January 2010 Regulatory Update

To: Members & Affiliates; Regulatory Policy Committee
From: National Office
Date: February 1, 2010

The National Association of Clean Water Agencies (NACWA) is pleased to provide you with the January 2010 Regulatory Update. This Update provides a narrative summary of relevant regulatory issues and actions current to January 29, 2010. Please contact NACWA’s Chris Hornback at 202/833-9106 or This e-mail address is being protected from spambots. You need JavaScript enabled to view it or Cynthia Finley at 202/296-9836 or This e-mail address is being protected from spambots. You need JavaScript enabled to view it with any questions or information on the Update topics.

NACWA Provides Comments on EPA Draft Strategy for Chesapeake Bay

In comments on EPA’s Draft Strategy for Protecting and Restoring the Chesapeake Bay , NACWA expressed support for controlling all sources of nutrients to the Chesapeake Bay, but raised concerns with how the strategy would be enforced. These comments reflected perspectives shared by the Association’s Strategic Watershed Task Force and member agencies located in the Chesapeake Bay states. EPA published the Draft Strategy in response to Executive Order 13508 , in which President Obama directed EPA and other federal agencies to take responsibility for the clean-up of the bay. The Draft Strategy outlines how the agencies intend to do this, and the associated report, The Next Generation of Tools and Actions to Restore Water Quality in the Chesapeake Bay, details how water quality improvements will be made, primarily based on the Chesapeake Bay total maximum daily load (TMDL) that EPA plans to establish by December 2010. The Bay watershed states will be required to develop watershed implementation plans (WIPs) to identify how necessary load reductions will be made for both point and nonpoint sources. NACWA’s comments state that the Association “supports the division of load reductions between point and nonpoint sources and allowing the states to determine the subdivision of needed reductions, to the extent these are accomplished in an equitable manner.”

NACWA is concerned, however, with several aspects of EPA’s plans related to the implementation of the TMDL. NACWA urged that waste load allocations (WLAs) for publicly owned treatment works (POTWs) consider population growth, allocations in tributary strategies, progress already made by POTWs in reducing nutrient discharges, affordability/financial capability limitations, and the impacts of treatment technologies on carbon footprint and climate change. EPA will require states to provide “reasonable assurance” that nonpoint sources will achieve loading reductions. NACWA requested that EPA clarify the meaning of “reasonable assurance” and provide guidance for states on how to plan for and enforce nonpoint source nutrient reductions.

EPA’s planned enforcement actions are also an area of concern for NACWA. EPA plans to enforce two-year milestones for the states, with enforcement focused on point sources, including wastewater utilities, regardless of which sources are failing to perform nutrient load reductions. “Instead of targeting consequences toward point sources, EPA should impose consequences on all specific sources that are not meeting their obligations to reduce nutrient loadings,” NACWA’s comments said. The Association also recommended that EPA set a timetable for its own planned actions to reduce atmospheric deposition of nitrogen, which accounts for 21 to 28 percent of nitrogen loading to the Bay – more than from municipal and industrial wastewater treatment. EPA outlined several regulations and programs for reducing nitrogen from a variety of stationary and mobile sources, but did not specify a timeline for completing or enforcing these actions.

The Chesapeake Bay effort offers a unique test case of planning and implementing a full-scale watershed approach which will both inform and be informed by NACWA’s draft 21st Century Watershed Act. Following up on discussion of this issue at NACWA’s Winter Conference next week, NACWA will issue an Advocacy Alert with a detailed analysis of EPA’s Draft Strategy and proposed Senate legislation for restoring the Chesapeake Bay, including how the Association’s initiative toward a 21st Century Watershed Act has impacted and compares to these proposals, as well as an opportunity for members to provide feedback on these initiatives.

