Response to the Conservative Agenda for Reforming Environmental Law, 32
Envtl. L. Rep. 11421 (Dec. 2002).
Analysis of EPA Guidance.--EPA's Water Trading Policy encourages
states and tribes to develop water quality trading programs for a
variety of constituents as a way to achieve water quality improvements
at lowered costs. The Policy is premised on the basis that flexibility
and economic efficiency will yield greater environmental benefits than
traditional regulatory approaches. Water quality trading supposedly
allows ``one source to meet its regulatory obligations by using
pollutant reductions created by another source that has lower pollution
control costs.''\15\ Further, the Water Trading Policy restricts
trading to a watershed or Total Maximum Daily Load (TMDL)-defined
segment, although there are no stated limitations on the size of the
watershed.\16\ EPA specifically supports trading in situations,
including the following, where trading:\17\
---------------------------------------------------------------------------
\15\ U.S. EPA, Water Trading Policy (January 13, 2003) at 1
(emphasis added), available at www.epa.gov/owow/watershed/trading/
finalpolicy2003.pdf [hereinafter Water Trading Policy].
\16\ Id. at 4.
\17\ Id. at 3 and 6.Achieves early reductions and progress toward
water quality standards pending development of TMDLS for impaired
waters.
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Reduces the costs of TMDL implementation.
Provides economic incentives for voluntary pollutant
reductions.
Reduces the cost of compliance with water quality based
requirements.
Offsets new or increased discharge to maintain support for
designated uses.
Creates ancillary benefits (e.g., wetland creation).
The Policy does not support trading to comply with existing
technology-based effluent limitations.\18\
---------------------------------------------------------------------------
\18\ Id. at 6.
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CONSISTENCY WITH THE CLEAN WATER ACT
Although the Policy states that trading is supposed to be
consistent with the CWA and ``aligned with and incorporated into core
water quality programs'' (e.g., watershed plans, water quality
standards, the continuing planning process),\19\ the CWA does not
provide any statutory language to authorize trading.\20\ In this sense,
the CWA is in sharp contrast to the Clean Air Act, which broadly
employs trading to reduce emissions as part of several programs.
Significant CAA trading programs, however, were written into the Act as
explicit statutory authority, including provisions for compliance
monitoring and enforcement.\21\ Because the Policy, like the creation
of CAA offsets and SO2 trading, attempts to create an inter-
source trading program to achieve environmental gains by significantly
changing the permitting system, these changes must occur at the
legislative level, and not via guidance.
---------------------------------------------------------------------------
\19\ Id. at 4 and 6.
\20\ Ann Powers, Reducing Nitrogen Pollution on Long Island Sound:
Is There a Place for Pollutant Trading? 23 Colum. J. Envtl. L. 137, 168
(1998) (hereinafter referred to as Powers).
\21\ Id. at 162.
---------------------------------------------------------------------------
Congress also apparently recognizes the fact that trading is not
currently authorized by the CWA as reflected by a previous attempt to
add such authority to the CWA. The Water Quality Act of 1994 to amend
the CWA included a number of provisions directed at controlling
nonpoint source pollution.\22\ Specifically, the bill included
provisions for enforceable nonpoint source pollution plans and the
study of trading programs.\23\ At the bill's introduction sponsor
Representative Mineta stated that a provision with a mechanism to
authorize pollution trading would be added.\24\ Ultimately the bill was
not enacted, thus leaving the CWA without authorization for such water
quality trading.
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\22\ H.R. 3948, 103d Cong. (1994).
\23\ H.R. 3948, 103d Cong. Sec. 314 (1994).
\24\ 140 Cong. Rec. 353 (1994)(remarks of Rep. Mineta).
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MECHANISMS FOR TRADING
The Water Trading Policy states that trading can legally be
accomplished by incorporating trading into water quality management
plans, the continuing planning process, watershed plans, water quality
standards, TMDLs and NPDES permits.\25\ Clearly, however, trading
cannot be used by an NPDES permittee to achieve its primary technology-
based effluent limits, as recognized in the Policy. However, the Policy
also states that EPA will consider revising certain effluent
limitations to allow such technology-based trading,\26\ which would
undermine the basic structure of the CWA that Congress created based
upon point source effluent controls.\27\
---------------------------------------------------------------------------
\25\ Water Trading Policy, supra note 15, at 6.
\26\ Id.
\27\ Sen. Rpt. 92-414, at 3675 (Oct. 28, 1971).
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NPDES permits, in addition to technology limits, must also include
water quality-based limits to ensure that ambient water quality
standards are not violated.\28\ The Water Trading Policy identifies
trading to meet water quality standards as an instance where trading
may occur to offset an increased discharge. This sort of trade to meet
water quality standards is inconsistent with the CWA and merely moves a
pollution problem from one spot to another. Legally a point source
cannot violate its water quality standards in exchange for a reduction
elsewhere. Allowing a point source to buy credits instead of meeting
water quality-based effluent limitations is also a poor policy choice
because, by definition, it would allow pollutants to be discharged at
levels that would be inconsistent with the designated uses protected by
the water quality standards at the point of discharge.
---------------------------------------------------------------------------
\28\ 33 U.S.C. Sec. 1311 (b)(1)(C).
---------------------------------------------------------------------------
Ironically, these aspects of the Water Trading Policy appear to
contradict other provisions of the same document that define a
pollution ``credit'' as reductions greater than those mandated by a
regulatory requirement or established by a TMDL.\29\ Unfortunately,
this apparent contradiction can be reconciled if one remembers that
TMDLs apply over a far greater area than the water quality standards
that are incorporated into individual permits in the form of discharge
limits. Even if EPA insists, as a practical matter, that trading comply
with TMDLs, numerous plant-specific violations of Water Quality
Standards could easily occur. Indeed, the new guidance would have
little value to industry if it did not produce this outcome.
---------------------------------------------------------------------------
\29\ Water Trading Policy, supra note 15, at 5.
---------------------------------------------------------------------------
VALID TRADING OPPORTUNITIES: TMDLS FOR NUTRIENTS
EPA trading supporters probably dismiss the complaints of
environmentalists on the basis that we have never seen trading that we
like. This perception is wrong and allows staff to evade real problems
with the Water Trading Policy using a heavily politicized rationale. In
meeting after meeting with top EPA officials, national
environmentalists repeatedly stated that, while trading to meet permit
standards under an NPDES permit is troublesome, TMDLs\30\ for nutrients
provide optimal vehicles for trading to occur. Under TMDLs trading can
be limited to circumstances in which there is adequate information on
ambient water quality, sources of pollution, current loadings, and the
amount of reduction needed to meet water quality standards (i.e.
baseline loadings and a declining pollution cap), which are all
provided by the TMDL program.
---------------------------------------------------------------------------
\30\ 33 U.S.C. Sec. 1313(d)(3).
---------------------------------------------------------------------------
Unfortunately, the Policy allows pre-TMDL trading.\31\ This tactic
effectively attempts to circumvent the TMDL process and implement
trading without a baseline or cap provided by a TMDL. Trading should be
allowed to occur only when there is a TMDL in place and the trading
program is consistent with TMDL allocations.
---------------------------------------------------------------------------
\31\ Water Trading Policy, supra note 15, at 5.
---------------------------------------------------------------------------
For trading to improve water quality, it must either be limited to
point-point trading of reductions exceeding those already required
under an NPDES permit (technology and water-quality-based standards) or
be done to implement future reductions under a TMDL designed to meet
water quality standards. Without a TMDL, EPA cannot allocate a
reliable, environmentally sound baseline of initial ``credits'' are
allocated. Trading without a reliable baseline and cap could result in
environmental degradation, not environmental improvement. This result
could occur, for example, if trading is allowed in a waterbody impaired
by both point sources and nonpoint sources, where the point sources
trade needed additional reductions with some nonpoint sources, yet
other nonpoint sources increase their discharges more than the amount
of the trade.
TRADABLE CONSTITUENTS: NUTRIENTS VERSUS TOXICS\32\
---------------------------------------------------------------------------
\32\ Id. at 4.
---------------------------------------------------------------------------
According to the Policy:
Nutrients (TN, TP) and sediments including cross-pollutant
trading for oxygen related pollutants are tradable as a matter of
course.
``Other'' pollutants (e.g., NH4, Se) can be
traded on a case-by-case basis where prior approval is provided via an
NPDES permit, TMDL, or as part of a state/tribal watershed plan or
pilot trading project.
No trading of ``persistent bioaccumulative toxics'' (PBTs)
is supported unless it is part of a pilot project to obtain more
information about PBT trading.
Nutrients provide an excellent opportunity for trading because they
are a leading cause of water quality impairment and are largely
attributable to nonpoint sources of pollution, which are inadequately
controlled. However, because many states do not yet have water quality
standards for phosphorus and nitrogen, trading to reduce these
nutrients should only occur in a TMDL situation where there is good
data about baseline conditions and a declining cap can be implemented.
Cross-pollutant trading, on the other hand, is extremely complicated,
because it makes tracking and monitoring difficult.
As for toxics, needless to say, one person's ``pilot project,'' if
replicated often enough, is another person's entire program. It is
profoundly disappointing that EPA did not shut the door to these
dangerous experiments not just with environmental quality, but with
public health. Trading must not apply to toxic pollutants because of
the risk to human health aquatic life and the potential to create ``hot
spots.'' A hot spot is a localized concentration of pollutants in
excess of water quality standards, which could result in fish kills and
contamination, adverse human exposure, beach closures, and other
impacts on aquatic life. The potential for creating hot spots is
particularly troublesome in the case of toxics since the hot spots
created today may not dissipate for decades or even centuries to come,
but may instead persist in the sediment or increase in the food chain
through bioaccumulation and biomagnification.
THE MERCURY EXAMPLE: NOT JUST WATER, BUT ALSO AIR
Mercury, for example, is recognized as a serious threat to human
health that poses a threat to children and pregnant women who eat a
range of fish.\33\ Once mercury is deposited in water, fish absorb it.
When humans eat the fish, their bodies take in the poison. At even very
low levels, mercury poisoning in pregnant women damages their babies'
central nervous system and causes heart, kidney and brain damage. Yet
pregnant women are not the only ones at risk. After a yearlong study, a
San Francisco physician announced in November 2002 that she had found
symptoms of low-level mercury poisoning in dozens of her patients who
consumed typical amounts of fish. Symptoms included hair loss, fatigue,
depression, difficulty concentrating, and headaches.
---------------------------------------------------------------------------
\33\ USATODAY, USATODAY.com, Anita Manning, If you Eat a lot of
Fish, you may Run a Health Risk, (Nov. 4, 2002).
---------------------------------------------------------------------------
In addition, the families of low-income, subsistence fishermen, who
rely on daily catch for the protein portion of their diet, are at even
greater risk. In 2001, 44 states issued public-health warnings that
people should not eat mercury-contaminated fish from local waters. The
Great Lakes, the Florida Everglades, and portions of the Chesapeake Bay
are afflicted, along with hundreds of other lesser-known water bodies.
Provoked by the very severe problems in the Great Lakes, a broad
coalition of sportsmen, wildlife groups, and environmentalists has
urged EPA to work toward a phase-out of all mercury pollution.
In nine states, fish advisories for mercury extend from inland
lakes to coastal waters where tuna and other popular fish are caught.
