[Senate Hearing 105-50]
[From the U.S. Government Publishing Office]


                                                 S. Hrg. 105-50, Part 2


 
         CLEAN AIR ACT: OZONE AND PARTICULATE MATTER STANDARDS

=======================================================================

                                HEARINGS

                               BEFORE THE

                            SUBCOMMITTEE ON
        CLEAN AIR, WETLANDS, PRIVATE PROPERTY AND NUCLEAR SAFETY

                                AND THE

                              COMMITTEE ON
                      ENVIRONMENT AND PUBLIC WORKS
                          UNITED STATES SENATE

                       ONE HUNDRED FIFTH CONGRESS

                             FIRST SESSION

                               __________

                   APRIL 24 AND 29, AND JULY 24, 1997

                               __________

  Printed for the use of the Committee on Environment and Public Works


                               


                      U.S. GOVERNMENT PRINTING OFFICE
 44-108 cc                  WASHINGTON : 1997
_______________________________________________________________________
            For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office, Washington DC 20402



               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                       ONE HUNDRED FIFTH CONGRESS

                 JOHN H. CHAFEE, Rhode Island, Chairman
JOHN W. WARNER, Virginia             MAX BAUCUS, Montana
ROBERT SMITH, New Hampshire          DANIEL PATRICK MOYNIHAN, New York
DIRK KEMPTHORNE, Idaho               FRANK R. LAUTENBERG, New Jersey
JAMES M. INHOFE, Oklahoma            HARRY REID, Nevada
CRAIG THOMAS, Wyoming                BOB GRAHAM, Florida
CHRISTOPHER S. BOND, Missouri        JOSEPH I. LIEBERMAN, Connecticut
TIM HUTCHINSON, Arkansas             BARBARA BOXER, California
WAYNE ALLARD, Colorado               RON WYDEN, Oregon
JEFF SESSIONS, Alabama
                     Jimmie Powell, Staff Director
               J. Thomas Sliter, Minority Staff Director
                                 ------                                

  Subcommittee on Clean Air, Wetlands, Private Property, and Nuclear 
                                 Safety

               JAMES M. INHOFE, North Carolina, Chairman

TIM HUTCHINSON, Arkansas             BOB GRAHAM, Florida
WAYNE ALLARD, Colorado               JOSEPH I. LIEBERMAN, Connecticut
JEFF SESSIONS, Alabama               BARBARA BOXER, California

                                  (ii)


                            C O N T E N T S

                              ----------                              
                                                                   Page

                             APRIL 24, 1997
                RISK ANALYSIS AND IMPLEMENTATION ISSUES
                           OPENING STATEMENTS

Allard, Hon. Wayne, U.S. Senator from the State of Colorado......     6
Boxer, Hon. Barbara, U.S. Senator from the State of California...     7
Chafee, Hon. John H., U.S. Senator from the State of Rhode Island    11
Hutchinson, Hon. Tim, U.S. Senator from the State of Arkansas....     4
Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma...     1
Sessions, Hon. Jeff, U.S. Senator from the State of Alabama......     5

                               WITNESSES

Chilton, Kenneth W., director, Center for the Study of American 
  Business, Washington University, St. Louis, MO.................     9
    Prepared statement...........................................    50
Cooper, Benjamin Y., senior vice president, Printing Industries 
  of America.....................................................    36
    Prepared statement...........................................   204
Dudley, Susan E., vice president and director of environmental 
  analysis, Economists Incorporated..............................    14
    Prepared statement...........................................   161
    Report, NAAQS for Ozone......................................   251
Hartsock, Beverly, Deputy Director, Policy & Regulatory 
  Development, Texas Natural Resource Conservation Commission....    39
    Letters, impact of proposed NAAQS on Texas...................   230
    Prepared statement...........................................   225
Kerkhoven, Paul C., director, Environmental Affairs, American 
  Highway Users Alliance.........................................    34
    Prepared statement...........................................   243
Krupnick, Alan, senior fellow, Resources for the Future..........18, 29
    Prepared statements..........................................
      177, 191...................................................
Leyden, Patricia, deputy executive officer, South Coast Air 
  Quality Management District....................................    38
    Prepared statement...........................................   208
    Responses to additional questions from Senator Lieberman.....   210
Lippmann, Morton, Institute of Environmental Medicine, New York 
  University.....................................................    17
    Prepared statement...........................................   168
    Responses to additional questions from Senator Lieberman.....   176
Nichols, Mary, Assistant Administrator, Office of Air and 
  Radiation, Environmental Protection Agency.....................    31
    Prepared statement...........................................   203
Shy, Carl M., Department of Epidemiology, School of Public 
  Health, University of North Carolina at Chapel Hill............    15
    Prepared statement...........................................   164
Starr, Thomas, principal, Environ Inc............................    11
    Prepared statement...........................................    54
    Reports:
        Associations of PM with Adverse Health Outcomes: Expert 
          Panel Review of Causality Issues.......................   134
        Proposed NAAQS for PM: Qualitative Risk Assessment.......    58
        Proposed NAAQS for PM: Issues of Causality...............    85

                          ADDITIONAL MATERIAL

Statements:
    Center for Study of Public Choice, George Mason University...   247
    Hopkins, Thomas D., Rochester Institute of Technology........   343
                                 ------                                

                             APRIL 29, 1997
                 IMPACT ON STATE AND LOCAL GOVERNMENTS
                           OPENING STATEMENTS

Hutchinson, Hon. Tim, U.S. Senator from the State of Arkansas....   368
    Resolutions, Arkansas legislature............................   372
    Statement, Arkansas State Representative Scott Ferguson......   369
Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma...   363
    Charts.......................................................   365
Sessions, Hon. Jeff, U.S. Senator from the State of Alabama......   381

                               WITNESSES

Alford, Harry C., president and CEO, National Black Chamber of 
  Commerce.......................................................   411
    Prepared statement...........................................   606
Billings, Hon. Leon G., Delegate, Maryland General Assembly......   382
    Prepared statement...........................................   462
    Responses to additional questions from Senator Baucus........   463
Fennelly, Kevin P., staff physician, Division of Environmental 
  and Occupational Health Sciences, National Jewish Medical and 
  Research Center................................................   398
    Prepared statement...........................................   595
Grande, Christopher M., executive director, International Trauma 
  Anesthesia and Critical Care Society...........................   400
    Prepared statement...........................................   604
Hansen, Paul, executive director, Izaak Walton League of America.   396
    Prepared statement...........................................   594
Heilman, Glenn, vice president, Heilman Pavement Specialties, 
  Inc., for National Federation of Independent Business..........   416
    Prepared statement...........................................   610
Herhold, Frank F., executive director, Marine Industries 
  Association of South Florida, for National Marine Manufacturers 
  Association....................................................   412
    Prepared statement...........................................   608
Homrighausen, Hon. Richard P., Mayor of Dover, OH................   377
    Prepared statement...........................................   423
Hull, Hon. Emma Jean, Mayor of Benton Harbor, MI.................   374
    Prepared statement...........................................   421
Junk, Robert C., president, Pennsylvania Farmers Union, for 
  National Farmers Union.........................................   392
    Prepared statement...........................................   474
Russman, Hon. Richard L. New Hampshire State Senate..............   379
    Letters, proposed NAAQS standards, New Hampshire Department 
      of Environmental Services..................................   467
    Prepared statement...........................................   464
Selph, Hon. John, Tulsa County Commissioner, OK..................   383
    Prepared statement...........................................   473
Smith, Jeffrey C., executive director, Institute of Clean Air 
  Companies......................................................   414
    Prepared statement...........................................   609
Vice, Bob, president, California Farm Bureau Federation, for 
  American Farm Bureau Federation................................   394
    Prepared statement...........................................   480

                          ADDITIONAL MATERIAL

Letters:
    American Farm Bureau Federation..............................   577
    CASAC Advisory Committee.....................................   581
    Department of Agriculture....................................   553
    Food Industry Environmental Council..........................   640
    Food processing industry representatives.....................   573
    Massachusetts Department of Environmental Protection.........   649
    National Caucus of Environmental Legislators.................   644
    Natural Resource Conservation Service........................   565
    New York Department of Environmental Conservation............   617
    Northeast States for Coordinated Air Use Management..........   646
    Public Service Electric and Gas Company......................   656
    Small Business Administration................................   568
    Vermont Governor Howard Dean.................................   654
Report, Long-Range Transport of North African Dust to the Eastern 
  United States..................................................   489
Statements:
    Associated Builders and Contractors..........................   611
    Cahill, John, Acting Commissioner, New York State Department 
      of Environmental Conservation..............................   613
    Public Service Electric and Gas Company......................   657
    United Steelworkers of America, AFL-CIO......................   664
Summary, Comments on Coarse Particles, Federal Register..........   532
                                 ------                                

                             JULY 24, 1997
                        IMPLEMENTATION STRATEGY
                           OPENING STATEMENTS

Allard, Hon. Wayne, U.S. Senator from the State of Colorado......   671
Baucus, Hon. Max, U.S. Senator from the State of Montana.........   694
Hutchinson, Hon. Tim, U.S. Senator from the State of Arkansas....   670
Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma...   667
Lieberman, Hon. Joseph I., U.S. Senator from the State of 
  Connecticut....................................................   694
Sessions, Hon. Jeff, U.S. Senator from the State of Alabama......   672
Thomas, Hon. Craig, U.S. Senator from the State of Wyoming.......   669

                                WITNESS

Nichols, Mary D., Assistant Administrator for Air and Radiation, 
  Environmental Protection Agency................................   673
    Prepared statement...........................................   695
    Responses to additional questions from:
        Senator Baucus...........................................   714
        Senator Inhofe...........................................   703



         CLEAN AIR ACT: OZONE AND PARTICULATE MATTER STANDARDS

                              ----------                              


                        THURSDAY, APRIL 24, 1997

                             U.S. Senate,  
       Committee on Environment and Public Works,  
             Subcommittee on Clean Air, Wetlands, Private  
                               Property and Nuclear Safety,
                                                    Washington, DC.

                RISK ANALYSIS AND IMPLEMENTATION ISSUES

    The subcommittee met, pursuant to recess, at 9:33 a.m. in 
room 406, Senate Dirksen Building, Hon. James M. Inhofe 
(chairman of the subcommittee) presiding.
    Present: Senators Inhofe, Hutchinson, Allard, Sessions, 
Lieberman, and Chafee (ex officio).
    Also present: Senator Baucus.

 OPENING STATEMENT OF HON. JAMES M. INHOFE, U.S. SENATOR FROM 
                     THE STATE OF OKLAHOMA

    Senator Inhofe. The hearing will come to order.
    Today's subcommittee hearing is the third on the proposed 
rule changes. It's actually the fourth hearing that we've had; 
one was a full committee hearing.
    The first was the science hearing, in which we heard from 
members of CASAC, and there are some members from CASAC here 
today as well as much of the scientific community.
    At the second hearing, Administrator Browner was the 
Administration's first witness. The committee then held a field 
hearing in Oklahoma City. In fact, I think we set a record for 
the longest and the best attended field hearing in the history 
of Oklahoma. Today, we turn to risk and implementation issues. 
This will be followed by a hearing this coming Tuesday, April 
29, which will focus on the impacts of the proposed regulations 
by EPA.
    I'm troubled by the risk issues surrounding these 
regulations. The risk analysis is necessarily based on the 
understanding of the science issues, but we learned in our 
science hearing that there is great uncertainty on the 
scientific side. When we add that to the uncertainties in the 
risk assessments, we end up with very dubious results.
    We have learned that the EPA greatly overestimated the 
impacts of both ozone and PM and they've had to publicly change 
their figures. In addition, we've learned that they selectively 
applied some study results, while ignoring others in their 
calculations.
    For example, the majority of the health benefits for ozone 
are based on one study by Dr. Moolgavkar even though the Agency 
ignored the results of that study because it contradicted their 
position.
    What I find most troubling is that first, the science is 
unclear and incomplete, and then these uncertainties are added 
to the uncertainties of risk calculations.
    The EPA has claimed these results are concrete facts, even 
though other Federal agencies and outside interest groups have 
raised many questions about these proposals. Public policy 
decisions must be open and aboveboard. Uncertainty in science, 
plus uncertainty in risk factors does not equal certainty.
    What I hope to gain from the testimony of the first panel 
today is a better understanding of the risk issues. I am 
pleased that we have some divergent viewpoints by members of 
the panel and hope they can shed some light on the risk issue.
    The second panel today will discuss the implementation 
issues. This area has not received the attention it deserves in 
the public debate. While implementation issues will become more 
important as the EPA proceeds, they do need to be discussed 
before the proposals are finalized. Because of that, we have 
invited several members of the EPA's Advisory Group for 
Implementation Issues to appear here today.
    I'm concerned that the planned implementation for these 
proposals is not reflected in the projected impacts. The EPA is 
planning to change the method of defining nonattainment areas. 
The proposals have created two new concepts--areas of violation 
and areas of influence.
    [Indicates chart.]
    Senator Inhofe. If you look over here, we don't have the 
entire United States; this is a chart I understand that came 
from the EPA and we talk about the very small circle in the 
middle as being those areas that could be out of attainment but 
it's very vague on what is expected in the other areas.
    This chart represents what the EPA is considering for 
implementation areas. If members have not seen this, I suggest 
you look closely and particularly you, Senator Sessions, 
because you don't really know what additional problems are 
going to be there.
    Most people have been under the wrong assumption that these 
proposals would only affect the nonattainment areas defined by 
the EPA. As you can see on the map, from only three 
nonattainment areas, the majority of five States would be 
affected. While this is only a strawman map and as it says on 
the top, ``conceptual only,'' the concept concerns me. The 
boundaries themselves could end up being larger or smaller. The 
fact that it's being considered needs to be addressed.
    The people who live in these areas, as well as the mayors, 
Governors, and even Senators, have had no idea that these 
regulations would apply to them. The importance of this cannot 
be underestimated. The people in these communities lost the 
opportunity to comment during the comment period. I suspect 
that if a lot of people had seen that map prior to the end of 
the comment period, there would have been a lot more comments.
    I hope this issue as well as other implementation issues 
will come out during our second panel. We have two good panels 
of witnesses today and I look forward to your testimony.
    [The prepared statement of Senator Inhofe follows:]
Prepared Statement of Hon. James M. Inhofe, U.S. Senator from the State 
                              of Oklahoma
    The hearing will now come to order.
    Today's hearing is the third subcommittee hearing on the proposed 
new ozone and particulate matter standards and the fourth for the 
Committee. The first hearing focused on the scientific issues. At the 
second hearing, a full Committee hearing, we received testimony from 
Administrator Browner. The third hearing was a field hearing in 
Oklahoma City where we received testimony from State and local 
government officials.
    Today we turn to risk and implementation issues. This will be 
followed by a hearing this Tuesday which will focus on the impacts of 
the proposals.
    I am troubled by the risk issues surrounding these regulations. The 
risk analysis is necessarily based on the understanding of the science 
issues. But we learned in our science hearing that there is great 
uncertainty on the scientific side. When we add that to the 
uncertainties in the risk assessments, we end up with very dubious 
results.
    Since our last hearings, we have learned that the EPA greatly 
overestimated the impacts for both ozone and PM, and they have had to 
publicly change their figures. In addition, we have learned that they 
selectively applied some study results while ignoring others in their 
calculations. For example, the majority of the health benefits for 
ozone are based on one PM study by a Dr. Moogarkar, even though the 
Agency ignored the PM results of that study because it contradicted 
their position on PM.
    What I find most troubling is that first the science is unclear and 
incomplete and that these uncertainties are then added to the 
uncertainties of risk calculations which must result in great 
uncertainty. But the EPA has postured these results as being the 
concrete facts, even though other Federal agencies have raised as many 
questions about these proposals as outside interest groups. Public 
policy decisions must be open and above board. Uncertainty in science 
plus uncertainty in risk does not equal fact.
    What I hope to accomplish in the first panel today is a better 
understanding of the risk issues. I am pleased that we have some 
divergent viewpoints on the panel. I hope they can shed some light on 
the risk questions.
    Our second panel today will discuss the implementation issues. This 
is an area that we have so far ignored and is not receiving the 
attention it deserves in the public debate. While implementation issues 
will become more important as the EPA precedes, they do need to be 
discussed before the proposals go final. Because of that, we have 
invited several members of the EPA's advisory group for implementation 
issues to appear here today.
    I am concerned that the planned implementation for these proposals 
is not reflected in the projected impacts. The EPA is planning to 
change how nonattainment areas are defined. The proposals have created 
two new concepts, Areas of Violation and Areas of Influence.
    This chart, represents what the EPA is considering for 
implementation areas. If members have not seen this, I suggest you look 
closely. In addition to requiring control measures in nonattainment 
areas, the EPA plans on requiring additional measures in these Areas of 
Influence. Most people have been under the wrong assumption that these 
proposals would only effect the nonattainment areas identified by the 
EPA. But as you can see on this map, from only three nonattainment 
areas, the majority of five States would be affected. While this is 
only a straw man map, and as it says on the top, conceptual only; the 
concept concerns me. The boundaries themselves could end up being 
larger or smaller, the fact that it's being considered needs to be 
addressed.
    The people who live in these areas, as well as the mayors, 
Governors, and even Senators have had no idea that these regulations 
would apply to them. The importance of this cannot be underestimated. 
These people and communities lost the opportunity to comment during the 
public comment period because their counties were not identified by the 
EPA as nonattainment areas. These proposals have been portrayed as only 
affecting certain areas when, in fact, they will impact the entire 
Nation.
    I hope this issue, as well as other implementation issues will come 
out during our second panel. We have two good panels of witnesses today 
and I look forward to your testimony.

    Senator Inhofe. I will now turn to Senator Hutchinson for 
any opening comments he might want to make.

OPENING STATEMENT OF HON. TIM HUTCHINSON, U.S. SENATOR FROM THE 
                       STATE OF ARKANSAS

    Senator Hutchinson. Thank you, Mr. Chairman.
    I want to commend you for your willingness to take on this 
very difficult issue. Too often, I think regulatory agencies 
are able to implement new standards and new regulations without 
any close scrutiny or necessarily the kind of focus that should 
be placed upon them. So thank you for leading this and for 
calling this issue today.
    I'm very happy that we can continue our study of the EPA's 
proposed clean air standards. About 2 months ago, we held the 
first hearing on the proposed standards. In this hearing, I 
learned very important information regarding the scientific 
basis behind the EPA's proposal.
    It was very clear that the CASAC scientists themselves did 
not agree on the standards proposed and they certainly did not 
agree that everything EPA has done is in accordance with the 
recommendations of CASAC.
    I must admit that in some ways I am amazed that we're still 
debating some of the issues that we are today. Since the 
science hearing, it has come out that several Government 
agencies have opposed these standards with, to my knowledge, no 
response from EPA. I've heard from hundreds of constituents, 
not just industry officials but the average citizen, strongly 
opposed to these new standards.
    I've seen editorials and articles from papers all over the 
Nation outlining weaknesses in the proposal and opposition to 
it. All of this has gone on in the last 2 months, yet we've 
heard very little from EPA. There's been no good faith effort, 
in my opinion, on the part of EPA to address these very 
legitimate concerns.
    I find this situation disturbing, especially the lack of 
response to the Government agencies opposing the standard. 
Instead, we have heard Administrator Browner claim that they 
have the scientific basis and justification for the standards. 
Unfortunately, this science is considered in many cases either 
valid, weak, or contradictory.
    In Arkansas, the EPA has become one of the most despised 
agencies. Perhaps in the month of April with IRS, it might 
exceed the hostility level, but the EPA is viewed as being 
heavy-handed, oftentimes arrogant and it seems this level of 
disrespect I think goes beyond the average Arkansan.
    Recently, I found out that some of the comments made by Dr. 
Schwartz in the first hearings were misleading at best. He 
testified that the United States is behind the rest of the 
world in clean air standards. Now we come to find out that is 
really not the case at all and yet Dr. Schwartz testified and 
led us in that direction--I think misled us in that direction.
    It troubles me and I think it should concern every Senator 
on this committee and every Senator in the U.S. Senate. Dr. 
Schwartz's studies are the primary studies the EPA has used to 
set the PM standard. Yet, these studies have not yet been made 
public. We are relying, in effect, on unchecked research of 
someone who has not been fully forthcoming to this committee. 
This concerns me greatly. I think Dr. Schwartz should provide 
us an explanation or an expansion on his comments to us.
    In the first hearing, I submitted a question to Mr. 
McClellan regarding the possibility that under certain 
circumstances, even if all manmade VOCs, volatile organic 
compounds, were eliminated, would it be possible for some 
regions of the country to find themselves out of attainment and 
he responded that was the case.
    Basically, under the current Clean Air Act, some areas 
could do everything possible to eliminate manmade VOCs and 
still be out of attainment. The EPA is determined that for 
these areas NAAQS must be regulated.
    What that would basically mean is that the Clean Air Act 
would have to be reopened. I don't think we desire to do that 
in order to regulate this area.
    Mr. Chairman, in short, there are many unanswered questions 
on these standards and I'm really surprised that there has been 
no attempt on the EPA's part to really come to the table and 
discuss the issues that have been raised and the concerns that 
have been expressed by this committee.
    I want to thank you for the opportunity to continue the 
hearings and to continue to explore what I think will be a far-
reaching impact upon not only our local and State governments, 
but upon each of our citizens.
    Senator Inhofe. Thank you, Senator Hutchinson.
    I also thank you for attending the field hearing out in 
Oklahoma. Out there, we saw what the people in the field 
thought. I might add at this point, this is not a partisan 
issue. The second panel we had in our Oklahoma field hearing, 
all of them were Democrats and they had very, very strong 
feelings, as you recall.
    Following the ``early bird'' rule, we'll turn now to 
Senator Sessions.

OPENING STATEMENT OF HON. JEFF SESSIONS, U.S. SENATOR FROM THE 
                        STATE OF ALABAMA

    Senator Sessions. Thank you, Mr. Chairman.
    I'd like to thank you for your work on this important 
issue. We're moving along very fast and I'm afraid we're 
considering adopting issues that could have great impact on our 
communities.
    It was remarkable that I think we had the official 
representative of the National League of Cities speaking 
strongly in opposition to the proposed regulations.
    Senator Inhofe. And the U.S. Conference of Mayors.
    Senator Sessions. And the State Legislatures, from 
Representatives, the chairman of the environmental committees, 
national presidents of those organizations, as I recall, were 
absolutely and firmly in opposition to it and had some very 
disturbing things to say about the possibilities that these 
regulations would impact adversely their growth and economic 
vitality.
    Obviously, what we've learned is that nations that are 
strong and healthy economically do a better job of cleaning up 
their envi- 
ronments. If you're doing well financially, you can afford to 
make the investment easier than you can if you're not and the 
poorer nations, we can see, just simply are not able to do so. 
So we need not underestimate the damage that can be done if we 
impose regulations that don't improve health commensurate with 
the economic burden that it may place on our people and our 
industries.
    We should note in a very positive way how much the air has 
been cleaned up in the past 25 years. Measured pollutants have 
been reduced nearly one-third with sulfur dioxide, the main 
precursor, to acid rain being reduced by 30 percent and 
particulate matter being reduced 78 percent.
    The standards we have in place now are working and many, 
many communities are continuing to clean up their air. Moving 
forward with these changes will affect the lives of many 
people. We need to make sure that we are, in fact, receiving 
health benefits.
    We want to hear from these panels, but I will say this--
it's important to me that the Environmental Protection Agency, 
when it states its position before this committee, that its 
numbers are verifiable.
    EPA is suggesting, for example, in their cost-benefit 
analysis that they have done, that implementation of this 
standard will cost $6 to $8 billion. I met with the 
environmental person for TVA. It would cost $2 billion alone 
for TVA to comply with these new standards. One of the power 
companies in the southeast said it would probably cost them $4 
billion. Other estimates have been $60 to $100 billion to meet 
these standards.
    We need to get better numbers. We need to get better 
numbers about health; we need to get better numbers about 
costs, and we need to make sure that the policy we're setting 
today as public officials is based on science and health and 
not on politics or other reasons.
    Senator Inhofe. Thank you, Senator Sessions.
    Senator Allard.

 OPENING STATEMENT OF HON. WAYNE ALLARD, U.S. SENATOR FROM THE 
                       STATE OF COLORADO

    Senator Allard. Thank you, Mr. Chairman.
    I want to thank you for continuing to seek to get the 
scientific truth on these issues as chairman of this committee. 
I commend you in your efforts in that regard.
    I do have a full statement for the record, and I will make 
a few brief comments.
    Senator Inhofe. Without objection.
    Senator Allard. We've heard from the Environmental 
Protection Agency earlier, specifically from Carol Browner, and 
I was one member of the committee who challenged the scientific 
basis for some of the claims she was making and challenged her 
to come up with some better science. Instead of coming up with 
better science, she just downgraded her figures.
    This is not a political give-and-take situation as much as 
this committee is searching for good, scientific evidence to 
help us in making the right decisions, to ensure the health of 
the people of this country. I'm looking forward to being able 
to review the record, and I commend you for seeking that 
science.
    The other comment I'd like to make is I think those 
regulations being promoted by the Environmental Protection 
Agency set up local governments, particularly States, to fail 
because I'm not convinced they have the technical ability to 
actually meet the challenge that is called for in the rules and 
regulations.
    Again, we're getting down to the best available technology 
and the ability of the States to carry forward with that 
technology and good science.
    Those are just some of the brief comments I have. I'm going 
to have to leave early because of this debate--I serve on the 
Intelligence Committee. I apologize to the panel members for 
not being here.
    I do have some questions that I'll ask the committee and my 
staff to submit to those who are testifying.
    Thank you, Mr. Chairman.
    [The prepared statement of Senator Allard follows:]
Prepared Statement of Hon. Wayne Allard, U.S. Senator from the State of 
                                Colorado
    Thank you, Mr. Chairman. Today's hearing is of great interest to me 
because we will focus on the nuts and bolts of the proposed 
regulations; first whether they will actually contribute to better 
health and second whether they can be implemented effectively. Also, 
this will allow me the opportunity to follow up on questions concerning 
the Grand Canyon Visibility Project Commission that I had for 
Administrator Browner in early February.
    First, is the issue of the health benefits that have been projected 
if these regulations should be implemented. I believe we have given the 
EPA every opportunity to prove that the benefits they claim will 
actually occur. Instead of proving their original claims they have 
downgraded them and witnesses today will testify that even these 
revised numbers may not hold up under scrutiny. If the EPA is 
uncertain, I think Congress has the obligation to approach their 
proposal with some skepticism.
    Second, the implementation of these regulations could very well 
place too much of a burden on States and set them up for failure. My 
view is that EPA should not run out in front of the States' technical 
ability to implement Federal regulations. Further, testimony that we 
will hear today indicates to me that the limited technical and 
financial resources of State governments was not considered before 
these rules were proposed.
    Finally, I am still concerned with regional haze issues. I have a 
series of questions on this matter and, should I have the time, I look 
forward to posing them to Ms. Nichols.
    Thank you again, Mr. Chairman.

    Senator Inhofe. Thank you, Senator Allard. I also have a 
statement from Senator Boxer that will be placed in the record.
    [The statement of Senator Boxer follows:]
 Prepared Statement of Hon. Barbara Boxer, U.S. Senator from the State 
                             of California
    Mr. Chairman, I believe that as Senators, we have no greater duty 
and responsibility than to protect the health and safety of the 
American people.
    With this in mind, I would like to make two points today.
    First, I want to say very clearly and strongly that EPA clean air 
standards must continue to be based on science and health concerns.
    The EPA proposal before us is based on the best available science 
regarding the health effects of exposure to ozone and particulate 
matter. Some argue that we should not set a new standard until we have 
scientific proof of the exact relationship between exposures to ozone 
and particulate matter, and health effects. If we had applied that 
principle in the late 1970's, we would not be enjoying the benefit of 
our current standards--which have led to, for example, air pollution 
from carbon monoxide being reduced by 28 percent, from sulphur dioxide 
41 percent, and from lead 98 percent.
    We must continue medical research to improve our understanding. We 
clearly need more monitoring data on particulate matter. But this 
should not make us lose our focus on the need to continue making 
progress and further protect the public health--especially our 
children.
    Young children constitute the largest group at high risk from 
exposure to air pollutants. They breath 50 percent more air by body 
weight than the average adult. In California alone there are over six 
million children under the age of 14 and approximately ninety percent 
of them live in areas that fail to meet State and Federal standards.
    The second point I want to make, is the importance of taking costs 
into account once the health-based standards are set. Costs should and 
will play a key role in how the standard will be implemented and how 
long States will have to comply.
    In California, the South Coast Air Quality Management District is 
responsible for cleaning up the L.A. basin, which has the most polluted 
air in the country. The South Coast Air District faces some of the most 
intractable and complex air pollution problems, in an area where nearly 
every possible source is already regulated. Yet the District supports 
the EPA proposal. Why? Because they believe that more stringent 
standards can be met as long as technology continues to develop, and 
the State is given sufficient time to develop an implementation plan 
that is cost effective.
    Mr. Chairman, I think we need to continue to listen to all sides in 
this debate before we make a final judgment. I am confident that EPA 
will seriously consider each one of the thousands of public comments it 
has received before making a final proposal.
    Lastly, I want to welcome Pat Leyden, the Deputy Executive Officer 
of the South Coast Air Quality Management District who will testify in 
the second panel. I think she makes key points in her testimony about 
the effectiveness of market-based strategies to reduce emissions--in 
particular the Regional Clean Air Incentives Market (RECLAIM) program.
    I look forward to continued work with Committee members on this 
important issue.
    Thank you.

    Senator Inhofe. We will be moving this right along because 
I think most people are aware that we're having an executive 
session on the Chemical Weapons Convention today and we want to 
get up there in time for that.
    I'd ask our first panel of witnesses if you'd take your 
places at the table. The way we have divided the panels today 
is to start with experts in the field of risk analysis. The 
second panel will consist of persons responsible for 
implementation of the proposed standards should they be issued.
    While you're coming forward, I'd like to give you an 
overview of how we will proceed during this public hearing.
    We have 12 witnesses today, so what we're going to try to 
do is your entire statement, as you've been told, will be 
submitted for the record, but we will be timing witnesses and 
we're asking you to stay within the time limit for your opening 
statement of 5 minutes. These lights will give you the 
designation as to when you should stop.
    Following 5 minutes of comments by each of the witnesses, I 
will then ask any member of the subcommittee if they'd like to 
ask questions. Then we will have a round of questions and 
answers.
    I think we're ready to begin, so let me introduce the 
members of the first panel. We have Dr. Kenneth Chilton, Center 
for the Study of American Business, Washington University. I 
put two kids through that university.
    Next is Dr. Alan Krupnick, Resources for the Future; Dr. 
Thomas Star, principal, ENVIRON Incorporated; Ms. Susan Dudley, 
Economists Incorporated; Dr. Carl Shy, Department of 
Epidemiology, School of Public Health, University of North 
Carolina at Chapel Hill; and Dr. Morton Lippmann, Institute of 
Environmental Medicine, New York University.
    With that, we will start with Dr. Kenneth Chilton.