Climate Change

NACWA Recommends Changes to Proposed Greenhouse Gas Tailoring Rule

NACWA reiterated its objections to regulating greenhouse gas (GHG) emissions under the Clean Air Act (CAA) and made other recommendations in December 28 comments on EPA’s proposed GHG tailoring rule. EPA proposed the rule in anticipation of its regulation of GHG emissions from light-duty motor vehicles, which will set in motion rules for controlling GHGs from stationary sources that emit more than 100 tons per year (tpy) of certain criteria pollutants specified in the CAA. Because the universe of stationary sources that would be subject to the GHG regulations is so large, permitting authorities would be completely overwhelmed. Therefore, EPA has proposed “tailoring” the CAA thresholds for GHGs, recommending a level of 25,000 tpy carbon dioxide equivalent. While NACWA disagrees with regulation of GHGs under the CAA, it supports this tailoring approach. NACWA believes, however, that the 25,000 tpy threshold is still too low, and stated in its comments that “it would be prudent for EPA to choose a higher initial threshold rather than have the permitting system overwhelmed by huge numbers of applications for GHG emissions.”

NACWA also urged EPA to provide better guidance for determining if a facility meets the threshold for GHG emissions under the Title V and PSD programs. The proposed tailoring rule states that EPA’s annual Inventory of U.S. Greenhouse Gases and Sinks should be used to calculate a source’s emissions, but as NACWA explained, “the Inventory is meant to provide a national estimate of GHG emissions from various emitter categories, not to provide a method for calculating GHG emissions from individual sources.” Discrepancies also exist between CAA requirements and the methods used in the Inventory for calculating emissions. It is not clear whether biogenic emissions are omitted from the tailoring rule, as they are in the Inventory, or how fugitive emissions should be counted. The tailoring rule threshold is also based on a facility’s potential to emit, while the Inventory estimates actual emissions. The potential to emit is likely to be much higher than actual emissions since POTWs usually do not operate consistently at their full capacity. Because of this, NACWA believes that EPA may have significantly underestimated the number of utilities that would exceed the 25,000 tpy threshold proposed in the tailoring rule. NACWA recommended that consistent methods be used in GHG regulations, including the tailoring rule and the Mandatory Greenhouse Gas Reporting Rule (see story below). In addition, NACWA recommended that EPA get results from the Reporting Rule before further regulating GHG emissions, since the Reporting Rule will provide information on how many and what type of facilities exceed the 25,000 tpy threshold. NACWA will continue to follow developments in the regulation of GHG emissions and inform members about how these regulations will affect wastewater utilities.

Greenhouse Gas Reporting Rule in Effect for 2010; Utilities Should Determine Applicability

EPA’s new Mandatory Greenhouse Gas Reporting Rule, finalized last September (see Regulatory Alert 09-05), will require some clean water agencies to report their greenhouse gas (GHG) emissions for 2010. The rule excludes normal process emissions from municipal wastewater treatment, but utilities will need to report emissions from their stationary combustion sources if these emissions exceed 25,000 metric tons of carbon dioxide equivalent (CO2e) for the year. The methane and nitrous oxide emissions from combustion of biogas are included in the calculations to determine if a facility exceeds the 25,000 metric tons CO₂e threshold, but not the CO₂ emissions from combustion of biogas. However, if a facility exceeds the threshold, the CO₂ emissions from biogas combustion must also be reported. Emissions from combustion of biosolids are specifically exempt from the calculations of combustion emissions. NACWA urges all member agencies to determine now if their facilities are expected to exceed the reporting threshold this year, and to provide Cynthia Finley ( This e-mail address is being protected from spambots. You need JavaScript enabled to view it ) with this information. EPA’s Applicability Tool for the Reporting Rule may help utilities to make this determination. EPA has also published a fact sheet about special provisions for 2010, which confirms that facilities that only have stationary fuel combustion sources can submit an abbreviated report for 2010, and can use any calculation method in subpart C of the rule for 2010. NACWA will be issuing an Advocacy Rule next month with more information about the Reporting Rule.