Tuna is the most consumed fish in the country, but because of concerns
about mercury, many experts recommend that pregnant women limit
themselves to two small cans per week. As one indication of the extent
of this problem, the Senate Environment and Public Works Committee
passed legislation in 2002 that bans mercury thermometers a mere drop
in the bucket by comparison to the quantities of mercury that could be
traded the Administration is now prepared to let industry pump into the
environment.
EPA, in fact, has already funded one mercury pilot project in
Sacramento.\34\ How many more may be in the pipeline is anyone's guess.
---------------------------------------------------------------------------
\34\ U.S. EPA, Office of Water, Press Release: EPA Releases
Innovative Approach to Cleaner Water 11 Pilot Projects Receive More
than $800,000 in Funding, Jan. 13, 2003 (last updated Jan. 13,
2003).
---------------------------------------------------------------------------
To add insult to injury, the Administration's ``Clear Skies''
initiative would establish a complex credit-swapping scheme by which
power plants will be entitled to trade mercury emissions. Most of the
mercury that ends up in the water is released first into the air, from
smokestacks where large utilities burn coal. The heavy metal particles
in the smoke fall down into the water. The President's Clear Skies
initiative, supposedly crafted to clean up the air more cheaply, would
permit the creation of hot spots with vastly more mercury than the
environment can sustain.
For 30 years, the standard approach has been to force plants to put
scrubbers on their stacks so that the worst pollution will be removed
before it goes into the air and EPA is overdue in promulgating Maximum
Achievable Control Technology (MACT) for mercury. But the Bush
Administration has decided that this straightforward solution is too
costly for the utility industry. Clear Skies permits power plants to
trade unused credits with plants up or downwind, even if mercury
emissions land where fish are spawned. Worse, high sulfur coal, such as
the coal used by the infamous ``Big Dirties'' in the Midwest, produces
more mercury than low sulfur coal, used by the relatively clean power
plants in the southwest. There is nothing in the Clear Skies proposal
that prohibits trading of mercury credits generated by utilities in the
arid southwestern deserts while the Great Lakes, the Everglades, and
the Chesapeake Bay become more polluted.
ANTIDEGRADATION
The Water Trading Policy also states that antidegradation review is
not required as part of trading programs because EPA does not believe
that trading will result in ``lower water quality'' where trading
programs result in a no net increase of pollutants.\35\ This claim
assumes that trades are done by plants in close proximity. However, the
Policy permits individual trades between sources at some distance from
each other, as long as such sources are located within a watershed,
raising the real possibility of a localized pollutant impact that would
require an antidegradation analysis.
---------------------------------------------------------------------------
\35\ Water Trading Policy, supra note 15, at 8.
---------------------------------------------------------------------------
ENFORCEMENT AND MONITORING: THE POTENTIAL FOR WASTE AND FRAUD
Although the Water Trading Policy lists elements that should be
used to ensure a successful state/tribal trading program, there is no
requirement that states or tribes include any of these elements. This
permissiveness is especially troubling with respect to provisions for
enforcement or monitoring.\36\ For example, the Water Trading Policy
recommends that credits should be generated before or at the same time
as they are used to comply with a limit, that standardized protocols
should be used to account for the uncertainty associated with reduction
of nonpoint source (NPS) pollution, and that there should be methods
for determining compliance.\37\ Trading programs, however, are subject
to manipulation and fraud and thus demand stringent monitoring and
enforcement mechanisms.\38\ Failed programs to reduce air pollution in
Los Angeles by the South Coast Air Quality Management District make
this point clear.\39\ In that case, stationary sources purchased
credits, including from vehicle owners to take their old engines off
the road, and without adequate monitoring the result was fraud and the
creation of volatile organic compound hotspots in minority
neighborhoods.\40\ This real life and spectacular failure makes plain
that all trades should be governed by a regulation, permit, or other
enforceable mechanism with both governmental and citizen enforcement
provisions.
---------------------------------------------------------------------------
\36\ Id. at 9 and 10.
\37\ Id.
\38\ Rena Steinzor, Center for Progressive Regulation, Testimony
before the House Subcommittee on Water Resources and the Environment of
the U.S. House of Representatives regarding Water Quality Trading: An
Innovative Approach to Achieving Water Quality Goals on a Watershed
Basis. June 13, 2002 [hereinafter Steinzor Testimony].
\39\Richard Toshiyuki Drury, et al., Pollution Trading and
Environmental Injustice: Los Angeles' Failed Experiment in Air Quality
Policy, 9 Duke Envtl. L. & Pol'y. For. 231 (1999).
\40\ Steinzor Testimony, supra note 38.
---------------------------------------------------------------------------
The Policy offers some sound ideas such as consideration of
compliance history to determine trading eligibility.\41\ But these
ideas must be transformed from notions into requirements for a trading
program. Additionally, EPA oversight and approval for all trading
programs is crucial, but it is a responsibility that is abdicated in
the Policy, which states that ``EPA does not believe that the
development and implementation by states and tribes of trading programs
consistent with the provisions of this policy necessarily warrant a
higher level of scrutiny under these oversight authorities [NPDES and
TMDL] than is appropriate for activities not involving trading.''\42\
On the contrary, continual EPA oversight of any state trading program
is important both to the state agency and to those who use state
waterbodies.
---------------------------------------------------------------------------
\41\ Water Trading Policy, supra note 15, at 10.
\42\ Id. at 11.
---------------------------------------------------------------------------
Compounding the potential for waste and fraud is the fact that the
technology necessary to measure pollution reductions at non-point
sources is still in it infancy. Consider, for example, a promise by
agribusiness to erect a tree buffer to stop run-off from reaching the
local water body. It is far more of an art than a science to predict
how effective the buffer will be in stopping run-off, especially since
meteorology, topology, and geology (e.g., soil type) play such a
crucial role in those determinations.
For this reason, environmentalists have called for trading ratios
that would compensate for problems in the methodology of measuring non-
point emissions by requiring, for example, two credits from a non-point
source to be traded for one credit from a point source. The EPA Policy,
however, neither acknowledges these problems nor recommends this kind
of solution.
PUBLIC INVOLVEMENT
Public participation is key to environmental programs, and similar
to monitoring and enforcement, EPA makes references to public
participation and access to information but without any specific
requirements.\43\ If the trade is part of an NPDES permit, the public
will have a chance to comment only when the permit including a trading
program is issued, but not for each trade. For trades that are not part
of an NPDES permit, the opportunity for public involvement is
unspecified and the Policy supports public participation and access to
information and encourages states and tribes to make information
available. There are no requirements, however, for such involvement.
---------------------------------------------------------------------------
\43\ Id. at 10.
---------------------------------------------------------------------------
The public must have a seat at the table when developing a trading
program. All trading programs involve changes to components of a state
water pollution program that require full public review (e.g., the
TMDL, the NPDES program, the impaired waters list, etc). The public
must be allowed to comment on and object to proposed trades, and should
be given adequate information to track trades and their water quality
effects. The Policy ``encourages'' entities to make trading information
available to the public, but does not call for public comment on
proposed trades or publicly available information on water quality
impacts.
SUMMARY
Water quality trading offers promise in solving some of our
remaining and intractable water quality problems. It is not, however,
the ``silver bullet'' answer to solve all problems. Each trading
program must be tailored to local conditions and based upon a legally
defensible background that will support trading consistent with
existing legislative authority. To achieve real gains, trading must
focus on reducing nutrients in TMDL settings with an enforceable and
declining cap against which credits can be measured.
______
Environmental Integrity Project
paying less to pollute
The Decline of Environmental Enforcement at EPA Under the Bush
Administration
[GRAPHIC] [TIFF OMITTED] T2384.010
Executive Summary
Shortly after taking the reins at the Environmental Protection
Agency, the Bush Administration announced that it would cut the
Agency's enforcement staff by 270 positions. The Administration has
also made clear that it does not support the laws that EPA has been
trying to enforce that prevent aging power plants, refineries, and
other factories from increasing pollution when they expand.
Predictably, these decisions have begun to take their toll on EPA's
ability to persuade violators to agree to settle enforcement actions
brought against them.
In the 2002 fiscal year--the first full year in which EPA was under
the thumb of the Bush Administration and its allies in the energy
lobby--the number of penalties recovered from polluters in civil cases
that were settled in Federal court declined by half compared to the
previous 3 year average. Defendants paid over $130 million, $84
million, and $94 million, respectively, in fiscal years 1999, 2000, and
2001 to settle judicial actions. In 2002, the U.S. Government was able
to recover only $51 million in civil penalties. In addition, nearly
two-thirds of penalties in the 2001 fiscal year (October 1, 2000 to
September 30, 2001) came from settlements lodged before the Bush
Administration took office on January 20, 2001. Declining penalties can
be explained in part by the absence of large settlements with the kind
of Fortune 1000 companies that were the subject of large enforcement
actions in prior years.
In addition to paying penalties, companies are expected to return
to compliance. EPA, however, will reduce penalties somewhat for those
willing to undertake ``supplemental environmental projects'' or
``SEPs'' that bind companies to do work that is well beyond what is
required to comply with the law. These SEPs offer substantial benefits
to local communities by, for example, financing the purchase and
preservation of wetlands and greenspace, underwriting the cost of
fenceline monitoring and mobile asthma clinics, or supporting
conversion of bus fleets to natural gas. The value of these SEPs
declined from a 3-year average of $106 million between fiscal years
1999 and 2001, to only $43 million in 2002. Significantly, more than
half of the SEPs obtained in the 2001 fiscal year originated from
settlements lodged during the Clinton Administration.
Attachment A documents the current Administration's persistent
campaign to cut back on enforcement staffing at EPA. By undercutting
the enforcement program, the Administration has hamstrung EPA's power
to effectively negotiate for environmental projects. The U.S. Senate
has acted to restore full funding to EPA's enforcement program, which
could help to reverse this trend, but has been stymied by the U.S.
House of Representatives' push to restore only partial funding that
would leave EPA with more than 100 fewer enforcement positions than it
had when the current Administration took office. Meanwhile, the Bush
Administration has made existing clean air laws even harder to enforce
by weakening rules that require plants to obtain permits and install
pollution controls. See Environmental Integrity Project (EIP), Turning
the Clock Back on the Clean Air Act (Oct. 2002); EIP, Bright Lines or
Loopholes? (Dec. 2002).
The attached analysis is based on a review of EPA cases lodged in
Federal court over the past four fiscal years. Because all judicial
settlements that resolve ongoing violations have to be published in the
Federal Register for comment, the Environmental Integrity Project was
able to obtain penalty and SEP data for almost all cases by searching
through the LEXIS inventory of Federal Register notices. EIP compared
the notices to EPA's announcements and press advisories on judicial
cases and Department of Justice docket data obtained through a Freedom
of Information Act request. The attached charts indicate ``no value
given'' where the notice of lodging notes that there was a penalty or
SEP obtained but does not state a specific amount. Entries are left
completely blank in a handful of cases where the notices of lodging
make no reference to penalties or SEPs whatsoever.
This analysis focuses on settlements lodged under the Clean Air
Act, Clean Water Act, the Resource Conservation and Recovery Act, and
several other statutes. According to Department of Justice data, a
small number of cases brought in fiscal years 2001 and 2002 were not
lodged. These settlements required only payment of a penalty, generally
because the facility had closed or already returned to compliance.