 STATEMENT OF DR. KENNETH W. CHILTON, DIRECTOR, CENTER FOR THE 
 STUDY OF AMERICAN BUSINESS, WASHINGTON UNIVERSITY, ST. LOUIS, 
                               MO

    Dr. Chilton. Thank you, Mr. Chairman.
    I'm in your debt for being able to testify today but after 
hearing that you have had two daughters attend Washington 
University I understand that you may well be in our debt as 
well.
    I'm the director at the Center for the Study of American 
Business at Washington University in St. Louis. I've been 
researching clean air issues for some 15-odd years. The 
comments I'm making this morning, of course, are my own and not 
necessarily those of the Center or of Washington University.
    The scientific evidence on ozone, I believe, is extensive. 
Ozone can cause coughing, wheezing, tightness in the chest, 
reduced lung function, which is reduced volume of air exchanged 
with each breath. These effects are related to both ozone 
concentrations and exercise levels. Healthy people typically 
experience less than a 5-percent loss in lung function, even 
when exercising vigorously at levels that are twice the current 
standard.
    Doctors don't consider loss of lung function of 10 percent 
or less a significant health effect. The person would not 
notice a loss this small.
    The primary concern, of course, is for the effects on 
asthmatics and others who are especially sensitive. The EPA 
staff report estimates that for each 1 million persons exposed, 
we can expect just 1 to 3 more respiratory hospital admissions 
a day for each 100 ppb increase in ozone levels.
    This is actually a very low incidence rate and a very high 
elevation in ozone levels. This effect has been translated, as 
everyone here knows, to the expected numbers of added annual 
asthmatic hospital admissions for the New York area. EPA 
projects that attainment of the new standard would lower 
admissions to 300 per year. This is just 1/10th of 1 percent of 
the 28,000 yearly asthmatic admissions in New York City--a 
very, very small number.
    On fine particles, the science is not so well developed, as 
you know. The EPA still projects, however, significant 
reductions in premature mortality to result from meeting a new 
fine particle standard. These projections are based not on 
thousands or even hundreds of studies but, in essence, two.
    These reports indicate an association between 
PM2.5 levels and death due to cardiovascular and 
pulmonary causes together and also a link between 
PM2.5 and death from all causes. It's curious that 
the link is not between fine particles and death due to 
respiratory disease or lung cancer alone. Medical science has 
not yet discovered a plausible mechanism to explain how fine 
particles cause any deaths.
    These studies also fail to control for other variables, 
temperature, humidity, or the existence of other air 
pollutants--that may cause the mortality rates to rise and fall 
with, and thus appear to be caused by, fine particle 
concentrations.
    The lack of air quality data for PM2.5 is 
another serious problem. EPA Administrator Browner, when she 
testified here, said that there are 51 PM2.5 
monitors collecting air quality data at present. That contrasts 
with 972 ozone monitors and 1,737 PM10 monitors. EPA 
had to project PM2.5 concentrations for many cities 
in order to derive its mortality estimates.
    Let me get to the recommendations. EPA is not required to 
tighten the ozone standard or to create a new PM2.5 
standard. For ozone there is little evidence that a tighter 
standard is warranted and would be more protective.
    For fine particles, the science is just not adequate to 
warrant a new standard. More could be accomplished for public 
health by staying the course for another 5 years than by 
disrupting this process with a new set of targets.
    However, the most important issue being raised by these air 
quality standards reviews is, by and large, being ignored, I 
believe. As you're well aware, the Clean Air Act requires the 
Environmental Protection Agency to establish and enforce air 
quality standards that protect public health with an adequate 
margin of safety. That's the mandate.
    In that process, it proscribes the consideration of 
economic factors. This is a very high-minded objective. It 
sounds good to say that air quality standards are to be set 
only on the basis of public health, but responsible public 
policy requires balancing incremental benefits and incremental 
costs. Spending more on one activity than it brings about in 
added benefits means that resources aren't available for other 
beneficial uses.
    Current ozone standards already require expenditures 
between $4 and $28 to produce $1 in health benefit. The tighter 
standard proposed only worsens this unfavorable tradeoff.
    Moreover, the physical responses to ozone can be 
demonstrated at levels produced by natural processes. As a 
result, the prime directive of the Clean Air Act has become 
mission impossible for ozone.
    The Clean Air Act Scientific Advisory Committee put it this 
way. ``The paradigm of selecting a standard at the lowest 
observable effects level and then providing an adequate margin 
of safety is no longer possible.'' I suppose CASAC would call 
this ``paradigm impossible'' instead of ``mission impossible.''
    In my opinion, EPA should appeal to Congress to reform the 
Clean Air Act. The Act's fundamental objective needs to be 
changed from this wishful thinking of protecting the public 
health with an adequate margin of safety to protecting the 
public health against unreasonable risk of important adverse 
health effects. Benefit costs analyses should be required, not 
proscribed, when setting air quality standards.
    The American people expect to be protected from air 
pollution that might significantly impair their health. They do 
not expect, however, that the cost of doing so will be all out 
of proportion to the benefits.
    Thank you.
    Senator Inhofe. Thank you, Dr. Chilton.
    We've been joined by the Chairman of the full committee, 
Senator Chafee. Senator Chafee, do you have any comments to 
make before we hear from our next witness?

OPENING STATEMENT OF HON. JOHN H. CHAFEE, U.S. SENATOR FROM THE 
                     STATE OF RHODE ISLAND

    Senator Chafee. Mr. Chairman, I don't want to interrupt. I 
do have a statement which I will ask be put in the record.
    I want to thank you for holding these hearings in your 
subcommittee.
    Unfortunately, I can only stay a short time, but I did want 
to come by and see what's up and obviously I will have the 
advantage of reading the testimony that's been submitted.
    Thank you very much.
    [The prepared statement of Senator Chafee follows:]
Prepared Statement of Hon. John H. Chafee, U.S. Senator from the State 
                            of Rhode Island
    Mr. Chairman, one of the most troubling aspects of this complicated 
EPA proposal is the mismatch between the public health threat that is 
presumably posed by fine particles and the schedule for actually 
reducing emissions of this pollutant.
    On the one hand, Administrator Browner has told us that 15,000 
Americans are killed each year by elevated levels of particulate 
pollution and tens of thousands more are hospitalized. Although many 
have urged that her decision now scheduled for July be postponed so 
that we could expand the scientific foundation for a new standard, EPA 
speaks of the problem in terms that communicate a public health 
emergency.
    On the other hand, we will learn at this hearing that the first 
regulations to actually reduce fine particulate pollution under the 
Clean Air Act will not be in place until the year 2005 or later. Today, 
we have few monitoring stations that can measure fine particulate 
pollution. Once the monitors are put in place, we must collect data for 
3 years to determine which areas violate the new standard. States with 
nonattainment areas are then given 3 more years to write plans to 
reduce emissions. And it is only after EPA has approved these plans--a 
step that frequently takes a year or more--that regulations to improve 
air quality are adopted by the States.
    This is a very important hearing because it allows us to explore 
the apparent disconnect between the rhetoric used to describe the 
problem and the timeline for acting on solutions. One lesson that we 
may take away from this hearing is that we do have time to improve our 
understanding of the health threat posed by this type of pollution 
before we commit vast sums to a new regulatory program. In my view, it 
is very important that we make the best possible use of this window for 
better science. Attaining this new standard for fine particulates 
everywhere in the Nation would take a very substantial effort--perhaps 
$20 billion per year or more. EPA will not be able to follow through on 
that kind of effort without a substantial public consensus as to nature 
of the health threat. That consensus does not exist today. But it can 
be built with more science and public education.

    Senator Inhofe. Thank you very much, Senator Chafee.
    Dr. Thomas Starr.

   STATEMENT OF THOMAS STARR, PRINCIPAL, ENVIRON INCORPORATED

    Dr. Starr. Good morning.
    The comments I offer today are drawn principally from two 
recent consulting projects in which we conducted a critical 
examination of the scientific evidence for potentially causal 
associations between particulate matter exposure and adverse 
human health effects.
    In the first, undertaken on behalf of the American 
Petroleum Institute, three world renowned epidemiologists--Drs. 
Raymond Greenberg from the Medical University of South 
Carolina; Jack Mandel from the School of Public Health at the 
University of Minnesota; and Harris Pastides, School of Public 
Health at the University of Massachusetts--were brought 
together as an expert panel to independently and objectively 
assess the quality of the epidemiological evidence for 
associations between PM exposure and increased human morbidity 
and mortality.
    In the second project undertaken on behalf of Kennecott 
Corporation, an ENVIRON colleague, Dr. Larisa Rudenko and I 
also evaluated the case for such associations.
    In addition, we assessed the credibility of the health 
benefits that EPA has projected that would accrue from 
implementation of the proposed new standards for PM. My remarks 
today briefly summarize our findings. I refer you to the full 
report that I submitted to the committee for additional 
details.
    First, let me address the issue of causality, that is, 
whether the effects observed are truly caused by exposure to PM 
or specifically PM2.5 or some other component of air 
pollution or lifestyle.
    In assessing whether the results from epidemiological 
studies support a causal relationship, criteria developed 
initially by Sir Austin Bradford Hill are often applied. These 
include the strength, consistency, coherence, specificity, and 
temporality of the reported associations.
    Although not explicitly stated, the presumption exists that 
the validity of the association has been established prior to 
consideration of these other criteria. What this means is that 
estimates of the association strength have been shown to be 
free of significant biases and not significantly confounded by 
other variables.
    Our expert panel of epidemiologists and our own independent 
review both concluded that the studies of PM and human disease 
do not satisfy these conditions. They have inadequately 
addressed potential biases and they have failed to resolve 
satisfactorily the issue of confounding.
    Even if the issue of validity were to be set aside, the 
health criteria would still not be met. The reported 
associations are extremely weak; they vacillate between 
positive and negative based on the specific regression model 
that is used. As additional co-pollutants are introduced, 
apparent positive associations with PM attenuate in magnitude 
often to nonsignificance. Indeed, based on the criteria and 
strength of association, it's difficult to imagine a weaker 
case for causality than that posed by the data for particulate 
matter.
    Furthermore, the results of the studies are not actually as 
consistent as they might at first appear. For example, 
different exposure measures--mean daily level, maximum daily 
level, or some lagged estimate of TSP, PM10, 
PM2.5--have been linked with different end points 
such as respiratory disease, cardiovascular diseases, or total 
death.
    Also, temporal relationships between exposure and disease 
are not the same across studies, but with lag times varying 
from zero to several days earlier.
    In addition, a critically important component of coherence, 
a dose response, is at best weakly established only in a few 
studies. In virtually all of the epidemiological studies of PM, 
exposure levels have not been based on personal dosimetry but 
rather on stationary samples located in specific geographic 
areas.
    Individual subjects were thus assigned communitywide 
measures of exposure rather than individual measures. The lack 
of personal exposure limits the ability to conclude that any 
individual death or disease is linked to air pollution per se. 
In fact, there is a large body of data indicating that 
community sampler measurements rarely provide good estimates of 
individual exposures.
    Even if a causal association were to exist, these 
ecological exposure estimates that have been used would likely 
misrepresent the associations of truth strength. Equally 
important, the underlying dose response relationship may be 
significantly distorted with sharp, thresholdlike curves being 
smoothed into nearly linear shapes by exposure 
misclassification.
    Another major challenge to the case for causality relates 
to the fact that PM exposure invariably occurs in combination 
with exposure to other air pollutants such as ozone, carbon 
monoxide and sulfur dioxide. Because this mixture composition 
varies according to the source, the season, time of day, 
weather conditions and geographic region, and because PM is, 
itself, a complex and highly variable mixture, it has been 
virtually impossible to disentangle the potential adverse 
effects of PM or a specific fraction like PM2.5 and 
those attributable to other confounding copollutants.
    The question of whether the course or fine particulate 
fractions are causally related to human health effects is one 
of great importance. If there is a causal relationship, then 
identification and establishment of a safe and acceptable level 
of PM will be a decision with enormous consequences.
    However, the severe limitations of existing studies prevent 
a conclusive judgment about causality. EPA's proposal for new 
PM standards is premature.
    The stated purpose for EPA's proposed standards is to 
provide increased protection against a wide range of PM-related 
effects. How confident can we be that the proposed new 
standards will lead to increased human health protection? The 
quantitative assessment conducted for EPA Abt Associates 
attempted to quantify the uncertainty inherent in the estimated 
health benefits from the new standards.
    This assessment is very thorough in its identification of 
the many weaknesses in the underlying data, remarkably frank 
about its necessary reliance on unproven assumptions, and 
surprisingly even-handed in its demonstration of the 
sensitivity and uncertainty analyses that the projected 
benefits might well be greatly exaggerated.
    Significant limitations of the benefit projections include 
the following. The projections have had to assume causation. 
Future reductions in specific PM levels need not necessarily 
result in any material health benefits.
    Senator Inhofe. Dr. Starr, you have to wind up here. You're 
going over your time. I think you may have an opportunity in 
the question time to cover that.
    Dr. Starr. Faced with such great uncertainty in the 
estimated magnitude of potential health benefits, it seems far 
more reasonable to me for EPA to initiate additional data 
collection and analy- 
sis activities on the health effects potentially associated 
with PM exposure.
    Implementation of the new standards could well make things 
worse rather than better.
    Senator Inhofe. Thank you, Dr. Starr.
    For those of you who are standing, there are many seats 
available, so feel free to sit down.
    Susan Dudley.

 STATEMENT OF SUSAN E. DUDLEY, VICE PRESIDENT AND DIRECTOR OF 
        ENVIRONMENTAL ANALYSIS, ECONOMISTS INCORPORATED

    Ms. Dudley. Good morning, I'm Susan Dudley.
    I'm vice president and director of Environmental Analysis 
at Economists Incorporated. I have 20 years experience 
evaluating and developing environmental policy. In my career 
I've worked at both the Environmental Protection Agency and the 
Office of Information and Regulatory Affairs at OMB.
    Today, what I'd like to do is highlight a few key points 
from an analysis I conducted on EPA's ozone rule for the 
Regulatory Analysis Program at the Center for Study of Public 
Choice at George Mason University.
    This is a research and education program dedicated to 
advancing knowledge of regulations and their impact. It 
produces careful and independent analyses of agency rulemaking 
proposals from the perspective of the public interest. I would 
like, if I could, to put a copy of our comments in the record 
of these proceedings.
    Senator Inhofe. Yes, without objection.
    Ms. Dudley. These comments, as well as the program's 
comments on the particulate matter rule, are also available on 
Economists Incorporated's web site.
    Today, I'd like to highlight three major points regarding 
the risk assessment underlying EPA's proposed ozone standard.
    First, there is little scientific basis for the selection 
of the level of the standard. EPA recognizes that the selection 
of .08 ppm was a policy decision rather than a scientific 
decision. EPA's Science Panel did not find this level to be 
significantly more protective of public health than the current 
level of the standard. Moreover, most members of the panel who 
expressed an opinion preferred a level less stringent than that 
which EPA has proposed.
    Second, EPA's risk analysis suggests that the health and 
welfare benefits of this proposal will be small. The general 
population would not notice the difference in air quality as a 
result of the proposed standard and that's because, as Ken 
Chilton has said, the effects of ozone appear to be reversible 
and largely without symptoms for the majority of the 
population.
    Even for the population with the greatest risk, those with 
preexisting respiratory conditions, EPA expects the impact of 
the proposed change to be small. For example, with full 
implementation of the rule, which EPA does not expect for at 
least a decade, probably many, many decades, EPA predicts a .6-
percent decrease in hospital admissions for asthmatics. 
Furthermore, evidence from animal studies suggests that long-
term exposure to ozone does not affect lung function.
    Our third point is that the proposal may actually harm 
public health and welfare. The rule is based on risks to 
asthmatics, yet ozone is certainly not a determining factor in 
asthma. Asthma has been increasing over the last decade, 
especially among poor urban children, yet ozone has been 
declining steadily over the same period.
    NIH recently conducted a study that found the leading cause 
of asthma by far was proteins from cockroach droppings and 
carcasses, not air quality. Thus, this rule is raising false 
hopes and would divert scarce resources from more effective 
solutions to the very real problem of asthma.
    What's more, the proposed standard would increase health 
and welfare risks from ultraviolet radiation, yet this was not 
considered in developing the proposal. Ground level ozone has 
the same beneficial screening effects on ultraviolet radiation 
as stratospheric ozone.
    Based on EPA analysis used to support earlier rulemakings 
on stratospheric ozone, it appears that the proposed standard 
could increase the incidence of cataracts, skin cancers and 
melanoma fatalities. These negative effects appear to outweigh 
the positive health effects that EPA has attributed to the 
rule.
    Using EPA's data assumptions and model results, I 
quantified and valued the health effects from the increased 
penetration of ultraviolet radiation attributable to this rule. 
My analysis suggests that attainment of the proposed standard 
would actually increase health risks by over $280 million a 
year. That is net of the benefits that EPA attributes to the 
rule.
    When the costs of the proposal are considered, the negative 
impact on public health is even larger. A growing literature 
linking income and mortality suggests that the cost of this 
proposal would, by lowering incomes alone, induce more 
fatalities. That's something that I think Senator Sessions 
addressed in his opening remarks.
    In fact, if as recent studies suggest, poverty is a more 
important risk factor than air quality for asthma, the rule may 
well increase the very disease it is targeted at improving.
    Thank you. I'd be happy to answer questions.
    Senator Inhofe. Thank you, Ms. Dudley.
    Dr. Carl Shy.

   STATEMENT OF DR. CARL M. SHY, DEPARTMENT OF EPIDEMIOLOGY, 
SCHOOL OF PUBLIC HEALTH, UNIVERSITY OF NORTH CAROLINA AT CHAPEL 
                              HILL

    Dr. Shy. Thank you, Senator Inhofe.
    I was very pleased to see that I was placed on the right 
side of this table from the point of view of the audience. I 
think we're also on the right side of the argument as far as 
public health is concerned.
    I'm a physician and an epidemiologist. I've been involved 
in air pollution research for 30 years. I started my career 
with the Environmental Protection Agency and then moved to the 
University of North Carolina some 25 years ago.
    I was recently a member of the panel on Particulate Matter 
of EPA's Clean Air Science Advisory Committee and I'm here to 
support the proposal to establish a new standard for fine 
particulates.
    I agree with EPA's proposal that the PM2.5 
standard be established at a concentration of 15 g per 
cubic meter annual average. I think there are three compelling 
reasons for EPA to establish an air quality standard for 
PM2.5 as proposed.
    The first reason is that I see and I think CASAC has also 
seen that there's ample evidence for a causal relationship 
between population exposure to fine particles and effects on 
mortality and morbidity in the population. There is ample 
evidence for excess mortality, for excess hospital admissions, 
for excess respiratory symptoms in adults and children and for 
decreases in lung function in children associated with 
currently experienced levels of particulate air pollution.
    The second reason is that given this causal relationship, 
the health burden of exposure to particulates in the United 
States today consists of thousands of excess deaths, hospital 
admissions, and respiratory disease episodes.
    These excesses can be addressed by a concerted program to 
lower the concentration of ambient air particulates. This 
program will bring a major health benefit for a majority of the 
U.S. population.
    The third reason I think there is compelling reasons to 
support EPA's proposed standard is that the Clean Air Act 
requires the Administrator of EPA to establish a national 
ambient air quality standard that avoids unacceptable risks and 
protects public health with a margin of safety.
    The risks that I've mentioned of thousands of deaths and 
hospital admissions I think are unacceptable and I think 
everyone would agree on that.
    The proposed PM2.5 standard that EPA has really 
provides only a minimal acceptable margin of safety against the 
mortality and morbidity risks that we have observed. We've seen 
excess mortality and morbidity when PM2.5 
concentrations are no more than 10 percent above the proposed 
EPA standard of 15 mg per cubic meter.
    So even though the proposed standard may not actually be 
adequate, I think it will at least move our country in the 
right direction of greatly minimizing the currently 
unacceptable health burden.
    The rationale for saying that there is a causal 
relationship I think was very well spelled out in the air 
quality criteria document of EPA to which CASAC agreed and the 
members of CASAC included epidemiologists who had a great deal 
of experience in the health effects of air pollution, including 
Frank Speizer, Jonathan Samet, Mort Lippmann, my colleague 
here, and myself.
    I think that in contrast to the other persons mentioned 
earlier who did not agree with causality, the persons who have 
had a great deal of experience in epidemiologic studies of air 
pollution have agreed that there is a causal relationship 
established between particulate exposures and excess mortality 
and morbidity.
    Thank you, Senator Inhofe.
    Senator Inhofe. Thank you, Dr. Shy.
    We've been joined by Senator Lieberman and I'd like to ask 
if he, at this time, in introducing his daughter, would like to 
make any statement?
    Senator Lieberman. Thank you, Mr. Chairman. You anticipated 
my most significant announcement which is to express my pride 
in having my daughter, Hanna Rachel, with me. Would you stand 
briefly? Thank you.
    [Applause.]
    Senator Lieberman. Undoubtedly, a future Senator from the 
State of Connecticut. I won't say yet which party because you 
know how children are.
    Senator Inhofe. I'll work on her.
    [Laughter.]
    Senator Lieberman. I apologize for being late. I don't want 
to interrupt the flow of the hearing and when it's time for 
questions, I'll be glad to join in.
    Thank you.
    Senator Inhofe. Thank you, Senator.
    We'll now hear from Dr. Morton Lippmann who I think has 
become a regular around here.

 STATEMENT OF DR. MORTON LIPPMANN, INSTITUTE OF ENVIRONMENTAL 
                 MEDICINE, NEW YORK UNIVERSITY

    Dr. Lippmann. Not my own choice, but I am responsive to the 
will of the Congress.
    Dr. Shy, with whom I served with on the CASAC PM Panel, has 
clearly covered the high points of the necessity for a fine 
particle standard. I was asked today to talk about the ozone 
issue and the risk assessment for ozone.
    In the case of ozone, we understand some of the mechanisms 
very well and we have a huge body of clinical data which 
establishes some reversible but potentially important effects. 
So the problem there is the significance of small changes in 
lung function has been questioned as a basis for tighter 
control.
    I point out in my testimony that the field studies of ozone 
responses in people engaged in natural activities outdoors that 
I pioneered in my own laboratory document clearly that the 
chamber responses are a minimum response, and that for whatever 
reason, we can't fully explain, per unit of ozone people in 
natural settings have greater functional responses and that 
establishes a baseline but not the full risk associated with 
the acute responses.
    In our most recent paper published in February, we looked 
at asthmatic children and found physician-prescribed 
medication, as well as functional changes that would have to be 
considered adverse for this population.
    There has been a lot of attention to the hospital admission 
studies and certainly ozone is not considered a causal factor 
but many people have asthma and it does aggravate it. I call 
your attention to page 5 of my prepared remarks which show the 
pyramid of responses associated with ozone from a wealth of 
environmental and epidemiologic data.
    The EPA only took hospital admissions for asthma into 
account. There are equal numbers of nonasthma respiratory 
admissions. There is mortality and there's been a flood of new 
peer review data since the document was prepared, at least 
eight papers I've collected, that show greater associations 
with mortality and ozone, plus the hundreds of thousands of 
restricted activity days and asthma attacks which are 
documented in that chart. So I think the Agency did not fully 
explain the serious health effects associated with ozone.
    The pyramid also shows the coherence of responses. This is 
the progression of increased numbers with decreasing 
seriousness that one would expect if something real is 
happening.
    There are some very important effects that are poorly 
understood which are not covered in the document, primarily 
because of the absence of data. The evidence clearly indicates 
that the lungs age more rapidly, that they become stiffer. We 
are probably talking about reduced longevity, although that is 
speculative at this time. That's a margin of safety 
consideration which the Administrator is obligated, by law, to 
consider in dealing with evidence primarily only on the acute 
effects.
    I think it's important to reiterate that with all its 
limitations, this criteria document, the staff paper for ozone, 
are by far, in my opinion, the best that EPA has ever produced. 
They're more interpretative, they take all the evidence into 
consideration in a better way, and I can speak for experience 
since I've sat on every PM and ozone panel since 1980 that EPA 
has gone through.
    In the end, there are uncertainties and if we're going to 
be more efficient in addressing the ozone issue, we need to 
engage in research based on the questions that have become 
better focused and sharpened through this review cycle.
    I won't reiterate my previous written testimony responses 
to your earlier questions and so forth about the level of 
research that's needed, but ozone and particles are strongly 
interrelated and I note in my testimony this time that there 
will be benefits from controlling ozone that go beyond the 
effects of ozone alone.
    When ozone is formed, fine particles are formed. The 
presence of the oxidants in that mixture oxidizes 
SO2 and NO2 to form more fine particles. 
So by controlling ozone, we would be substantially reducing the 
presence and impact of the fine particles which Dr. Shy has 
been talking about. So some of those benefits EPA did not claim 
I think are legitimate claims for the reduction of ozone.
    I thank you.
    Senator Inhofe. Thank you, Dr. Lippmann.
    Dr. Alan Krupnick.