Municipal Wastewater Emissions Unchanged in New EPA Draft Greenhouse Gas Inventory

NACWA received an expert review draft of the annual Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2008, and the draft for public review is expected to be released soon. This annual estimate of greenhouse gas (GHG) emissions includes a category for Wastewater Treatment, consisting of municipal wastewater treatment, septic systems, and industrial wastewater treatment. No substantial changes to the emissions estimates for municipal wastewater treatment were made to this year’s Inventory. Using funds from the Targeted Action Fund (TAF) and the Critical Issues Action Initiative (CIAI), NACWA has provided comments to EPA on the Inventory for the last three years, leading to several changes in the estimation methods that reduced the emissions for municipal wastewater treatment. Although the Inventory has only been used for information purposes in the past, it is now being considered as a basis for regulatory action with EPA’s proposed GHG tailoring rule (see story above). NACWA’s Climate Change Committee will evaluate the current Inventory, EPA’s responses to NACWA’s comments in the past three years, and the importance of further revisions to the Inventory. The Committee will then decide how the Association should respond to this year’s Inventory.

Conferences & Meetings

Critical Wet Weather Issues Examined in NACWA’s Flow Web Seminar Series

Registration is now underway for NACWA’s new Flow Web Seminar Series – innovative web seminars addressing some of the hottest topics in wet weather and stormwater management. The first seminar, Stormwater Management: What Really Works?, was held on January 13. Designed as a central element of NACWA’s Wet Weather Advocacy Project (WWAP), the remaining Flow Series web seminars will feature experts discussing topics of concern for public utilities charged with the management of wet weather flows:

Climate Change: It’s All About Water! (March 10, 2010)
Water Quality: The True Impact of Stormwater Runoff (June 9, 2010)
Green Infrastructure: What’s Legal? (September 8, 2010)

All web seminars will be held from 2:00-3:00 p.m. EST. Register for one or all of the seminars and engage key members of your staff in these unique and important offerings. More details are available on NACWA’s website. Be sure to join us for these valuable web seminars – register today!

Emerging Contaminants

NACWA Weighs in with EPA on New National Drug Disposal Guidelines

NACWA sent a letter to EPA on January 6, expressing concern about a new set of recommendations from the Food and Drug Administration (FDA) on the disposal of unused pharmaceuticals. The new FDA guidelines, which include a list of drugs recommended for flushing, will only complicate NACWA member efforts to educate their communities on the importance of source control and the availability of other, more environmentally-friendly alternatives for disposing of unused pharmaceuticals. NACWA will write to the FDA directly about these concerns, but alerted EPA first because of FDA’s assertion in the guidelines that flushing these pharmaceuticals will have little or no human health or environmental impact. NACWA believes EPA is the appropriate agency to make such a finding after consulting with other agencies, including FDA.

NACWA noted that while there is a very real potential for accidents or diversion of prescription medication for illicit use, making such broad statements of relative risk, and basing national guidelines on those statements, is problematic unless all of the necessary analyses have been done. EPA’s water quality standards program generally does not consider relative risk. NACWA is concerned about the potential for a situation where one federal agency recommends the flushing of pharmaceuticals while another mandates the installation of technology at clean water agencies to remove those same compounds from their wastewater or solids. NACWA highlighted the need for a consistent message from the federal government regarding the disposal of pharmaceuticals. If it is determined that a risk trade-off is truly needed whereby potential environmental impacts would be accepted in order to prevent accidental ingestion, then this decision needs to be made collectively and the policy applied consistently by all federal agencies.