Because this data was not available from prior years, it was not
included in this analysis. Similarly, enforcement actions establishing
the government's environmental claims in bankruptcy cases were omitted,
as recovery is uncertain under such circumstances.
The attached does not include Superfund cases, or a tally of
natural resource damages under the Oil Pollution Act. It also does not
include administrative actions, as that data is not yet available.
Nevertheless, judicial cases typically account for more than two-thirds
of penalties and supplemental environmental benefits recovered in civil
enforcement cases. The analysis is limited to civil enforcement cases,
and does not include statistics from the criminal enforcement program,
as these are not yet readily available.
No single statistic can capture the full range of benefits realized
when environmental laws are enforced. Moreover, enforcement trends tend
to be cyclical in nature, making it possible that the results for
fiscal year 2002 are an aberration. Unfortunately, it is more likely
that these numbers reflect an intentional effort to weaken enforcement
efforts, indicating that the Bush Administration will do little to
enforce environmental laws unless the public demands it.
[GRAPHIC] [TIFF OMITTED] T2384.011
Responses of Rena Steinzor to Additional Questions from Senator
Jeffords
Question 1. Is the government somehow precluded from offering
immunity under the criminal negligence section of the Clean Water Act?
Response. In a word, no. Like every other provisions of Federal
criminal law, this section does not preclude the government from
offering immunity to cooperating witnesses. The major rationale offered
by those who wish to narrow the negligence provision is that it impedes
government investigations of accidents because witnesses are too afraid
to cooperate. Given the government's unimpeded authority to offer
immunity, it is difficult to understand the basis for this argument.
Question 2. On page 3 of Mr. Hall's testimony, he outlines a
scenario where the FAA provides for lenience when individuals self-
disclose violations. He implies that the same does not exist at EPA or
elsewhere in the Federal Government.
Attached are three key documents related to this point.
(1) First, EPA's 1994 memo on the Exercise of Investigative
Discretion states that significant environmental harm and culpable
conduct should be present before deciding to proceed with a criminal
case; (2) Second, the US Department of Justice Spring 2000 Status
Report on the Use of Immunity and Evidentiary Privileges to Encourage
Voluntary Disclosure of Self-Discovered Regulatory Violations described
the use of voluntary disclosure policies like the one you describe at
FAA throughout the government. It cites the long standing 1991 policy
of the Environment and Natural Resources Division that voluntary
disclosure will lead to criminal prosecutorial leniency; (3) Third, the
EPA December 1995 policy statement provides incentives such as
elimination of the gravity component of civil penalties and not
recommending cases for criminal prosecution in situations where
voluntary disclosure has occurred.
Ms. Steinzor, it would appear that these documents as well as other
similar documents found at the FBI and the Coast Guard offers the very
protection Mr. Hall describes at the FAA. In addition, it seems that
these documents would limit the use of criminal prosecutorial tools to
a fairly limited universe of cases. Can you comment on this?
Response. Yes, these documents substantially limit the use of
criminal prosecutorial tools to a very limited universe of cases. Not
only is criminal prosecution reserved for the most significant and
egregious violations, but leniency policies are in place that encourage
companies to voluntarily disclose environmental violations so as to
avoid criminal prosecution. Accordingly, very few cases are actually
criminally prosecuted. The three documents mentioned in the above
question specifically support this contention.
First, the EPA's 1994 memo on the Exercise of Investigative
Discretion explicitly recognizes that there are ``specific factors that
distinguish cases meriting criminal investigation.'' (EPA 1994 memo,
page 1) More specifically, the criminal case selection process is
``guided by two general measures--significant environmental harm and
culpable conduct.'' (EPA 1994 memo, page 3) Investigative discretion is
based upon whether--and to what extent--these two general measures are
present.
In deciding whether significant environmental harm has occurred,
investigators will examine four factors. Specifically, investigators
will consider: (a) the actual harm, either to the environment or human
health, caused by the illegal discharge, release, or emission; (b) the
threat of significant harm, either to the environment or human health,
caused by the illegal discharge, release, or emission; (c) the failure
to report the discharge, release, or emission; and, (d) the likelihood
of the illegal conduct representing a trend or common attitude within
the regulated community (EPA 1994 memo, page 4). The more of these
factors that are present, the greater the chance that investigators
will find that significant environmental harm has occurred.
In deciding whether culpable conduct has been exhibited,
investigators will consider five factors. Specifically, investigators
will determine whether: (a) there is a history of repeated violations;
(b) the violation was a result of deliberate misconduct; (c) an attempt
was made to conceal the misconduct; (d) monitoring or control equipment
was tampered with; and, (e) the business operation was conducted with
the proper permit, license, manifest, or other required documentation.
(EPA 1994 memo, page 5) Again, if more than one of these factors are
present, there is a greater chance that investigators will find that
culpable conduct has been exhibited.
After considering the two general measures explained above,
investigators will decide whether to proceed criminally. However, even
if investigators elect to do so, it doesn't necessarily translate into
a criminal prosecution. In fact, this exercise of investigative
discretion is but a ``critical precursor to the prosecutorial
discretion later exercised by the Department of Justice. (EPA 1994
memo, page 3) In addition, when a case does not meet the specific
criteria to proceed criminally, as is the case most of the time, it is
``systematically referred back to the Agency's civil enforcement office
for appropriate administrative or civil judicial action.'' (EPA 1994
memo, page 3) Therefore, investigators neither arbitrarily nor
recklessly decide whether to criminally proceed. Rather, two general
measures and several accompanying factors are considered in order to
reach an appropriate determination. Accordingly, the criminal
enforcement authority entrusted is taken very seriously and is used
only to prosecute the ``most significant and egregious violators.''
(EPA 1994 memo, pages 2, 7)
Second, as explained in the US Department of Justice Spring 2000
Status Report on the Use of Immunity and Evidentiary Privileges to
Encourage Voluntary Disclosure of Self-Discovered Regulatory
Violations, many Federal agencies have supported and/or adopted
leniency policies, which ``reduce or waive penalties for violations
that were voluntarily discovered, promptly disclosed, and quickly
remedied.'' (DOJ 2000 Status Report, page 1) These policies--modeled on
``discretionary leniency''--encourage disclosure while preserving
Federal discretion to impose appropriate administrative and civil
sanctions. (DOJ 2000 Status Report, pages 1-2) Therefore, companies are
given an opportunity to escape criminal prosecution so long as they
voluntarily disclose such violations and quickly remedy the problems
that the violation caused.
Third, in its December 1995 policy statement, the EPA provides for
such a leniency policy. More specifically, the EPA policy seeks to
``enhance protection of human health and the environment [by
encouraging voluntary disclosure of environmental violations].'' (EPA
1995 policy statement, page 66706) In exchange for such disclosure, the
EPA offers the incentives of ``eliminating or substantially reducing
the gravity component of civil penalties and not recommending cases for
criminal prosecution.'' (EPA 1995 policy statement, page 66706)
Therefore, the EPA itself offers violators an opportunity to avoid
criminal prosecution by voluntary disclosing the details of the
violation.
As Robin Greenwald alluded to in her testimony, two former chiefs
of the Department of Justice, Environmental Crimes Section, Ronald
Sarachan and Steven Solow, undertook a statistical analysis
illustrating that of the 1,436 environmental crimes prosecuted from
1987 to 1997, only 86, or approximately 6 percent, were negligence
cases. Clearly, the EPA and DOJ have taken very seriously their
authority to criminally investigate and prosecute environmental
violations. Furthermore, as my testimony reflects, an environmental
violation that was merely an accident has never been criminally
prosecuted. Rather, as the EPA sets forth, the criminal enforcement
authority is used only to prosecute the ``most significant and
egregious violators.'' (EPA 1994 memo, pages 2, 7)
Question 3. Section 309 of the Clean Water Act has been used in a
number of prosecutions involving both environmental damage and personal
injury. Can you describe a few cases other than the Hanousek and the
Hong cases that have resulted in successful enforcement actions against
violators?
Response. There are three other cases that immediately come to mind
as examples of successful enforcement actions under Section 309 of the
Clean Water Act. First, as noted by Ms. Greenwald's testimony, the
Exxon Valdez oil spill was perhaps ``one of the worst environmental
catastrophes in this country.'' In that case, the specific negligence
was Exxon's decision to allow a known alcoholic to ``navigate the barge
in the Prince William Sound.'' The combination of ``significant
environmental harm'' and ``culpable conduct'' in the Exxon spill made
this case a clear Section 309 criminal enforcement.
Second, also noted by Ms. Greenwald's testimony, the Colonial
Pipeline spill in the Reedy River is another example of a significant
environmental harm resulting from the negligence of an operator. In
particular, there was a ``tremendous loss'' of nearly one million
gallons of petroleum products caused by the ``'negligent' failure to
repair a known weak spot in the pipeline.'' In fact, Colonial knew
specifically of the weak spot yet elected to take the risk and move the
petroleum product anyway.
As Greenwald asserts, if Section 309 were amended to include the
proposed statutory language, neither the Exxon Valdez nor Colonial
Pipeline cases could have been prosecuted for Clean water Act
negligence because ``no one was injured nor put at risk of death or
serious bodily injury.'' But, both of these cases were deserving of
criminal prosecution due to the ``significant environmental harm'' and
``culpable conduct'' involved.
A third example of successful Section 309 criminal enforcement is
the tragic case of the Olympic Pipeline spill. In June 1999, a rupture
in the Olympic petroleum pipeline resulted in a spill of approximately
236,000 gallons of gasoline into Hannah Creek and Whatcom Creek.
(http://www.usdoj.gov/usao/waw/text--version/press--room?2003/jun/
olympic.htm). In addition, the gasoline ignited, resulting in the
deaths of three teenagers (http://www.usdoj.gov/usao/waw/text--version/
press--room?2003/jun/olympic.htm). This example differs from the
previous two in that it illustrates the ability of the EPA and DOJ to
investigate and prosecute cases that did cause death or serious bodily
injury. In other words, the proposed amendment to Section 309 is not
only too restrictive, but it is also unnecessary. As the case of
Olympic Pipeline demonstrates, both the EPA and DOJ are already well
aware that whenever death or serious bodily injury occurs as a result
of an environmental violation, criminal prosecution is appropriately
preferred.
Question 4. It is my understanding that the Department of Justice
has applied a simple negligence standard to criminal environmental
cases for an extended period of time. Can you comment on this?
Response. As the testimony of Robin Greenwald reflects, the
Department of justice has applied a simple negligence standard to
criminal environmental cases since 1987, when Congress amended the
Clean Water Act in 1987 to add Section 309. However, defendants have
never been prosecuted for what was a simple ``accident'', as the oil
industry suggests. In fact, neither the Hanousek and Hong decisions
represent a departure from that practice. Both cases, as described by
Ms. Greenwald, evidence the practice of only criminally prosecuting
``catastrophic'' environmental violations that were caused by an
operator's failure to exercise the care that a reasonable person would
have taken under similar circumstances; the defendants in both cases
acted with ``utter disregard'' for the environment. Accordingly, both
decisions ``represent the need for Section 309 to punish egregious
behavior.'' Furthermore, as the statistical research of Ronald Sarachan
and Steven Solow illustrates, only 6 percent of the criminal
environmental prosecutions between 1987 and 1997 were negligence cases.