 STATEMENT OF ALAN KRUPNICK, SENIOR FELLOW, RESOURCES FOR THE 
                             FUTURE

    Dr. Krupnick. Thank you for inviting me to the hearing.
    I wanted to mention first that I was in the first Clinton 
administration on the Council of Economic Advisors and I chair 
EPA's Subcommittee on Ozone, PM and Regional Haze 
Implementation Programs but these comments are entirely my own.
    First, I wanted to applaud the Republicans for their 
openmindedness in inviting me here because I have somewhat of a 
mixed message.
    On PM, I favor a fine particle standard, but one less 
stringent than the Administrator has proposed. On ozone, I 
favor changing to an 8-hour standard but set at a level of 
stringency no more stringent than the current standard.
    I wanted to address my remarks to just a few points that 
have been in the debate, both in the EPW and in the press.
    The first is junk science as applied to PM. Of course there 
are major uncertainties with respect to the epidemiology, the 
toxicological mechanism and so on but nevertheless, I think the 
scientific record supporting a fine particle standard is 
actually more than adequate judging from the perspective of the 
information underlying previous NAAQS rulemaking efforts which, 
in my view, are pretty laughable compared to the amounts of 
information we have here.
    I think the Administrator is being prudent in issuing a 
fine particle standard and as to those who would wait until 
uncertainties are resolved, I say the best way to gain a better 
understanding of this pollutant and its consequences is to 
issue a fine particle standard now and that will get the 
country's attention.
    EPA needs to be mindful of the possibility of going in the 
wrong direction and needs to have a process that triggers 
speedy reopening of the NAAQS process and the SIPs to reverse 
direction if it looks like that is the way to go.
    The second issue is science versus policy judgment. 
Administrator Browner came before you cloaked in science as a 
justification for the standards but as the CASAC said, science 
doesn't lead to a bright line for either ozone or PM. There are 
no thresholds.
    I feel for the Administrator that the Clean Air Act is not 
really giving her criteria for making a judgment, so she has to 
use her own. With respect to ozone, I think they are making the 
wrong judgment, the ozone effects seem to be very small of a 
tighter standard, the costs are likely to be huge, and their 
risk assessment is highly flawed.
    In terms of backyard barbecues, industries use this analogy 
to dramatize the potential for invasive controls on everyday 
living and I have to agree with the analogy. In fact, one way 
or another, emissions coming from consumer sector activity will 
need to be controlled. Driving is going to be more expensive, 
inspection and maintenance programs are likely to have to go 
into new nonattainment areas. These are the areas where there 
are large emissions and they have to be addressed.
    We've heard from EPA that the cost estimates for industries 
are usually higher than they turn out to be, the industries' 
own estimates, but using EPA's own estimates, you find the cost 
of going partway to meeting the ozone standard will be $2.6 
billion and partway to the fine particle standard will be $6 
billion. This is only a little of the way down the path.
    Chicago, EPA finds, only can get 14 percent of the 
reductions it needs in trying to meet the new standard. The 
Northeast, for PM, only can get 16 percent of their reductions. 
There might be innovation and economic incentives that will 
hold down costs, but we're looking at much larger costs than 
EPA has written about.
    I wanted to agree with Susan Dudley on UVB risks. EPA 
refuses to look at these and they are a major issue.
    On the benefits of fine particles, we've heard that these 
are large dollar benefits based on valuing reduced mortality 
risks.
    From the work that I've done, I find this is based on a 
body count approach to risk assessment. It doesn't recognize 
that most of the effects are to older people with compromised 
health, really affecting the life expectancy of older people 
and by a very tiny amount.
    Using values that older people provide for increasing their 
life expectancy a tiny amount, as well as those from younger 
people who provide this information from reducing their future 
life expectancies, has the potential to dramatically lower 
these benefits.
    Finally, I've got to come back to Congress to say I think 
you should really fix the outdated criteria in the Clean Air 
Act for setting standards. Require that the Administrator 
consider benefits and costs of her actions, but of course 
consider this along with other criteria such as public health 
protection and equity and ethics.
    If we're going to appropriately allocate our resources, we 
simply have to have the Administrator considering the social 
benefits of her actions.
    Senator Inhofe. Thank you, Mr. Krupnick.
    We're going to proceed now and we're going to try to adhere 
to the same confinements that we've imposed upon you.
    Ms. Dudley, in your testimony you raised the issue of 
negative health effect and that was also referred to by Mr. 
Krupnick. You based your information on EPA data. You said they 
did not consider this in the proposal. Is that true?
    Ms. Dudley. Yes, that's true.
    Senator Inhofe. So the agency didn't factor these health 
costs into their benefit calculations?
    Ms. Dudley. That's right. There's a paragraph in the RIA 
that says they expect the UV-B effects will be small.
    Senator Inhofe. It's my understanding that the EPA was 
briefed on the health costs by the Department of Energy and I 
have the statement from the Department of Energy which I do 
want to submit to the record at this point because this 
actually makes comments on things far more serious than just UV 
radiation. They talk about HIV patients, skin cancers, 
cataracts and many other things there also.
    While we talked about decreasing ozone and the benefits, we 
didn't talk about the liabilities that go with that?
    Ms. Dudley. Exactly.
    Senator Inhofe. Mr. Starr, I'd like to focus on one 
statement you made in your testimony which I addressed in my 
opening statement which leads to my main concern with the risk 
analysis for PM and that's the uncertainty with the science 
leading to uncertainty with the risk.
    You said ``Although there is not a proven causal 
relationship between the health effects and PM, the EPA had to 
assume a causation in order to calculate the expected 
benefits.'' How does this assumption throw off the benefits 
projections?
    Dr. Starr. Senator, I think the important issue there is 
there is a certain probability that a causal relationship does 
not exist and if it does not exist, then implementation of 
standards may have, in fact, zero benefit.
    Also important is to consider that those benefits were 
calculated with essentially a straight line type relationship 
between exposure level and response. Ironically, because most 
of the days of the year are characterized by low or moderate 
levels of particulate matter, the projected benefits arise 
primarily from those days and not the days with high level 
exposure to particulate matter.
    That is the area where the relationship, if there is one, 
is most uncertain. We do not know if there is an association 
and particularly--specifically we do not know what the nature 
of it is at these relatively low and moderate levels of PM.
    Senator Inhofe. Dr. Chilton, in your testimony you stated, 
``The upper bound benefit estimate of $1.5 billion in EPA's 
analysis for ozone results from the assumption that the 
proposed standard would save lives and that this claim is 
unsubstantiated.'' I think that's very significant. I'd like to 
ask you to elaborate on that.
    Dr. Chilton. That's where I guess Dr. Lippmann and I would 
disagree. I don't think any of the studies he's talking about 
that try to show premature mortality relate to the kind of 
exposure levels that we're experiencing in this country. 
Nowhere else in the discussion is EPA talking about mortality 
effects of ozone except in the regulatory impact analysis. 
Then, to estimate the high end of the benefits, they take into 
account mortality effects. It's inconsistent, if nothing else.
    Senator Inhofe. Would you say that fine particles don't 
cause deaths?
    Dr. Chilton. This is ozone we're referring to here, I 
believe. No, with fine particles, I just say the case is out on 
their effects. The science isn't sufficient enough to warrant 
setting a standard at this time. I don't share Dr. Krupnick's 
optimism that if we launch into this brave new world that it 
will all come out in the end. I'm afraid we'll do a lot and it 
may not have any effect whatsoever, but it will be costly.
    Senator Inhofe. Do you want to respond to that?
    Dr. Krupnick. Just a little. It's not all that brave. We 
already are controlling sulfur dioxide which would reduce 
sulfate levels which is counted as a fine particle. As Dr. 
Lippmann said, we are already reducing nitrogen dioxides which 
also convert to fine particles.
    One issue I'd want to take up with Dr. Lippmann and mention 
to the committee is if we did not go further on ozone, we would 
not have to go as hard after volatile organic compounds, VOCs, 
as we would do if we tighten the ozone standard. I think that 
would save the country a lot of money for very little health 
risk.
    Senator Inhofe. In attempting to stay within my own time 
limitations, I'm going to jump to Dr. Shy. In your testimony, 
you state a proposed standard of 15 g per cubic meter 
for PM provides ``a minimal acceptable margin of safety.'' I 
would ask you how many other members of CASAC shared your view 
that 15 was minimally acceptable?
    Dr. Shy. It's difficult to tell because quite a few of the 
members of CASAC didn't express a numerical number.
    Senator Inhofe. How many expressed it? It's my 
understanding there were only two and those are the only two 
who are here today who agreed with that figure.
    Dr. Shy. Yes. One thing you have to realize is that many of 
the members of CASAC were not health risk experts or 
epidemiologists.
    Senator Inhofe. So of the 21 scientists, just the two of 
you had expertise in this area and were able to properly 
analyze this and come to this conclusion?
    Dr. Shy. I wouldn't say we were able to properly analyze, 
I'd say we've had in-depth knowledge of the quantitative levels 
of health effects and exposure that many other members of CASAC 
did not.
    Senator Inhofe. And the other 19 did not?
    Dr. Shy. Right.
    Senator Inhofe. Senator Lieberman.
    Senator Lieberman. Thank you, Mr. Chairman.
    This gets to what for me is at the heart of what is 
happening here. As you know, Mr. Chairman, I've generally 
supported the proposed standards, although I'm still learning 
and have some questions that I want to have answered on the 
understanding that the basic two-tier system that was 
established in the Clean Air Act is a sensible one which is 
that first, we have the obligation to try to reach a judgment, 
or the Administrator does, as to what the health consequences 
to people are of polluted air, and then, in the implementation 
phase, the system allows for the practical considerations, 
including costs.
    For instance, in Fairfield County, CT, the prevailing air 
quality standard, the county was given 17 years to come into 
compliance because of the difficulty of doing that. That, to 
me, represented a combination, to the best science can provide 
us, of the health standard and then allowing factors of 
practicality and cost benefit to be fed into on the second 
tier.
    I regret that I will not be able to listen to the testimony 
of most of you but I've gone over the written testimony 
submitted that we had before. Although obviously it's hard for 
those of us who are nonscientists to appreciate this, there are 
many occasions when scientists don't quite agree on where truth 
is. I don't know that I'd say there is artistry in science, but 
it's not always a question of two and two equalling four.
    Perhaps I should start with a broad question for any of you 
who would care to answer it, particularly those who are critics 
of these air quality standards as they've been proposed. Is 
your criticism that the science is bad or is your criticism 
that cost benefit doesn't justify the standards?
    If it's the latter, then my conclusion is that in the 
implementation phase, we'll take care of that, but if you 
disagree with that, I'd be interested in hearing why. Dr. 
Chilton.
    Dr. Chilton. I would like to comment on that. I do have a 
fundamental problem with the two-tiered approach. Absolutely, 
we need good scientific information, but I do not understand 
why we have proscribed having economic information. The 
strength of the economy has something to do with public health. 
It also has something to do with a lot of things that Americans 
value, as well as they value being protected from air 
pollutants.
    I once suggested in an op-ed that we can create an 
Association for Compassionate Economists. It sounds like an 
oxymoron, but economists are some of the few people looking at 
the issue and saying that we need to look at benefits and 
costs. We need to make sure that benefits outweigh costs. 
Incremental spending on one program must provide more benefits 
than cost, otherwise we're wast- 
ing resources. Those wasted resources even could be health-
related resources.
    Senator Lieberman. But why do that at the same level? In 
other words, it's hard to do it with an operation but maybe if 
you went to your doctor and he gave you his best guidance about 
a condition you had and let's assume for a moment it's not 
life-threatening, and told you how much it would cost over your 
coverage, wouldn't you first want to know what the threat to 
your health is and then afterward decide whether you can afford 
to fix it?
    Maybe a less frightening analogy is some repair to your 
house which somebody who should know is telling you what you 
ought to do, but then you're going to decide as we do all the 
time whether you can afford it at that given moment or not. At 
least you want the first stage to be as close to the fact 
regarding risk as somebody can give it to you.
    Dr. Chilton. The problem is, though, that at the end of the 
first stage, we've already made the decision. You're already 
going to incur costs. It's just a question of whether you're 
going to incur less cost because you do things a little more 
intelligently. You've already made the decision.
    I often use the example of buying a car. Would you want to 
buy a Mercedes or a Chevrolet if all you cared about was 
quality? Well, you'd decide on the Mercedes. Then you can shop 
for friendly loan arrangements to try to reduce the payments 
for that Mercedes. If you looked at both quality and cost, you 
would have probably said, ``My budget won't afford a Mercedes, 
and I'm going to go with the Chevrolet.''
    Senator Lieberman. For me, that's essentially different 
because there is no particular risk whether you're buying a 
Chevrolet or a Mercedes, but there is the home improvement 
fellow who tells you your roof is about to fall in or if the 
doctor tells you that you've got a health problem and the 
question is how do you begin to treat it, do you do the more 
expensive or the less expensive. Ms. Dudley.
    Ms. Dudley. I don't want to take up all your time but I 
looked only at the ozone rule and I think the rule is actually 
increasing health risks.
    Senator Lieberman. Because of the connection to the 
ultraviolet radiation?
    Ms. Dudley. The ultraviolet radiation and also the notion 
that if asthma is our concern, there are so many other ways we 
can address asthma and make people with asthma have better 
lives that are better than this rule.
    Senator Lieberman. Without telling kids they've got to go 
inside?
    Ms. Dudley. Right. I think more research on what is causing 
asthma is going to help a lot more children than this rule.
    Senator Lieberman. I was puzzled by that business about the 
ultraviolet radiation. Forgive me, I'm giving an extreme 
rendering of it but it almost sounds like the more ground level 
ozone we have, the better it's going to be for us because it's 
going to protect us from ultraviolet radiation. That can't be 
what you're asking because we know at some level people get 
sick from ground level ozone.
    My lay reaction to what you said is that you were mixing 
apples and oranges here, that 95 percent of the atmosphere is 
ozone and way up 30 miles above our heads. The ground level 
ozone is only about 3 to 5 percent of the total and that's what 
we're focused on here.
    Ms. Dudley. That's true. It's a real tradeoff though. These 
are real health risks, these cataracts, skin cancers, and 
deaths.
    Senator Lieberman. Sure.
    Ms. Dudley. They are just as real as the health risks from 
ozone. Some might even say more real. All I'm saying is that a 
policymaker needs to have that information.
    Senator Lieberman. This is my last question because the red 
light is on but aren't we taking care. Presumably we continue 
to implement the CFC prohibitions. Aren't we taking care of the 
stratospheric ozone level in a way that doesn't require more 
ground level ozone to protect us from UV radiation?
    Ms. Dudley. I guess that's a decision that policymakers 
should make, but it shouldn't be hidden. It should be 
explicitly addressed because it is a very real tradeoff.
    Senator Lieberman. Thanks, Mr. Chairman. I'm sorry I went 
over.
    Senator Inhofe. Senator Hutchinson.
    Senator Hutchinson. Thank you, Mr. Chairman.
    Ms. Dudley said, I think at one point in her testimony, 
that it would take at least a decade for implementation of 
these. In the hearing we had with Carol Browner, I outlined a 
time line which I think wasn't unreasonable in implementing the 
PM standard. Recently at a meeting with EPA, it was suggested 
that monitoring should begin as early as January 1998.
    Since EPA clearly didn't have the money to establish the 
monitoring outposts that would be necessary, the question was 
asked, where will the money come from to buy the new monitors? 
I think there are 51 on PM, 51 monitors nationwide, so where do 
we get the money to do that?
    EPA's answer was that it was expected that States have 
already begun to budget money to purchase monitors in 
preparation of the implementation to standard. So yesterday, we 
talked with the Arkansas Department of Pollution Control and 
Ecology to see if EPA's assertion was correct in Arkansas. Has 
Arkansas begun to budget money to purchase monitors? The 
response was about what I expected. They laughed.
    In Arkansas, they budget every 2 years. We just finished 
the budget cycle about a week ago. The next budget process will 
not begin until 1998, will not be finalized until March 1999. 
No new money would be available until at least July 1999.
    I don't know what the other State budget processes are like 
but I suspect they are similar which means the money available 
to purchase these monitors for a regulation that is not even 
being promulgated is a long ways from being there. So at least 
in Arkansas, monitoring probably could not be possible until 
sometime in the year 2000 at the earliest.
    If you assume a 3-year monitoring period, a year of 
technical analysis, State implementation plan proposals, et 
cetera, we're looking at the actual control of particulates 
sometime well into the next century, maybe even as late as 
2006, 9 years away or a decade, is about what Ms. Dudley said.
    Dr. Krupnick, you may be right, it may be worth going ahead 
and doing this to get the country's attention, but I think 
surely there is a better way.
    My question is given the conflicting scientific evidence 
that we have, and I think Dr. Lippmann said there are 
uncertainties, at least in the ozone area, wouldn't it be just 
as productive to do the research on the issue for a few years 
to determine the best route to take on regulating PM and really 
get an answer to that question?
    Dr. Lippmann, it's my understanding at a recent House 
hearing on the standards, you testified that if given a choice 
between implementing the PM standards now or waiting 5 years 
and getting $50 million a year for research on particulate 
matter, you'd rather have the money for research and that makes 
sense to me. It would seem to me that would be the best use of 
very limited resources.
    Dr. Lippmann. No, that is not correct. I don't think you'll 
find it in the record. There was a hypothetical question by one 
member that stated, couldn't some of the same objectives be 
obtained by targeting, monitoring and research money as 
implementing the standard.
    In the particular context of the question asked, I said, 
much of the objective could be achieved, but I do not endorse 
delaying the standard. I think without the standard, we won't 
have the monitoring data.
    Monitoring data is useful for legal enforcement and in the 
initial case, as you suggest, for finding out whether 
enforcement will be needed, but in this field where we're 
looking at population responses, and for PM, that's what is 
driving it, human responses based on comparison of health 
responses to ambient levels. Only the existence of the standard 
will get that monitoring network in.
    I think I'd like to respond to what you just said in terms 
of the dollars. I participated in the CASAC Panel on the design 
of the monitoring system. EPA was very concerned about the cost 
of the system and I think they went a little too far in making 
it inexpensive.
    I think it might be better to invest a little more in 
monitoring and get more frequent and better data, so the 
monitoring equipment is not expensive. Arkansas or any other 
State does not need a separate budget. The budget of the agency 
which is now monitoring will not be greatly stretched by buying 
a few of these monitors. That's a false issue.
    Arkansas and the other States may have no choice, if 
monitoring is required, they're going to have to do it and they 
are going to have to find a few thousand dollars to buy a 
monitor. That's not an issue.
    We may, in fact, not enforce these rules until the next 
century but if we don't start now, we'll never start.
    Senator Hutchinson. Except that we may be imposing the 
wrong rules and not have the research.
    Dr. Lippmann. Clearly that is not the case now.
    Senator Hutchinson. I know that is your opinion but we 
heard lots of testimony over the preceding hearings that there 
is a lot of conflicting opinion and clearly, it is a policy 
decision that is being made. It may be the case that our biases 
are imposing our policy view on this, but it's not just 
science. There certainly is a differing opinion among the 
scientists who have testified.
    Mr. Starr, you said in your opinion, there would be zero 
benefit with the new standards. Ms. Dudley, you said--and this 
was kind of startling--your assertion that in fact the new 
standards would negatively impact health risks. I guess that's 
the UV. I think Mr. Krupnick said in fact he didn't think EPA 
adequately addressed those concerns.
    Dr. Shy, what is the answer to that? Why has that issue not 
been dealt with, the possible negative health risks that could 
be the result of these standards?
    Dr. Shy. I think many of them are claiming that ground 
level ozone is somehow going to protect us against ultraviolet 
light. It is really stratospheric ozone that is important, not 
ground level ozone. That point was made by Senator Lieberman.
    Senator Hutchinson. Indeed, he did. Ms. Dudley, could you 
respond to that?
    Ms. Dudley. EPA's analysis, if you look into it, indicates 
that it is total column ozone that matters, and ground level 
and stratospheric ozone both have the same impact on total 
column ozone.
    Senator Hutchinson. I know my time is up but Mr. Krupnick 
would you comment on this line?
    Dr. Krupnick. I have to agree there. Although there is only 
3 percent of the total ozone column which is low level, these 
ozone benefits that we're talking about from tightening the 
standard are so small that they can be overwhelmed or maybe 
nearly overwhelmed by the small increment.
    Senator Hutchinson. Thank you, Mr. Chairman.
    Senator Inhofe. Thank you, Senator Hutchinson.
    We're a little bit ahead of schedule so while we're not 
going to have a second round, I want to ask if any of the 
members remaining would like to ask one additional question. We 
can do it and try to keep it down to about 2\1/2\ minutes.
    Before you came in, Senator Lieberman, we talked about what 
was going on over there and why we had to make sure to stay on 
schedule, so we can get back to our meeting.
    Dr. Krupnick, you support the PM proposal except you would 
apply cost factors and set the standard higher at 20 
micrograms, is that correct?
    Dr. Krupnick. That's right.
    Senator Inhofe. You agree that we don't completely 
understand the mechanisms or which of the particles is the 
culprit, correct?
    Dr. Krupnick. Right. I say this this way just because to me 
the epidemiological literature on PM does tell a compelling 
story, a coherent story. There are lots of uncertainties, but 
again, as I said in my testimony, if you go back to when the 
ozone standard was set in 1977 or 1978, a handful of studies, 
incredibly primitive techniques, very little information, total 
policy call on the Administration's part.
    Senator Inhofe. OK, but I guess what I'm trying to get at 
also is you'd said Congress should bind the EPA in the event 
the evidence came along, they could fast track some 
legislation. If that should happen, would that reopen the Clean 
Air Act?
    Dr. Krupnick. I think there could be agreements made with 
EPA to develop a fast track process. You'd have to ask your 
lawyers about that, but there should be some fail safe measures 
put in so that we can reopen the NAAQS process quickly.
    Senator Inhofe. Last, on ozone, you mentioned the 
importance of selecting the appropriate number of exceedances. 
The EPA has chosen three and I recall you were here during our 
first scientific meeting. I remember Dr. Schwartz was saying 
the standards are much more stringent over in Europe. However, 
we found out in Europe, they are not 3, but 10 and that's in a 
period of 1 year instead of 3 years. Would you comment on how 
this would affect the U.S. standard and how the EPA should 
determine an appropriate number?
    Dr. Krupnick. This sounds like it's not an important issue, 
when you say three or four or five or six exceedances, but in 
fact, because the distribution of daily readings of ozone is so 
skewed, just increasing that number of exceedances from three 
to five could result in 200 fewer counties being in violation. 
So this is an extremely important decision and one the Clean 
Air Act criteria doesn't give the Administrator really any 
guidance on.
    Senator Inhofe. That's the point I'm making on this.
    Senator Lieberman.
    Senator Lieberman. Thanks, Mr. Chairman. I appreciate the 
opportunity to ask one more question.
    This goes to the basic two-tier system and the standards 
set in the first tier. Dr. Chilton, I didn't have a chance to 
hear you but I gather you spoke to an issue that I read in a 
Providence Journal article you'd written the lend of last year 
which was to recommend ``EPA should shift from the old paradigm 
of protecting the public health with an adequate margin of 
safety to a new paradigm protecting the public against 
unreasonable risk of important adverse health effects.''
    In the context of the scientific uncertainty, it has been 
my conclusion that we ought to stick with the current standard 
which is protecting the public health with an adequate margin 
of safety and then fit in the practicality, including cost in 
the second tier.
    I worry in the recommended new standard that you've 
proposed that there's a lot of words there that are not 
scientific, in other words, for instance, unreasonable risk 
with the emphasis on unreasonable which is a tough word to 
define, and not only adverse health effects which EPA has been 
protecting us against with an adequate margin of safety, but 
important adverse health effects again, leaving some question 
about definition.
    Maybe I'd first ask Dr. Lippmann and then ask you to 
respond, based on your own experience on CASAC, how do you 
respond to Dr. Chilton's proposed change from the adequate 
margin of safety in terms of health to unreasonable risk of 
important adverse health effects and then I'd ask Dr. Chilton 
to respond?
    Dr. Lippmann. I think Dr. Chilton's language allows anybody 
to come to any conclusion they want. I think we've lived with 
the Clean Air Act language for many years and it has led to 
very great improvements in air quality and improvements in 
public health as a result of the reduction of air pollutants.
    Senator Lieberman. Am I not correct that EPA sets the 
standards not to protect against all identifiable effects but 
only against those that are adverse?
    Dr. Lippmann. That's correct and that's where the ozone 
effect on lung function comes in. It can easily measure small 
changes in capacity but we have trouble interpreting it as 
being adverse until it reaches a certain magnitude. So I think 
judgment will always be necessary, but I think as long as we 
choose to give great emphasis to the public health and look at 
populations at risk, not extreme individuals at risk as the EPA 
currently has been doing, I think the current rules are quite 
reasonable.
    In fact, in recent examinations of acceptable ozone levels, 
the trend is well below those proposed by EPA. The World Health 
Organization in Europe has just adopted a 60 or .06 ppm 
recommendation for ozone based on 8-hour exposure, not .08.
    In fact, the occupational health limit for workers who are 
adults and healthy enough to work is now .08 for moderate work 
and .05 for heavy work. So we're not talking about extreme 
degrees of protection; we're talking about only protecting to 
the level that healthy workers are being protected currently.
    Senator Lieberman. Dr. Chilton.
    Dr. Chilton. I'd like to respond to your question. I think 
we're stuck with the problem of words being ambiguous. I don't 
think we can define ``public health'' with no ambiguity. I 
don't believe we can define ``adequate margin of safety'' with 
no ambiguity.
    In point of fact, CASAC has said in its closure letter that 
the current paradigm is impossible. It will not work because we 
can find effects all the way down to background levels. So 
there is no adequate margin of safety possible.
    I don't know how you ignore that conclusion. I agree with 
that conclusion. I concluded that a long time ago and I was 
really thrilled to see that in print.
    The point of trying to go to an objective that prevents 
important adverse health effects and unnecessary exposures is 
that it gets around a problem that Milton Russell, a former EPA 
official, once described. Dr. Russell said that the Clean Air 
Act, the way it is currently written, protects against the 
effects of a common cold and cancer as if they were both the 
same and as many resources should be spent on the one as should 
be spent on the other.
    I think that is a fundamental flaw of the Clean Air Act. 
There is no differentiation of what is a significant public 
health effect. The interpretation of ``adverse'' is set at a 
very low level. If some small group of sensitive individuals 
are affected, that's an adverse effect. Whether it's reversible 
or not doesn't matter; whether it's lethal or something that is 
an acute effect is not taken into account either.
    Senator Lieberman. Thank you, Dr. Chilton. I understand 
your position but respectfully, I disagree with it because I'd 
prefer it to err on the side of the adequate margin of safety 
as opposed to opening up the doors of unreasonable risk of 
important adverse health effects. It's been a good exchange.
    Thanks, Mr. Chairman.
    Senator Inhofe. Thank you, Senator.
    I have one more question for clarification. Senator 
Hutchinson made a comment, Dr. Lippmann, and asked the question 
about going forward with the agency's PM proposal or in lieu of 
that, spending $50 million a year for 5 years on PM research 
and was implying that your position at that time was you would 
support that. You said that's not correct.
    I'd asked for the transcript of the meeting and I'll just 
read this for what it's worth because I think it is a little 
bit confusing.
    Representative Barton said, ``I think she's saying we would 
do the measurements, we would appropriate the money to do the 
measurements; we just wouldn't set a standard. I think that's 
what she said.''
    Representative Cubin, ``Exactly. That's exactly what I 
said.''
    Representative Barton, ``So would you oppose that?''
    Dr. Lippmann. ``No. If in fact the situation were created 
where we were getting this information and the pressure is 
under the current Act to get the levels further down, we could 
get away with that. I doubt if that's going to happen.'' Is 
this an inaccurate statement?
    Dr. Lippmann. I stand by my earlier statement to you. It 
was a hypothetical and it wasn't inaccurate in the terms of 
responding to a hypothetical, but it's not my preferred 
position by any means.
    Senator Inhofe. Then you can have it both ways.
    Dr. Lippmann. If you interpret it that way.
    Senator Inhofe. All right.
    First of all, thank you very much all of you for coming. We 
appreciate it.
    I see there are no further questions and we'll move on now 
for our second panel, the panel on implementation. Our second 
panel consists of, again, Alan Krupnick--we're going to wear 
him out--Resources for the Future; Mr. Paul Kerkhoven, manager 
of Environmental Affairs, American Highway Users Alliance; Mr. 
Ben Cooper, senior vice president, Printing Industries of 
America; Ms. Beverly Hartsock, deputy executive director, Texas 
Natural Resources Conservation Commission; Ms. Mary Nichols--we 
know her very well--assistant administrator, Office of Clean 
Air and Radiation, Environmental Protection Agency; and Ms. 
Patricia Leyden, deputy executive officer, Stationary Source 
Compliance, South Coast Air Quality Management District. 
Welcome to the panel.
    Let's start off with Dr. Krupnick, again.

 STATEMENT OF ALAN KRUPNICK, SENIOR FELLOW, RESOURCES FOR THE 
                       FUTURE--CONTINUED

    Dr. Krupnick. I want to doubly emphasize here that I'm 
speaking from a position of experience as the co-chair of EPA's 
Federal Advisory Committee for Ozone, PM and Regional Haze 
Implementation Programs, but I am speaking for myself, not for 
what I'll call the FACA.
    My main message to you is that the proposed standards, if 
they become law, are likely to be incredibly expensive to 
implement and our FACA is working toward developing consensus 
ideas to try to reduce those costs.
    The Administrator has clearly endorsed cost effectiveness 
as a major criterion for developing an implementation strategy 
and I think Congress' job is to help EPA live up to this goal 
and remove any impediments posed by the Clean Air Act.
    For this testimony, I'm taking it as given that the 
proposed standards are going to become law and now I'm asking, 
how can we cost effectively get there.
    Some background on FACA since I'm going first here. The EPA 
established this now 82-person subcommittee to obtain advice 
and recommendations from a broad group of stakeholders on 
possible new cost effective approaches to attaining the NAAQS 
and reducing the regional haze. We were charged with thinking 
out of the box and out of the Clean Air box as well, if that 
was appropriate.
    The committee has reached few specific consensus 
recommendations and the subcommittee and associated work groups 
have been working, and also EPA staff, exceedingly hard and are 
making significant progress in identifying options, discussing 
the pros and cons of many critical issues, and deciding how to 
decide on which options are the best.
    Our subcommittee will continue through 1997 with the goal 
of providing EPA with input and perhaps consensus 
recommendations on issues critical to the development of their 
implementation strategy.
    We can't work miracles, it's a very large, diverse group. 
We get into a lot of tense arguments and I think the progress 
has been limited so far because the standards issue has not 
been settled. Once that issue is settled, I think negotiations 
are likely to become much more intense.
    There are a number of measures that have come out of our 
FACA that have come up, although they are not agreed upon by 
any means yet, that I thought I'd bring to the attention of the 
committee for reducing the costs of meeting these standards.
    No. 1, that I think does not require congressional action 
has to do with reasonable further progress reform. Serious 
consideration is being given to one, basing measures of 
progress on effective emissions which would account for the 
effect of a location of a source, its stack height and other 
factors rather than assuming that all tons are equal when the 
States go after emissions reductions under RFP.
    No. 2, giving States the flexibility to define RFP that's 
appropriate for their particular conditions rather than one-
size-fits-all, and No. 3, permitting States to take credit in 
the present for emissions reductions that would occur in the 
future, such as through land use controls.
    Congress can do several things. The first is to affirm 
EPA's interpretation of the area classification section of 
Title I. This interpretation is that a change in the form and/or 
level of the ozone standard would invalidate this section. 
That affirmation is essential, I think, if the highly 
prescriptive and expensive mandates that are in the Act are to 
be able to be reexamined.
    The second is, I'm afraid to say, to open the Clean Air 
Act. I think the Act significantly restricts EPA's ability to 
implement cost effective ideas without compromising 
environmental protection. Let me give you a few examples.
    The first is facilitating the creation of a regional NAAQS 
trading program. In the FACA, if there is one thing we've 
agreed on, it's regional air management partnerships, or RAMPs, 
that are regional planning institutions that could help develop 
a NAAQS trading program. My fear is that we need Federal 
involvement to get all the States to play by the same rules.
    We need, I think, to eliminate LAER and BACT requirements, 
the tight technology requirements on new sources if there is a 
trading cap in place. We can't do that with the current Act.
    Congress should make it clear that episodic use of controls 
to reduce ozone episodes are creditable toward reasonable 
further progress and for use in attainment demonstrations.
    Although I'm sure Congress is reluctant, it should provide 
EPA with authority to require that States adopt specific cost 
effective policies and measures as part of their SIPs. This 
should come with a quid pro quo that EPA's requirements pass 
some sort of cost effectiveness test.
    Finally, on the Clean Air Act, I think Title II and Title 
IV need to be reopened as well in light of these new standards. 
Both of them can inhibit the use of cost effective approaches 
to meeting the standards.
    For instance, on the SO2 Allowance Trading 
Program in Title IV, that has been pretty successful, but the 
cap may need to be tightened to meet these tighter, fine 
particle standards.
    My last plea is one that's already come up which is for 
Congress to increase a target funding for monitoring and make 
it a line item in the EPA budget so it can't be raided for 
other uses.
    Thank you.
    Senator Inhofe. Thank you, Dr. Krupnick.
    Ms. Mary Nichols, it's nice to have you back.

 STATEMENT OF MARY NICHOLS, ASSISTANT ADMINISTRATOR, OFFICE OF 
       AIR AND RADIATION, ENVIRONMENTAL PROTECTION AGENCY

    Ms. Nichols. Thank you, Mr. Chairman.
    I'll try to summarize my testimony as well.
    I'm delighted to be invited back this time to talk about 
the implementation efforts that are associated with the EPA's 
proposed revisions to the National Ambient Air Quality 
Standards for Particulate Matter and Ozone.
    The history of the Clean Air Act over the past 26 years is 
one that we can all be proud of, that of working to make 
progress continually and bringing down the levels of air 
pollution and to do it at a time when our country has been 
growing both in population and in our level of domestic/economic 
activity.
    The Clinton administration views protecting health and the 
environment as one of its highest priorities and we have prided 
ourselves on protecting the most vulnerable among us, 
especially children, from the harmful effects of pollution.
    When it comes to the Clean Air Act, we take very seriously 
the responsibility that Congress gave us to set air quality 
standards that will protect public health with an adequate 
margin of safety, recognizing the difficulties in making those 
decisions based on the best science available.
    As you well know, at this point, we have only proposed 
revisions to the standards for these two important pollutants. 
We are in the process of very seriously considering all the 
public comments on these proposals before making any final 
decisions. We've heard from small businesses, industry, State 
and local governments, other Federal agencies, and citizens, 
including individuals who have various forms of lung diseases, 
doctors, and the public at large.
    While we have proposed specific levels for each pollutant, 
we've also asked for comment on a wide range of alternative 
options. We do not intend to make a final decision until we've 
carefully considered comments on all of those alternative 
options.
    Throughout the history of the Act, the national standards 
have been established based on an assessment of the science 
concerning the effects of air pollution on public health and 
welfare. Costs of meeting the standards and related impacts 
have never been considered in setting the national ambient air 
quality standards themselves and this has been true throughout 
six administrations and 14 Congresses and has been reviewed by 
the courts frequently. So we have a body of common law, if you 
will, on this topic.
    In choosing our proposed levels for the ozone and 
particulate matter standards, EPA's focus has been entirely on 
health risk, exposure and damage to the environment. Sensitive 
populations such as children, the elderly and those with asthma 
deserve to be protected from the harmful effects of these 
pollutants and, I think almost equally importantly, the 
American public deserves to know whether the air in its cities 
and counties is safe or not.
    That question ought not to be confused with the separate 
issues of how long it may take or how much it may cost to 
reduce pollution to safe levels. However, if we do revise any 
air quality standard, it is both appropriate and indeed 
necessary to work with States, local governments, and all other 
affected entities to develop the most cost effective, common 
sense strategies and programs possible to meet those new 
standards.
    Under the Clean Air Act, States have the primary 
responsibility and discretion for devising and enforcing 
implementation plans to meet the national standards. We are 
determined to work with States and others to ensure a smooth 
transition from efforts to implement the current standards to 
any efforts that may be needed to implement new standards.
    We haven't waited until the final decision to begin doing 
just that. By 1995, it had become apparent from the emerging 
body of science that we might have to propose revisions to one 
or both of these two standards, ozone and particulate, and that 
in order to fulfill our obligations to develop a regional haze 
program, new tools would be necessary.
    At that time, we determined the best way to meet the goal 
of developing common sense implementation strategies was to 
bring in experts from around the Nation to provide us with 
their advice and insights. As a result, we've used the Federal 
Advisory Committee Act to establish a Subcommittee on Ozone, 
Particulate Matter and Regional Haze.
    John Seitz, director of the Office of Air Quality, Planning 
and Standards in my office co-chairs that committee along with 
Dr. Krupnick who is here today. The subcommittee is composed of 
about 75 official representatives from State and local 
government, industry, small business, environmental groups, and 
other agencies. It also includes five separate working groups 
with additional members composed of another 100 or so 
representatives of these or similar organizations.
    The subcommittee and various groups have been meeting 
regularly for over 18 months to address strategies for EPA and 
the States to consider in implementing any revised standards. 
Indeed, much of their work will be useful to us even if EPA 
were to make the decision not to implement any revised 
standards because it's building on the work we're already doing 
today.
    The members from the various groups are putting forward 
position papers with innovative ideas and it's our belief that 
many important discussions are taking place. Basically, there 
are five important questions this group is considering and I'll 
just tick them off.
    One is the issue of deadlines. What should the deadlines be 
for meeting any new standards? Again, we assume there is an 
opportunity to either continue or to revise the system that was 
put in place in the 1990 amendments for dealing with various 
classifications of areas.
    What should be the size of an area that's being defined as 
a nonattainment area? Again, if there are revisions to the 
standards, EPA has a responsibility to determine what areas are 
nonattainment and to draw the boundaries. We know how 
contentious those issues can be. We also know more than we did 
even at the time the 1990 amendments passed about the issue of 
transport.
    That leads to the next issue which is how do we actually 
address, in a cost-effective manner, the problem that the 
pollutants that form ozone and fine particles are transported 
hundreds of miles and continue to operate in the atmosphere, to 
react in the atmosphere as they move into downwind areas.
    What kinds of control strategies are most appropriate for 
the various nonattainment areas? Can we use the experience of 
the past several years to help the States target those control 
strategies that are the most effective.
    Last, but obviously the most important of all, how can we 
promote market-based air pollution control strategies?
    All of these kinds of issues relate to the basic reality 
that revision of the revised standards is going to need to 
focus on the major emitters. We're talking about cars, trucks, 
buses, power plants and fuels. Those are the major sources and 
tools that we have to work with.
    In some areas, as with the current standards, we're seeing 
that reaching the standards will present substantial 
challenges. All the programs we're pursuing to meet the current 
standards for ozone and particulate matter will be needed to 
meet any new and revised standards as well.
    Everything we're doing today will be helpful in meeting any 
tougher standards that may be adopted. For example, the sulfur 
dioxide reductions that are achieved in the acid rain programs 
will greatly reduce levels of fine particles in the eastern 
United States.
    Senator Inhofe. Ms. Nichols, we're going to ask you to 
conclude your opening statement. You've run over the time.
    Ms. Nichols. I will. Thank you, sir.
    I'd just like to add that we've expanded the membership of 
the committee in order to include more small businesses as well 
as local governments in the interest of making sure that we 
have the widest possible participation and the Administrator 
has stated her intention to propose first steps in 
implementation at the time we announce our final decision on 
any revisions to the ozone and particulate standards.
    Thank you, Mr. Chairman.
    Senator Inhofe. Thank you, Ms. Nichols.
    We have been joined by Senator Baucus. Do you have an 
opening statement you'd like to make.
    Senator Baucus. Not at this time.
    Senator Inhofe. The next witness is Mr. Paul Kerkhoven.