Enforcement

NACWA Submits Comments on Proposed EPA Enforcement Priorities for 2011-2013

NACWA submitted comments January 14 on EPA’s proposed national enforcement and compliance priorities for fiscal years 2011-2013, expressing concern that the EPA Office of Enforcement and Compliance Assurance (OECA) continues to focus on municipal wet weather issues without addressing other sources of water quality impairment. NACWA also submitted a copy of its December 2009 Enforcement White Paper and requested that it be considered in the final version of the enforcement priorities. Among EPA’s proposed priorities is “wet weather municipal infrastructure,” including combined sewer overflows (CSOs), sanitary sewer overflows (SSOs), and stormwater. NACWA’s comments expressed concern with this approach, stating that “national enforcement priorities for the next three years that place continued emphasis on municipal utilities without addressing other sources of water impairment such as agricultural discharges will fail to achieve any meaningful water quality improvement.” NACWA also emphasized the message in its white paper that the current “business as usual” approach to clean water enforcement will not work and that a new paradigm focused on a watershed approach, increased federal funding for water infrastructure, and revised federal affordability criteria is needed to meet the water quality challenges of the 21st century.” NACWA will continue to advocate aggressively on behalf of its members on enforcement issues and will report to the membership once EPA finalizes the 2011-2013 national enforcement priorities.

EPA

Perciasepe Confirmed as EPA Deputy; NRDC’s Stoner Moves to EPA Water Office

Bob Perciasepe has been confirmed by the Senate to become EPA’s deputy administrator. His confirmation had been held up for several months by Sen. George Voinovich (R-Ohio), who wanted to pressure EPA into providing greater detail regarding its economic analysis on climate change legislation. Perciasepe previously served as EPA’s assistant administrator for water early in the Clinton Administration and then as the assistant administrator for air and radiation. After leaving EPA, he became the chief operating officer of the National Audubon Society. In addition, he was on the Board of Directors of the Clean Water America Alliance, an organization launched by NACWA to pursue a more holistic approach to addressing 21st century challenges relating to wastewater, drinking water, stormwater, and water reuse.

NACWA also recently learned that Nancy Stoner, the co-director of clean water programs at the Natural Resources Defense Council (NRDC), will become EPA’s deputy assistant administrator in the Office of Water. Prior to her tenure at NRDC, Stoner worked in EPA’s Office of Enforcement and Compliance Assurance. She also has worked very closely with NACWA on key initiatives, including the development of a draft policy on blending, which EPA has never finalized, and on the Green Infrastructure for Clean Water Act (H.R. 4202), which was introduced last fall to promote green infrastructure technologies as a way to address stormwater flows and other water quality challenges. NACWA looks forward to working with both Perciasepe and Stoner on priority clean water issues.

Silva Outlines Office of Water Priorities for 2010

In a memo to EPA Office of Water employees on January 25, Assistant Administrator for Water Peter Silva listed the Office’s priorities for 2010 and explained how the Office is working to address these priorities. The two organizing themes for the Office of Water priorities are “Sustainable Communities” and “Healthy Watersheds.” To help build sustainable communities, the nation’s water resources must be sustainable, secure, and protective of public health. EPA plans to continue using state revolving funds and recovery act funds to improve infrastructure and increase sustainability. Silva states that the Office of Water will continue to protect public health by improving water quality science and working closely with the enforcement program. The health of watersheds will be improved through work targeted to specific geographic areas, such as the Chesapeake Bay, and through increased enforcement actions. The Office also plans to work on improving watershed-based approaches by improving “the way existing tools such as water quality standards, protection of downstream uses, permits and total maximum daily loads are used to protect and restore watersheds, explore how innovative tools such as trading and other market-based approaches to watershed protection can be applied, and enhance efforts to prevent water quality impairments in healthy watersheds.” Climate change action, endocrine-disrupting chemicals, and environmental justice are also mentioned as priorities in the memo.