In addition, as I testified, there has never been a case of an
environmental violation prosecuted for which there was merely an
``accident.'' Therefore, Section 309 has functioned in the very manner
for which it was created--to only hold the most significant and
egregious violators criminally responsible.
[GRAPHIC] [TIFF OMITTED] T2384.012
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Statement of Jim Hall, Principal Partner, Hall and Associates; Former
Chairman, National Transportation Safety Board
Mr. Chairman, Mr. Ranking Member, Members of the Committee, thank
you for the invitation to testify before you today. I am pleased to be
here to share my experience with transportation safety, and its
particular relevance to aspects of the Clean Water Act (CWA).
Briefly, let me spend a few moments on my previous role at the
National Transportation Safety Board (NTSB) and on the Board's overall
mission. I was nominated as member of the NTSB by President Bill
Clinton in 1993, and subsequently served as the Board's Chairman from
June 1994 to January 2001. I currently serve as President of Hall &
Associates, where I advise a host of government and private clients on
transportation safety and security issues.
Ever since Congress created the NTSB, the Safety Board has served
as the `eyes and ears' of the American people whenever there is a
significant transportation incident. The mission, then and now, is to
impartially and thoroughly investigate accidents to determine their
cause, with the primary goal of preventing future accidents and
providing Americans with continued confidence in the nation's many
transportation modes. The Board issues scores of recommendations to
government and industry every year. In making recommendations, the
Board looks for, and historically achieves, a high level of voluntary
compliance.
Likewise, NTSB investigations rely in large part on the voluntary
and unpaid assistance of companies involved in accidents to understand
what went wrong and how to fix it. This system of voluntary cooperation
works exceedingly well, and the goal--a safer transport system--is
considered so important to our national interest that Congress has
given NTSB accident investigations priority over all other Federal
investigations.
As Chairman, I often said our work focused on a single, very
simple, point--the more information we have, the safer we all can be.
During my tenure at NTSB, I was never bashful in speaking out about
issues that sometimes inadvertently separate our government from that
focus. The threat of criminal sanction for purely accidental behavior
has the real potential to stifle cooperation, to stifle the ready
development of information necessary to understand an occurrence and
prevent its repetition.
That has a price, potentially high, and would need to be offset by
the possibility that punishing pure accidents reduces their likelihood.
I have seen no evidence for that proposition, and indeed, several
successful safety programs sponsored by the Department of
Transportation proceed on exactly the opposite presumption.
As the Members of this Committee are well aware, every mode of
transportation is closely regulated for safety purposes under a variety
of statutes, and each of these provides for both civil and criminal
sanction for some classes of regulatory violation. Typically criminal
violations are reserved for knowing violations--activities such as
falsification of records or safety tests, the deliberate violation of
regulatory standards, or willful or reckless behavior that leads to
injury or death, or destruction of property.
However, one statute, the Clean Water Act (CWA), provides criminal
penalties, including fines and imprisonment, for simple negligence.
Simple negligence, as defined, does not require intent, or knowledge,
or even willful or reckless disregard of norms. As such, it easily is
charged and potentially just as easily proved in accidents where all
due care was thought to have been exercised. Potentially, an entity
believing that it is exercising due caution and using current
technology and modern procedures may still find that the company, its
supervisors, or its operating employees will be charged criminally, if
a water source becomes polluted. Wholly apart from the impact that such
a regime has on the ability of a company to attract top notch employees
and managers, its implications for safety investigations and ultimately
safe regulation are problematical at very best.
During my tenure at the NTSB, I became increasingly concerned with
the trend toward the criminalization of any or all transportation
accidents. Let me be clear, there are ``accidents'' where criminal
prosecution is warranted and even the preferred course of action. While
traditional criminal law theory requires a finding that one intended
the consequences of the criminal act, it has long been accepted, and I
accept, the proposition that wanton disregard of behavioral norms
suffices to sustain a criminal prosecution, even if the consequences of
the behavior were not intended, indeed even if they were as horrifying
to the perpetrator as to the rest of us. No one hesitates to prosecute
drunken driving as negligent homicide. But what good would come of
prosecuting a driver who, blinded by the sun, lost track of the vehicle
in front him and did harm identical to that of the drunk? How best to
answer the questions raised by these issues became the major focus of a
symposium on Transportation Safety and the Law that the NTSB convened
under my direction in April of 2000. This conference, attended by more
than 400 representatives of public, private, and academic
organizations, covered a host of important issues. However, discussion
about when an accident warrants criminal prosecution was a dominant
topic.
Two general themes emerged out of that symposium that bear
repeating.
First, transportation safety is increasingly dependent on being
able to spot trends, to see problems as they arise, to anticipate
failures from sophisticated ``data mining,'' and from the sometimes
not-so-sophisticated self-disclosure of the near misses. This is an
enormously productive field that is being pursued by almost all the
regulatory agencies. And these agencies often include, as part of this
type of program, some form of prosecutorial immunity for persons and
companies who participate.
FAA, for example, treats self-disclosure from pilots, or data
derived from quick access flight recorders as exempt from use in
enforcement actions based on simple violations discovered. Of course
the agency doesn't waive the right to proceed against knowing
violations, and may even do so criminally. What agencies do say is we
won't proceed against simple accidental behavior. Without such a
promise, the data wouldn't be forthcoming, and safety would be
compromised.
And that is exactly the issue with the Clean Water Act. Simple
negligence can be treated as a criminal act, punishable by
imprisonment. When accident investigators arrive on scene to find out
what has occurred, they are in no way empowered to grant any immunity
from prosecution for pure mistakes. So if there has been waterway
contamination, prevention and understanding will take a back seat to
legal maneuvering.
If the NTSB hopes to make timely recommendations based on their
investigations, cooperation is necessary. NTSB recommendations form a
basis by which the industry involved in the accident can make changes
to avoid a re-occurrence of the incident. And avoiding future incidents
provides more value to the public than attempting to prosecute a
company or an employee for an accident.
A second and related theme that developed at the NTSB symposium was
the belief that, while criminal enforcement can be an important tool,
it should be directed toward intentional or reckless behavior rather
than non-intentional conduct. Criminal enforcement, strong civil and
administrative remedies, and an independent investigative body such as
the NTSB, are all essential tools in protecting public safety, our
transportation systems, and the environment. Criminal penalties do
deter intentional conduct, but have a much diminished and unproven
relationship to preventing purely accidental behavior.
Criminal enforcement, indiscriminately and routinely applied to
ordinary industrial accidents, can deny safety regulators the very
information they need to decide how to prevent similar accidents in the
future. The rush to assess blame and punish those connected with the
accident inevitably forces this vital information behind closed doors
as the prosecution and the defendants prepare for a potential criminal
trial. The intent should be to promote cooperation rather than threaten
parties with punishment for things over which they had no control.
The language of the CWA, prosecutors' increasing use of the
criminal negligence provisions of the CWA, and new views of the CWA
taken by the courts have all combined to deter post-event industry
cooperation when CWA criminal violations are potentially involved.
Individuals engaged in industrial activities that bring them in
contact with water face a difficult proposition. How should companies
respond to parallel criminal and accident investigations? In that
situation, companies face conflicting demands on one hand, they need to
be responsive and open to the public, and on the other, they the need
to fairly protect their employees. That was one of the questions raised
at our symposium, and I still cannot adequately answer that question.
Another issue is the effect that the possibility of criminal
prosecution will have on hiring and retaining a skilled work force.
Although I don't have direct experience, this was a common complaint
that I heard while at the NTSB, and one that is intuitive. If skilled
employees are to be subject to criminal charges for their role in an
accident despite their training and the technologies at their disposal,
then they will be less likely to engage in those occupations. These
positions would then have to be filled with less qualified personnel or
not filled at all, leaving the remaining employees over-extended. This
could have a disastrous outcome and would be counter-productive to the
intent of the CWA.
Defense attorneys representing firms and individuals facing
criminal liability for accidental behavior often advise prudent
reluctance in providing information to the NTSB. Other times, the NTSB
arrives at an accident scene after a criminal investigation has already
begun in earnest, and simply inspecting evidence can be extremely
difficult for Board investigators.
The bottom line is if the NSTB can do a thorough investigation, and
can complete its investigation, and have cooperation in that
investigation, potential larger problems can be corrected before they
cause future accidents or incidents. What's more, these problems can be
understood in a broader context, and solutions can have an industry-
wide application through consensus reached with the regulators and the
firms involved.
However, a growing fear of criminal prosecution is rapidly
compromising industry's willingness to cooperate in safety
investigations, and, while this is understandable, it is in the long
run contrary to the interests of government and industry alike. What is
needed is a widespread agreement within the government not to proceed
criminally for purely accidental behavior, particularly where firms
have agreed to cooperate fully with the government's subsequent safety
investigation. And amendment of the Clean Water Act to make clear that
simple negligence is not sufficient for criminal prosecution is
probably now necessary to recover from the tremors caused by recent
court cases, which have chilling implications for supervisors, and
managers who may be remote in time and place from the activities giving
rise to negligent spill.
I do not believe in a model of enforcement that immediately sends
all the parties, public and private, before a magistrate. I do believe
in a robust regulatory regime with adequate civil, administrative, and
criminal teeth to ensure compliance. At the same time, it is clearly
counter-productive to the greater collective good to criminalize
ordinary industrial accidents.
While this issue deserves a thoughtful review by this Committee, I
submit that this one provision of the CWA clearly is inconsistent with
the larger body of transportation law, and the criminalization of
simple negligence really has no place in a statute not lacking for
``teeth.''
My primary concern is information, and more of it. Investigators
and regulators need access to relevant information to do their jobs. To
an increasing extent, information is becoming harder to obtain which
impacts the Board's ability to investigate and make recommendations. We
are all safer and more secure when we can learn from these incidents,
and implement improved technologies and procedures as a result.
In conclusion, it is my conviction that the balance between
appropriately pursuing individual wrong-doers on one-hand and the
broader purpose of accident investigation and prevention on the other
hand, tips more and more away from a focus on prevention. We follow
this road at our long-term peril.
When there is no malfeasance, but merely an accident, our
overriding concern should be fixing the problem, not the blame. By
focusing criminal prosecutions where they are most appropriate, we
protect the rights of workers, address scarce government resources in
the most useful way, increase compliance and cooperation, and find
answers more swiftly that can, in turn, be applied to prevention. I
urge the Committee to think through this issue, and have no doubt the
net result of a positive change in this provision will be increased
safety, continued reduction in the number of incidents, and greater
protection of our fellow citizens and the environment.
I thank the Committee for its consideration in allowing me to
testify today. I would be happy to answer any questions that you may
have.
__________
Statement of the American Waterways Operators
The American Waterways Operators (AWO) appreciates the opportunity
to submit this statement for the hearing record. AWO is the national
trade association representing America's inland and coastal tugboat,
towboat, and barge industry, the largest segment of the U.S.-flag
domestic maritime industry. AWO's 375 member companies include the
owners and operators of tugboats, towboats, and barges that move more
than 800 million tons of America's cargo every year, including dry,
liquid, containerized and specialty cargoes on the inland river system,
the Atlantic, Pacific, and Gulf coasts, and the Great Lakes. The
transportation of petroleum and petroleum products is a key segment of
our industry's business: tank barges move 20 percent of the oil that
fuels our economy and keeps our cars running and our homes warm.