    STATEMENT OF PAUL C. KERKHOVEN, DIRECTOR, ENVIRONMENTAL 
            AFFAIRS, AMERICAN HIGHWAY USERS ALLIANCE

    Mr. Kerkhoven. Good morning, Mr. Chairman.
    Thank you for the opportunity to be here this morning.
    The transportation sector has played a major role in 
attaining the air quality goals realized by many areas across 
the country. We expect this role to continue.
    Carbon monoxide emissions from highway vehicles have been 
reduced by one-third, while VOC emissions have been cut in 
half. Today's cars have achieved at least a 95-percent 
reduction in tailpipe emissions since 1960 and it takes 20 of 
today's new cars to produce as much tailpipe pollution as only 
one car did 30 years ago.
    The reformulated gasoline for California is so effective, 
it's like taking 3.5 million cars off the road. That's twice 
the number of vehicles registered in the State of Oregon.
    In spite of these accomplishments and future progress, the 
EPA continues to advocate strict policies to control the growth 
of vehicle miles traveled. The agency pursues this misplaced 
policy by enforcing transportation control measures that 
discourage automobile use and advocate higher funding for the 
congestion mitigation and air quality programs to implement 
these measures.
    Mr. Chairman, a fundamental individual freedom, the freedom 
of mobility, is at stake whenever the Government proposes to 
restrict the ability of Americans to choose where, when and how 
to travel. There may be times when such restrictions are 
necessary but those decisions should not be made by our elected 
representatives and not by the subterfuge of a bureaucratic 
rulemaking procedure. Constraints on motor vehicle use and 
restriction of personal mobility are a serious obstacle to 
economic growth and productivity increases.
    One of the Clean Air Act's largest challenges are its 
conformity determination requirements. The conformity 
provisions were designed to ensure that transportation 
decisions made by State and local governments in areas out of 
compliance with air quality standards were consistent with the 
region's plan to improve the air. Failure to meet the 
conformity requirements by a State can lead to withholding of 
Federal highway funds.
    The implementation policy for the proposal states that the 
present conformity determination process will continue until 
State implementation plans that address the new standard are 
approved by the EPA.
    We question whether the current model intensive conformity 
process will still be meaningful with much larger nonattainment 
areas. For example, to make a conformity determination in rural 
areas will be a senseless and cumbersome exercise because in 
virtually all cases, there are few, if any, transportation 
alternatives.
    The proposal also will likely result in tighter emission 
budgets and make conformity an even more challenging process.
    The proposals do not address the cost effectiveness of the 
transportation control measures and these may be the most 
costly elements of further emission reduction efforts. 
Similarly, the highway funding sanctions could also affect 
larger areas.
    I question whether the EPA intends to impose highway 
funding sanctions on the 8-20 residual nonattainment areas in 
its partial attainment scenario. Transportation is a big part 
of the economic development equation. Projects to reduce 
congestion and expand capacity should be expedited, not 
burdened with new regulatory hoops.
    Congress established the Congestion Mitigation and Air 
Quality Improvement Program, also known as CMAQ, in ISTEA 
primarily to help State and local governments meet the cost of 
implementing the transportation control measures. The Highway 
Users oppose setting aside $1 billion of highway funds each 
year exclusively to meet costs imposed on State and local 
governments by the Clean Air Act. Those air quality improvement 
projects may or may not be a top transportation priority in a 
given area.
    The Highway Users support the efforts to eliminate separate 
CMAQ funding category and we question EPA's efforts to promote 
it. We would make air quality and congestion mitigation 
projects eligible for funding under a streamlined surface 
transportation program.
    As for the assertion that State transportation officials 
will not implement transportation control measures in their 
plans, if they do not have the specific setaside for them, we 
do not believe that.
    Mr. Chairman, the 1990 Clean Air Act mandates that State 
transportation officials give priority consideration to and 
provide for the timely implementation of transportation control 
measures in their clean air plans. It is not the CMAQ Program 
that drives these requirements.
    If attainment goals are not reached, the State faces 
highway funding sanctions. There is no greater incentive. This 
is the stick that forces each State and local official to craft 
transportation plans which include the right mix of projects to 
reduce emissions.
    The Administration's new highway bill also addresses the 
CMAQ issue and there are several provisions there that we 
support and do not support. We do not support the hold harmless 
provision for CMAQ funding, nor do we support the proposal that 
when a State submits its SIP, the CMAQ funding increase is 
triggered. Both provisions expand CMAQ funding at the expense 
of the more flexible STP account.
    If Congress chooses to retain a separate CMAQ account, we 
do support the Administration's proposal to fund two 
transportation control measures that are listed in the Clean 
Air Act, but were ex- 
cluded from CMAQ funding eligibility in ISTEA. In addition, 
congestion mitigation projects such as those that increase 
capacity for single occupant vehicles in ozone and carbon 
monoxide nonattainment areas should be eligible for CMAQ funds.
    Mr. Chairman, in conclusion, our central points are as 
follows. Current and emerging technologies will ensure the 
continuing decline of mobile source emissions without the new 
air quality standards. We should not burden vast areas of the 
country with new regulatory hoops the proposed standards 
changes will create.
    The transportation control measures needed to meet the new 
standard could cause significant economic hardship and I would 
like to echo comments of the U.S. Department of Transportation 
that it will require lifestyle changes by a significant part of 
the U.S. population.
    Finally, the Clean Air Act gives transportation officials 
strong incentives to make air quality projects a top priority. 
We urge Congress to give those officials a truly flexible STP 
program account that will allow them to weigh all their 
transportation needs, including air quality improvements, when 
establishing funding priorities.
    Thank you.
    Senator Inhofe. Thank you, Mr. Kerkhoven.
    Mr. Cooper.

    STATEMENT OF BENJAMIN Y. COOPER, SENIOR VICE PRESIDENT, 
                 PRINTING INDUSTRIES OF AMERICA

    Mr. Cooper. Thank you, Mr. Chairman.
    We appreciate the opportunity to appear before you today. 
I'd like to ask that the comments we make also be submitted in 
behalf of the Small Business Legislative Council, a coalition 
of almost 100 trade associations of which I serve as chairman.
    Senator Inhofe. Without objection.
    Mr. Cooper. I would like to say in the beginning that I 
also serve as a member of the Clean Air Act Advisory Committee 
and have since its beginning. I'm also a member of the 
Subcommittee on the Implementation of the New Proposed 
Standards. I have recently been appointed to a small industry 
review team at EPA to evaluate the impact of the standards on 
small business and other small entities.
    I'd like to say at the outset that while EPA has come under 
a lot of criticism in these standards and will probably 
continue to, I think it's fair to acknowledge that EPA, 
particularly recently, has done a great deal to reach out to 
the small business community and to try to bring us in. While 
we would like for this to have occurred earlier in the process, 
a great deal is being done now to bring us in more fully.
    I think it is also important to note that EPA has probably 
the strongest small business ombudsman program of any Federal 
agency and oversees a very strong State technical assistance 
program in dealing with implementation issues in the Clean Air 
Act. I think it's fair to acknowledge the positive work the 
agency has done.
    I'd also like to say from the outset that we wish the new 
standards would not be implemented. We don't feel they are 
necessary. Having said that, if the new standards are to be 
implemented, there are some areas we think are fairly critical, 
particularly in dealing with small business.
    First of all, we don't believe the Clean Air Act has been 
fully implemented and we don't think we have even begun to see 
the full positive effects of the implementation of the 1990 
amendments.
    I know in looking at it from just the printing industry 
alone, we still do not have standards for the industry that are 
applied nationwide. There are many areas, technological issues, 
affecting the printing industry that have not been addressed. 
This is true in a number of small business sectors.
    Second, we're quite concerned about EPA's data base on 
which it calculates the emissions from various industries. This 
is another area where I have some sympathy with EPA. Frankly, 
the data base is flawed. The data base that calculates 
emissions from various industries is based on permits; those 
permits are those of large companies and industries such as 
ours.
    The permits are not based on actual emissions, but in fact, 
based on potential emissions and companies are virtually forced 
under their hopes for growth of buying more emissions than they 
may actually have so that the data tends to skew the emissions 
information a little higher than it is.
    As I mentioned, one of the big problems in a lot of small 
business industries is guidance isn't available to the States. 
While it may be nice to say that when you get down to the city 
or county level that these people are working very effectively 
with small business, as a practical matter, small business is 
treated as a group. It is sort of a regulatory carpet bombing.
    The regulations are sort of laid out there, small business 
is told to reduce by 10 percent, but without the guidance 
necessary to tell them how to do it. What this amounts to, in 
effect, is not so much a reduction of emissions, but a 
collection of fees because each one of these permits comes with 
a permit fee. So for many small businesses, they look at this 
as simply an environmental tax rather than a program of 
actually reducing emissions.
    We think the implementation plan that's under discussion 
may be superior to the current plan and we don't know, we 
haven't evaluated it fully, is going to be confusing to small 
business. As a native of Alabama, looking at this chart, if 
you're living in Gadsden, AL, you don't know which area of 
influence you're in and you don't know which area of violation 
you're contributing to. In fact, you could end up with 
jurisdictions giving you direction from different directions.
    One of my main concerns in this program is that we have not 
even addressed in the implementation strategy something Carol 
Browner has put a great deal of her efforts into and that is 
multimedia applications or alternative strategies for dealing 
with overall pollution reduction.
    We're one of the common sense initiative sectors at EPA. We 
think this clean air proposal ought to be run through those 
common sense sectors so that we can balance the media effects 
of different pollutants, not just air pollution.
    EPA has a major program underway called ECOS which is 
dealing with this same type of project. We think it's a golden 
oppor- 
tunity for EPA to change the method of operation in dealing 
with States.
    Finally, from a very parochial standpoint, the small 
business program of the Clean Air Act, known as the 507 Program 
which we were instrumental in getting included in the 
amendments to the Act, has not been fully implemented.
    If we go through with the implementation of this new 
standard without adequate guidance at the State level for small 
business, I'm concerned there will be chaos and I think we 
really need to address those very critical issues before we 
move ahead.
    Thank you very much, Mr. Chairman.
    Senator Inhofe. Thank you.
    Ms. Leyden.

 STATEMENT OF PATRICIA LEYDEN, DEPUTY EXECUTIVE OFFICER, SOUTH 
             COAST AIR QUALITY MANAGEMENT DISTRICT

    Ms. Leyden. Thank you, Mr. Chairman.
    I too will speak informally from my comments that you have.
    I regulate all of the largest industries, many medium and 
small industries in the South Coast Air Basin, and I'd like to 
talk to you today about the issues of implementation with the 
new standards.
    I think it is especially germane for the Senate to look at 
what types of sources will need to produce additional emission 
reductions, what kind of time will be allowed to meet those 
standards, and how can we accomplish these objectives at the 
lowest possible cost.
    To that end, I'd like to tell you just a little bit about 
our mass emissions trading program called Reclaim and then tie 
the discussion of that program to the matter before you today, 
the consideration of the new standards.
    Reclaim is the largest multi-industry, mass emissions 
reduction program in the United States. It covers nitric oxide 
and SOx emissions; it regulates over 330 of the largest 
polluters in the South Coast Air Basin. It covers industries as 
large and as diverse as refineries, power plants, aerospace, 
hotels, cement kilns, metal melting and down to small 
businesses like hotels and even amusement parks.
    When our program went into effect in 1994, it replaced over 
32 command and control rules. It gives businesses the 
opportunity to select the lowest cost alternative to achieve 
their emission reductions. We're very pleased that the program 
is a success and has exceeded our expectations.
    In the first 3 years of the program, the actual emissions 
from the sources are a good one-third below their allocations. 
The cost in reducing those emissions is almost half of what had 
been anticipated under command and control regulations.
    We have a vigorous trading market, a market that has 
exceeded our expectations, with over $33 million in trades 
already having occurred to support plant modifications and 
business expansion.
    Reclaim works. It works in large part because it is dealing 
with fuel combustion sources. Industries under the program very 
carefully report the actual emissions from the facilities. I 
think this is important because careful monitoring and 
reporting makes the emission reduction credits a blue chip 
investment in the market.
    It also is germane as the Senate considers the new 
standards because as you look at what works, and you look at 
how it applies to large, medium and small-sized emissions fuel 
combustion sources, I think that ties directly back to the new 
standards before you.
    I've written a lot of very tough command and control rules 
in my career. I think for the sources that I've regulated, the 
trading programs really do offer a lower cost way to accomplish 
the objective.
    In many parts of the country, the new standards will 
require companies to meet emission limits currently in place in 
California. As we've looked at the new standards, we believe 
the driving force for additional reductions will not come so 
much from the ozone standards, but from the small particulate 
standards.
    We spent about 2 years and almost $1.5 million collecting 
small particulate data. It drives us to the conclusion that 
additional emission reductions will come primarily from fuel 
burning sources. We'll be looking for additional NAAQS 
reductions, probably up to about 35 percent more than what 
we've seen to date.
    We think our largest sources have really done their fair 
share and as we look to who needs to come up with additional 
emission reductions, we'll be talking in large part, first, 
about fuel burning sources subject to Federal regulations--
ships, trains, planes, interstate trucks, offroad construction 
and agricultural equipment.
    We'll also be talking about sources that are considered 
small and in many instances, have protected status currently 
under the Clean Air Act. Emissions from sources like 
refrigerators, stoves, small internal combustion engines sound 
small but they aren't when you're talking about a huge 
metropolitan area. Today, in the South Coast Basin, emissions 
from small internal combustion engines, less than 50 horse 
power, exceed the emissions of the largest power plant in the 
basin.
    A few conclusions quickly. South Coast Air District 
supports the new standards. We have but one request--additional 
time to accomplish the objective. Our deadline under the 
current standards is 2010. We believe additional years will be 
required to meet the new standards.
    Second, trading programs work. Trading programs will be an 
important component in achieving the new standards. For our 
program to have been adopted, we needed the political 
commitment to clean up dirty air, we needed a strong 
partnership with business and the environmental community to 
develop the regulations. For the new standards to work, the 
same will be true.
    Thank you, Mr. Chairman.
    Senator Inhofe. Thank you, Ms. Leyden.
    Ms. Hartsock.

   STATEMENT OF BEVERLY HARTSOCK, DEPUTY DIRECTOR, POLICY & 
  REGULATORY DEVELOPMENT, TEXAS NATURAL RESOURCE CONSERVATION 
                           COMMISSION

    Ms. Hartsock. Thank you, Mr. Chairman.
    My name is Beverly Hartsock and I'm pleased to be here 
today representing the Texas Natural Resource Conservation 
Commission to address the issue of implementation of the 
proposed new air quality standards.
    From a State regulator standpoint, I think it's important 
to recognize that just adopting a new standard does not result 
in improved air quality. Programs must be developed to 
implement it and that is what my agency is expected to do.
    Implementation of any new air standard follows a series of 
steps. Monitoring data must be gathered to determine if an area 
meets the standard. For the new particulate matter standard, 
this will mean installing and operating new monitors. Even 
phasing these in over 3 years, as EPA has proposed, will cost 
Texas from $1.3 million next year up to almost $2 million in 
2000. There will also be additional monitors needed for ozone 
and its precursors since we are likely to have new 
nonattainment areas and there is a need to know more about 
transport levels in rural areas.
    Next, we must inventory the sources of emissions in each of 
these areas. New nonattainment area inventories will require us 
to examine industrial and business process information and 
estimate all population-based activities. Analysis of emissions 
and air quality data must then be performed using computer 
model simulations.
    This is a major undertaking as can be seen by the 2-year 
effort and millions of dollars that have recently been spent in 
the OTAG process, studying four high ozone episodes in the 
Midwest, Northeast, and Atlanta.
    The computer analysis will yield an estimate of the level 
of emission reduction predicted to solve the problem. This 
reduction occurs through implementation of new rules or program 
requirements developed by State and local agencies based upon 
available technology, cost effectiveness, and feasibility.
    Traditionally, large industrial sources have been the focus 
of these controls, but more and more, we're having to focus on 
smaller, individual contributors such as small businesses and 
cars since collectively these are significant emissions 
sources.
    Final decisions on new controls occur through a public 
participation process of meetings and hearings. The results, 
along with all the supporting analyses, are compiled as a State 
implementation plan which is submitted to EPA. Reductions 
actually occur as sources come into compliance with the new 
requirements from one to many years later depending upon the 
type of program.
    States must continue to monitor air quality to measure 
actual improvement compared to the modeled predicted benefits. 
Additional controls must be implemented if air quality goals 
aren't meant.
    In my written comments, I provided a more thorough 
discussion of the air quality planning process, the 
difficulties we have encountered, and the problems we see with 
implementing proposed new standards.
    In summary, there are five points I would like to leave 
with you. First, my agency and the leadership of our State are 
on record as supporting the retention of both the existing 
ozone and particulate matter standards until the science to 
support any change is more definitive.
    The recently released studies of health effects of ozone 
estimate fewer benefits from the proposed standard than 
previously thought. The particulate matter studies have raised 
as many questions as they have provided answers.
    Second, if new standards are adopted, extensive new work 
will be needed to implement them and it appears likely that 
there will be little additional funding from EPA. States do not 
need another unfunded mandate.
    Additional requirements without adequate funding will take 
away from our ongoing effort to solve the more serious air 
pollution problems that have already been identified.
    Third, we should explore ways for air pollution planning to 
be a part of a city's urban planning whether or not new 
standards are adopted that cause the city to be designated 
nonattainment. New approaches should build on voluntary action 
programs such as flexible attainment approaches and should 
provide incentives for early planning, expanded monitoring and 
early reductions.
    Fourth, adequate time should be provided to allow areas to 
plan, implement controls and measure the results of those 
controls. The 5-year timeframes of the Clean Air Act allow for 
planning and implementation, but fail to allow time to monitor 
results or to build adequate data bases.
    Our experience shows that 10 years is a more reasonable 
planning cycle and the more difficult air pollution problem 
areas will take two or more planning cycles. Mid course 
corrections should be included so that new information can be 
used to improve imprecise predictions of growth and emissions 
changes.
    Finally, adequate time must be provided to allow major 
emission reducing trends such as those happening in the 
transportation sector to be significant contributors to 
attaining national air quality goals. In order for the country 
to be able to afford all that is likely to be required to meet 
all of our goals, we must allow time for market forces and 
technological development to minimize costs of accomplishing 
the reductions and spread those costs over time.
    Thank you for the opportunity to present these comments.
    Senator Inhofe. Thank you, Ms. Hartsock.
    We'll start with Dr. Krupnick since he's been around the 
longest.
    I notice and a lot of the people have testified on the 
previous panel and also on this panel, and others may have a 
comment about this too, you had mentioned the implementation, 
you identify areas of the Clean Air Act that need to be 
invalidated and you provided a laundry list.
    To do that, I think we pretty much would conclude we would 
have to have a full scale rewriting of the Clean Air Act. Do 
you agree or disagree with that?
    Dr. Krupnick. I'm not a lawyer, so I can't make that 
judgment. It just seems to me that there are certain aspects of 
this new world that we're looking at that are really up to 
Congress to address.
    I think if Congress does not act, it's my estimation that 
EPA is willing to push that Act as far as they can push it to 
try to move toward cost-effective implementation policies, but 
you could help that process along a lot and save the country a 
lot of money by maybe some surgical strikes into the Act.
    Senator Inhofe. I guess what I'm getting to is every time 
this comes up, I've asked myself the question, is it all that 
bad. There are some very positive things that could come out of 
a rewriting such as cost-benefit analysis and some things I 
feel would be a very helpful part of it.
    Ms. Hartsock, I was listening to you and you covered pretty 
much the cost but let's go back and kind of put this in a 
timeframe. First of all, in Texas, I assume you don't have 2.5 
monitors in place?
    Ms. Hartsock. No. We haven't had any in place. In the month 
of March, we just put the first six out.
    Senator Inhofe. When could you start deploying? You've 
already started deploying the monitoring network, is that 
right?
    Ms. Hartsock. Yes, sir, but that is only in one city, 
Houston, and we have several other major metropolitan areas 
where we need to get out monitoring. That's to be started over 
the next year.
    Senator Inhofe. Let's assume that is right, then if the EPA 
is proposing the standard as a 3-year average, what year would 
you have that data?
    Ms. Hartsock. It would be 3 years from the time we started. 
Our phase-in program is over 3 years, so the first areas, such 
as Houston, we would have 3 years of data 3 years from now. The 
last of the areas would be 6 years from now.
    Senator Inhofe. So say by 1999, you'd have a lot of them 
out. In 3 years, it would be 2002. After you get the data, what 
steps are necessary to designate the nonattainment areas and 
how long would that take?
    Ms. Hartsock. There is a formal process, but in essence, I 
believe it's within a year that we have to have the 
designations in and then EPA has another year.
    Senator Inhofe. Then you have 3 years after that for your 
State implementation plan, so that would put us around 2006?
    Ms. Hartsock. Yes, sir, from that last date that you had.
    Senator Inhofe. All right. When would you have attained the 
standard, would it be 5 years after the designation which would 
bring us to about 2008?
    Ms. Hartsock. By that time, I think we're looking at having 
the initial round of controls in place, but as I indicated in 
my comments, one of the things you have to do then is monitor 
what the air quality looks like after those controls are in 
place.
    Senator Inhofe. And I understand they allow one extension 
of say up to 5 years. So we're talking about then perhaps the 
year 2013?
    Ms. Hartsock. Yes, sir.
    Senator Inhofe. Every time I look at this, it seems to me 
it makes sense to just go ahead and conduct the scientific 
tests first and then collect the data before we set the 
standard. Someone mentioned the other day it's kind of like 
instead of ready, aim, fire, it's ready, fire, aim. Do you 
agree with that analogy?
    Ms. Hartsock. Yes, sir.
    Senator Inhofe. You mentioned unfunded mandates and this is 
something I'm very sensitive to being a former mayor of a major 
city for three terms. Our major problem wasn't crime in the 
street, it was unfunded mandates, but we passed a law that was 
supposed to protect political subdivisions. You are a political 
subdivision, you're the State of Texas. Do you consider this an 
unfunded mandate?
    Ms. Hartsock. Yes. We do not see that additional funding is 
going to be made available by EPA to handle the new costs that 
we'll be incurring.
    Senator Inhofe. Mr. Cooper, Senator Sessions was here 
earlier for the previous panel. We're all supposed to be going 
over there for an executive session, so we're going to be 
hoping to get through in a timely fashion, but he was concerned 
also. He looked at that map and that is something that would 
concern someone who is from Alabama.
    In your testimony, you state your industry disagrees with 
the emissions estimates of the agency and it's miscalculated 
for printers and your industry. You also mentioned how the 
reductions are generally targeted across the board.
    Do you have any estimates or has the EPA estimated the 
burden on your industry for implementation purposes?
    Mr. Cooper. There are some estimates on the emissions and I 
think in fairness to EPA, I think you'd be able to agree these 
estimates are the best they have to work with. We don't have 
the estimates of emissions in our industry and part of the 
problem is, the science of air emissions on an individual site, 
an individual company, talking about monitoring data, is 
basically how you calculate what goes on in a certain kind of 
operation. It is not an agreed to formula. So any kind of 
estimation of emissions is guess work.
    Senator Inhofe. You mentioned in your testimony that you're 
on the advisory board, right?
    Mr. Cooper. Yes, I am.
    Senator Inhofe. And you have recommended changes. Is this 
one of the changes that you might be referring to?
    Mr. Cooper. Yes. As Ms. Nichols mentioned, we now have a 
larger group of small business folks on there. We are now 
meeting as a separate group to come up with these 
recommendations as a larger group of small businesses and how 
EPA can make some adjustments in these calculations.
    Senator Inhofe. Mr. Kerkhoven, I'm also concerned about the 
transportation end and we're going to be considering ISTEA, the 
Intermodal Transportation reauthorization and what does this 
map do to you when you look at this?
    Initially, correct me if I'm wrong, you were making your 
estimates on those areas that would be the smaller, dark green 
dots in the middle before we produced this map that shows two 
more concentric circles?
    Mr. Kerkhoven. Correct. Senator, actually the NHS bill 
addresses part of the conformity determinations, where 
conformity determinations may be made in the nonattainment 
areas and if we're going to expand conformity determinations to 
areas of violation or areas of influence, it's going to make it 
very, very difficult for localities.
    Senator Inhofe. It is my understanding, is it your 
understanding also, that these areas outside of the dark green 
specified area would not qualify for CMAQ funding?
    Mr. Kerkhoven. Correct.
    Senator Inhofe. Senator Baucus.
    Senator Baucus. Thank you, Mr. Chairman.
    I'll start with you, Ms. Nichols. What is EPA doing about 
ozone transport either currently and/or under the new proposed 
regulations?
    Ms. Nichols. Senator Baucus, the issue of transport has 
been around for many, many years and Congress actually gave EPA 
some authority directly to take action to make sure that States 
don't interfere with attainment or maintenance of areas 
downwind. The problem historically has been to get the data and 
to get action taken can be a very lengthy, time-consuming 
process.
    In the 1990 amendments, Congress actually created an Ozone 
Transport Commission to cover the 13 New England, northeastern 
States as far south as Virginia and including the District of 
Columbia in recognition that we now know enough about how the 
air moves around that region so that it was important that 
region get together and plan and take some action as a group in 
order to achieve the most cost effective reductions and to 
enable some of the areas to be able to attain the standards.
    As a result of the 1990 amendments and the need for 
attainment plans, EPA convened a much larger group of States 
beyond the ozone transport regions covering the entire area 
east of the Mississippi where we had evidence there was some 
degree of transport and interference. The States themselves 
took on the task through the environmental commissioners of the 
States to begin a planning process, to do a great deal of 
modeling and analysis to try to get a better handle on this 
issue.
    We are expecting in June of this year that we will receive 
recommendations from the Ozone Transport Assessment Group as to 
which States they feel need to take action in order to solve 
this transport issue for ozone. That's all under the current 
ozone standard.
    In looking at this map here which somewhat out of context 
looks like an amoeba, it reflects the kind of conversations 
that some of the experts in the Advisory Committee have been 
having about how to deal with this issue, that there is 
transport, that States have the primary responsibility but that 
there are some kinds of cost-effective measures, as Dr. 
Krupnick mentioned, particularly cap and trade programs that 
can be implemented on a broader level if the States agree to do 
it.
    There may be, indeed, a necessity on the part of some 
States to be doing some kinds of controls to help out their 
downwind neighbors if they really are making a substantial 
contribution. So these kinds of lines are designed to help 
people think about where you would want to have regional 
partnerships and the States getting together to at least try to 
plan together and possibly agree on some control strategies.
    There is no consensus, at this point, on any of this stuff 
but there is particularly no consensus on what the area of 
influence might have to do. It would be up to the States that 
we're in an area of influence if one of them gets established 
to decide for themselves what the measures would be.
    Certainly an area of influence is not the same thing as a 
nonattainment area. A nonattainment area is an area where you 
actually have violations of the standard, so some of the 
concerns that Mr. Kerkhoven mentions I think are frankly off 
the mark.
    Senator Baucus. What you're saying though is that there's 
room under the proposed standards, to cap or trade or work out 
various arrangements to deal with transport?
    Ms. Nichols. Yes.
    Senator Baucus. You still think that is possible?
    Ms. Nichols. I think it's possible. It's difficult.
    Senator Baucus. And probably even necessary?
    Ms. Nichols. But it will be necessary if the transport 
issue is going to be solved, yes, sir.
    Senator Baucus. A general question I had for anybody who 
has problems with these regulations or proposed regulations, 
first of all, PM10, it's my understanding that 
CASAC, the independent scientific peer review committee decided 
overwhelmingly that a new standard should be set. It didn't say 
what the standard should be, but did say a standard should be 
set. I think the vote was 19-2.
    I wonder if anyone has any problems with that or disagrees 
with that conclusion of CASAC and why?
    [No response.]
    Senator Baucus. So everyone agrees a new standard should be 
set?
    Ms. Hartsock. I don't know that I can speak for the others. 
I wouldn't indicate that I'm an expert on the standard in any 
way. The primary focus of the comments we had would be if there 
is going to be a new standard, what would be the steps 
necessary in implementation and what do we see as the problems 
there. I don't know that I'm really prepared to answer that.
    Senator Baucus. CASAC did say, especially with respect to 
PM2.5, that a standard should be set. I think there 
are 15,000 premature deaths annually as a consequence of 
occurrence of particulates and that was the reason that the 
CASAC Commission decided that a new PM2.5 standard 
should be set.
    It did not address the question of what the standard should 
be, but based upon that amount of premature deaths annually, it 
reached that conclusion. The vote was 19-2 as I recall.
    Ms. Leyden, you've heard some complaints about this and yet 
you say you favor the proposed regulations.
    Ms. Leyden. Yes.
    Senator Baucus. What would you say in answer to some of the 
other witnesses that had some problems with these proposed 
regulations?
    Ms. Leyden. Well, I guess from my vantage point, I've spent 
almost the last decade looking at how to reduce pollution and 
tailoring regulations to assess things like cost effectiveness, 
looking at what new technology can do. We've made phenomenal 
progress in the South Coast Air Basin and I see no reason at 
all not to first protect the public health and provide adequate 
time to get there.
    I really believe for us, as I said in my comments, it will 
be additional NAAQS reductions, that will be needed to hit the 
2.5 standard. It's the right thing to do and we can get those 
additional NAAQS reductions by focusing on sources that have 
yet to reduce their emissions to the same level as some of our 
largest industries have reduced them.
    Senator Baucus. Mr. Chairman, if I might have one more 
question?
    Senator Inhofe. Sure.
    Senator Baucus. The vast amount of research on the question 
of whether the Clean Air Act benefits outweigh costs is 
overwhelmingly conclusive. That is in the affirmative by a 
factor of many times. All the studies on the Clean Air Act 
generally have reached the conclusion by a huge factor that the 
benefits of the Clean Air Act outweigh the cost of the Clean 
Air Act.
    Yet, we also run into the problem of the tyranny of the 
majority, the tyranny of averages because some provisions of 
the Act may have disproportionate effects on some people or 
individuals compared to some others.
    I think most of us are concerned about small business, that 
the cost on a particular small business person might be 
disproportionately greater than on a large enterprise.
    Ms. Nichols, we heard Mr. Cooper say that perhaps the EPA 
could do a better job in implementing section 507 of the Clean 
Air Act, particularly with respect to small business. I think 
all of us in Congress are very sensitive to the unique 
characteristic of small business.
    So on the aggregate, benefits vastly exceed the costs, we 
don't know if that is the case with respect to the new 
regulations, but we do know that is the case generally with the 
Act.
    What are you doing at EPA to address the concerns of the 
small businessmen?
    Ms. Nichols. Senator, we have a number of measures underway 
to do a better job of listening to and working with small 
business. I think in our programs implementing Title III of the 
Clean Air Act, the Toxics Program, we've had some of our best 
successes sitting down industry by industry as a group 
developing the data base jointly and coming up with regulations 
that can be met even when a particular sector is characterized 
by a great number of small businesses.
    I would have to say as a resident of the South Coast Air 
Basin in my past and somebody who worked with Ms. Leyden and 
others on some of these programs, we have learned from the 
experience of the South Coast which has had to go further in 
terms of regulating small businesses because the problems were 
more severe and have found that in many situations, we were not 
doing as good a job as we should have of outreach.
    Particularly on the enforcement side, some of the 
mechanisms that were being used to communicate and enforce 
against small businesses just weren't effective, that you 
needed to find ways to get the industry to help us to 
communicate what requirements were going to be.
    One of my favorite examples is one where we worked with a 
particular industry to develop a standard and then helped them 
to develop a workbook that could be distributed to all of their 
individual members. It's kind of like a desk reference manual 
so that the person who is actually running one of these 
particular facilities can look up what the requirements are in 
plain English and not have to hire an engineer or a specific 
environmental person in order to help them run their business.
    Those are the kind of practical realities that you have to 
deal with when you're actually working with small companies and 
try- 
ing to get compliance and recognizing that they want to comply 
but oftentimes an assistance approach is what is needed.
    EPA has funded the development of a number of small 
business compliance assistance centers for that reason. The 
Clean Air Act really led the way in that regard because of 507. 
We've worked with the State small business ombudspeople that 
were required to be created to help make them be more effective 
in carrying out these responsibilities.
    There is no doubt we could do better at this and I think 
Mr. Cooper and others have given us some ideas as we move 
forward with this implementation committee as to how to bring 
in the small business community and really address their 
concerns earlier in the process.
    Senator Baucus. Mr. Chairman, if you don't mind, if I might 
ask Mr. Cooper what more can be done to help address small 
business concerns?
    Mr. Cooper. I can't tell you how happy I am you asked that 
question. Let me tell you the core of the problem and maybe 
some in the small business community would not appreciate my 
saying this but by and large, small business people are fairly 
limited in their options of what they can do. The thing I hear 
more than anything is just tell us what we have to do and we'll 
do it.
    What that cries out for is very good guidance that isn't 
left subject to an engineer in Cleveland may be different 
engineer in Louisville, so you have guidance that is fairly 
clear-cut. Then you have to have the people available to answer 
the phone because there's a lot of fear out there. That's what 
the ombudsman program has provided.
    The core of the problem with the ombudsman program is that 
it is funded out of permit fees and when you get down to the 
State level, Texas has one of the strongest ombudsman programs 
in the country and I think their funding is over $1 million for 
that program which is about 10 times what it is in most States.
    If you're in a State and you're competing for dollars with 
the enforcement people and you're in technical assistance, 
you're going to lose. So what I would love to see is this 
committee to go over to the Appropriations Committee and set 
aside some funds to bolster the 507 Program. Without it, that 
program will die. There are a number of States that have cut 
back their programs already.
    I am very concerned that when this new standard comes out, 
if these programs aren't in place, that's when the realities 
are going to hit and it is going to be a mess.
    Senator Baucus. Thank you very much, Mr. Chairman, for your 
indulgence.
    Senator Inhofe. Thank you, Senator Baucus.
    Let me clarify one thing. You weren't here during the first 
panel and this whole idea on the 15,000 premature deaths is 
assuming causation. It's my understanding from the testimony of 
many of them that science has not been prepared to assume 
causation in that case in terms of the 15,000 premature deaths.
    Senator Baucus. I don't know the number but I do know the 
overwhelming conclusion of CASAC is based upon the data and the 
number of deaths and they reached a conclusion 19-2 that a 
standard should be set.
    Senator Inhofe. Then I have two more questions. I didn't 
quite use all my time and this is going to be very, very 
difficult for you, Ms. Nichols, because I'm going to ask you a 
question and I want one word for the answer and that answer 
would either be yes or no.
    Senator Baucus talks about the fact that the benefits have 
outweighed the costs. I believe he was referring to the 
previous standards.
    Under the proposed standards, I understand there is a 
regulatory impact analysis that came to the conclusion that the 
costs outweighed the benefits for ozone. Is that correct?
    Ms. Nichols. No.
    Senator Inhofe. OK. I will produce that report and we'll 
take that up at our next meeting.
    One last question for Ms. Leyden. In your written 
testimony, although you didn't say it in your verbal testimony, 
you talked about additional reductions were needed to come from 
diesel sources such as planes, interstate trucks, agricultural 
equipment and so forth. For the purposes of classification, do 
you classify jet fuel as diesel?
    Ms. Leyden. Yes, I would consider that a heavier fuel. It 
would be in that same category.
    Senator Inhofe. That classification has been used by the 
EPA?
    Ms. Leyden. My focus is on the heavier fuel type, sir.
    Senator Inhofe. You had said you're getting cooperation 
from some of the large contributors and I'm glad to hear that. 
You said in addition, small internal combustion engines 
together emit more than the largest power plant in your area. 
Can you give me a couple of examples of small combustion 
engines?
    Ms. Leyden. Small combustion engines would be anything less 
than 50 horsepower. They are protected under the Federal Clean 
Air Act and have an emissions standard that represents 
technology that today is 10 years old.
    Senator Inhofe. Would that be either two cycle or four 
cycle?
    Ms. Leyden. They'd be two cycle. We estimate, based on 
sales of equipment and fuel consumption, that emissions from 
that source category represents about 17 tons a day of nitric 
oxide emissions going into our air. That is almost four times 
greater than the emissions from the largest power plant in the 
basin.
    Senator Inhofe. I'm going to end with a request, Ms. 
Nichols. On this issue of jet fuel being considered for your 
purposes the same as diesel, I spent 40 years in that field and 
I think I'd like to have you at least look and reevaluate that 
because I think you'll find it is a much cleaner burning fuel 
and I was not aware that you threw all those in together.
    Maybe you don't, but if you could let me know on that, I'd 
appreciate it very much.
    Ms. Nichols. I'll be happy to find out.
    Senator Inhofe. Senator Baucus, do you have any last 
questions?
    Senator Baucus. No.
    Senator Inhofe. I appreciate the panel coming very much. We 
had said we were going to end right at 12 o'clock. We will have 
to do that because we're having an executive session over in 
the Capitol.
    Thank you very much for coming and for the time you've 
taken to come here and testify.
    [Whereupon, at 12:05 p.m., the subcommittee was adjourned, 
to reconvene at the call of the chair.]
  Prepared Statement of Kenneth W. Chilton, Director, Center for the 
           Study of American Business, Washington University
    I wish to thank the Senate Subcommittee on Clean Air and Wetlands 
for the opportunity to testify on the proposed national ambient air 
quality standards for ozone and particulate matter.
    I have researched clean air issues for over a decade and a half. I 
am the director of the Center for the Study of American Business, a 
501(c)(3) non-partisan, not-for-profit public policy research 
organization at Washington University in St. Louis. These are my 
personal comments and do not necessarily reflect the views of the 
Center for the Study of American Business or Washington University.
    I would like to address several of the most important public health 
questions in the NAAQS debate. I will also speak about some very basic 
issues regarding the primary objective of the Clean Air Act.
                          the science on ozone
    The scientific evidence on the health effects of ozone is rather 
extensive. Ozone has been demonstrated to cause undesirable physical 
effects in some individuals. The effects include coughing, wheezing, 
tightness in the chest and reduced lung function--less volume of air 
exchanged with each breath. Based on EPA's estimate of the relationship 
between changes in forced expiratory volume (FEV) and various 
combinations of exercise levels and ozone concentrations, typical 
subjects experience less than a 5 percent loss in lung function even at 
the highest ozone levels recorded in the United States in 1996 (about 
twice the current standard).\1\ (See Figure 1.) Medical experts do not 
consider lung function decrements of 10 percent, or less, an adverse 
health effect. The primary concern, however, is for ozone's effects on 
asthmatics or others especially sensitive to a combination of high 
ozone levels and moderate to heavy exercise.
---------------------------------------------------------------------------
    \a}\Lung function is measured as the volume of air a subject can 
force from his/her lungs in 1 second.
    Source: Review of the National Air Quality Standard for Ozone 
Assessment of Scientific and Technical Information (Washington, DC.: 
U.S. EPA, Office of Air Quality Planning and Standards, June 1996), p. 
31.