Pretreatment and Pollution Prevention

EPA Releases Preliminary 2010 Effluent Guidelines Program Plan

In the Preliminary 2010 Effluent Guidelines Program Plan , EPA describes its plans to immediately begin developing best practices for unused pharmaceutical management at health care facilities, rather than conducting a survey of these facilities. The Plan contains the results of EPA’s 2009 annual review of existing effluent guidelines and pretreatment standards and the evaluation of indirect dischargers that do not have categorical pretreatment standards, and it also outlines EPA’s preliminary 2010 Plan. EPA began a detailed study of the Health Services category in 2007, and in 2008 NACWA provided comments on a survey that the Agency planned to distribute to health care facilities to collect detailed information on the management and disposal practices for unused pharmaceuticals. EPA has conducted significant outreach and data collection activities since 2007, including speaking or meeting with over 700 different people and conducting many site visits. EPA believes it now has enough data to develop best practices for unused pharmaceutical management at health care facilities, and it does not need to conduct a survey to gather additional facility-specific data. EPA plans to complete the best practices for inclusion in the final 2010 Plan.

In addition to the Health Services category detailed study, EPA continued its detailed studies of the Steam Electric Power Generating category and the Oil and Gas Extraction category. The Steam Electric Power Generating study is now complete, and EPA has decided to revise the current effluent guidelines for this category. The Oil and Gas Extraction category study is only examining whether to include coalbed methane extraction as a new subcategory, and this study will be continued in the next year. EPA will also be continuing a preliminary category review of the Ore Mining and Dressing category. No categories were selected for new reviews or detailed studies. NACWA will be issuing an Advocacy Alert next month to provide more details about the Plan and to solicit member comments, particularly related to the decision to develop best practices for unused pharmaceuticals for health care facilities.

Security and Emergency Preparedness

2009 Water Sector Metrics Report Provides Information about Utility Security Actions

WaterISAC released the Water Sector Coordinating Council's (WSCC) 2009 Water Sector Measures Analysis report on January 26. The initiative, which built on the Council's 2008 work to measure security at water utilities, is part of a broader effort by the Department of Homeland Security (DHS) to measure security for all of the nation's 18 critical infrastructure and key resource sectors. NACWA encouraged all members to participate in the annual metrics reporting effort, and utility participation in the anonymous reporting in 2009 was substantially higher than the participation in 2008. The reporting indicates that most drinking water and wastewater utilities (85-88 percent) have integrated security and preparedness into budgeting, training, and manpower responsibilities and receive screened, validated, and timely security threat information from one or more sources. Over 90 percent of utilities secure and monitor the perimeter of areas containing hazardous materials and the shipping, receipt, and storage of materials for the facility. The metrics reporting results will be used to help inform the WSCC, DHS, and EPA about the security status of the water sector.

Water Sector Releases Consequence Management Planning Guide for Utilities

The Water Sector Coordinating Council (WSCC) and EPA have released a new document, All-Hazard Consequence Management Planning for the Water Sector (All-Hazard CMP), to help drinking water and wastewater utilities incorporate all-hazard consequence management planning into their emergency preparedness, response, and recovery plans and programs. The All-Hazard CMP was produced by a workgroup made up of drinking water and wastewater utilities, Water Sector associations (including NACWA), and representatives of state and federal water programs. Patricia Cleveland, operations manager, Northern Region, Trinity River Authority of Texas and a NACWA Board member, co-chaired the workgroup. The All-Hazard CMP includes customizable lists of preparedness, response, and recovery actions that will improve resiliency across all hazards, as well as consequence-specific lists of actions for potential hazards that are most relevant to drinking water and wastewater utilities. It also provides incident-specific flow charts and checklists developed as an example by a utility with links to the downloadable and customizable versions online. Information on how the National Incident Management System (NIMS) and the Incident Command System (ICS) are used in preparedness and during response and recovery is also contained in the document. Utilities that do not already have comprehensive emergency preparedness, response, and recovery plans are encouraged to use the All-Hazard CMP to develop these plans. Utilities that already have comprehensive plans may find it useful to compare their plans with the guidance provided in the All-Hazard CMP.