Powerful, state-of-the-art tugboats also provide tanker escort services
to facilitate the safe movement of petroleum cargoes in busy ports and
harbor approaches.
Chairman Inhofe and Senator Baucus, AWO would first like to thank
you for convening this hearing to examine issues related to the Clean
Water Act. AWO and its member companies are deeply committed to marine
safety and environmental protection. We understand that one of the
issues addressed at today's hearing will be criminal liability for oil
spill incidents. We believe that criminal liability, when imposed under
OPA 90, should be employed only where a discharge is caused by conduct
that is truly ``criminal'' in nature, i.e., where a discharge is caused
by reckless, intentional or other conduct deemed criminal. We agree
that the current ``negligence'' standard in OPA 90 is a lower threshold
than traditionally seen for criminal liability. Criminal culpability in
the United States typically requires intentional actions or omissions
by individuals.
In addition, we are very concerned that responsible operators are
exposed to criminal fines and potential imprisonment for maritime
transportation-related oil spills due to the application and use of
antiquated and unrelated strict criminal liability statutes. Strict
criminal liability imposes criminal sanctions without requiring a
showing of criminal knowledge, intent or even negligence. AWO and its
members are very troubled, as are other responsible, law-abiding
maritime interests, by both the Justice Department's increasing
willingness in the post-OPA 90 environment to use strict criminal
liability statutes and the increasing attention to criminal enforcement
in oil spill incidents. These Federal actions imposing strict criminal
liability have created an atmosphere of extreme uncertainty for AWO
members about how to respond and cooperate with the Coast Guard and
other Federal agencies in cleaning up an oil spill. Strict criminal
liability statutes such as the Migratory Bird Treaty Act (16 U.S.C. 703
et.seq.) and the Refuse Act (33 U.S.C. 407, 411)--statutes that were
enacted at the turn of the century to serve other purposes--have been
used to harass and intimidate the maritime industry, and in effect,
have turned every oil spill into a potential crime scene without regard
to the fault or intent of companies, corporate officers and employees,
and mariners.
The Migratory Bird Treaty Act (MBTA) provides that ``it shall be
unlawful at any time, by any means or in any manner, to pursue, hunt,
take, capture, kill, attempt to take, capture, or kill any migratory
bird . . .'', a violation of which is punishable by imprisonment and/or
fines. Prior to the Exxon Valdez oil spill in 1989, the MBTA was
primarily used to prosecute the illegal activities of hunters and
capturers of migratory birds, as the Congress originally intended when
it enacted the legislation in 1918. In the Exxon Valdez case itself,
prior to the enactment of OPA 90, the MBTA was first used to support a
criminal prosecution against a vessel owner in relation to a maritime
oil spill, and this ``hunting statute'' has been used since against the
maritime industry. The Refuse Act was enacted over 100 years ago at a
time well before subsequent Federal legislation essentially replaced it
with comprehensive requirements and regulations specifically directed
to the maritime transportation of oil and other petroleum products.
OPA 90 provides a statutory framework for proceeding against
individuals for civil and/or criminal penalties arising out of oil
spills in the marine environment. When Congress crafted OPA 90, it
balanced the imposition of stronger criminal and civil penalties with
the need to promote enhanced cooperation among all of the parties
involved in the spill prevention and response effort. OPA 90 imposes
criminal liability for negligent violations and provides for punishment
of up to 1-year imprisonment and/or fines between $2,500 and $25,000
per day. The punishment for each knowing violation was increased by OPA
90 to up to 3-years imprisonment and/or fines between $5,000 and
$50,000 per day. Furthermore, OPA 90 added and/or substantially
increased criminal penalties under the following pre-existing laws
which comprehensively govern the maritime transportation of oil and
other petroleum products:
Negligent Vessel Operations. 46 U.S.C. 2302
Vessel Inspections. 46 U.S.C. 3318
Carriage of Liquid Bulk Dangerous Cargoes. 46 U.S.C. 3718
Vessel Load Lines. 46 U.S.C. 5116
Foreign Commerce Pilotage. 46 U.S.C. 8503(e)
Ports and Waterways Safety Act. 33 U.S.C. 1232(b)
Intervention on the High Seas Act. 33 U.S.C. 1481(a)
Deepwater Port Act of 1974. 33 U. S.C. 1514(a)
Act to Prevent Pollution from Ships. 33 U.S.C. 1908(a)
Congress, by omitting the Migratory Bird Treaty Act and the Refuse
Act from this list of existing statutes modified by OPA 90, apparently
did not anticipate or intend their use in the case of maritime oil
spills.
In the event of an oil spill, a responsible party not only must
manage the cleanup of the oil and the civil liability resulting from
the spill, but also must protect itself from the criminal liability
that now exists due to the available and willing use of strict criminal
liability laws by the Federal Government. Managing the pervasive threat
of strict criminal liability, by its very nature, prevents a
responsible party from cooperating fully and completely in response to
an oil spill situation. The OPA 90 ``blueprint'' of prevention and
response is no longer clear. The use of the strict criminal liability
statutes has undermined the spill prevention and response objectives of
OPA 90, the very goals that were established by Congress to preserve
the environment, safeguard the public welfare, and promote the safe
transportation of oil.
Archaic statutes such as the Migratory Bird Treaty Act and the
Refuse Act are unrelated to the regulation and enforcement of oil
transport activities and were not included within OPA 90 as one of the
many applicable statutes where criminal liability could be found.
Without the elimination of the use of such strict liability statutes,
the maritime industry cannot avoid exposure to criminal liability,
regardless of how diligently it adheres to prudent practice and safe
environmental standards. As stated the U.S. Coast Guard's own
environmental enforcement directive, a company, its officers, employees
and mariners, in the event of an oil spill ``could be convicted and
sentenced to a criminal fine even where [they] took all reasonable
precautions to avoid the discharge.'' (Criminal Enforcement of
Environmental Laws, U.S. Coast Guard Commandant Instruction M16201.1 of
30 July, 1997.)
The exposure of mariners and management to criminal liability
regardless of fault has had a negative impact on the recruitment and
retention of qualified and committed personnel for the maritime
transportation of oil and petroleum products. At a 1998 hearing of the
Subcommittee on Coast Guard and Maritime Transportation of the House
Committee on Transportation and Infrastructure, several working
mariners noted this development. One Captain with long experience in
the industry indicated that he could not recommend a similar career
path to his children because of the uncertainty created by the
existence of strict liability. A witness from the management of a
company that transports petroleum testified that his company had
modified its response protocol and had retained criminal counsel to
assist in the event of a spill because of the potential impact of
criminal liability on the company and its employees. At conferences
held in 2001 and 2002, jointly sponsored by the Coast Guard, industry
and labor organizations, criminal liability was identified as one of
six factors affecting the recruitment and retention of mariners. The
conclusion of the group considering criminal liability was that ``(t)he
unjustifiably low threshold for prosecution inhibits the recruitment
and the retention of mariners.'' The group recommended changes in the
laws governing criminal liability in the event of oil spills.
Criminal sanctions under OPA 90 should follow the traditional
notion of what constitutes criminal acts in this country--namely, that
a crime occurs when a knowing, intentional act is committed. AWO
respectfully requests that the Environment and Public Works Committee
take the lead on this critical issue by: (1) reaffirming the
traditional definition of criminal conduct for prosecutions in oil
spill incidents; and, (2) reasserting the preeminent role of OPA 90 as
the statute providing the exclusive criminal penalties for oil spills.
Such legislation would ensure increased cooperation and responsiveness,
while not diluting the deterrent effect of stringent criminal penalties
imposed under OPA 90 itself.
Thank you again for the opportunity to present this statement for
the hearing record.
__________
Statement of the American Society of Civil Engineers
Mr. Chairman and Members of the Subcommittee, the American Society
of Civil Engineers (ASCE) is pleased to offer this statement to the
Subcommittee for the hearing on issues related to the implementation of
the Clean Water Act.
ASCE was founded in 1852 and is the country's oldest national civil
engineering organization. It represents more than 130,000 civil
engineers in private practice, government, industry, and academia who
are dedicated to the advancement of the science and profession of civil
engineering.
I. POLICY RECOMMENDATIONS
ASCE supports a Clean Water Act (CWA) that maximizes, to
the extent possible, the protection of our nation's waters and the
beneficial use of those waters. The Act should aggressively address
nonpoint source pollution from watersheds and also point sources,
including from sanitary sewer overflows, combined sewer overflows, and
storm sewer discharges.
National policy should protect the beneficial uses of the
nation's water and be flexible enough to allow innovative practices and
means to achieve these goals.
Water quality should be protected at the source through
cooperative partnerships that utilize financial incentives or other
market-based mechanisms. Emphasis needs to be given to protecting water
quality and habitat from adverse impacts of wet weather flows,
including non-point sources, stormwater, and combined sewer overflows.
II. BACKGROUND
Wastewater treatment is now well established throughout the Nation,
and the design, construction, and maintenance of treatment plants is
understood. There is still a need for controlling other sources of
point source pollution (e.g. stormwater wet weather systems, combined
sewer overflows, sanitary sewer overflows, and stormwater discharges)
and a much greater effort is needed to control nonpoint sources of
pollution.
Measuring the effects of nutrients as well as toxic pollutants on
water quality and ecosystems requires further research. Establishing
source water programs will minimize downstream pollution programs.
Watershed approaches to water-quality management offer the best way to
integrate management of diverse pollution sources with the wide range
of water usages seen in the United States.
The Federal Water Pollution Control Act is the principal law that
deals with pollution in the nation's streams, lakes, and estuaries.\1\
The Act, commonly referred to as the Clean Water Act, is ``one of the
landmark statutes of the twentieth century, . . . .''\2\
The Act consists of two major parts: a regulatory scheme that
imposes progressively more stringent requirements on industries and
cities to abate pollution and meet the statutory goal of zero discharge
of pollutants and provisions that authorize Federal financial
assistance for municipal wastewater treatment plant construction. Both
are supported by permit and enforcement provisions. Programs at the
Federal level are administered by the Environmental Protection Agency
(EPA); the Act allows EPA to delegate enforcement and permitting
authority to the states, and they have major responsibilities to
implement the Act's programs.
In 1972, Congress declared that it intended to restore and maintain
the chemical, physical, and biological integrity of the nation's
waters.\3\ These objectives were accompanied by statutory goals to
eliminate the discharge of pollutants into navigable waters by 1985 and
to attain, wherever possible, waters deemed ``fishable and swimmable''
by 1983. While the goals have not been entirely achieved, progress has
been made, especially in controlling conventional pollutants (suspended
solids, bacteria, and oxygen-consuming materials) discharged by
industries and municipal sewage treatment plants. These discrete
sources are easily identifiable and regulated.
The Act focuses on two possible sources of pollution: point sources
and nonpoint sources. Adopting a command-and-control response to water
pollution, Congress dealt with the problem of point source pollution
using the National Pollution Discharge Elimination System (NPDES)
permit process. Under this approach, compliance rests on technology-
based controls that limit the discharge of pollutants from any point
source into certain waters unless that discharge complies with the
Act's specific requirements.\4\
When the NPDES system fails to adequately cleanup certain rivers,
streams, or smaller water segments, the Act requires use of a water-
quality based approach. States are required to identify such waters,
which are to be designated as ``water quality limited segments''
(WQLS). The states must then rank these waters in order of priority,
and based on that ranking, calculate levels of permissible pollution
called ``total maximum daily loads'' or TMDLs.\5\
TMDLs are the maximum quantity of a pollutant the water body can
receive on a daily basis without violating the water quality standard.