[GRAPHIC] [TIFF OMITTED] T6586.001

    No one should minimize the trauma that a severe attack of asthma 
causes the asthmatic or his or her loved ones. The EPA staff report, 
however, estimates that for each one million persons exposed, we can 
expect just one to three more summertime respiratory hospital 
admissions a day for each 100 parts per billion increase in ozone 
levels.\2\ This is a very low incidence rate and a very high elevation 
in ozone levels. In a city of one million people, one to three added 
respiratory hospital admissions would be virtually undetectable. Such 
days would also be very rare even in cities with persistent ozone air 
quality problems.
    EPA has recently modified its risk assessments for ozone, resulting 
in less public health benefits expected from the proposed NAAQS. For 
example, the new risk assessment projects that attainment of the 
proposed standard would lower New York City asthmatic hospital 
admissions caused by ozone to 109 per year, from 139 under the current 
standard.\3\ That is a reduction of 30 hospital admissions, or one 
tenth of 1 percent of the 28,000 yearly asthmatic admissions. The 
previous estimate, contained in the Staff Paper, was that the standard 
would reduce yearly admissions by about 90.\4\
    The revised risk assessments, which were conducted for nine urban 
areas, lower the expected benefit of the proposed standard in terms of 
other health effects, as well, especially for children playing out of 
doors. For example, EPA had previously expected 600,000 fewer 
occurrences of decreased lung function (instances where the amount of 
air that can be rapidly exhaled in 1 second decline by more than 15 
percent) in children, but now projects just 282,000 such incidences. 
Anticipated improvements in episodes of moderate to severe chest pain 
in children were revised downward from 101,000 to 53,000, and the 
estimate for prevented cases of moderate to severe cough in children 
was lowered from 31,000 to 10,000.\5\
    EPA's NAAQS proposal is based on the previous risk assessments. 
Because the revisions are large (reducing the expected benefit by half 
or more for several health effects), the wisdom of the proposed tighter 
standard is further called into question.
    It is important to point out that, thus far, ozone has not been 
shown to cause premature mortality. The upper bound benefit estimate of 
$1.5 billion in EPA's Regulatory Impact Analysis of ozone, however, 
results almost entirely from the assumption that the proposed standard 
would save lives. This claim is unsubstantiated.
    I also would like to note that a separate secondary standard to 
protect plants and buildings hardly seems justified. First, ozone 
concentration data for rural areas is very limited. Second, incremental 
cost and benefit estimates for meeting the proposed SUM06 secondary 
standard versus meeting the current 0.12 ppm goal have not been 
included in the agency's Regulatory Impact Analysis. Surely, we do not 
need to focus substantial financial and human resources preparing 
implementation plans to protect primarily commercial crops with no idea 
whether the hypothetical benefits outweigh the costs.
                    the science on fine particulates
    Unlike the science on ozone's health effects, the science for fine 
particulates is not very developed and, thus, is plagued with 
uncertainties. EPA makes the claim that full attainment of the new fine 
particulate standard would result in between $69 billion and $144 
billion worth of health benefits.\6\ These predictions of extraordinary 
health benefits derive from estimates of reduced mortality from meeting 
a new fine particle standard. Whether the expected number of lives 
prolonged is 20,000, as stated by Administrator Browner when she 
testified before this subcommittee in February, or 15,000 as most 
recently predicted, or zero is hard to say given the paucity of 
scientific data supporting these projections.
    The mortality improvements expected from reduced levels of fine 
particles are based not on thousands or even hundreds of studies, as 
the agency casually infers, but, in essence, from just two studies. 
These studies purport to show an association between PM2.5 
levels and death due to cardiovascular and pulmonary causes together 
and also a link between PM2.5 and death.\7\ It is curious, 
to say the least, that the statistical link that has been demonstrated 
is between fine particles and cardiopulmonary deaths, and not deaths 
due to respiratory disease or lung cancer alone.\8\
    Perhaps it shouldn't be totally surprising that a fine particle-
mortality link has not been demonstrated where one might expect, 
because medical science has not yet discovered a biologically plausible 
mechanism to explain how fine particulates cause any deaths. Without 
knowing more about the mechanism through which particulates might 
affect human health, the observed association between premature 
mortality and fine particles cannot be considered tantamount to a 
cause-and-effect relationship.
    An additional scientific uncertainty with regard to these studies 
results from the problem of confounding. Confounding is a situation in 
which an observed association between an exposure and a health effect 
is influenced by other variables that also are associated with the 
exposure and affect the onset of the health effect. A variety of 
factors such as temperature, humidity, or the existence of other air 
pollutants may cause mortality rates to rise and fall with, and thus 
appear to be caused by, fine particulate concentrations.\9\
    Also, before regulating air pollutants simply on a basis of size, 
more research is needed to try to identify which components, if any, of 
fine particulate matter are producing the observed association--
ultrafine particles, nitrates, sulfates, metals, volatile (or 
``transient'') particles, and so forth. We know very little about 
transient particles, which form and disappear quickly, and, therefore, 
go undetected by filter monitors.
    Lack of air quality data for PM2.5 is another serious 
problem. EPA Administrator Browner testified that there are 51 
PM2.5 monitors collecting air quality data at present.\10\ 
The inference was that this is a large number; it is not. For example, 
in 1995 there were 972 monitors measuring ozone levels and 1,737 that 
collected data on PM10.\11\ For EPA to derive mortality 
estimates, PM2.5 concentrations had to be projected for many 
cities where monitoring data do not exist.
    Administrator Browner says the scientific evidence establishing the 
need for a fine-particle standard is ``compelling.'' I respectfully 
disagree. A convincing case for a new fine-particle standard has not 
been made.
    Epidemiological evidence is scant and indicates an association, not 
a cause-and-effect relationship. A toxicological explanation for the 
observed mortality and fine particle link has not been established. 
Exposure data are lacking due to the small number of monitors and this 
lack of data raises questions about the epidemiological studies. 
Setting a separate PM2.5 standard at this time could be 
another case of ``ready, fire, aim,'' as former EPA Administrator 
William Reilly once described past quick responses to perceived 
environmental problems.
    Let me shift gears and raise a more fundamental issue that thus far 
has been missing in the debate over the proposed ozone and particulate 
air quality standards. The Clean Air Scientific Advisory Committee 
hinted at this problem but perhaps its language was a bit too obtuse.
                    the clean air act's flawed goal
    As the members of this subcommittee are well aware, the Clean Air 
Act calls on the Environmental Protection Agency to establish and 
enforce air quality standards that protect public health with an 
adequate margin of safety. It proscribes the consideration of economic 
factors in this process. Economics may come into play only at the 
implementation phase.
    This is a very high-minded objective. Who but a Philistine could 
disagree with it?
    Well, nearly any economist might. In a world of scarce resources 
(the real world), people have to be concerned about balancing 
incremental benefits with incremental costs. Spending more on one 
activity than it brings about in added benefits means that resources 
aren't available to spend on other desirable activities that could 
produce more benefits than their costs.
    Theoretically, it might still be possible to protect public health 
with an adequate margin of safety and spend resources wisely, provided 
that the health-based standard can be set at a level where added health 
benefits equal or exceed added costs. Unfortunately, two factors are 
conspiring against this happy state.
    First of all, all health effects from air pollution can't be 
eliminated, at least not for ozone. Physical responses to ozone can be 
demonstrated at background levels--levels produced by natural 
processes. This is what the Clean Air Scientific Advisory Committee 
(CASAC) was trying to get across in its closure letter to Administrator 
Browner when it wrote:

          The Panel felt that the weight of the health effects evidence 
        indicates that there is no threshold concentration for the 
        onset of biological responses due to exposure to ozone above 
        background concentrations. Based on information now available, 
        it appears that ozone may elicit a continuum of biological 
        responses down to background concentrations. This means that 
        the paradigm of selecting a standard at the lowest-observable-
        effects-level and then providing an ``adequate margin of 
        safety'' is no longer possible.\12\

    In plain English, the prime directive of the Clean Air Act is 
``mission impossible,'' at least for ozone. Taken literally, the 
standard would have to be set at a level produced by natural emissions 
of ozone precursors. The cost of such an effort is incalculable and the 
goal unattainable.
    Second, the point where incremental costs equal benefits was 
crossed with respect to ozone with the passage of the 1990 Clean Air 
Act Amendments. The standard we are currently trying to meet is costing 
between $4 and $28 to produce $1 worth of benefits.\13\ A more 
restrictive standard, such as the one proposed, has to be an even worse 
tradeoff. Cost estimates from private economists and at the Council of 
Economic Advisers confirm this expectation.
    The Agency has presented some very modest figures for both benefits 
and costs in its Regulatory Impact Analysis (RIA). While the ozone 
standard being proposed was not specifically addressed in the RIA, its 
benefits should be bounded between $0 and $1.5 billion and its costs 
between $600 million and $2.5 billion, according to the impact 
analysis.\14\ This figure most likely represents only a small fraction 
of the real cost of full attainment, for a variety of reasons. For 
example, full costs of attainment were calculated for only one to three 
cities.
    Other estimates of costs and benefits are quite different, 
particularly on the cost side. Economist Susan Dudley predicts that 
full attainment of the current ozone standard will cost between $22 
billion and $53 billion a year. The proposed standard would add an 
additional $54 billion to $328 billion to the price tag, according to 
Dr. Dudley.\15\ Council of Economic Advisers member Alicia Munnell has 
projected added costs for meeting the new ozone standard of $60 billion 
a year.\16\
    EPA's Regulatory Impact Analysis for the fine particulate standard 
estimates an annual cost of $6 billion for partial attainment. Like 
EPA's cost estimate for the ozone standard, this figure is most likely 
far too low.\17\ EPA truncates costs at $1 billion per microgram 
(g) of fine particle reduction, although most areas would 
incur costs to lower particulates that are much higher than this cutoff 
figure.
    A sensitivity analysis performed for two cities, Denver and 
Philadelphia, demonstrates how quickly marginal cost rises above EPA's 
$1 billion/g cutoff. In Philadelphia, the $1 billion/g 
cutoff would result in a 20 percent reduction in 
PM2.5 concentration from the 2007 baseline. An additional 1 
percent reduction would result from a $2 billion/g cutoff, but 
the cost would double. The RIA reports similar results for Denver.\18\
                            recommendations
    EPA is not required to tighten the ozone standard or to create a 
new PM2.5 NAAQS. In the case of ozone, there is little 
evidence that a tighter standard will be more protective of those who 
are considered the sensitive population. For particulates, the science 
is not adequate to warrant a new PM2.5 standard. Certainly, 
CASAC members were of quite divergent opinions on how to set a 
PM2.5 standard. In her testimony, Administrator Browner made 
much ado about the fact that there was a consensus among CASAC members 
that a new PM2.5 NAAQS be established. It is also true, 
however, that there was ``no consensus on the level, averaging time, or 
form'' of the standard.\19\
    Indeed, on February 5, the chair of CASAC shared with this 
subcommittee just how tepid the support for the proposed fine particle 
standard was. Only two members of the 21-member CASAC endorsed a range 
for an annual PM2.5 standard as strict as 15 
g/m3 to 20 g/m3, yet EPA has 
proposed an annual limit of 15 g/m3. Eight of the 
members did not support any annual PM2.5 standard.\20\ (See 
Table 1.)
    Given the rather poor state of atmospheric and medical scientific 
knowledge of fine particles, it is difficult to see how setting a 
standard at this time will produce meaningful health benefits. Rather 
than press forward with a tighter air quality standard for ozone and a 
new standard for fine particles, EPA should appeal to Congress and The 
White House to revisit the Clean Air Act.
    Two basic reforms are required. First the fundamental objective of 
the Act needs to be changed from ``protecting the public health with an 
adequate margin of safety'' to ``protecting the public against 
unreasonable risk of important adverse health effects.'' Second, 
benefit-cost analyses should be required, not proscribed, when setting 
air quality standards.
    The American people expect their elected officials to protect them 
from air pollution that might significantly impair their health. They 
do not expect, however, that the costs of this protection will be so 
out of proportion to benefits that other desirable outcomes are forgone 
because economic resources have been applied too generously to this 
task.

 Table 1.--Summary of CASAC Panel Members Recommendations for an Annual 
                PM2.5 Standard (all units g/m3)                
------------------------------------------------------------------------
              Name                    Discipline         PM2.5 Annual   
------------------------------------------------------------------------
Ayres..........................  M.D................  yes2              
Hopke..........................  Atmospheric          20-30             
                                  Scientist.                            
Jacobson.......................  Plant Biologist....  yes2              
Koutrakis......................  Atmospheric          yes2,3,4          
                                  Scientist.                            
Larntz.........................  Statistician.......  25-305            
Legge..........................  Plant Biologist....  no                
Lippmann.......................  Health Expert......  15-20             
Mauderly.......................  Toxicologist.......  20                
McClellan......................  Toxicologist.......  no6               
Menzel.........................  Toxicologist.......  no                
Middleton......................  Atmostpheric         yes2,3            
                                  Scientist.                            
Pierson........................  Atmospheric          yes2,7            
                                  Scientist.                            
Price..........................  Atmospheric          yes8              
                                  Scientist/State                       
                                  Official.                             
Shy............................  Epidemiologist.....  15-20             
Samet1.........................  Epidemiologist.....  no                
Seigneur.......................  Atmospheric          no                
                                  Scientist.                            
Speizer1.......................  Epidemiologist.....  no                
Stolwijk.......................  Epidemiologist.....  25-305            
Utell..........................  M.D................  no                
White..........................  Atmospheric          20                
                                  Scientist.                            
Wolff..........................  Atmospheric          no                
                                  Scientist.                            
EPA Staff......................  ...................  12.5-20           
------------------------------------------------------------------------
Notes:                                                                  
1 Not present at meeting; recommendations based on written comments     
2 Declined to select a value or range                                   
3 Concerned upper range is too low based on national PM2.5/PM10 ratio   
4 Leans toward high end of staff recommended range                      
5 Desires equivalent stringency as present PM10 standards               
6 If EPA decides a PM2.5 NAAQS is required, the 24-hour and annual      
  standards should be 75 and 25 g/m3, respectively with a      
  robust form                                                           
7 Yes, but decision not based on epidemiological studies                
8 Low end of EPA's proposed range is inappropriate; desires levels      
  selected to include areas for which there is broad public and         
  technical agreement that they have PM2.5 pollution problems           
                                                                        
Source: CASAC Closure Letter on the Staff Paper for Particulate Matter, 
  June 13, 1996, docketed as EPA-SAB-CASAC-LTR-96-008,  Table 1.        

                                 notes
    1. Review of National Ambient Air Quality Standards for Ozone 
Assessment of Scientific and Technical Information OAQPS Staff Paper 
(Research Triangle Park, N.C.: U.S. EPA Office of Air Quality Planning 
and Standards, June 1996), p. 31.
    2. Ibid., p. 40.
    3. R.G. Whitfield, A Probabilistic Assessment of Health Risks 
Associated with Short-Term Exposure to Tropospheric Ozone: A Supplement 
(Argonne, Illinois: Argonne National Laboratory, contracted for U.S. 
Environmental Protection Agency, January 1997), Table 6.
    4. Ozone Staff Paper, p. 130.
    5. Memorandum, ``Supplemental Ozone Exposure and Health Risk 
Analyses,'' Harvey M. Richmond, EPA Risk and Exposure Assessment Group, 
to Karen Martin, EPA Health Effects and Standards Group, February 11, 
1997.
    6. Draft Document Regulatory Impact Analysis for Proposed 
Particulate Matter National Ambient Air Quality Standard (Research 
Triangle Park, N.C.: U.S. EPA Office of Air Quality Planning and 
Standards, December 1996), p. ES-20.
    7. Douglas Dockery, C. Arden Pope III, Xiping Xu, John D. Spengler, 
James H. Ware, Martha E. Fay, Benjamin G. Ferris, Jr., Frank E. 
Speizer, ``An Association Between Air Pollution and Mortality in Six 
U.S. Cities,'' New England Journal of Medicine, vol. 329, no. 24, 
December 9, 1993, pp. 1753-1759; C. Arden Pope III, Michael J. Thun, 
Mohan M. Namboodiri, Douglas W. Dockery, John S. Evans, Frank E. 
Speizer, Clark W. Heath, Jr., ``Particulate Air Pollution as a 
Predictor of Mortality in a Prospective Study of U.S. Adults,'' 
American Journal of Respiratory Critical Care Medicine, vol. 151, 1995, 
pp. 669-674. Technically, while both Dockery et al. and Pope et al. 
show a link between increased mortality and fine particle 
concentrations, Pope et al. is the basis for EPA projections of lives 
prolonged by attaining the proposed PM2.5 NAAQS.
    8. William M. Landau, Gregory Evans, Raymond Slavin, letter to EPA 
Docket A-95-54, commenting on the proposed PM2.5 NAAQS, 
March 7, 1997.
    9. Suresh H. Moolgavkar and E. Georg Luebeck, ``A Critical Review 
of the Evidence on Particulate Air Pollution and Mortality,'' 
Epidemiology, v. 7, n. 4, July 1996, pp. 420-428.
    10. Testimony of EPA Administrator Carol Browner before U.S. Senate 
Committee on Environment and Public Works, February 12, 1997.
    11. National Air Quality and Emissions Trends Report, 1995 
(Research Triangle Park, N.C.: U.S. EPA Office of Air Quality Planning 
and Standards, October 1996), p. 163.
    12. Clean Air Scientific Advisory Committee closure letter to EPA 
Administrator Carol Browner on the primary standard portion of the 
OAQPS Staff Paper for ozone (November 31, 1995), p. 2.
    13. Kenneth Chilton and Stephen Huebner, Has the Battle Against 
Urban Smog Become ``Mission Impossible?'' (St. Louis: Center for the 
Study of American Business, Policy Study 136, November 1996), p. 14.
    14. Regulatory Impact Analysis for Proposed Ozone National Ambient 
Air Quality Standard (Research Triangle Park, N.C.: U.S. EPA Office of 
Air Quality Planning and Standards Innovative Strategies and Economics 
Group, December 1996), p. ES-22.
    15. Susan E. Dudley, Comments on the U.S. Environmental Protection 
Agency's Proposed National Ambient Air Quality Standard for Ozone 
(prepared for the Regulatory Analysis Program, Center for the Study of 
Public Choice, George Mason University, March 12, 1997), p. ES-3.
    16. Memorandum from Alicia Munnell, Council of Economic Advisers, 
to Art Fraas, Office of Management and Budget, December 13, 1996.
    17. Thomas Hopkins, Can New Air Standards for Fine Particles Live 
Up to EPA Hopes? (St. Louis: Center for the Study of American Business, 
Policy Brief 180, April 1997), pp. 10-17.
    18. Regulatory Impact Analysis, p. 7.6.
    19. Clean Air Scientific Advisory Committee closure letter to EPA 
Administrator Carol Browner on the Staff Paper for Particulate Matter 
(June 13, 1996), p. 2.
    20. Ibid., Table 1.
                                 ______
                                 