Water Quality

EPA Proposes Nutrient Criteria for Florida; NACWA to Comment

As anticipated, EPA released its proposed nutrient criteria for Florida on January 15, marking the first time the federal government has acted to impose nutrient water quality criteria for a state. While the impacts for Florida utilities are anticipated to be significant, the potential precedent this action represents could also have major implications nationwide. In August 2009, EPA entered into a consent decree with the Florida Wildlife Federation, committing to propose numeric nutrient standards for lakes and flowing waters in Florida by January 2010, and for Florida’s estuarine and coastal waters by January 2011.

The Federation alleged that EPA failed to protect the state’s waters from nutrient impairment and sued to force federal promulgation of the criteria. Environmental groups in Wisconsin have already expressed their intent to follow the same path to force federal promulgation of nutrient standards in that state, and NACWA believes that the success of the Florida legal challenge could lead other environmental groups around the country to do the same. EPA’s proposed criteria for flowing waters in Florida, as expected, rely on the reference condition approach to nutrient criteria derivation. The proposal notes that EPA was not able to establish the causal link between nutrient levels and in-stream impacts necessary to develop criteria based on a stressor-response relationship, and instead used the reference condition/percentile. Of more national significance, EPA is for the first time proposing to change the water quality criteria it is establishing for flowing waters to ensure that they are protective of downstream waters. In most cases, the criteria are significantly more stringent as a result. In addition, EPA is also proposing to use a new concept in Florida, a “restoration standard,” that NACWA was briefed on late last year. EPA has described the restoration standard as a long-term variance from meeting the water quality standard, allowing for a longer timeframe to improve the quality of impaired waters. This could help minimize the immediate impacts of the Florida criteria, but NACWA’s analysis is just getting underway. Initial reactions are that establishing the restoration standard could require a significant amount of data and multiple use attainability analyses. NACWA’s nutrient working group is reviewing the criteria and will develop comments on the proposal.

NACWA Raises Concerns with New WET Test Analysis Procedure

NACWA expressed concerns in a January 11 letter about a new procedure for evaluating whole effluent toxicity (WET) test results, the test of significant toxicity (TST), that EPA hopes will address some of the criticisms surrounding its WET testing program. While NACWA continues to have concerns with the entire suite of WET test methods and endpoints, the Association’s primary focus continues to be on the use of chronic, sub-lethal endpoints, where permit compliance or reasonable potential may be more a function of the method itself, than of effluent quality. The procedures for evaluating WET test results (i.e., hypothesis testing and point estimates) can moderate some of the acknowledged uncertainties in the methods.

As outlined in NACWA’s letter, EPA’s TST approach seems to address some of the issues that arise when using hypothesis testing, but leaves many questions unanswered. Chief among these unresolved issues, the letter notes, is EPA’s continued reliance on hypothesis testing, while most states, dischargers and even parts of EPA have recognized that point estimates (EC/IC25 calculations) provide a superior approach for evaluating WET test results. NACWA believes that EPA’s resources would be better utilized improving point estimate approaches given the Agency’s stated preference for them over hypothesis testing, rather than continued work on the TST approach. There are limitations to using hypothesis tests in the reasonable potential (RP) calculations advocated by EPA that the TST approach or any other concept to refine hypothesis tests cannot adequately address. The TST approach, while controlling the rate of “toxic sample non-toxic” (false negatives) in WET tests, results in an unacceptably high false positive rate. Thus, more non-toxic samples are being mistakenly labeled as toxic than under the current procedures — a major issue for permitted dischargers.

In addition to pointing out several other issues raised by the TST approach, NACWA’s letter reiterates the need for EPA to develop comprehensive guidance on the implementation of WET testing requirements in the National Pollutant Discharge Elimination System (NPDES) program. Major issues remain in dealing with discharges with little or no dilution, unnecessary conservatism in the Technical Support Document for Water Quality-based Toxics Control (TSD) reasonable potential procedures, and in implementing chronic WET requirements in permits. It is unclear when EPA will officially release the TST guidance for public comment, but NACWA will continue to evaluate the new procedure and weigh in with EPA as needed.

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