The TMDL calculations are to ensure that the cumulative impacts of
multiple point source discharges and nonpoint source pollution are
accounted for. The TMDL does not establish direct controls over
pollutants, however. It is a technology-forcing program that may
require pollutant sources within a watershed to install new pollution-
control devices.
States may then institute whatever additional cleanup actions are
necessary, which can include further controls on point and nonpoint
pollution sources. Under the Act, states are required to submit lists
of WQLSs and TMDLs to the EPA at certain times; the first were due by
June 26, 1979.\6\
The TMDL program regulates waste load allocations for point
sources, watershed allocations for nonpoint sources, and includes a
margin of safety. It was intended to serve as a backstop to the NPDES
permit program.
Section 303(d) and the TMDL program were included in the Act
as a second-string safeguard against failure of the primary
water quality improvement mechanism, the NPDES program. As a
result of its backup status, the TMDL program was not
aggressively or broadly pursued until the late 1980's and early
1990's when it became clear that the NPDES program alone could
not solve the country's water quality problems.\7\
The NPDES and TMDL approaches sanction the controlled release of
pollutants into the ambient environment. Like virtually every aspect of
the American environmental protection system, the programs assume that
a certain amount of pollution--an external diseconomy--is acceptable in
order to maintain the overall wealth and security of the Nation.
Such a tradeoff between economic welfare and ecological protection,
while politically essential, cannot provide the most advantageous
outcome to environmental degradation, however. Every contaminant
release, no matter how well controlled, results in a progressively
greater pollutant load on the environment, although it may be argued
that the burden likely grows more slowly because the releases occur at
less toxic levels than if there were no NPDES program at all.
The use of economic tools to assess the ecological effects of
market-based activities in order to alleviate environmental pollution
is a relatively new phenomenon. But human economic welfare, not the
physical welfare of ecosystems or species, is at the heart of all
neoclassical economic analysis.
In neoclassical economic theory, groups and individuals act to
advance their own economic self-interest. Non-economic considerations--
including real or potential damages to the commons from industrial
pollution or other threats to the environment from economic activity--
are not possible. This is because all market-driven economic systems
are unsentimental and utilitarian; they do not place the preservation
of natural resources above the need to improve the economic welfare of
individuals and groups in the economy. The central function of
neoclassical economics is the well-being of the consumers (and
producers) who make up the economy.\8\
To state it clearly:
The hallmark of welfare economics is that policies are
assessed exclusively in terms of their effects on the well-
being of individuals. Accordingly, whatever is relevant to
individuals' well-being is relevant under welfare economics,
and whatever is unrelated to individuals' well-being is
excluded from consideration under welfare economics.\9\
Because classical economics concentrates on the control of
pollution only as it affects the economic utility of agents in the
economy, it frequently ignores the effect of pollution on economic
activity and the resulting restrictions placed on the economy by
increasingly polluted (and therefore scarcer) ecosystem resources.
Although the severe economic functionalism has been somewhat
softened by a host of environmental laws like the Clean Water Act and
other regulations governing virtually every aspect of American
financial and industrial life, the use of economics to measure the
benefits of these protective laws remains controversial. Indeed, the
advent of new economic approaches--often called ``natural capitalism''
or ``resource economics''--simply exacerbates the old problem of how
best to allocate scarce natural resources.\10\
Despite some obvious disadvantages, however, economic solutions to
environmental problems are increasingly seen as preferable by
policymakers looking for different solutions to pollutant-control
issues and ecological degradation.
[There is] a general trend toward using market mechanisms to
attain environmental protection objectives. Market-based
programs operate under the assumption that allowing regulated
entities to choose among a range of compliance options results
in more efficient environmental management than does
traditional ``command-and-control'' regulation. Essentially,
environmental markets attach costs to environmentally damaging
activities and values to environmental benefits, thereby
encouraging companies and individuals to consider the
environmental impact of their activities. Regulators
increasingly are turning to taxes, subsidies, unit charges,
deposit-refund schemes, and tradable permit programs to force
regulated entities to internalize environmental costs.\11\
III. IMPLEMENTATION OF THE CLEAN WATER ACT
A. The National Pollutant Discharge Elimination System
The EPA frequently has lauded its efforts and those of its state
partners to protect the nation's waters from point sources regulated
under the NPDES permitting program. ``Over the nearly thirty years
since enactment of the Clean Water and Safe Drinking Water Acts, we
have worked together at all levels to make remarkable progress in
improving the quality of surface waters and the safety of drinking
water.''\12\
The admiration is not universally shared. Critics have noted, for
example, that ``EPA has never been very interested in pursuing a broad
interpretation of the Clean Water Act that would construe some of the
statute's ambiguities to fit the scope of the nation's water pollution
problem.''\13\ Another states: ``Unfortunately, point source controls
have reached the limits of their effectiveness, yet water quality
remains ubiquitously substandard nationwide. While America's rivers and
harbors no longer catch fire, thousands of waterways fail to meet water
quality standards despite point source regulation.''\14\
The nation's remaining water quality problems are varied, ranging
from runoff from farms and ranches, city streets, and other widely
distributed sources to metals (especially mercury), organic and
inorganic toxic substances discharged from factories and sewage
treatment plants, as well as numerous nonpoint sources.
Whatever limited success the Act has enjoyed is due almost entirely
to Federal and state efforts to apply the NPDES program to control
point sources. Inadequate nationwide data make it difficult to assess
the scope of the remaining water quality issues.
In 2000, the latest year for which data are available, EPA
concluded from an extremely narrow examination of the nation's waters
that only 61 percent of assessed river and stream miles; 54 percent of
assessed lake acres; 49 percent of assessed estuarine square miles; and
22 percent of assessed Great Lakes shoreline miles supported the water
quality standards evaluated.\15\
B. Total Maximum Daily Loads
The Total Maximum Daily Load (TMDL) program languished for decades.
Despite the mandate in the Act, after 30 years, there are still more
than 22,000 impaired waters nationwide, with an estimated 48,000
individual impairments in these water bodies, according to the EPA.\16\
The states, who have been delegated to implement the TMDL program under
EPA oversight, have generally failed to carry out their section 303(d)
duties.\17\
The TMDL provision . . . is a relic of the previous strategy
that calls for states to manage pollution loading into
waterways that, despite point source regulation, do not meet
water quality standards. With a few exceptions, the states have
consistently bowed to political pressure and not established
TMDLs. In addition . . . EPA had virtually ignored its mandate
to evaluate state TMDLs.\18\
The program was reinvigorated in the 1980's and 1990's after
environmental groups began making use of the Act's citizen suit
provisions to go to court to force EPA and the states to speed the
approval of TMDLs. Because the Act requires EPA to develop a priority
list for the state and make a Federal TMDL determination if a state
fails to set TMDLs for its impaired water bodies, the suits met an
initial round of judicial successes.
Numerous judicial rulings employed the doctrine of ``constructive
submission'' to require the EPA to issue a TMDL when states failed
(often for many years) to submit a TMDL for EPA approval. The doctrine
held that a state's failure to submit any TMDLs effectively was a
``constructive submission'' of no TMDLs, thus requiring EPA to act.\19\
Lately, however, environmentalists have found a less friendly reception
at the courthouse. In a recent shift from earlier decisions, at least
two Federal appellate courts have narrowed the doctrine to situations
in which a state clearly refuses to adopt a TMDL and the EPA delays
action unreasonably.\20\ The burden of conclusively proving Federal and
state obduracy is now ``nearly insurmountable.''\21\
C. Water Quality Trading
In January 2003, EPA sought to ration water pollution in U.S.
watersheds. It adopted a new ``Water Quality Trading Policy'' designed,
in part, to move away from top-down regulations and to establish a
market-based program by which state and tribal governments may attain
the required TMDLs for their impaired water bodies.\22\
[M]arket-based approaches such as water quality trading
provide greater flexibility and have potential to achieve water
quality and environmental benefits greater than would otherwise
be achieved under more traditional regulatory approaches. . . .
[T]he policy is intended to encourage voluntary trading
programs that facilitate implementation of TMDLs, reduce the
costs of compliance with CWA regulations, establish incentives
for voluntary reductions and promote watershed-based
initiatives.\23\
The modified ``cap-and-trade'' policy focuses on total emissions of
nutrients and sediment in a watershed. It caps total pollutant
emissions and encourages pollution reductions through the trading of
nutrients and sediment from point and nonpoint sources. Trades of other
pollutants are possible, but the Agency will oppose any trades
involving persistent bioaccumulative toxics in the absence of evidence
that such a trade would achieve ``a substantial reduction'' of the
pollutant.
The Water Quality Trading Policy is similar to the program for
sulfur dioxide emissions established under the Clean Air Act Amendments
of 1990. In title IV, Congress authorized EPA to create a tradable
emissions market for sulfur dioxide (SO2). The
SO2 program produced a market for pollution permits
(allowances) in order to reduce emissions from older, less efficient
electric generating plants. The CAA Amendments established a cap-and-
trade system whereby the government capped emissions from generating
units at each plant. (Many plants have more than one generating unit
subject to the cap.)
In general, an ambient pollution permit for a given environmental
receptor (air, water, or land) gives the holder the right to emit a
pollutant at any location, provided that the incremental pollution
emitted into the specific receptor does not exceed the permitted
amount. The marginal savings to the permit holder should equal the
permit price. When the price of a permit is greater than the savings
from releasing the pollutant, the allowance holder will try to sell
some allowances and emit fewer pollutants.
Theoretically, allowance trading creates more flexibility than the
standard command-and-control policies in the reduction of pollutants.
The increased efficiency resulting from a tradable permit system
potentially allows environmental regulators to tighten emission
standards, resulting in less pollution while still holding costs at
their initial level.
A central feature of any emissions trading program is that it
shifts the burden of designing and locating pollution controls from the
government to industry. Finally, three points in determining the
economic significance of pollution allowances must be kept in mind:
A market equilibrium exists in the buying and selling of
ambient pollution permits for any initial issuance of permits.
Emissions from each source in a permit market equilibrium
are efficient (the least costly way of attaining the efficient level of
pollution for each environmental receptor) no matter how the permits
are initially distributed.
If the price of the permits in equilibrium equals the
marginal damage from pollution, economic efficiency has been
obtained.\24\
The CAA Amendments granted allowance holders with a surplus of
credits a Federal license to release one ton of SO2
emissions or to sell the allowances to another generating unit. The
allowances transfer pollutant abatement from high-cost generating units
to ones that cost less, thus improving economic efficiency.
Under the Amendments, owners of existing generating units are given
fixed numbers of tradable allowances each year following rules that
depend primarily on historic emissions and fuel use. Each allowance
entitles its holder to emit one ton of SO2. A small number
of additional allowances are auctioned annually by the EPA, with the
revenues rebated to utilities roughly in proportion to their allowance
allocations.
New units must buy needed allowances from existing units or at the
EPA auctions. Each covered generating unit must deliver to EPA valid
allowances sufficient to cover each year's emissions within 30 days of
year's end or incur serious penalties. Allowances can be bought or sold
without restrictions to cover emissions from any generating unit in the
U.S.\25\ The overall amount of SO2 released by all units
remains the same as long as the number of permits does not increase.