      Testimony of Thomas B. Starr, Ph.D. and Principal, ENVIRON 
                       International Corporation
    Good morning. I very much appreciate the opportunity to testify 
before this Senate Subcommittee regarding the U.S. Environmental 
Protection Agency's (EPA) proposed new standards for particulate 
matter.
    My name is Thomas B. Starr. I am a Principal with ENVIRON 
International Corporation, a consulting firm headquartered in 
Arlington, Virginia, that specializes in health and environmental 
science issues related to chemical exposures, pharmaceuticals, medical 
devices, and food products, pesticides, and contaminants. My own 
consulting activities focus on the development and use of effective 
methods for incorporating scientific knowledge of toxic mechanisms into 
the quantitative risk assessment process. A brief biographical sketch 
is attached (Appendix A).
    The comments I offer today are drawn principally from two separate 
consulting projects in which we have performed a critical examination 
of the scientific evidence for potentially causal associations between 
particulate matter (PM) exposure and adverse human health effects. In 
the first project, undertaken on behalf of the American Petroleum 
Institute, three world-renowned epidemiologists, Drs. Raymond 
Greenberg, Provost and Vice-President for Academic Affairs, Medical 
University of South Carolina, Jack Mandel, Chairman, Department of 
Environmental and Occupational Health, School of Public Health, 
University of Minnesota, and Harris Pastides, Chairman, Department of 
Epidemiology and Biostatistics, from the School of Public Health at the 
University of Massachusetts, were brought together as an Expert Panel 
to independently and objectively assess the quality of the 
epidemiologic evidence for associations between PM exposure and 
increased human morbidity and mortality.
    In the second project, undertaken on behalf of Kennecott 
Corporation, an ENVIRON colleague, Dr. Larisa Rudenko, and I also 
evaluated the case for such causal associations, and, in addition, 
assessed the credibility of health benefits that EPA has projected 
would accrue from implementation of the proposed new PM standards.
    The final reports from these projects were submitted to EPA and are 
included along with my oral testimony for your information. My remarks 
today briefly summarize their findings; I refer you to the full reports 
for additional details.
    First, the issue of causality, or whether the effects observed are 
truly caused by the exposure to PM, specifically PM2.5, or 
some other component of air pollution or lifestyle. In assessing 
whether the results from epidemiologic studies support the existence of 
a causal relationship between exposure and disease, criteria developed 
initially by Bradford Hill (1965) are often applied. These include the 
strength, consistency, coherence, specificity, and temporality of the 
reported association. Although not explicitly stated, a presumption 
exists that the validity of the association has been established prior 
to consideration of these criteria. What this means is that the 
estimates of the association's strength have been shown to be free of 
significant biases and not significantly confounded. The Expert Panel 
of epidemiologists and our independent review both concluded that the 
studies of PM and disease do not satisfy these conditions; they have 
inadequately addressed potential biases and they have failed to resolve 
satisfactorily the issue of confounding.
    Even if the issue of validity were to be set aside, the Hill 
criteria would not be met. The reported associations are extremely weak 
and vacillate between positive and negative based on the specific 
regression model that has been used to characterize the dose-response 
relationship; as copollutants are introduced into the analyses, 
apparently positive associations attenuate in strength, often to non-
significance. Indeed, based on the criterion of strength of 
association, it is difficult to imagine a weaker case for causality 
than that posed by the data on PM and mortality or morbidity.
    Furthermore, the results of the studies are not actually as 
consistent as they might at first appear. For example, different 
exposure measures (e.g., mean daily level, maximum daily level, or some 
lagged estimate) have been associated with different endpoints (e.g., 
respiratory diseases, cardiovascular diseases, or total deaths). Also, 
temporal relationships between exposure variables and disease 
occurrence are not the same across studies, with lag times varying from 
concurrent day to several days earlier.
    In addition, a critically important component of coherence, namely, 
dose-response, is, at best, weakly established in only a few studies. 
In virtually all of the epidemiologic studies of PM, exposure levels 
have not been not based on personal dosimetry, but rather on stationary 
samplers located in specific geographic areas. Individual subjects were 
thus assigned ``community-wide'' measures of exposure, rather than 
individual measures. The lack of personal exposure measures limits the 
ability to conclude that any individual death is linked to air 
pollution per se. In fact, there is a large body of data indicating 
that community sampler measurements rarely provide good estimates of 
individual exposures.
    Even if a causal association were in fact to exist between PM 
exposure and disease occurrence at the individual level, such 
``ecological'' exposure estimates would likely misrepresent the 
association's true strength. Equally important, the shape of the 
underlying dose-response relationship would also likely be 
significantly distorted by ecologic analyses, with sharp threshold-like 
curves being smoothed into more nearly linear curves by exposure 
misclassification.
    Another major challenge to the case for causality relates to the 
nature of PM exposure, which invariably occurs in combination with 
exposure to other air pollutants such as ozone, carbon monoxide, 
SO2, H2SO4, metals, and volatile 
organics. Because this mixture's composition varies according to 
source, season, time of day, weather conditions, and geographic region, 
and because PM is itself a complex and highly variable mixture, it has 
been virtually impossible to disentangle the potential adverse health 
effects of PM, or a specific PM fraction, such as PM2.5, 
from those potentially attributable to other confounding copollutants.
    The question of whether the coarse and/or fine particulate 
components of air pollution are causally related to adverse human 
health effects is one of great importance. If there is a causal 
relationship, identification and establishment of a safe and acceptable 
level of ambient particulate matter will be a decision with enormous 
consequences. However, the severe methodological limitations of 
existing studies prevent a conclusive judgment about the causality of 
associations between PM exposure and adverse health effects at the 
present time. EPA's proposal for new PM standards is premature.
    There is an obvious need for new epidemiologic studies that collect 
data at the individual subject level. Carefully designed case-control 
studies can also be effective. It is especially important that future 
study designs be related to clearly articulated theories about the 
specific mechanistic pathways through which particulate air pollution 
may affect human health. To serve as a basis for regulatory 
decisionmaking, future epidemiologic studies will be most useful if 
they inform us about the specific manner in which individual air 
pollution constituents might affect human health. The current 
epidemiologic literature falls well short of this goal.
    The stated purpose for USEPA's proposed new PM standards is to:

          ``. . . provide increased protection against a wide range of 
        PM-related health effects, including premature mortality and 
        increased hospital admissions and emergency room visits 
        (primarily in the elderly and individuals with cardiopulmonary 
        disease); increased respiratory symptoms and disease (in 
        children and individuals with cardiopulmonary disease such as 
        asthma); decreased lung function (particularly in children and 
        individuals with asthma); and alterations in lung tissue and 
        structure and in respiratory tract defense mechanisms.'' (Fed 
        Reg 61:65638)

    How confident can we be that the proposed new PM standards will in 
fact lead to increased human health protection? The quantitative risk 
assessment conducted for EPA by Abt Associates, Inc. attempts to 
quantify the uncertainty inherent in the estimated health benefits from 
the new standards. This assessment is very thorough in its 
identification of many weaknesses in the underlying PM and health 
effects data, remarkably frank about its necessary reliance on numerous 
unproven assumptions, and surprisingly even-handed in its 
demonstrations, via multiple sensitivity and uncertainty analyses, that 
the health benefits projected from the proposed standards might well be 
greatly exaggerated.
    Significant limitations of EPA's benefit projections either noted 
in the Abt Associates, Inc. risk assessment are in our critique of it 
and include the following:

          Because correlation is not causation, the projections have 
        had to assume causation; thus, future reductions in specific PM 
        levels need not necessarily result in any material health 
        benefits. This has not been acknowledged explicitly.
          EPA's failure to account for the potential health effects due 
        to simultaneous exposure to PM, other pollutants, and related 
        weather variables almost certainly leads to substantial 
        overstatements of both the strength and statistical 
        significance of the apparent associations specifically with PM 
        exposure. This issue of confounding has been explored only to a 
        very limited extent, yet EPA has concluded that its benefit 
        estimates are robust to the inclusion or exclusion of 
        individual co-pollutants. This conclusion is at variance with 
        the findings of several reanalyses that considered multiple 
        confounding variables simultaneously. The discrepancy is almost 
        certainly due to the fact that EPA's sensitivity analyses 
        considered only ``one-at-a-time'' additions of individual co-
        pollutants instead of real-world multiple exposures. Thus, the 
        true benefits that result from compliance with the proposed new 
        PM standards may well be completely negligible.
          The benefit projections assume log-linear relationships 
        between PM exposure above natural background levels and various 
        adverse health outcomes. Because most days of the year have low 
        to mid-range levels of PM, the estimated health benefit over an 
        entire calendar year of daily PM exposures is dominated by the 
        contribution from the many days with low to moderate levels of 
        PM. This is precisely the exposure range for which the 
        empirically determined log-linear dose-response relationships 
        are most uncertain. The assumption of a log-linear no-threshold 
        dose-response relationship is not presently scientifically 
        justified; threshold-like alternatives cannot be ruled out.
          EPA's sensitivity analysis using different cut points (i.e., 
        thresholds) demonstrates the enormous impact that thresholds 
        can have on the projected benefits from proposed new standards. 
        High thresholds imply negligible health benefits. Nevertheless, 
        health benefits estimated with threshold-like dose-response 
        relationships play only a secondary role in EPA's benefits 
        assessment. They should instead be considered at least on an 
        equal footing with the benefits estimated with log-linear 
        models.
          EPA's regression models presume implicitly that the 
        independent variables are known without error. Yet actual PM 
        exposure levels are very poorly characterized and highly 
        uncertain. EPA has acknowledged that little regional monitoring 
        data, and virtually no personal exposure data, are available 
        for PM2.5 at the present time. Furthermore, recent 
        studies have shown that only weak correlations exist between 
        individual personal exposures and PM measures recorded by 
        regional monitoring stations. Uncertainty about the true values 
        of these variables, or errors in their measurement, leads to a 
        serious ``errors in variables'' problem that can only be 
        resolved with further prospective study involving adequate 
        simultaneous measurements of both individual PM exposures and 
        region-wide measures of air quality.

    Faced with such great uncertainty in the estimated magnitude of 
potential health impacts of the proposed new standards, it seems far 
more reasonable for EPA to initiate additional data collection and 
analysis activities on the health effects poten- 
tially associated with various PM fractions rather than rush to 
promulgate and implement new standards that could well make things 
worse rather than better.
    That completes my oral testimony. Thank you for your attention. I 
would be happy to answer any questions.
                                 ______
                                 
                               Appendix A
    Thomas B. Starr trained in theoretical physics at Hamilton College 
and the University of Wisconsin-Madison, receiving his Ph.D. in 1971. 
Following National Science Foundation postdoctoral and faculty 
appointments in the Institute for Environmental Studies at Wisconsin, 
he joined the staff of the Chemical Industry Institute of Toxicology in 
1981, first as a senior scientist in the Department of Epidemiology, 
and then in 1987 as Director of CIIT's Program on Risk Assessment. In 
1989, he joined ENVIRON International Corporation as a principal in the 
Health Sciences Division. His research interests have focused on means 
for explicitly incorporating knowledge of toxic mechanisms into the 
quantitative risk assessment process, and improving epidemiologic 
methods for assessing effects of chemical exposure on worker health. He 
has published over 80 scientific papers and abstracts, and given 
hundreds of scientific presentations.
    Dr. Starr holds an adjunct faculty appointment in the Department of 
Environmental Sciences and Engineering in the School of Public Health 
at the University of North Carolina-Chapel Hill. He has been appointed 
to numerous advisory posts, including the Halogenated Organics 
Subcommittee of the U.S. Environmental Protection Agency's Science 
Advisory Board, the North Carolina Academy of Sciences Air Toxics 
Panel, and the North Carolina Environmental Management Commission Ad 
Hoc Committee for Air Toxics. Currently, he serves on the Methylene 
Chloride Risk Characterization Science Committee, and the Secretary's 
Scientific Advisory Board on Toxic Air Pollutants for the North 
Carolina Department of Environmental Health and Natural Resources. He 
has testified before OSHA, EPA, and other regulatory agencies regarding 
human health risks posed by various chemical exposures, including those 
to 1,3-butadiene, cadmium, dioxin-like compounds, formaldehyde, lead, 
methylene chloride, and environmental tobacco smoke. He is also active 
in professional societies, including the American Statistical 
Association, the Society for Epidemiological Research, the Society for 
Risk Analysis, and the Society of Toxicology. In 1988-89 he served as 
the first President of the newly formed SOT Specialty Section on Risk 
Assessment, and in 1989-90 as President of the Research Triangle 
Chapter of the Society for Risk Analysis.
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 Prepared Statement of Susan E. Dudley, Vice President and Director of 
             Environmental Analysis, Economics Incorporated
    Good Morning. My name is Susan E. Dudley. I am Vice President and 
Director of Environmental Analysis at Economists Incorporated, a 
consulting firm in Washington, DC. I am pleased and honored to be here 
before you today to discuss the risk assessment underlying the 
Environmental Protection Agency's proposed national ambient air quality 
standard (NAAQS) for ozone.
    My understanding of the health and welfare risks of the proposed 
ozone NAAQS is based on an analysis of the proposed rule and its 
accompanying regulatory impact analysis (RIA) that I conducted for the 
Regulatory Analysis Program (RAP), a research and educational program 
at the Center for Study of Public Choice at George Mason University. 
RAP is dedicated to advancing knowledge of regulations and their 
impact. As part of its mission, the program produces careful and 
independent analysis of agency rulemaking proposals from the 
perspective of the public interest. I am grateful to Dr. Wendy Lee 
Gramm, the director of RAP, for her intellectual and financial support 
in the preparation of the comments submitted to EPA. RAP's comments on 
the proposed ozone NAAQS, and its accompanying comments on the 
particulate matter NAAQS \1\ are available on Economist Incorporated's 
web site: http://www.ei.com.
---------------------------------------------------------------------------
    \1\ Thomas D. Hopkins, Ph.D, Arthur J. Gosnell Professor of 
Economics, Rochester Institute of Technology prepared RAP's comments on 
the PM NAAQS.
---------------------------------------------------------------------------
    This morning, I would like to highlight some of our most important 
concerns with the risk assessment underlying EPA's ozone proposal.
1. There is little scientific basis for the selection of the standard
    EPA recognizes that the selection of the standard was a policy 
decision, rather than a scientific decision. EPA's science panel did 
not find the proposed standard to be significantly more protective of 
public health than the current standard, and most members who expressed 
an opinion preferred a level less stringent than that which EPA has 
proposed.
2. EPA's preamble and RIA suggest that the health and welfare benefits 
        expected from implementation of the proposal are small and 
        highly uncertain
    The effects of ozone on the general population appear to be 
transient, reversible, and generally asymptomatic. Even for the 
population at the greatest risk, those with pre-existing respiratory 
conditions, the expected impact of the proposed change in ozone levels 
is small. With full implementation of the rule, EPA predicts a 0.6 
percent decrease in hospital respiratory admissions for asthmatics. 
Furthermore, EPA's evidence from chronic animal studies suggests that 
long-term exposure to ozone does not affect lung function.
3. As a result of EPA's narrow interpretation of its mandate to protect 
        public health, this proposal may actually harm public health 
        and welfare
    EPA appears to focus on the impact of ozone on at-risk populations, 
particularly children with existing respiratory conditions such as 
asthma. While asthma is a disturbing health problem, particularly since 
(a) reported cases have been increasing in recent years (45 percent in 
the last decade), (b) one-third of its victims are children, and (c) it 
is most severe among the urban poor, this trend cannot be explained by 
ozone levels; air quality has been improving over the last decade and 
ozone levels in particular declined 6 percent between 1986 and 1995.\2\ 
Recently, the National Institute of Allergy and Infectious Diseases 
funded a study that revealed that ``the leading cause of asthma by far 
was . . . proteins in the droppings and carcasses of the German 
cockroach.'' \3\ The American Thoracic Society concluded:
---------------------------------------------------------------------------
    \2\ USEPA, National Air Quality and Emissions Trends Report, 1995.
    \3\ Chemically Speaking, July 1996.

          Poverty may be the No. 1 risk factor for asthma. . . . As 
        with many of the health problems facing society today, 
        education and prevention are the keys to controlling asthma in 
        the inner city.\4\
---------------------------------------------------------------------------
    \4\ American Thoracic Society, 1996 Conference Articles.

    Thus, even if asthma were the only public health issue of concern, 
the proposal may have a perverse effect on health. The potential impact 
on those afflicted with the disease is very small, and the costs of the 
rule will drain society's resources from more effective remedies.
    Perhaps even more disturbing is EPA's analysis (not presented as 
part of this rulemaking) that suggests that the proposed standard would 
increase health and welfare risks from ultra-violet radiation. Ground-
level ozone has the same beneficial screening effects on ultraviolet 
radiation as stratospheric ozone. Based on EPA analysis used to support 
earlier rulemakings to protect stratospheric ozone, it appears that the 
proposed 10 ppb change in the ozone standard could result in 25 to 50 
new melanoma-caused fatalities, 130 to 260 incidents of cutaneous 
melanoma, 2,000 to 11,000 new cases of nonmelanoma skin cancer, and 
13,000 to 28,000 new incidents of cataracts each year. These negative 
health effects of the proposal could vastly outweigh the positive 
health effects attributed to it in the RIA. By converting all health 
effects into a dollar metric, we estimate that attainment of the 
proposed standard could actually increase health risks by over $280 
million per year.
    When the costs of the proposal are considered, the negative impact 
on public health is even more dramatic. If, as recent studies suggest, 
poverty is a more important risk factor for asthma than air quality, 
the rule may well increase the very disease it is purportedly targeted 
at improving. Moreover, studies linking income and mortality suggest 
that the cost of this proposal would, by lowering incomes alone, result 
in an increase in 4,250 to 5,667 deaths per year.
                           executive summary
    The Regulatory Analysis Program offers the following conclusions 
and recommendations regarding EPA's proposed revision to the ozone 
National Ambient Air Quality Standard (NAAQS) and the accompanying 
Regulatory Impact Analysis (RIA).
A. The proposal will not improve public health and welfare
    EPA interprets the Clean Air Act to prohibit the consideration of 
costs in setting NAAQS. Even if one were to accept EPA's interpretation 
of its statute, EPA appears to have ignored important public health and 
welfare considerations.
    There is little scientific basis for the selection of the standard, 
and the health and welfare benefits attributed to the proposal are 
small and highly uncertain. Moreover, EPA has chosen not to consider 
important risk information relevant to public health and welfare, 
arguing that the statute only allows it to consider the negative 
impacts of chemicals, not their positive impacts.
    As a result, EPA's proposal may harm public health and welfare, 
regardless of cost. For example, the potential for a change in the 
ozone standard to increase people's exposure to ultraviolet radiation 
raises serious questions about the net health and welfare effects of 
this proposal. Taking into consideration the beneficial screening 
effects of ozone on ultraviolet radiation, we estimate that the impact 
of attaining the proposed standard would be to increase health risks by 
over $280 million per year. This is particularly disturbing in light of 
the enormous costs full attainment of this rule would impose on every 
aspect of our lives.
    When the costs of the proposal are considered, the negative impact 
on public health is even more dramatic. If, as recent studies suggest, 
poverty is a more important risk factor for asthma than air quality, 
the rule may well increase the very disease it is purportedly targeted 
at improving. Moreover, studies linking income and mortality suggest 
that the cost of this proposal would, by lowering incomes alone, result 
in an increase in 4,250 to 5,667 deaths per year.
    EPA has a responsibility for setting NAAQS that protect public 
health and welfare. To fulfill that responsibility it cannot ignore 
important health and welfare effects which can be readily, and 
reliably, quantified.
B. EPA's regulatory impact analysis does not provide an adequate basis 
        for making a sound policy judgment
    According to EPA's own RIA, the costs of the proposal will exceed 
the benefits. Furthermore, questionable assumptions and serious 
omissions in the RIA lead to an understatement of costs. EPA admits 
that ``aggregate total costs underestimate the true cost of each 
alternative to such an extent that the metric's reliability must be 
limited.'' EPA estimates the cost of only partially complying with the 
current and proposed standards. EPA does not include the costs of 
regional controls in its estimates of either the current or proposed 
ozone NAAQS. EPA also assumes that areas that can achieve ozone 
concentrations that are only 64 percent of the standard will incur no 
costs. As a result of these deficiencies, our analysis suggests that 
EPA's cost estimates reflect less than 5 percent of the true full costs 
of attainment.
    Modeling, exposure, and valuation constraints make EPA's benefit 
estimates very uncertain. CASAC observed that due to the compounded 
uncertainties in the approach to estimating welfare effects, ``small 
differences in benefits may have no significance . . .'' EPA places its 
best (i.e., most likely) estimate of the incremental health benefits of 
the proposed standard is at the low end of its range, between $11 
million and $108 million.
    According to EPA, more than 98 percent of its total estimated 
health benefits come from reduced mortality, not the other health 
benefits EPA relies on to support its proposal. However, this estimate 
of reduced fatalities is based on a single study that was not discussed 
in the criteria document or staff paper, and thus not reviewed by EPA's 
science advisory committee (CASAC).
C. The costs of the proposed standard are strikingly high
    Even after imposition of all feasible control measures, EPA 
anticipates a large degree of nonattainment. Without any change in the 
current NAAQS, EPA estimates that between 39 million and 57 million 
people will live in non-attainment areas for the foreseeable future. 
EPA expects an additional 14 million to 32 million people would live in 
non-attainment areas under the proposed revised standard.
    EPA estimates that partial attainment of the standard will cost 
billions of dollars each year and impose costs in excess of benefits on 
Americans of between $1.1 billion and $6.2 billion each year. These net 
costs are over and above EPA's estimates of the annual net costs of 
partially complying with the existing standard, which are also 
considerable--EPA estimates the costs of partially meeting the current 
standard will exceed benefits by between $400 million and $2.2 billion 
per year.
    The full costs of meeting this standard would be orders of 
magnitude higher than EPA's estimated costs of partial attainment. Our 
analysis suggests that the full cost of attaining the current standard 
will be between $22 billion and $53 billion per year. We estimate that 
the proposed standards will impose additional costs in the range of $54 
billion to $328 billion per year (1990 dollars).
D. Recommendations
    Based on our review and analysis of EPA's proposal, we offer the 
following recommendations.
            1. EPA should not proceed with promulgation of the proposed 
                    standard
    In light of EPA's science panel's conclusion that the proposed 
standard (level and number of exceedances) is not significantly more 
protective of public health than the alternatives examined, and the 
very real concern that implementation of this rule will actually harm 
public health and welfare, EPA should not proceed with its 
promulgation.
    There may be adequate basis for changing the averaging time and 
form of the standard. However, as EPA's own analysis suggests that the 
current level of the standard already imposes social costs (both in 
terms of health and welfare) that exceed its benefits, EPA should not 
select a level and number of exceedances that is more stringent than 
the current standard.
            2. More effective alternatives are available for addressing 
                    the potential ill effects of ozone
    Non-regulatory approaches are available to achieve the public 
health benefits targeted by this rule. As CASAC recommended in its 
November 30, 1995 closure letter on the primary standard, public health 
advisories and other targeted approaches may be an effective 
alternative to standard setting.

          Because there is no apparent threshold for responses and no 
        ``bright line'' in the risk assessment, a number of panel 
        members recommended that an expanded air pollution warning 
        system be initiated so that sensitive individuals can take 
        appropriate ``exposure avoidance'' behavior. Since many areas 
        of the country already have an infrastructure in place to 
        designate ``ozone action days'' when voluntary emission 
        reduction measures are put in place, this idea may be fairly 
        easy to implement.

    Furthermore, research and education are more likely to target what 
some public health experts regard as a more important factor behind the 
increasing incidence of asthma during a period in which ozone (and 
other pollutants) are declining--poverty and poor living conditions.
                            i. introduction
    Ozone is a gas that occurs naturally in the earth's troposphere and 
stratosphere. It is also created when sunlight reacts with nitrogen 
oxides (NOX), and volatile organic compounds (VOCs). 
Tropospheric (ground-level) ozone is the primary constituent of urban 
smog.
    Ozone levels are heavily influenced from year to year by 
meteorological conditions. EPA observes that the lowest national mean 
level of ozone was recorded in 1992, and the highest in 1988. After 
adjusting for meteorological effects, however, the year to year trend 
shows a continued improvement in ozone concentrations of about 1 
percent a year.\1\
---------------------------------------------------------------------------
    \1\ U.S. EPA National Air Quality and Emissions Trends Report, 
1995.
---------------------------------------------------------------------------
    Ozone is associated with respiratory problems, particularly in 
sensitive individuals. It is also credited with reducing the harmful 
effects of ultraviolet rays. Because it ``may reasonably be anticipated 
to endanger public health and welfare,'' ozone has been identified 
under the Clean Air Act as a ``criteria pollutant'' The U.S. 
Environmental Protection Agency (EPA) must periodically review and, as 
necessary, revise its National Ambient Air Quality Standards (NAAQS) 
for criteria pollutants.
    The CAA charges EPA with setting NAAQS that protect public health 
and welfare. In these comments,\2\ we examine whether EPA's December 
1996 proposed revision to the ozone NAAQS meets this mandate.
---------------------------------------------------------------------------
    \2\ These comments were prepared by Susan E. Dudley, Vice President 
and Director of Environmental Analysis at Economists Incorporated with 
support from the Regulatory Analysis Program at the Center for Study of 
Public Choice at George Mason University.
---------------------------------------------------------------------------
    The rest of our comments are organized as follows.
Section II--Review of EPA's Proposal
    We review EPA's statutory obligations, its interpretation of those 
obligations, and the factors EPA relied on in making its policy 
judgment regarding the appropriate standard to protect public health 
and welfare. This review suggests that because EPA bases its policy 
judgment on a narrow set of criteria, the resulting rule is likely to 
result in public health and welfare outcomes contrary to EPA's 
expressed intent.
Section III--Review of EPA's Regulatory Analysis
    EPA's own regulatory analysis, summarized in the first part of this 
section, concludes that the costs of implementing the proposed standard 
will exceed the benefits. In the second part of this section, we 
identify major flaws in EPA's analysis and present revised estimates of 
the benefits and costs of the proposal based on our own analysis.
Appendix A--Uncertainties in EPA's Analysis
    Due to the considerable uncertainty in the science associated with 
both ozone modeling and the health and welfare effects of different 
ozone levels, EPA's analysis necessarily involves numerous assumptions. 
This appendix reviews key uncertainties and assumptions.
Appendix B--Ozone's Impact on Ultraviolet Radiation
    Ozone in the troposphere, like ozone in the stratosphere, has the 
beneficial effect of screening ultraviolet radiation, which is known to 
have various health and welfare effects including melanoma and non-
melanoma skin cancer, cataracts, and crop and fishery damage. This 
appendix presents our analysis of the harmful public health and welfare 
impact that would be caused by the reduction in tropospheric ozone if 
this rule is implemented.
Appendix C--The Full Costs of Attainment
    EPA's estimates reflect only the cost of partial attainment. In 
this appendix, we present our analysis of the full costs based (1) on 
assumptions EPA uses in its analysis, and (2) on our revisions to EPA's 
estimates.
Appendix D--Control Measures to Achieve Partial Attainment
    This appendix reproduces EPA's Table C-1 from Appendix C of its 
Ozone NAAQS RIA. The table lists the control measures EPA expects to be 
used to achieve partial compliance with the current and proposed 
standards.
                                 ______
                                 