Opinion among economists as to the supposed superiority of the cap-
and-trade system is divided, however. Command-and-control regulations
may be more protective and more cost-effective if they result in
reductions in environmental pollutants below the standard set in the
regulations. This ``over control'' may make command-and-control
policies more expensive--and more efficient.\26\
``The evidence is ambiguous as to whether marketable permits have
stimulated any more innovation in pollution control than the command-
and-control technological restrictions. Marketable permits have proved
to be administratively cumbersome.''\27\
Under the 2003 Water Quality Trading Policy, emissions of sediment
and nutrients are to be capped in the form of the waste load
established under a TMDL for point and nonpoint sources. For water
bodies or watersheds for which there are no TMDLs at the time of the
trade the caps are implied, according to EPA.
In watersheds with approved TMDLs, the watershed itself effectively
will be treated as if it were a more traditional point source under the
Policy; in watersheds without a TMDL at hand, the task of establishing
regulatory baselines in order to determine the allowances to be traded
will be exceedingly difficult in the absence of good data on total
emissions of the covered pollutants.
It is this feature of the new Water Quality Trading Policy--the
attempt for the first time to measure and regulate emissions from
nonpoint sources within an entire watershed with ``implied'' caps--that
holds the greatest challenge for the Agency. Almost certainly, the
regulation of these widespread regional pollutants promises to be
difficult, as the EPA concedes in its January announcement.\28\
IV. POLICY CONSIDERATIONS FOR THE SUBCOMMITTEE
A. The Subcommittee Should Consider Legislation to Establish a Water
Quality Trading Program at EPA
EPA has established the Water Quality Trading Policy without
explicit congressional authorization. Although the Agency claims that
the Policy is supported by the existing Clean Water Act, this point is
at least arguable. EPA established its air quality trading program in
1974, but Congress did not codify Agency practices until 1990. In the
absence of statutory authority, such a lengthy deferral in establishing
a clear congressional role for pollutant trading under the Clean Air
Act postponed the ecological reckoning by many years years in which
independent analysts raised serious questions about the environmental
worth of the Agency's air quality trades.\29\
To eliminate any doubts as to the legality and efficacy of the
program, Congress should enact enabling legislation within the Clean
Water Act. The legislation should contain explicit safeguards and a
strong and continuing oversight role for Congress, including the use of
regular audits of the water quality trading program by the General
Accounting Office (GAO) and independent analyses of its utility by the
Congressional Budget Office (CBO).
B. Congress Must Monitor the EPA Water Quality Trading Program Closely
Cap-and-trade programs generally have reduced the regulatory burden
on industry and increased its welfare, but they have not had large or
unusually positive effects on the environment. They merely place a
limit on total emissions of a given pollutant in a given area, and then
allow firms that emit this pollutant to trade excess emissions
allowances (each allowance entitles the user to emit a certain amount)
with each other and with other third-party traders. These types of
programs can be contrasted with command-and-control programs, which
tend to be more prescriptive and more expensive for industry, requiring
regulated units to install various types of pollution-control
equipment.\30\
It is important to remember, however, that emissions trading
programs are heavily dependent upon historic emissions data. The
permits are not simply a means of improving economic efficiency for
polluters or for abolishing the standard technological controls; they
are meant to ration the release of pollutants governed by the
allowances into the ambient environment based upon well established
past practices.
Congress needs to maintain a close watch on the EPA Water Quality
Trading Policy as it evolves. There are enough uncertainties associated
with this particular policy, especially its unique approach to the
trading pollutants from area sources, that it must be carefully
overseen.
Among the issues that need to be carefully assessed are the timing
of the permits, knowing how the monitoring data are to be obtained, and
determining the appropriate government inspection schedule. Penalties
for violating the permit must be greater than the permit price so that
producers will stay within the rules of the market.
It is especially important for Congress to assess the marketable
permit system for water bodies for which no TMDL has been approved
early in the process. Without hard data on historic emissions within a
watershed, it will be extremely difficult for the EPA to measure the
amount of nutrients and sediment to establish in the initial permit
issuance. Congress must insist on the best data available or consider
prohibiting trades in non-TMDL watersheds.
NOTES
\1\ 33 U.S.C.A. 1251 et seq. (West 2003).
\2\ William L. Andreen, The Evolution of Water Pollution Control in
the United States--State, Local, and Federal Efforts, 1789-1972: Part
II, 22 Stan. Env. L.J. 215, 216 (2003).
\3\ William H. Rodgers Jr., Environmental Law 248 (2d ed. 1994).
\4\ 33 U.S.C.A. Sec. Sec. 1311(a), 1362(12) (West 2003).
\5\ San Francisco BayKeeper v. Whitman, 297 F.3d 877, 880 (9th Cir.
2002).
\6\ See Id.
\7\ Jim Vergura and Ron Jones, The TMDL Program: Land Use and Other
Implications, 6 Drake J.Agric. L. 317, 320 (2001) (citations omitted).
\8\ Kalman Goldberg, the Market System 57 (2000).
\9\ Louis Kaplan and Steven Shavell, Fairness Versus Welfare, 114
Harv. L. Rev. 961, 977 (2001).
\10\ Paul Hawken et al., Natural Capitalism (1999). (``[H]umankind
is facing a historic juncture: For the first time, the limits to
increased prosperity are due to the lack not of human-made capital but
rather of natural capital.'')
\11\ David Sohn and Madeline Cohen, From Smokestacks To Species:
Extending The Tradable Permit Approach From Air Pollution To Habitat
Conservation, 15 Stan. Envtl. L.J. 405, 408 (1996) (footnote omitted).
\12\ Statement of G. Tracy Mehan III, Assistant Administrator for
Water, U.S. EPA, before the Subcommittee on Water Resources and
Environment, Committee on Transportation and Infrastructure, U.S. House
of Representatives, Feb. 27, 2003, at http://www.epa.gov/water/
speeches/022703tm.html (last visited Sept. 11, 2003).
\13\ Michael C. Blumm and William Warnock, Roads Not Taken: EPA vs.
Clean Water, 33 Envtl. L. 79 (2003) (concluding that the Agency ``has
failed miserably'' to carry out the point and nonpoint source control
programs in the Act due to political expediency).
\14\ Debbie Shosteck, Pronsolino v. Marcus, 28 Ecology L.Q. 327,
328-329 (2001) (footnotes omitted).
\15\ Environmental Protection Agency, 2000 National Water Quality
Inventory Report to Congress ES-5 (2002), at http://www.epa.gov/305b
(last visited Sept. 11, 2003) Less than half of all U.S. waters were
assessed in 2000. States assessed 19 percent of the nation's total
river and stream miles; 43 percent of its lake, pond, and reservoir
acres; 36 percent of its estuarine square miles; and 92 percent of
Great Lakes shoreline miles.
\16\ Environmental Protection Agency, National Section 303(d) List
Fact Sheet, at http://oaspub.epa.gov/waters/national--rept.control
(last visited Sept. 11, 2003). Approximately 9,100 separate TMDLs
nationally covering the more than 22,000 impaired water bodies have
been completed since 1972. Indeed, most of them have been completed
only since 1996. Id.
\17\ See U.S. General Accounting Office, Clean Water Act: Proposed
Revisions to EPA Regulations to Clean Up Polluted Waters (2000).
(``[State] compliance with existing TMDL regulations has been
problematic, and future compliance in the absence of the proposed
regulation [of 2000] is uncertain . . .'').
\18\ Shosteck, Pronsolino supra note 14, at 330.
\19\ See, e.g., Scott v. Hammond, 741 F.2d 992, 998 (7th Cir. 1984)
(holding that the Clean Water Act ``undoubtedly imposes mandatory
duties on both the states and the EPA''); Alaska Center for the
Environment v. Reilly, 762 F. Supp. 1422, 1429 (1991) (``Section 303(d)
expressly requires the EPA to step into the states' shoes if their TMDL
submissions or lists of water quality limited segments are
inadequate.'') aff'd sub nom. Alaska Center for the Environment v.
Browner, 20 F.3d 981 (9th Cir. 1994); Defenders of Wildlife v. Browner,
909 F. Supp. 1342 (1995) (same); Natural Resources Defense Council v.
Fox, 909 F. Supp. 153 (1995) (same); Sierra Club v. Hankinson, 939 F.
Supp. 865 (1996) (same); Raymond Profitt Foundation v. EPA, 930 F.
Supp. 1088 (1996) (same); Idaho Conservation League v. Browner, 968 F.
Supp. 546 (1997) (same).
\20\ See San Franscisco Baykeeper supra note 5, at 883 (holding
that, because the State of California had submitted at least 18 TMDLs
for pollutants received by waters designated as WQLS and had
established a schedule for completing its remaining TMDLs, the
constructive submission doctrine, under which complete failure by state
to submit TMDLs was treated as decision not to submit TMDLs, did not
apply); see also Hayes v. Whitman, 264 F.2d 1017, 1023 (10th Cir. 2001)
(``Only upon [a] determination that the states' inaction was so clear
as to constitute a `constructive submission' of no TMDLs would the EPA
then incur a nondiscretionary duty to approve or disapprove the
constructive submission.'').
\21\ James R. May, Where The Water Hits The Road: Recent
Developments in Clean Water Act Litigation, 33 Envtl. L. Rep. 10,369
(2003).
\22\ Environmental Protection Agency, Water Quality Trading Policy;
Issuance of Final Policy, 68 Fed. Reg. 1608 (Jan. 13, 2003).
\23\ Environmental Protection Agency, water quality trading policy
1-2 (Jan. 13, 2003), at http://www.epa.gov/owow/watershed/trading/
finalpolicy2003.html (Last visited Sept. 10, 2003).
\24\ Charles C. Kolstad, Environmental Economics 163 (2000).
\25\ Richard Schmalensee et al., An Interim Evaluation of Sulfur
Dioxide Emissions Trading, 12 J. Econ. Persp. 53 (1998). See also
Susanne M. Schennach, The Economics of Pollution Permit Banking in the
Context of Title IV of the 1990 Clean Air Act Amendments, 40 J. Envtl.
Econ. and Mgmt. 189 (2000).
\26\ See W.E. Oates et al., The Net Benefits of Incentive-Based
Regulation: A Case Study of Environmental Standard Setting, 79 Am.
Econ. Rev. 1233 (1989).
\27\ Nick Hanley et al., Environmental Economics in Theory and
Practice 88 (1997).
\28\ See 68 Fed. Reg. at 1612.
\29\ See, e.g., Robert W. Hahn and Gordon L. Hester, Where Did All
the Markets Go? An Analysis of EPA's Emissions Trading Program, 6 Yale
J. on Reg. 109, 151 (1989) (concluding that, after 15 years of air
emissions trading, the program had provided billions of dollars worth
of pollution-control savings to industry, but also determining that the
EPA-designed program had had a negligible effect on the environment).
\30\ The United States is not the only Nation to experiment with
cap-and-trade permits for pollutants from area sources. In 2001, the
European Union established a cap-and-trade program for governing
greenhouse gas emissions among EU countries. See Michael J-H. Smith and
Thierry Chaumeil, Greenhouse Gas Emissions Trading within the European
Union: An Overview of the Proposed European Directive, 13 Fordham
Envtl. L.J. 207 (2002).