 Prepared Statement of Carl M. Shy, Department of Epidemiology, School 
     of Public health, University of North Carolina at Chapel Hill
  subject: epa's proposed air quality standard for particulate matter
    My name is Carl Shy. I was a member of the Panel on Particulate 
Matter of EPA's Clean Air Science Advisory Committee (CASAC), and am 
currently a professor of epidemiology in the University of North 
Carolina School of Public Health. Over the past 2 years, I was an 
invited participant and discussant in EPA's workshops on the health 
effects of particulate matter, and, as a panel member of CASAC, a 
reviewer of the various drafts of EPA's criteria document for 
particulate matter and of the staff papers recommending an air quality 
standard for particulates.
    I make this statement to urge the members of the U.S. Senate to 
support EPA's proposed revision of the air quality standard for 
particulate matter, and more specifically to support the proposal to 
establish a new standard for fine particulates, i.e., for particles 
less than 2.5 micrometers diameter (PM2.5). I agree with 
EPA's proposal that the PM2.5 standard be established at a 
concentration of 15 micrograms per meter cubed, annual average.
    I suggest that there are three compelling reasons for EPA to 
establish the air quality standard for PM2.5 as proposed:
    (1) There is ample evidence that there is a causal relationship 
between population exposure to fine particulates, at concentrations now 
existing in the air environment of many cities in the U.S., and excess 
mortality, hospital admissions, respiratory symptoms in adults and 
children, and decreases in lung function of children. I will expand on 
my reasons for stating that the evidence for a causal relationship is 
compelling.
    (2) Accepting the causal relationship between air particulates and 
excess mortality and morbidity in the population, the health burden of 
exposure to ambient air particulates at current levels in the U.S. is 
unacceptable, consisting of thousands of excess deaths, hospital 
admissions and respiratory disease episodes. This large health burden 
can be addressed by a concerted program to lower the concentration of 
ambient air particulates in those cities that exceed the proposed 
annual standard for PM2.5. This is an achievable goal, one 
that will have a major health benefit for a majority of the U.S. 
population.
    (3) The Clean Air Act of 1970, amended several times, requires the 
Administrator of EPA to establish national ambient air quality 
standards at a level that avoids unacceptable risks and protects public 
health with a margin of safety. The PM2.5 standard proposed 
by EPA, of 15 micrograms per cubic meter annual average, provides a 
minimally acceptable margin of safety against the mortality and 
morbidity risks noted above. A number of well conducted epidemiologic 
studies demonstrate an increase in mortality and morbidity when 
PM2.5 concentrations begin to exceed the proposed standard 
of 15 micrograms per cubic meter. In some cases, this excess mortality 
and morbidity is observed even when PM2.5 concentrations 
reach 16 micrograms per cubic meter, a level that is less than 10 
percent above the proposed standard. In the future, we may well find 
that the 15 microgram per cubic meter standard is not adequate to 
protect public health, but the proposed standard will at least move our 
country in the right direction of greatly minimizing the currently 
unacceptable health burden.
    Since the issue of the causal relationship between air particulates 
and mortality/morbidity of the population is crucial to the three 
points I am presenting in this statement, I would like to expand on my 
reasons for asserting that the causal relationship has been established 
to a degree sufficient to require EPA to propose the new standard for 
PM2.5. The criteria for causality I will briefly discuss are 
the same at those used by the Surgeon General of the U.S. in the 1965 
report on the adverse health effects of cigarette smoking. These 
criteria are widely accepted in the scientific community as reasonable 
guidelines for assessing causality in the matter of disease risks to 
populations. These criteria are:
    Consistency: Many studies, numbering more than 30, have observed a 
significant and meaningful relationship between population exposure to 
air particulates and excess mortality and morbidity (the latter being 
increased hospital admissions, increased respiratory symptoms, and 
decrease lung function in children). Many of these studies have been 
carefully scrutinized for potential sources of error, for confounding 
by weather factors and season of year, for limitations in statistical 
methods, and for inadequacies of measurement methods. None of these 
potential problems were found to diminish the consistently observed 
relationships between adverse health effects and particulate exposures. 
EPA's Criteria Document for Particulate Matter, which the CASAC 
carefully reviewed and approved, provides extensive discussion of these 
issues and reaches the conclusion that the evidence is fully compatible 
with a causal interpretation. In comparison with the 1987 major 
revision of the air quality standard for particulates, when a 
PM10 standard was established, we now have a much larger 
body of evidence regarding adverse health effects of particulate air 
pollution.
    Coherence: Among the more than 30 studies mentioned above, the same 
types of adverse health effects have been consistently observed. That 
is, the primary causes of excess deaths in mortality studies are deaths 
from heart and from lung diseases, and the primary causes of 
hospitalizations in morbidity studies are from diseases of the heart 
and lung. Other causes of death and hospital admissions do not show a 
consistent association with levels of air particulates. This agreement 
between the different types of studies strongly suggests a causal 
relationship, since the same disease endpoints are so consistently 
found when there is a common causal agent.
    Exposure-Response Gradient: As levels of air particulates 
increased, there was a proportional increase in mortality or in 
morbidity in the above studies. The importance of finding an exposure-
response gradient is that it becomes less and less likely that risk 
factors other than air pollution could explain the disease gradients. 
To do so, these other risk factors would also have to increase in 
nearly perfect step with changes in air quality, and there is no 
evidence that such risk factors exist, in spite of considerable effort 
to find them.
    Cause Precedes Effect: The excess in mortality and morbidity 
consistently occurs either on the day of the elevated air particulate 
concentration or 1 to 2 days after the elevated concentration occurs. 
There is no evidence that excess mortality and morbidity precedes days 
with higher air particulates.
    Strength of the Association: The relative increase in total 
mortality and morbidity associated with a 50 percent increase in air 
particulates is not large, being on the order of 5 to 10 percent above 
the mortality or morbidity observed on days with the lowest 
concentrations. From this point of view, the association between air 
particulates and mortality and morbidity is not nearly as strong as it 
is for tobacco smoking, excess alcohol consumption, or high fat diets. 
But, because a majority of the population is exposed on many days to 
air particulate concentrations above the proposed standard, the 
population burden of air particulate exposures is indeed large, with 
deaths and hospitalizations numbering in the several thousands during 
the course of 1 year. (Estimates range from 10,000 to 60,000 excess 
deaths alone, associated with days of higher air particulate levels in 
the U.S.)
    Biological Plausibility: This criterion is satisfied when there is 
experimental evidence that air particulates can cause the type of human 
health responses that would lead to excess mortality and morbidity. We 
do not have firm evidence to satisfy this criterion, in part because, 
when animals or humans were experimentally exposed to particulates, the 
experimenters were unable to reproduce in the laboratory the complex 
mixture of particulates in the ambient atmosphere. Recently, these 
complex mixtures have been introduced into experimental studies, and 
the researchers report that they found physiological changes in the 
exposed animals that may indeed be precursors of mortality and 
morbidity. Furthermore, there is ample evidence from older studies that 
air pollution at considerably higher levels than now exist were 
causally related to excess mortality and morbidity in humans. Thus it 
is entirely reasonable that similar effects, but at lesser magnitude, 
are occurring at current elevated concentrations.
    Specificity: This criterion requires that there be a unique 
relationship between exposure to the risk factor and the disease caused 
by this exposure, e.g., the nearly unique relationship that exists 
between asbestos exposure and mesothioloma of the lung. Very few causes 
of human disease manifest this unique relationship. Thus cigarettes 
cause lung cancer, but so do a number of chemicals that exist in the 
occupational environment. A lack of specificity does not argue against 
causality, nor does a lack of any one of the causal criteria negate the 
argument for causality, since each of these criteria are meant to serve 
as guidelines in making a judgment about a possible causal 
relationship.
    Confounding by Other Air Pollutants: This is not one of the 
criteria addressed in the Surgeon General's report on cigarette 
smoking, but it is an issue frequently discussed at scientific meetings 
on the health effects of air pollution, and it was discussed in some 
depth at the CASAC meetings. The concern boils down to the question: 
can we conclude that fine particulates, as indexed by PM2.5, 
are the causal agent responsible for the consistently observed excesses 
of mortality and morbidity? In my opinion, and in the opinion of other 
epidemiologists who are closely involved with research on the health 
effects of air pollution, the answer is, yes, it is reasonable to 
conclude that fine particulates, rather than any other regularly 
measured air pollutant, is our best measure of the causal agent. No 
other known air pollutant so consistently demonstrates an exposure-
response relationship with mortality and morbidity across the many 
different studies reported in the literature. Although there are cities 
in which gaseous air pollutants, such as sulfur dioxide and ozone, are 
sometimes highly correlated with fine particle concentrations (and thus 
prevent drawing conclusions as to the most likely causal component in 
the air pollution mixture), there are enough studies in which the other 
pollutants were either present in such low concentrations that adverse 
health effects from these levels would be unlikely, or there were 
studies in which the correlation between particles and other air 
pollutants was sufficiently small to enable the investigators to 
distinguish between the effects of the different pollutants. Moreover, 
there is sound biological evidence that fine and ultrafine particles 
penetrate deeply into the lung and produce an inflammatory response, 
whereas gaseous air pollutants do not reach the lower portions of the 
lung except by becoming attached to fine particles.
    There are many hazardous agents, often consisting of a complex of 
chemicals that cause significant human health risks, for which we do 
not know the precise causal component, but which we clearly know is 
part of the causal chain leading to harm. Several prominent examples of 
this can be cited, such as cigarette smoke and high fat diets. There 
are more than 200 chemicals in cigarette smoke, a number of which may 
cause lung cancer, chronic lung disease, and heart disease, but we do 
not know precisely which of these chemicals are actually the causal 
agent for these consequences. The relationship between fine 
particulates and excess mortality/morbidity is analogous to the 
smoking-health effects association. Fine particulates are the best 
single indicator of that component of the air pollution mixture 
consistently associated with excess mortality and morbidity. From this 
point of view, fine particulates are the causal agent, in the sense 
that they are a very useful and predictable marker for the complex of 
chemical and physical factors that are causing the unacceptable health 
consequences, just cigarettes are the causal agent for smoking-related 
deaths and disease. No other component of the air pollution mix is 
compatible with the diversity of findings on excess mortality and 
morbidity reported in the above studies.
    For all of the above reasons, EPA has made the argument that a 
causal interpretation for fine particulates is a reasonable one. If we 
fail to take action on reducing population exposure to fine 
particulates, as proposed by EPA, we run the significant risk of 
continuing to allow thousands of excess deaths and diseases, with all 
of the associated societal costs, that could otherwise be prevented. It 
is not reasonable to wait until advances are made in scientific 
knowledge to prove conclusively that fine particulates are or are not 
the specific causal agent. We have sufficient evidence that fine 
particulate are a part of the causal chain, and that reduction in fine 
particulate levels is an efficient strategy to interrupt this chain.
    Thank you for the opportunity to present this statement.
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    Responses by Morton Lippmann to Questions from Senator Lieberman
    Question 1. Some have contended that the effects of ozone are not 
that serious and that a temporary loss in lung function of 20 to 30 
percent is not really a health effect. Do you think this is true? How 
serious is a loss of 20 to 30 percent of lung function in asthmatics 
and other sensitive populations--the groups the Clean Air Act is 
intended to protect?
    Response. Many of the effects of ozone are quite serious. On page 5 
of my prepared remarks, I showed the pyramid of effects attributed to 
ozone in New York City. These range from the most serious, i.e., 
premature mortality, and hospital admissions for asthma and for other 
respiratory diseases. Somewhat less serious, but more prevalent effects 
include the asthma attacks and restricted activity days. Less serious 
effects include symptoms and modest changes in lung function (<20%) in 
healthy individuals. The diagram of effects did not include the 
respiratory function responses, which vary in seriousness between 
healthy individuals and those with chronic lung disease. In an 
individual with asthma or chronic obstructive pulmonary disease, a 20% 
decline in lung function can be quite serious, and lead directly to the 
need for increased medication usage, physician or clinic visits, and/or 
restricted activities.

    Question 2. An issue associated with the ozone standard is who 
responds and how much. Dr. Chilton used a figure (from p. 31--Ozone 
Staff Paper) in his testimony that shows relatively small lung function 
declines for varying ozone and exercise levels. Is this the most 
appropriate way to illustrate the typical distribution of lung function 
declines in ozone chamber studies?
    Response. The figure illustrating declines in lung function in 
relation to ozone concentration and level of exercise does not 
represent several important aspects of our current knowledge. First, it 
is based on two-hour exposures, and therefore does not depict what 
happens during the chamber exposures lasting 6.6 hours. The great 
increase in average response during successive hours is illustrated on 
p. 32. Second, it only shows the average response. It is well known 
that some individuals have essentially no response, while a significant 
portion of the population have much greater than average responses. 
These people must breathe the ambient air and need to be protected.

    Question 3. One of Ms. Dudley's arguments for not setting a tougher 
ozone standard is that while air pollution is dropping, the incidence 
of respiratory disease is increasing. If this is true, the argument 
might be, then air pollution is not causing respiratory disease. What 
is your response to this?
    Response. The incidence of asthma has indeed been rising. There is 
one recent report (Abbey, D.E. Presentation at 1997 Annual Conference 
of the Health Effects Institute) that indicates asthma incidence among 
Seventh Day Adventists in California was significantly associated with 
ozone. However, even if ozone was not associated with asthma incidence 
(new cases), it is well known that ozone is highly correlated with the 
frequency of asthma exacerbations. Thus, more asthma prevalence (from 
whatever causes) leads to more ozone exacerbations.

    Question 4. I think you've been clear in your testimony before this 
Committee that you believe the Administrator made a prudent public 
health decision with respect to both the particulate matter and ozone 
standards. I also think you have been clear that you do not support 
substituting a research program for the proposed particulate matter 
standard. Is this correct?
    Response. Yes. I see no good reason to delay the promulgation of 
the ozone and fine particle standards proposed by the EPA Administrator 
in November 1996. It is true that currently mandated reductions in 
SO2, NOX and hydrocarbons will bring down ozone 
and fine particle concentrations in future years, but are not likely to 
be optimally targeted to meet health protection goals based on 8 hr 
ozone and PM2.5 targets. It is only by having better targets 
that our health protection goals can be efficiently structured. At the 
same time, a minimum of $50 x 106 per year for targeted 
NAAQS research represents a wise investment decision for the creation 
of a much firmer data base for the difficult NAAQS decisions that will 
be needed early in the next decade.
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Prepared Statement of Mary Nichols, Assistant Administrator, Office of 
        Air and Radiation, U.S. Environmental Protection Agency
    Mr. Chairman, Members of the Subcommittee, thank you for inviting 
me to discuss the implementation efforts associated with the 
Environmental Protection Agency's (EPA's) proposed revisions to the 
national ambient air quality standards for particulate matter and 
ozone.
    For 26 years, the Clean Air Act has promised American adults and 
American children that they will be protected from the harmful effects 
of dirty air--based on best available science. Thus far, when you 
consider how the country has grown since the Act was first passed, it 
has been a tremendous success. Since 1970, while the U.S. population is 
up 28 percent, vehicle miles traveled are up 116 percent and the gross 
domestic product has expanded by 99 percent, emissions of the six major 
pollutants or their precursors have dropped by 29 percent.
    The Clinton Administration views protecting public health and the 
environment as one of its highest priorities. We have prided ourselves 
on protecting the most vulnerable among us--especially our children--
from the harmful effects of pollution. When it comes to the Clean Air 
Act, we take very seriously the responsibility the Congress gave us to 
set air quality standards that ``protect public health with an adequate 
margin of safety''--based on the best science available.
    The Clean Air Act requires EPA every 5 years to review national 
ambient air quality standards and, if necessary, revise them to reflect 
the best available science. This standard-setting process includes 
extensive scientific peer review from experts outside of EPA and the 
Federal Government. After 3\1/2\ years of scientific peer review and 
public involvement, based on our reading of the best available science, 
the Administrator has proposed new standards for particulate matter and 
ozone that we believe are required to protect the health of the 
American people.
    As you know, at this point we have only proposed revisions to the 
standards for these two pollutants. We take very seriously our 
obligation to carefully consider all public comments on these proposals 
before making a final decision. We have heard from small businesses, 
industry, State and local governments, Federal agencies, and other 
citizens like the elderly, children, doctors and people with asthma. 
While we have proposed specific levels for each pollutant, we have also 
asked for comment on a wide range of alternative options. We do not 
intend to make a final decision until we have carefully considered 
comments on all of those alternative options.
    Throughout the history of the Clean Air Act, national ambient air 
quality standards have been established based on an assessment of the 
science concerning the effects of air pollution on public health and 
welfare. Costs of meeting the standards and related factors have never 
been considered in setting the national ambient air quality standards 
themselves. This has been the case through six Presidential 
administrations and 14 Congresses, and has been reviewed by the courts. 
We believe this approach is appropriate.
    In choosing proposed levels for the ozone and particulate matter 
standards, EPA's focus has been entirely on health, risk, exposure and 
damage to the environment. Sensitive populations like children, the 
elderly and asthmatics deserve to be protected from the harmful effects 
of air pollution. And the American public deserves to know whether the 
air in its cities and counties is safe or not; that question should 
never be confused with the separate issues of how long it may take or 
how much it may cost to reduce pollution to safe levels. Indeed, to 
allow costs and related factors to influence the determination of what 
levels protect public health would be to mislead the American public in 
a very fundamental way.
    However, once we revise any air quality standard, it is both 
appropriate and, indeed, critical that we work with States, local 
governments, industry, Federal agencies, and others to develop the most 
cost-effective, common-sense strategies and programs possible to meet 
those new health standards. Under the Clean Air Act, States have 
primary responsibility for devising and enforcing implementation plans 
to meet the national air quality standards. We are determined to work 
with States and others to ensure a smooth transition from efforts to 
implement the current standards with efforts to implement any new 
standards. And we have been actively working to do just that.
    By 1995 it became apparent from the emerging body of science that 
we may have to propose revisions to one or both of the ozone or 
particulate matter national ambient air quality standards, as well as 
fulfill our obligations on developing a regional haze program. At that 
time we determined that the best way to meet the goal of developing 
common-sense implementation strategies was to bring in experts from 
around the Nation to provide us their advice and insights. As a result, 
we used the Federal Advisory Committee Act to establish a Subcommittee 
for Ozone, Particulate Matter and Regional Haze Implementation 
Programs. John Seitz, Director of my Of- 
fice of Air Quality Planning and Standards, co-chairs that 
Subcommittee, along with Alan Krupnick from Resources for the Future, 
Inc. The Subcommittee is composed of about 75 representatives from 
State and local government, industry, small business, environmental 
groups, other Federal agencies and other groups. It also includes five 
working groups comprised of another 100 or so members of these same 
kinds of organizations.
    The Subcommittee and the various workgroups have been meeting 
regularly for over 18 months to hammer out strategies for EPA and the 
States to consider in implementing any revised standards. Members from 
industry, State governments and others are putting forward position 
papers advocating innovative ways to meet air quality standards. It is 
our belief that results from this Subcommittee process are leading to 
innovative approaches for implementing any new standards. The 
Subcommittee will continue to meet over the next year to help develop 
cost-effective, common-sense implementation programs.
    The questions being addressed by the Subcommittee include:
     What will be the new deadlines for meeting any new 
standards? [If EPA tightens a standard, it has the authority to 
establish deadlines of up to 10 years--with the possibility of two 
additional 1-year extensions--beyond the date an area is designated 
``nonattainment.'']
     What will be the size of the area considered 
``nonattainment''? [If it revises an air quality standard, EPA has the 
ability to establish the size of the affected nonattainment areas and 
focus control efforts on those areas that are causing the pollution 
problems, not just the downwind areas that are monitoring unhealthy 
air.]
     How do we address the problem of the pollutants that form 
ozone and/or fine particles being transported hundreds of miles and 
contributing to nonattainment problems in downwind areas?
     What kinds of control strategies are appropriate for 
various nonattainment areas? Can we use the experience of the past 
several years to help States target those control strategies that are 
the most cost-effective?
     How can we promote innovative, market-based air pollution 
control strategies?
    The implementation of revised standards is likely to focus on 
sources like cars, trucks, buses, power plants and cleaner fuels. In 
some areas, as with the current standards, our analysis shows that 
reaching the standards will present substantial challenges. All of the 
air pollution control programs we are pursuing to meet the current 
ozone and particulate matter standards, as well as certain programs to 
implement other sections of the Clean Air Act, will help meet any 
revised standards. For example, the sulfur dioxide reductions achieved 
by the acid rain program will greatly reduce levels of fine particles, 
particularly in the eastern United States. Cleaner technology in power 
plants would greatly reduce the nitrogen oxides that help form ozone 
across the eastern United States.
    In announcing the proposed ozone and particulate matter standards 
last November, we initiated steps to obtain even broader views from 
stakeholders on implementation strategies. We expanded the membership 
of the Federal Advisory Subcommittee to include more representation 
from small business and local governments. Also, in conjunction with 
the Small Business Administration and the Office of Management and 
Budget, we are holding meetings with representatives of small 
businesses and local governments to obtain their input and views on how 
best to implement our proposed standards.
    We intend to announce our proposals on implementation of the 
proposed new standards in phases that correspond to the Subcommittee's 
schedule for deliberating on various aspects of the program. The 
Administrator has stated her intention to propose the first phase of 
the implementation program at the same time that we announce our final 
decision on revisions to the ozone and particulate matter standards.
    Mr. Chairman, this concludes my written statement. I will be happy 
to answer any questions that you might have.
                                 ______
                                 
   Prepared Statement of Benjamin Y. Cooper, Senior Vice president, 
                     Printing Industries of America
    Mr. Chairman and members of the Subcommittee on Clean Air, 
Wetlands, Private Property and Nuclear Safety, I want to thank you for 
the opportunity to testify on the proposed revision of the National 
Ambient Air Quality Standards for ozone and particulate matter. My name 
is Benjamin Y. Cooper. I am senior vice president for the Printing 
Industries of America. I appear before you today in behalf of PIA and 
the Small Business Legislative Council. The Printing Industries of 
America is the nation's largest graphic arts association with more than 
14,000 members. The Small Business Legislative Council is a permanent 
coalition of nearly 100 trade associations. This year, I have the 
privilege to serve as chairman of SBLC.
    The Printing Industries of America and I as the industry's 
representative have extensive experience working with the Environmental 
Protection Agency and State government on environmental matters. I have 
served as a member of EPA's Clean Air Act Advisory Committee since it 
was formed following the passage of the 1990 Amendments to the Act. I 
subsequently was appointed to the subcommittee charged with advising 
EPA on the implementation of the new standards. I have also been 
appointed to the Small Entity Caucus and the Small Entity Review Team 
at EPA to provide information on the impact of the implementation of 
the standards on small business. Further, the industry is one of EPA's 
Common Sense Initiative sectors and a partner in the Design for the 
Environment project. Finally, we have been involved for nearly 4 years 
with the Council of Great Lakes Governors and the Environmental Defense 
Fund in the Great Printers Project, a major pollution prevention 
project for our industry. The EPA has been a strong supporter of this 
project.
    In addition to these specific projects, PIA along with the National 
Federation of Independent Business and the American Furniture 
Manufacturers' Association lobbied successfully for the passage of the 
Small Business Technical Assistance Amendment to the 1990 Clean Air Act 
Amendments. This program known as the ``507'' program after the section 
of the Act has been enormously successful despite underfunding and has 
become a model for small business programs in other environmental 
legislation.
    My purpose in outlining these activities is to establish the fact 
that we are an industry which is working to support positive 
environmental actions. We are not alone. Many small business groups are 
working on similar projects. As you know, small business is uniquely 
tied to its community A good, sustainable environmental policy is 
critical to the future of these businesses.
    I want to address several issues connected to the NAAQS proposal, 
but I want to say at the outset that EPA and the Administrator have 
done a great deal to open communication with small business and to 
explore opportunities for alternative paths to compliance. While EPA's 
work with small business continues to have room for improvement, it is 
our opinion that EPA does more than any Federal agency in seeking the 
cooperation of small business. We meet regularly with senior officials 
at EPA on a variety of topics including regular meetings with Deputy 
Administrator Fred Hansen. Further, the EPA Small Business Ombudsman 
continues to provide a level of service to which all agencies should 
aspire. Now I wish to highlight our concerns with the proposed 
standards and their implementation plans:
                     the standard is not necessary
    We understand the Clean Air Act's requirements for a review of the 
scientific and health data and the need to make changes in the NAAQS 
when the data suggests a need to do so. What we do not understand is 
how a change can be suggested when the air is steadily improving and 
when the 1990 amendments to the Clean Air Act have not yet been fully 
implemented. In fact, significant portions of the Act have not been 
implemented. It would have been a genuine surprise if the health and 
science advisors to EPA had come back with a conclusion that there is 
no relationship between air pollutants and health. It is also an 
obvious conclusion to suggest that the cleaner the air the less adverse 
affect on health. It is quite a leap in logic to say that because of 
these conclusions, the entire nation has to undergo an extremely 
expensive regulatory adventure which may or may not achieve the desired 
results.
    There is an assumption that the Federal Government must set a 
standard for the nation--including its States and localities and its 
businesses or progress will stop. In fact, State, localities, small 
printing company owners and other small businesses believe we have as 
much as, if not a greater, stake in a clean environment than the 
Administrator. Printers work with State officials on a regular basis to 
develop programs to improve compliance where it is required or 
voluntary reductions of emissions where compliance is not required. The 
printing industry has cooperative projects in Illinois, Michigan, 
Minnesota, Wisconsin, Massachusetts, Florida, Ohio and Texas. Other 
States are examining similar opportunities. In virtually all of these 
instances, the vast majority of the companies participating in the 
programs are too small to be considered major sources under the current 
Clean Air Act or under State programs. Instead, these companies are 
seeking ways to reduce emissions of all types as good management 
practice. These are all actions which have been generated at the State 
level in full cooperation with the businesses in the States. In fact, 
with the exception of very large companies in our industry, regula- 
tion of printing companies is done at the State level. Our members 
would argue that the States are doing their job aggressively.
                       epa's data base is flawed
    EPA has based much of its activities to date and predicates future 
activities on an assessment of the emissions from various industries. 
For example, EPA estimates the volatile organic compounds released by 
the printing industry is approximately 101,000 tons, making printing 
the fifth largest source of VOC's among stationery sources. This data 
may be correct but neither we nor they could verify it. Their 
information is taken from models based on permits supplemented with 
other types of industry information; however, permits are not accurate. 
It is instructive to understand the real world of permits to understand 
this point.
    Permits are not issued based on what a company does but on what a 
company is capable of doing or what it might do under certain 
circumstances. Further, if the company hopes to get more business, it 
has to buy a bigger permit than it may currently need to accommodate 
the growth.
    One of the most contentious issues emerging from the Clean Air Act 
Amendments of 1990 was that emissions are based not on actual emissions 
but the potential to emit. To date, PTE as it is known has been 
calculated in most parts of the country as operating 24 hours per day 
throughout the year at full capacity. Clearly no one does this. 
Printing company owners probably dream of being able to use their 
equipment to full capacity. PTE can be modified if a company can prove 
through emission monitoring that their actual emissions are lower. 
Unfortunately, small business has difficulty coming up with such proof 
since monitoring emissions is very costly.
    The EPA is currently in the process of revising its rules on PTE 
and we believe the revisions will be satisfactory. However, the current 
figures issued by EPA are based on existing calculations. It is 
entirely possible that if EPA had the resources to study the emissions 
from the printing industry, they would find that we do not have the 
amount of emissions they project. In addition, in the printing 
industry, three types of sources are subject to Federal controls-
gravure, flexographic and large heatset web printing companies. The 
rest of the industry has an altogether different emission profile from 
these companies; therefore, conclusions drawn from one of the three 
printing processes with Federal standards do not apply to the rest of 
the industry. It is our understanding that other small business 
industries have similar problems.
           epa does not have adequate guidance for the states
    One of the long-standing issues between the printing industry and 
EPA has been the development and publication of control techniques 
guidelines (CTG). Twice in the past 17 years, EPA has begun a CTG 
project for the industry and twice has abandoned the project. In the 
first case, EPA completed a significant portion of the CTG, but stopped 
the project when industry objections to their conclusions reached a 
critical stage. Nevertheless, the draft-with its flaws-was released to 
the States.
    That draft CTG in the early 1980's created significant problems for 
us since States were regulating based on faulty conclusions. In the 
1990 Amendments, EPA was required to complete work on 12 CTG's. We were 
to have been one of these CTGs. However, despite completing most of the 
work, the document was never completed. EPA made available an 
Alternative Control Techniques document. Unfortunately, failure to 
complete the CTG left the industry without the kind of uniform guidance 
which would have resolved many difficulties at the State and local 
level. Issuance of a CTG by EPA means that the guidance described is 
used by the States whereas an ATC merely provides examples of 
processes.
    We are attempting to get this project back on track at EPA since 
consistent guidance would reduce regulatory costs for us and 
enforcement costs for the States and EPA. We have had recent meetings 
with EPA officials and we believe this matter may be finally be 
resolved.
    One of the major problems faced by EPA is having to make technical 
decision regarding U.S. industry. These industries are complex and must 
be thoroughly understood in order to issue good regulations. This is a 
time consuming and costly process but absent the process, industries 
such as printing are faced with regulations that do not make sense and 
do not improve air quality. EPA's problems are magnified when the 
industry is predominantly small businesses such as printing. It is 
clear that the agency should devote more of its resources to this level 
of activity well in advance of enforcement activities.
        small business will be hardest hit by the new standards
    We have heard that EPA plans to target certain industrial segments 
under the new NAAQS. Further, we have been lead to believe that if the 
emissions can be achieved from these sources, it will not be necessary 
to go after small sources. Unfortunately, life in the environmental 
regulation community does not work that way.
    EPA rarely regulates small business directly. Small business is 
subject to regulations by States and regions under State implementation 
plans or SIPS. These SIPS lay out the plan for reducing emissions 
through an area. Establishment of a SIP is often a political fight. 
Small business falls into the category known as area sources. 
Typically, a State must reduce a target amount from such area sources. 
This is often done by a percentage basis-telling all companies of a 
certain size to reduce by a specific percentages on an industry basis-
lowering the level at which companies in an industry must be permitted. 
At that point, the agency often issues control requirements known as 
Reasonably Available Control Technology. If the technology requirement 
is inappropriate, the industry in faced with a fight to change the 
proposal. This is done on an area by area basis. Emission reductions on 
area sources is a regulatory version of carpet bombing.
    While the problems on large businesses are no less onerous, they 
are generally armed with specialists to meet with the agency. Large 
sources may even have an opportunity to negotiate timetables or control 
strategies. Small business rarely has such help.
    It is also rare that small companies have the resources to 
implement the kind of controls required by the agency. Sometimes the 
control are add-on devices which in our industry can cost millions of 
dollars. Other times the requirements are ``process controls'' where 
the printer has to change the chemistry of the printing process. Some 
of these changes are practical; some are not. Government officials have 
proposed total enclosure of printing presses as a control option 
leaving the obvious difficulty of getting the press operator safely to 
the press. We have had process controls recommended which compromise 
the printing process itself. Often these controls are suggested in 
advance of thorough review. Often industry protests are ignored until 
substantial resources have been invested to produce counter arguments.
    From a purely political standpoint, it is often easier for a State 
agency to apply a general 10 percent emission reduction requirements on 
a large group of area sources than to apply a costly engineering 
control on one or a relative handful of very large sources. Often the 
small sources do not know what has hit them until the process is over.
    The development of the NAAQS standards is typical of what happens 
to small business. Many in the small business segment were caught by 
surprise at EPA's plans. While the printing industry has been 
represented at many of the meetings, there was very little small 
business representation until recently. It was only after the proposals 
had been issued and a good portion of the work of the implementation 
subcommittee had been finished that small business was invited to begin 
meeting with EPA. Fortunately, it may not be too late for small 
business to influence the process and EPA officials seem to be 
genuinely interested in our views.
            epa should provide a regulatory impact analysis
    We have been in an ongoing discussion with EPA about whether or not 
various laws apply to this proposed new standard and its 
implementation. Candidly, for most of us in small business, we cannot 
understand why an agency would not want to thoroughly gauge the impact 
of a regulation on small business. We have never understood why any arm 
of government would have to be forced by law to assess the harm that 
may result from an agency action. In the case of the current proposal, 
any delay or cost impact of the analysis would be more than offset by 
the positive results of such analysis.
    We recommend that EPA take this concept one step further by 
aggressively seeking ways to limit the adverse affect of the proposals 
on small business. Since the Act does not require EPA to include small 
sources in the Federal program, it could use the implementation 
strategy to develop clear alternative programs for small business.
            the implementation proposal may be too confusing
    EPA is reviewing various recommendations from the implementation 
subcommittee of the Clean Air Act Advisory Committee which would change 
areas to which the new standards would be applied. These new areas 
known as areas of influence and areas of violation would replace the 
current designations for non-attainment. We would urge careful 
consideration of the impact of these new areas on small busi- 
ness. While the current regime may not provide the ideal framework for 
dealing with every air emission problem, the business community-
including the small business community-understands attainment and non-
attainment. Whenever possible, we should avoid the implementation of 
new terms of bureaucratic management such as AOV's, AOI's, RAMP'S and 
RIP'S. These new terms would be in addition to SIPS.
     we thought the age of command and control regulation was over
    We keep hearing that the age of command and control regulation is 
over and yet we keep getting new commands. As I outlined above, the 
printing industry has involved itself in as many projects as EPA has 
offered. We want to participate, learn and improve; however, if this 
new standard goes into effect, I could not encourage our industry to 
engage in similar projects in the future. What is the point of working 
toward consensus on environmental issues when the final step in the 
process is to raise the bar? An argument could be made that an industry 
which waits for regulations rather than seek change may spend fewer 
resources in the long run. It would be ironic if the proposal by 
Administrator Browner had the effect of killing the projects which have 
marked her service at EPA.
                          what do we recommend
    1. We know that EPA must review the NAAQS periodically. If the 
Administrator is convinced that this standard is necessary, it should 
only be implemented when it is clear that the current standard is no 
longer achieving the desired results. One way of approaching the new 
proposal is to make it conditional subject to review after the full 
implementation of the current Act.
    2. At a minimum, a final decision on the proposed standard should 
be delayed until a full inventory of current emissions from industry 
has been developed and subjected to thorough review. Further, the 
standard seems to need additional scientific and medical review. 
Additional time would assure that such review can occur.
    3. EPA should be specifically required to conduct a thorough 
regulatory impact analysis. This standard has the potential to 
permanently drive manufacturing away from significant portions of the 
U.S. and make it virtually impossible for any inner city to attract 
manufacturing jobs. We do not believe this should be a burden to the 
agency but an opportunity.
    4. EPA should be required to fully implement the 1990 Clean Air Act 
amendments before embarking on a new regulatory plan. An example of 
this includes the 507 programs referenced above. While the full 
implementation of these programs is required under the Act as a 
condition of SIP approval, most States do not have adequate programs. 
Many States are cutting back on such programs due to the pressure from 
EPA for enforcement. Despite what we hear about the end of command and 
control, it is command and control that gets the funds while help and 
information get short-changed.
    5. Finally, EPA has an unprecedented opportunity to practice what 
it preaches. As we have said, there is nothing in the Act that requires 
EPA to regulate small business. In fact, as we have stated, most of the 
regulations on small business come at the State level under pressure 
from EPA. EPA has the power to provide incentives to the States to deal 
with small sources through technical and educational assistance. Under 
such a plan, States could be given credits toward their SIPS equal to 
the emissions contribution from area sources for properly implemented 
technical assistance programs. The reality is that neither EPA nor the 
States have the resources to follow through on command and control 
activities. The agency may be amazed to find that if you provide 
guidance and help, small companies may just do the right thing.
                                 ______
                                 