__________
Statement of Robin Greenwald, Clinical Professor of Law, Rutgers School
of Law, Newark, NJ; Former Assistant Chief, Environmental Crimes
Section, Department of Justice; Assistant U.S. Attorney, Eastern
District of New York
Mr. Chairman, Mr. Ranking Member, Members of the Committee, thank
you for considering my comments on the oil industry's proposal to amend
Section 309 of the Clean Water Act to require human endangerment as a
prerequisite for criminal negligence. Based on my experiences spanning
more than 10 years prosecuting environmental crimes cases, including
prosecuting negligent Clean Water Act cases, I am submitting this
written testimony in opposition to the proposed legislative amendment
and to encourage the Committee to reject its proponents' ``smoke and
mirrors'' argument that Section 309 of the Clean Water Act impedes
safety investigations conducted by the National Safety Transportation
Board. Recent decisions by the Ninth and Fourth Circuit Courts of
Appeals have not changed the standard for prosecuting negligent Clean
Water Act cases and, to date, Section 309 has not impeded NSTB
investigations.
In the cloak of concern for comprehensive NSTB investigations
following oil spills, the oil industry is pressuring Members of
Congress from oil-rich states to weaken substantially an important, and
sparingly used, Clean Water Act criminal provision, Section 309 of the
Clean Water Act, which carries misdemeanor penalties for negligently
violating the Clean Water Act.\1\ In fact, under Federal law, section
309 has not interfered and should not interfere with NSTB
investigations, and in those precious few cases in which a negligent
CWA criminal investigation and a NSTB investigation are proceeding
simultaneously, there are procedures available, when appropriate, to
ensure that an important and time-sensitive safety concern is fully and
expeditiously investigated.
---------------------------------------------------------------------------
\1\ In an article by two former chiefs of the Department of
Justice, Environmental Crimes Section, Ronald Sarachan and Steven
Solow, the authors undertake a statistical analysis of the total number
of negligence based Federal environmental crimes prosecutions compared
to the total number of Federal environmental crimes prosecuted over a
10-year span, from 1987 to 1997. In total, of the 1,436 environmental
criminal prosecutions during that decade, only 86, or approximately 6
percent, of the prosecutions were negligence cases.
---------------------------------------------------------------------------
The recent interest in this statutory amendment appears to be the
prosecutions of two negligent CWA cases, United States v. Hanousek\2\
and United States v. Hong\3\. Neither of these cases, however,
represents a departure from the type of negligent CWA prosecutions
brought by the Department of Justice since Congress amended the Clean
Water Act in 1987 to add Section 309, nor do the decisions affirming
the convictions in Hanousek and Hong constitute a departure from well-
established criminal negligence law. In each of these cases, neither
defendant was prosecuted for what was a simple ``accident'', as the oil
industry suggests. Indeed, in the case of an ``accident'' that results
from conduct that was reasonable under the circumstances, the type of
conduct to which the oil industry refers, no criminal liability would
attach under Section 309. It is only when a person causes an event that
violates the Clean Water Act, such as a catastrophic oil spill, as a
result of his or her failure to exercise the care that a reasonable
person would have taken under similar circumstances that the person is
subject to negligent CWA prosecution. This is precisely the type of
criminally negligent conduct that occurred in the events leading up to
the Clean Water Act criminal violations in the Hanousek and Hong cases,
and it is the very type of criminal negligence prosecutions Congress
contemplated when it enacted Section 309.
---------------------------------------------------------------------------
\2\ 176 F.3d 1116 (9th Cir. 1999), cert. denied, 528 U.S. 1102
(2000).
\3\ 242 F.3d 528 (4th Cir. 2001), cert. denied, 112 S.Ct. 60
(2001).
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A review of the facts in Hanousek and Hong illustrate these points.
In Hanousek, the defendant was engaged in rock blasting operations
adjacent to what defendant knew was an old pipeline. Hanousek's
predecessor had created a protective work area around the blasting
operations to ensure that the pipeline was not compromised during the
blasting operations. When Hanousek became the manager of the
operations, with full knowledge of the pipeline's proximity to the
blasting operations, he stopped protecting the pipeline. As a result,
the pipe broke when workers drove over the pipeline with a backhoe. To
make matters even worse, well before Hanousek knew the type of
enforcement case the government was contemplating, Hanousek mislead
government investigators and hid pieces of the pipeline from
investigators. Clearly, the break of the pipeline here was not an
unavoidable accident, and Hanousek did not mislead investigators
because he knew they were investigating him for criminal negligence.
Had Hanousek taken the care that the former manager of the blasting
operations took to protect the pipeline, the pipeline would not have
broken and Hanousek would not have been subjected to criminal
prosecution. It was Hanousek's failure to exercise the care that a
reasonable person would have taken to protect the pipeline under the
circumstances, and his subsequent efforts to mislead the government,
that resulted in his conviction.
The defendant in Hong acted with the same utter disregard for the
environment as did Mr. Hanousek. Hong acquired wastewater treatment
facilities in 1993. Two years later, Hong inquired about the purchase
of a carbon-filter treatment system for one of his facilities, which
lacked a wastewater treatment system altogether. The seller of the
system told Hong that the treatment system he was considering was not
appropriate for completely untreated wastewater; rather, it was
designed only for the final step in the wastewater treatment process.
Despite this warning, Hong purchased the system and used it as the sole
means of treating wastewater. Employees soon complained to Hong that
the system was becoming clogged, and soon thereafter Hong's employees
began discharging untreated wastewater into the sewer system in
violation of the company's discharge permits and in the presence of
Hong on several occasions. Certainly Hong's actions that resulted in
untreated wastewater being dumped into the sewer system were not the
result of an ``accident.'' Hong, knowing full well that the treatment
system he installed was insufficient for the use he used it for, did
not act as a reasonable person would have acted in a similar situation.
Indeed, while Hong's actions could be said to be knowing, warranting a
felony prosecution under the Clean Water Act, at a minimum Hong failed
to exercise the care to prevent untreated wastewater from being
discharged into the sewer system that a reasonable person would have
taken in the same situation.
Essentially, Hanousek and Hong do not represent a sea change in
negligent Clean Water Act prosecutions; rather, they represent the need
for Section 309 to punish the egregious behavior of these defendants
whose negligent actions caused environmental damage.
Other noteworthy negligent Clean Water Act prosecutions that
involved the discharge of large quantities of petroleum products
illustrate further that Federal prosecutors have reserved Section 309
for egregious conduct. For example, in the case of the Exxon Valdez oil
spill, Exxon of course did not want to lose millions of gallons of
product and to spend many times more to remediate the environment. But
the ``negligent'' event that caused one of the worst environmental
catastrophes in this country was Exxon's decision to allow a captain
with a history of alcohol abuse to navigate the barge in the Prince
William Sound. The Colonial Pipeline spill in the Reedy River is
another example of an unwanted, tremendous loss of valuable product and
an expensive clean-up that was caused by the ``negligent'' failure to
repair a known weak spot in the pipeline that was carrying the
petroleum product. Colonial Pipeline, anxious to move product quickly,
yet knowing the risks of over-pressuring the pipeline, made the
decision to take the risk and move the petroleum product which the
pipeline could not withstand, causing the pipeline to burst and
spilling nearly one million gallons of products. If the proposed
statutory language were part of Section 309, not one of these cases
could have been prosecuted for Clean Water Act negligence because no
one was injured nor put at risk of death or serious bodily injury.
Just as there is no basis for the argument that recent case law has
somehow changed the standard for Clean Water Act criminal negligence,
it is similarly not credible for industry to argue the need for this
statutory amendment on the basis that Section 309 impedes NSTB
investigations. It is highly unlikely that the rewriting of Section 309
will change a person's decision not to speak to the government after a
catastrophic environmental event. Other penalties might still attach to
the conduct that caused the catastrophe, and the uncertainty allegedly
created now by Section 309's negligence provision will still be present
based on the threat of other prosecutions, such as prosecution for
knowing Clean Water Act violations or obstruction of justice, just to
name a couple.
Moreover, the oil industry's proposed statutory amendment to
Section 309 to allow criminal negligence prosecutions only when the
result of the violation involves injury or risk of injury to people
certainly would not create, in their own words, ``an incentive to
cooperate in bringing forward information on accident causes'', the
goal the oil industry claims it seeks to achieve. To the contrary, with
its statutory revision, in the most serious of cases when the need for
prompt and complete information (i.e., when people are injured or in
serious risk of injury) is most important, workers who fear criminal
prosecution might assert their 5th Amendment rights, the very right
industry fears impeding NSTB investigations under the current version
of Section 309. In fact, this concern is really no concern at all,
because in a case in which a criminal investigation is proceeding
simultaneously with a NSTB investigation, and there is a necessity to
speak to a worker who has asserted his 5th Amendment right that trumps
the criminal investigation, the government can immunize that worker and
compel his cooperation in the NSTB process. There simply is no reason
to amend the negligence provision of Section 309 out of fear of what
might happen in a future NSTB investigation in which the Department of
Justice is investigating a matter at the same time the NSTB is
conducting a safety investigation, an event that has occurred many
times in the past without conflict.
Supporters of the legislative amendment also emphasize that
``accidents'' should not be criminally penalized,\4\ and history shows
that the Department of Justice has not used Section 309 to ``turn
clean-up efforts and accident assessment procedures into legal
minefields.'' Ironically, supporters of this legislation suggest
amending the language of Section 309 to allow criminal prosecutions
following an ``accident'' only when such accidents involve injury or
risk of injury to the public. Yet if the real concern is prompt and
open cooperation with NSTB investigations following an oil spill, for
example, wouldn't the need for a prompt and open NSTB investigation be
most important in cases where the public is placed at risk? Why under
these circumstances are the proponents of this legislation not
concerned with employees' reluctance to speak because of fear of
prosecution? The transparency of their argument is evident: this
provision is intended to shield the oil industry from criminal CWA
negligence for oil spills because most CWA negligence prosecutions
result in extreme environmental damage, but not injury to the public.
---------------------------------------------------------------------------
\4\ The emphasis placed on ``accident'' is obvious given the fact
that in the context of oil spills the pollutant discharged into the--
water petroleum product--has great value and no petroleum company or
transporter of petroleum products want to spill valuable product,
unlike other Clean Water Act prosecutions, such as Hong where the
discharge is not a product but a waste. But the events that are subject
to prior negligence Clean Water Act prosecutions are far from
``accidents'' as that word is commonly used. Merely because the
defendant in an oil spill prosecution never intended nor wanted to
discharge the oil does not obviate the facts that lead up to the spill
that constitute a deviation from the care that a reasonable person
would have exercised in a similar circumstance.
---------------------------------------------------------------------------
Finally, there is a practical reason for rejecting oil industry's
proposed statutory amendment to Section 309. The negligence provision
of Section 309 oftentimes benefits defendants by giving prosecutors a
lesser offense to which defendants can plead guilty. Without this
provision, prosecutors are left only with charging defendants with a
Clean Water Act felony for knowing violations of the Act. Thus, in
Hong, for example, where there appears to have been ample evidence of
knowing conduct, prosecutors would have no discretion to consider a
misdemeanor charge for his conduct if the oil industry prevails and,
instead, could only charge him with a Clean Water Act felony. Surely
this is a result that not even the industry advocating for change
desires.
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