Prepared Statement of Pat Leyden, Deputy Executive Officer, South Coast 
                    Air Quality Management District
    Good morning Mr. Chairman and members of the Committee. It is a 
pleasure to be here. My name is Pat Leyden and I am a Deputy Executive 
Officer at the South Coast Air Quality Management District in Southern 
California.
    As the Senate considers the proposed new air pollution health 
standards, a number of important implementation issues warrant 
discussion. We need to understand:
     what types of sources are likely to be subject to 
additional clean-up requirements:
     how much time will be allowed to achieve the standards; 
and
     how can we accomplish our objectives with equity and at 
the lowest possible cost.
    I have had the honor of working for the District on air pollution 
abatement for the last 8 years. I am responsible for rules, permits, 
and enforcement for all of the stationary sources in our air basin. 
Much progress has been made; but, we still have the worst air quality 
in the Nation. Thus, my job involves a continuous effort to find the 
least painful path to clean air.
    Without apology--I can tell you that I have written and implemented 
some of the toughest command-and-control air pollution regulations in 
the world. But, I am also here to tell you that I think there is a 
better way.
    I'd like to take just a few moments and tell you about our success 
with the use of market-based strategies, such as emissions trading 
programs. In particular, I'll focus on our mass cap program, called 
RECLAIM. Then, I'll close with a few comments on the potential use of 
trading programs to achieve the proposed new health standards.
                               i. reclaim
    RECLAIM is the nation's largest multi-industry emissions trading 
program. RECLAIM stands for Regional Clean Air Incentives Market. Over 
330 of our largest pollution sources have a mass emissions facility cap 
that declines annually. The program covers facilities that emit four 
tons or more a year of either Nitrogen Oxide (NOX) or Sulfur 
Oxide (SOX). The types of industries included are: 
refineries, power plants, cement kilns, aerospace, food manufacturing, 
textiles, metal melting, hotels, and even amusement parks. Facilities 
under RECLAIM have the flexibility to choose the least expensive way to 
reduce emissions. If they reduce more than required, they can sell 
credits to other facilities. The program is mandatory and all 
reductions will be accomplished by the year 2003. RECLAIM replaced 32 
command-and-control rules. In both the NOX and 
SOX markets, these facilities will cut their emissions by 
almost two-thirds. (Note, the specific emissions reductions are: 73 
percent for the NOX market and 63 percent for the 
SOX market.)
    This type of commitment to reducing pollution did not come from a 
vacuum or simple good will. Dirty air, political resolve and the cost 
of command-and-control rules created the momentum. For 2 years, over a 
thousand individuals, companies, and organizations worked with the 
District, the State, and EPA to forge the regulations. It goes without 
saying that there were major battles along the way, over every detail 
from starting allocations to emissions monitoring. In the end, EPA, the 
Governor of California, and over 80 percent of the companies affected 
urged the adoption of the regulation.
    RECLAIM went into effect in January, 1994. After 3 years of 
implementation, the success of the program has exceeded our initial 
expectations. In brief, here is the report card.
     Actual emissions are a third lower than allocations. 
(Note: Use of historic emissions allowed companies an allocation 
slightly higher than actual emissions for the first 3 years. Some 
groups were concerned that this would result in an increase in 
pollution. This has not been the case.)
     Facility compliance is better than seen in many command 
and control rules. Actual Emissions are reported daily from 
computerized Continuous Emission Monitors for 85 percent of the market, 
smaller sources use non-resettable fuel meters. Public knowledge of 
total emissions is vastly superior to command-and-control. Compliance 
at the end of the first year was 87 percent, and rose to 92 percent at 
the end of the second year. Even higher compliance is anticipated at 
the end of the third year.
     Trading of excess emissions to support increases in 
production and plant modernization has exceeded expectations. To date, 
more than $33 million have been traded. The cost per ton of each 
pollutant is well below national averages for the cost of emissions 
control. (Note: The price of NOX, for the year 2000 and 
beyond ranges from $1,500 to $1,700/ton; for the same period the price 
of SOX is $2,000/ton.)
     Job loss attributed to RECLAIM has been dramatically lower 
than what was forecast for the command-and-control rules that it 
replaced. (Note: The job loss for the command-and-control rules was 
estimated at 2,013 jobs forgone annually. The RECLAIM job loss was less 
than 4 percent of the forecast in the first year, and less than 2 
percent in the second year.)
     Under RECLAIM, the cost of achieving emission reductions 
has been cut almost in half. The final story on actual costs won't be 
available until all emissions are reduced in the year 2003. However, 
based on the first 3 years of reductions, it appears that the initial 
estimate of an annual cost savings of 42 percent under-estimated 
reality. (Note: the command-and-control cost was estimated at $139 m/yr, 
compared to the RECLAIM estimated cost of $80 m/yr.)
    RECLAIM works. It not only works for the companies now in the 
program, it suggests that the power of emissions trading in the 
marketplace should be used to lower the costs of compliance for other 
companies as well. To this end, the District has adopted numerous rules 
for voluntary excess credits to be produced from mobile and area 
sources. These credits can currently be used by RECLAIM sources. The 
District hopes to be able to broaden their use to other sources.
    RECLAIM is a success story about reducing emissions from burning 
fuel. As the Senate assesses the new air pollution health standards, 
this consideration of what works is especially germane.
        ii. the new standards and additional emission reductions
    In many parts of the country, the new standard may require sources 
to meet emission limits similar to those in place in California. 
Control strategies will vary region by region, depending on the 
composition of each area's emissions inventory, and the severity of the 
non-attainment problem.
    The District's initial analysis of the proposed new standards leads 
to the conclusion that the driving force for additional emission 
reductions will come from the 2.5 particulate standard. After 2 years 
of inventory analysis, at a cost of $1.3 million, the South Coast Air 
Basin has some of the best data in the Nation on what sources 
contribute to the small particulate problem. Meeting the new standard 
will require additional emission reductions from fuel combustion 
sources. In our region, we estimate that an additional 35 percent 
reduction may be required.
    Our largest contributors are doing what is needed under RECLAIM. 
Additional reductions will need to be considered from other sources. 
High on the list of priorities will be diesel sources, including those 
regulated at the Federal level. A few examples are: ships, trains, 
planes, interstate trucks, and off-road construction and agricultural 
equipment.
    In addition, many small sources have protected status under the 
Clean Air Act, even though their emissions can be lowered by today's 
technology. Some examples include: refrigerators, stoves, and small 
internal combustion engines. Although individually small, these sources 
add up. It has been estimated that the emissions from small internal 
combustion engines is today greater than the largest power plant in our 
air basin.
    Our RECLAIM experience illustrates that compliance costs can be 
lowered when there are differential costs of control between sources in 
a market. The classic advice of economists is true. The market does 
incentivize the development and use of low-cost reductions. The 
procedures to verify emissions from fuel burning are now well-
established for most types of sources. This allows emission credits to 
be a blue chip investment in the marketplace.
                            iii. conclusions
    Members of the Committee, I'll close with a few summary 
observations.
    First, the South Coast Air Quality Management District supports the 
new standards. Our No. 1 request is for adequate time to achieve the 
new target. We cannot be held to our current deadline of the year 2010. 
Additional time will be needed.
    Second, trading programs are important tools to be used in 
implementing the proposed new standards. Trading programs are not a 
magic, painless potion. There are significant costs to cleaning our 
air. There will be hard tradeoffs as we push for cleaner fuels, 
equipment, and products. Trading programs do not decrease government's 
work in developing plans or rules, permitting sources, or assuring 
compliance. But, they do give businesses much greater flexibility and 
offer the promise of significantly lowering the price tag.
    For RECLAIM to have been adopted, a strong political will to clean 
up the air was required. For RECLAIM to be a success, a strong 
partnership was needed with business and the environmental community. 
The same will be true as the Senate considers the new standards.
    Mr. Chairman and members of the Committee, thank you for the 
opportunity to speak.
                                 ______
                                 
      Responses by Pat Leyden to Questions from Senator Lieberman
    Question 1. How has air quality in the SCAQMD improved since 1970? 
Why do you think SCAQMD was able to make good progress in cleaning up 
the air?
    Response. Past air quality programs have resulted in dramatic 
improvements in Basin air quality. In spite of the growth in population 
and vehicle miles traveled, ozone levels have been reduced in half over 
the past 30 years, sulfur dioxide and lead standards have been met, and 
other pollutant concentrations have significantly declined. And, for 
the first time in 1992, the Federal annual nitrogen dioxide standard 
was not exceeded in the Basin. However, the Basin still experiences 
exceedances of health-based standards for ozone, carbon monoxide, and 
particulate matter under ten microns (PM10).
    These dramatic improvements in Basin air quality are the direct 
result of a long-term comprehensive strategy to reduce emissions from 
stationary, mobile and area sources. This strategy included highly 
innovative and often the Nation's most stringent pollution control 
programs, such as conventional stationary source control programs, as 
well as new market-based programs such as RECLAIM (REgional CLean Air 
Incentives Market), mobile source tailpipe standards and reformulated 
gasoline, and consumer product regulations.
    Figures 1-1 through 1-4 demonstrate graphically the improvements in 
air quality over the last two decades. Figure 1-1 demonstrates the 
significant decrease in the number of days exceeding State and Federal 
ozone standards, health advisory and episode levels for the years 1976-
1996, while Figure 1-2 demonstrates the significant reduction of the 
maximum ozone concentrations recorded in the Basin for the years 1955-
1996. Figures 1-3 and 1-4 show the downward trend of the number of days 
exceeding the Federal standards, and State standards, respectively, for 
the years 1976-1996.
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    Question 2. From your experience, has industry developed 
new technologies that were not available at the time of 
enactment of air quality standards? What do you think the 
impact might have been if SCAQMD had waited before all 
technologies were available to set the standard?
    Response. This question can be answered by breaking it down 
into four other easy questions. First, is today's technology 
significantly cleaner than it was 27 years ago when the current 
Federal air standards were first adopted? Yes. Every major 
emissions category is both cleaner and more efficient. This is 
true for mobile sources (cars, trucks, and buses), volatile 
organic products (solvents, and coatings), and energy sources 
(boilers, turbines, and engines). The attached charts show 
advancements in these areas over the last 10 years or so.
    Second, did the health standards create demand for cleaner 
products? Yes. Over and over again the story has repeated 
itself. The incentive to reduce emissions by reformulating 
products and designing cleaner fuels and engines has 
consistently been driven by the public demand for clean air. 
Each step along this road was taken with intense debate over 
cost, technology and timing.
    Third, would today's clean air progress have been achieved 
if the health standards had been based on current technology? 
Hardly. In fact, mix 1970's technology with 1997's population, 
and the South Coast Air Basin would have air pollution like 
Mexico or Eastern Europe. The attached chart illustrates the 
dramatic reduction in emissions seen in a number of basic 
emission sources.
    Fourth and final question; are significant technology 
advances needed for most of the Nation to meet the proposed new 
standards? No. Although there are real costs associated with 
cleaner fuels and new equipment, most regions should be able to 
achieve the standards with the steady step-by-step application 
and advancement of known technology.
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    Question 3. What type of integrated strategies for PM and 
ozone has the AQMD developed?
    Response. Historically, the AQMD has proposed a 
comprehensive control plan to address all criteria pollutants. 
Since the 1989 Air Quality Management Plan (AQMP) and 
throughout its successive revisions (including the recently 
adopted 1997 AQMP), the AQMD has proposed an integrated 
strategy to achieve the air quality standards for both 
PM10 and ozone (as well as the other criteria 
pollutants). In designing a comprehensive plan to meet the 
ozone and PM standards, all feasible and cost-effective control 
measures are identified, with a focus on measures that reduce 
precursors of both ozone and PM10. For example, in 
determining the level of VOC vs. NOX controls for 
ozone attainment demonstration, the contribution of 
NOX emissions to the formation of PM10 
and PM2.5 in the air basin plays a significant role 
in determining the optimal level of NOX controls. 
This integrated approach leads to the most cost-effective path 
to clean air for all air quality standards. Control of other PM 
and its precursors, such as oxides of sulfur, elemental carbon, 
ammonia, and fugitive dust, are included in the overall control 
strategy for all criteria pollutants in this region. Tables 7-3 
and 7-6 from the 1997 AQMP (see attached) detail the integrated 
control strategy by measure and targeted pollutant(s).
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    Question 4. Does SCAQMD anticipate having to ban backyard 
barbecues as part of implementing the new standards?
    Response. There has never been any plan to ban backyard 
barbecues. There was, however, a rule adopted 7 years ago that 
required manufacturers of charcoal lighter fluid to reduce 
volatile compound emissions by 70 percent. The myth about this 
rule is almost humorous. All manufacturers had their products 
reformulated and on the shelves for sale within just a few 
months. There was never a pause in the joy of backyard 
barbecuing, or any discernible difference in price or 
performance. This rule was one of the easiest steps taken to 
eliminate four tons of pollution from the air on a daily basis.
                                ------                                

Prepared Statement of Beverly Hartsock, Deputy Director for Policy and 
 Regulatory Development, Texas Natural Resource Conservation Commission
    Good morning, Chairman Inhofe and members of the Subcommittee on 
Clean Air, Wetlands, Private Property, and Nuclear Safety of the 
Committee on Environment and Public Works. My name is Beverly Hartsock. 
I serve as the head of the Office of Policy and Regulatory Development 
of the Texas Natural Resource Conservation Commission (TNRCC). I am 
pleased to be here today to address the issue of implementing the 
proposed new national ambient air quality standards.
    As you are probably aware, there have been a significant number of 
concerns raised including some by former chairs of U.S. Environmental 
Protection Agency's (EPA) Clean Air Scientific Advisory Committee 
(CASAC) in their recent testimony before a congressional committee 
questioning the scientific basis of EPA's proposed new air standards 
for ozone and particulate matter. The lack of a clear scientific basis 
for the levels and forms of these proposals was reflected in CASAC's 
closure letters to EPA on both proposals. Based on this lack of a clear 
``bright line'' for either proposal and recent risk analysis 
information that indicates for some areas (Houston and Los Angeles) the 
current 1-hour ozone standard is more protective than the proposed 8 
hour standard, the TNRCC submitted comments supporting the retention of 
both the existing ozone and particulate matter standards until the 
science to support any changes is more definitive. Attached is a letter 
to Ms. Carol M. Browner, EPA Administrator, from Governor Bush 
addressing the recent national air quality proposals. Also attached are 
comments from the TNRCC to EPA on the proposed revisions to the ozone 
standards and the particulate matter standards.
    From a State regulator's standpoint, I think it's important to 
recognize that just adopting a new standard does not result in 
improving air quality. Programs must be developed to implement a new 
standard, and that's what my agency is expected to do. Someone must 
analyze current situations, understand as best possible what is causing 
problems that are detected, and design new programs to reduce those 
emissions that are significantly contributing to the problem. Those 
programs must maximize cost-effectiveness and sustainable development 
and must be phased in over a timeframe commensurate with minimizing 
excess cost and disruption. Progress achieved toward meeting the air 
quality goals established must be carefully monitored and analyzed so 
that mid-course corrections can be made based on actual results.
    This is not a unique set of planning activities. Many programs 
incorporate similar steps. What is unique about air pollution control 
is the number of emission sources, the chemistry involved in 
determining cause and effect, and the meteorological variation that is 
inherent in the earth's weather patterns.
    Chemical compounds are emitted into the air constantly from both 
man-made and natural sources. Some are harmless, some can be lethal. 
Typically, air contaminants are invisible to the naked eye. They 
evaporate off houses being painted, from car gas tanks being refilled, 
from inks drying on paper; they come from valves and pumps along piping 
in chemical plants, from stacks at power plants, from leaves of trees. 
These are but a few examples of the thousands of activities going on 
every day that generate air contaminants. To understand how to solve 
the problem of excess contaminants measured at a monitor site, we must 
understand not only what is being added to the air and where, but also 
take into account naturally occurring or background levels that in many 
areas are routinely 25 percent to 50 percent of the standard. Since we 
can't readily see the emissions, we must estimate what's happening. We 
require tests of emissions at large industrial plants, we require 
production records at small businesses, and we use formulas to guess 
how much is coming from cars, equipment use, consumer product use, and 
natural events. As you can imagine, this is an imprecise science at 
best, but we call it the development of an emissions inventory for an 
area. Gathering the data and performing necessary cal- 
culations are extremely time-consuming for businesses as well as State 
regulatory agencies, but are necessary. The emissions inventory is the 
basis for estimating how much reduction is needed to solve a problem 
and which types of activities are candidates for additional controls.
    But all this assumes that there is a problem that needs to be 
solved. Let's take a step back and look at how that is decided. Air 
contaminant monitor stations are dotted around the country. These 
stations are primarily focused in urban areas so we can know the 
quality of the air large concentrations of people are breathing. The 
stations are equipped with several different instruments since it takes 
different kinds of monitors to detect different kinds of pollutants. 
Thus, an ozone monitor only monitors for ozone and can't detect fine 
particulate matter or sulfur dioxide emissions. That requires 
installation of two additional monitors. The measurements made at these 
monitors are checked against the levels set by EPA as national 
standards. If monitored levels are higher than allowed, then the area 
is designated nonattainment. Nonattainment designation is a formal 
legal process including State proposals and EPA approval of designated 
areas. For each nonattainment area, a plan, called a State 
Implementation Plan, must be developed which identifies and enforceably 
commits the State to implement new controls on defined sources within 
established deadlines. Such controls can include vapor recovery at 
gasoline stations or marine terminals, incineration of process vent 
gases, use of low solvent inks, vehicle inspection and maintenance, 
etc.
    EPA has only set a handful of national standards but one of them 
has been particularly difficult to attain--ozone. It's a tough standard 
allowing as little as 4 hours of measurements over the standard in a 3-
year period of time. Many of the country's large urban areas, including 
four in Texas--Houston/Galveston, Dallas/Fort Worth, Beaumont/Port 
Arthur, and El Paso--have not yet met this standard. The new standard 
proposed by EPA is even more stringent. In Texas, cities like San 
Antonio, Austin, Corpus Christi, Longview/Marshall/Tyler, and Victoria 
would likely be declared nonattainment. Additional monitoring will be 
needed to determine the size of the new nonattainment areas, the amount 
of the chemical precursors in the air, and the amount of pollutant 
being transported into the area from neighboring areas. Planning and 
control program development for these new areas would also have to 
begin intensively if we are to meet the kind of time tables and 
deadlines set by the Clean Air Act and EPA. This effort will be costly 
and could easily serve to distract us from solving the most serious of 
our problems--the areas currently identified as nonattainment. It 
should also be noted that EPA has not proposed any funding to cover the 
costs.
    Adoption of standards for new pollutants such as EPA has proposed 
with the fine particulate matter standard brings with it even greater 
challenges for State air regulators. As I previously mentioned, each 
pollutant requires its own kind of monitor. We haven't had any 
PM2.5 monitors in the field since the mid-1980's. We're 
scrambling now to buy and begin operating some monitors, but it will be 
quite a while before we have the data we'll need to assess our status 
relative to the proposed new standard. EPA plans to allow States 3 
years to install and begin operating all the monitors. This is needed 
because of the high cost of monitoring--for Texas, we estimate $1.3 
million for fiscal year 1998, $1.8 million for fiscal year 1999, and 
$1.9 million for fiscal year 2000--and to allow equipment manufacturers 
and monitoring agencies time to prepare for this onslaught of new 
monitoring. Since more than 1 year of data will be needed to understand 
annual weather variability and to judge against the 3-year average 
basis that is the form of the proposed EPA standard, it will be from 3 
to 6 years before we have a really good feel for how many areas of the 
country have air quality that doesn't meet this proposed new national 
standard.
    Once we know where additional air quality improvements are needed, 
we have to understand the causes of the problem. Although there are 
many similarities among cities, each problem is somewhat unique and 
solutions will be dependent upon understanding the broad principles of 
air pollution and the factors unique to that area. One of the main 
reasons that solving our country's ozone problems has proven so 
difficult is that ozone is created in the air by a chemical combination 
of other pollutants. Trying to regulate this giant atmospheric 
chemistry lab that is occurring over each of our cities is taxing the 
limits of our scientific understanding. The variables are many and the 
solutions are complex. We cannot change how fast the wind blows or how 
much sunlight there is on a given day. Instead, we have to estimate how 
much emissions can be in the air from all sources--man-made or natural, 
industrial or personal activities--we have to assume the worst weather 
conditions--usually for my part of the country that means a series of 
hot, still days--and assess what emissions can be allowed without 
triggering enough of the chemical reactions to cause ozone to form at 
levels over the standard. Complex models have been designed to assist, 
but it often feels more like art than science when we try to perform 
these regulatory analyses. This type of analysis is very resource 
intensive and often frustrating, providing less than definitive 
answers. And keep in mind, the results of this work are the basis for 
requiring new control programs that can cost billions of dollars.
    We can look at the work that has been undertaken by the Ozone 
Transport Assessment Group (OTAG) as an example of the complexity of 
understanding ozone formation. OTAG has been studying air pollution 
transport over the 37 States in the eastern half of the U.S. for the 
last 2 years. The work has focused on identifying how much of the man-
made and natural emissions in one area are blown to another area and 
how this impacts high ozone levels monitored in the mid-west, northeast 
and Atlanta. Ozone is formed when volatile organic compounds and oxides 
of nitrogen react in the presence of sunlight. There are many man-made 
sources of each of these types of pollutants but naturally occurring 
sources (primarily trees) are also an important source of organic 
compounds and contribute significantly to the formation of ozone. The 
reactions that create ozone also reverse to breakdown ozone that has 
been formed, so understanding the concentrations of each type of 
pollutant as it is being blown from one area to another is significant. 
With the lack of rural monitors in most areas of the country, all these 
analyses are computer simulated projections based primarily on 
meteorological data and monitored data from urban areas. Needless to 
say, the results are open to a lot of debate. Millions of dollars have 
been spent in the OTAG effort, and only four high ozone episodes have 
been studied. It is reasonable to estimate that similar investments 
will be needed to study each of our problem areas.
    The proposed new fine particle standard will also require 
significant additional work. Once we know how much fine particulate 
matter is measured in each of our cities, we'll know if those cities 
are in attainment of the standard. But this is only the beginning of 
understanding what to do if they are not in attainment. We will also 
need to analyze the separate components of the particulate on the 
filters to know what chemicals are causing the problem. Knowing the 
chemical constituents of the fine particulate will help us to trace 
those chemicals back to their sources. This analysis will be crucial to 
understanding how to solve the problems, but just knowing chemical 
constituents doesn't completely define the controls needed. It tells 
you what types of sources are the biggest contributors to the problem. 
Analysis of possible control options can be targeted to these type 
sources. This additional chemical analysis of the particulate to 
determine its components further adds to the costs of the monitoring 
significantly. Further, these costs will continue beyond the initial 
startup as long as the particulate monitoring is needed. These 
monitoring and chemical analysis costs are in effect additional 
unfunded mandates on the States because EPA has not proposed adequate 
funding.
    Analysis must not only be directed at what is likely to be causing 
the problem but also to what can be changed that would help solve the 
problem. For example, knowing that organic compounds are naturally 
emitted by trees helps you to understand more about the atmospheric 
chemical reactions, but doesn't give you any information on how to 
solve the ozone problem. However, knowing that organic compounds that 
evaporate from oil-based paints are a part of the ozone formation 
process leads you to examine the feasibility for phasing out oil-based 
paints and replacing these with latex paints. This example also 
illustrates another part of the control program evaluation. Timing is a 
key ingredient to establishing a good control program. The phase-out of 
oil-based paints, if allowed to occur over a number of years and with a 
limited number of exceptions, can be a smooth transition to a more 
environmentally friendly and economically sustainable way of life. If 
done overnight or without necessary flexibility it can put companies 
out of business and leave citizens unable to satisfy their needs and 
unhappy with the inefficiency and ineffectiveness of government 
programs. Traditional controls have focused on large industry; new 
controls will have to focus more and more on small businesses. We must 
take all steps possible to minimize the negative effects on our small 
business community.
    The need to allow sufficient time to phase in controls is 
especially important when we look at programs to reduce emissions from 
the transportation sector--emissions that occur as we move ourselves or 
our products from place to place. Recently, I had the opportunity to 
listen to the EPA Office of Mobile Sources summarize their current and 
planned programs. Included were new car improvements like lower tail 
pipe emissions, on-board canisters to trap fueling emissions, and on-
board diagnostics to alert car owners of system failures that could 
increase emissions and impair efficient vehicle operation. Also 
discussed were improved diesel engines for construction and farm 
equipment, lower emitting locomotive engines, improved small engines 
for lawn and garden use, and cleaner burning diesel and gasoline fuels. 
All of these programs, most of which are required under the current 
Clean Air Act, have been set in place but will require several years 
for equipment replace- 
ment to realize actual benefits. In fact, EPA estimated that 
significant benefits from these programs would not be seen until 2000 
and the full benefits not realized until 2020. In order to maximize the 
use of these programs, we must be mindful to set timeframes for 
accomplishing our air quality goals that match the time needed to 
realize the reductions from these long-term programs.
    Timing is not just critical as it relates to the implementation of 
controls but also in proper planning. As noted earlier, it will be 
three to 6 years before we have good data on levels of fine particulate 
matter. Even for ozone where current data is much more complete, we 
will need to study rural levels of this pollutant to know what's being 
transported from one area to another. Analysis of the causes of the 
problems can be undertaken even as the monitoring data is being 
gathered. But once control measure options are identified, there must 
be a public process to decide the most appropriate controls to impose. 
This type of public process includes meetings and hearings with local 
planning organizations, citizens, affected businesses, and all levels 
of elected officials and government. Typically, these public processes 
take up to 18 months. After the best control options have been 
selected, time must be allowed for companies to install equipment, 
cities to make transportation system changes, and new products to be 
developed. The simplest of such controls can be implemented in 1 year; 
the more extensive industrial controls require up to 3 years for 
installation during process turnarounds. As previously discussed, 
transportation controls and new products can take up to 10 years or 
more to implement completely. After controls are in place, air must be 
monitored to see the results of these efforts. Depending on the 
standard, up to 3 years may be needed to measure the effects of new 
controls.
    The planning timeframes provided by the Clean Air Act and 
traditional EPA guidance documents typically allow only 5 years to 
accomplish all of the above activities. Our experience shows that 10 
years is a more reasonable planning cycle and that the more difficult 
air pollution. problem areas will take two or more planning cycles.
    Looking for new ways to do things and learning from our experiences 
will be particularly important if EPA adopts new or more stringent 
standards. EPA set up the Federal Clean Air Act Advisory Committee 
Subcommittee on Ozone, Particulate Matter and Regional Haze 
Implementation. The charge to this group of almost 80 representatives 
of business, government, environmental groups, and academia was to 
develop recommendations to EPA on how to smoothly transition from the 
current requirements to new approaches. The challenge is to not lose 
the momentum that we have built as we have made substantial 
improvements in air quality with existing programs. But, as so many 
have stated, traditional regulatory programs are unlikely to be able to 
meet the challenges of new higher standards or even to solve the 
persistent problems we already have identified. New approaches must be 
used to harness economic forces to work in concert with regulatory 
efforts to address environmental protection. New ideas such as 
identifying areas of violation and areas of influence must be explored 
rather than just expecting each nonattainment area to solve its own 
problems in isolation from all else going on around its geographic 
boundaries. We must also explore ways to provide incentives for areas 
to expand monitoring, to do early planning, and to implement controls 
voluntarily before they become required. Current law has clearly 
outlined negative consequences for failure to plan or implement 
programs but does little to provide incentives for early or voluntary 
action.
    In summary, there are five points regarding implementation of 
national air quality standards that I would like to leave with you. 
First, we do not believe that new national standards should be set 
until there is a firmer scientific basis. The recently released studies 
of health effects of ozone estimate fewer benefits from the proposed 
standard than previously thought. The particulate matter studies have 
raised as many questions as they have provided answers. Additional 
research is needed to target the cause of the particulate matter 
impacts on public health.
    Second, if new standards are adopted, extensive new work will be 
needed to implement them and it appears likely that there will be 
little additional funding from EPA. States do not need another unfunded 
mandate.
    Third, we should explore ways for air pollution planning to be a 
part of a city's urban planning whether or not new national standards 
are adopted that cause the city to be designated nonattainment. New 
approaches should build on voluntary action programs such as the 
Flexible Attainment Region approach being used in Tulsa, 
Longview/Marshall/Tyler, and Corpus Christi. Incentives for early 
planning, expanded monitoring, and voluntary or early reductions should 
be provided in EPA guidance and any new statutory revisions.
    Fourth, adequate time should be provided to allow areas to plan, 
implement controls, and measure the results of those controls. The 5-
year timeframes of Sec. 172 allow for planning and implementation but 
fail to recognize the need to monitor results and that some areas have 
inadequate data bases upon which to begin their planning. Longer term 
planning cycles should include mid-course corrections so that new 
information is used to improve imprecise predictions of growth and 
emissions changes that will theoretically occur in the future.
    Finally, adequate time must be provided to allow major trends such 
as those happening in the transportation sector to be a significant 
contributor to attaining national air quality goals. In order for the 
country to be able to afford all that is likely to be required to meet 
all of our air quality goals, we must allow time. Allowing time for 
market forces, technological development, and corporate economic 
planning will minimize costs of accomplishing the reductions and spread 
those costs as with other prudent investments in our future.
    Thank you for the opportunity to present these comments. I would be 
pleased to respond to any questions you might have or to provide 
additional information that you would like to assist you in your review 
of these issues.
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    Prepared Statement of Paul Kerkhoven, Director of Environmental 
                Affairs, American Highway Users Alliance
    Mr. Chairman and members of the subcommittee, thank you for the 
invitation to appear before you today to present our views on how the 
U.S. Environmental Protection Agency's (EPA) proposed new ozone and 
particulate matter standards would impact transportation and 
specifically the Congestion Mitigation & Air Quality program.
    I am Paul C. Kerkhoven, Director of Environmental Affairs at the 
American Highway Users Alliance. The Highway Users represent a broad 
cross-section of businesses and individuals who depend on safe and 
efficient highways to transport their families, customers, employees 
and products. We support the Clean Air Act and the health based 
scientifically sound standards that are its foundation as well as a 
strong Federal transportation policy and the prudent investment of 
scarce highway use taxes in those programs that enhance our economic 
productivity, improve roadway safety, and contribute to the enviable 
quality of life that Americans enjoy.
    I will begin today by noting the significant clean air 
accomplishments of the transportation community. I will then briefly 
outline current environmental requirements applicable to transportation 
programs and offer our perspective on the implementation of the 
proposed new national ambient air quality standards. I shall finish 
with some specific comments on the Congestion Mitigation & Air Quality 
(CMAQ) program.
                           air quality trends
    The transportation sector has played a major role in attaining the 
air quality goals realized by areas across the country. Since 1970, 
population in the U.S. has grown by 28 percent, production of goods and 
services has doubled, there are 60 percent percent more drivers driving 
80 percent more vehicles 116 percent more miles. Yet, carbon monoxide 
emissions from highway vehicles have been reduced by one third and 
volatile organic carbon emissions have been cut in half.
    Even today's cleaner reformulated gasoline for California is so 
effective it's almost like taking 3.5 million cars of the road--twice 
as many cars as are registered in Oregon. Today's cars have achieved a 
95 percent reduction in tailpipe emissions since the 1960's. As a 
result, it would take 20 of today's new cars to produce as much 
tailpipe pollution as only one new car did 30 years ago. Automobile 
related air pollution is well on its way to being a thing of the past.
    Those reduced motor vehicle emissions have been a major 
contributing factor in the air quality improvements realized 
nationwide. According to EPA data, ambient concentrations of the six 
major air pollutants have decreased almost 30 percent since 1970. As a 
result, every major city and urban area is making significant progress 
toward meeting the National Ambient Air Quality Standards. In fact, if 
we look at the most recent data only 40 some areas would be in 
violation of meeting the ozone standard. I expect reduced mobile source 
emissions to continue contributing to improved air quality well into 
the next century.
    Yet, the EPA continues to downplay these results and argues that 
emissions from automobiles will begin to rise again by the year 2005 
because of a projected steady increase in vehicle miles of travel. It 
should be noted that the agency has been projecting an increase in 
vehicle emissions since the early 1980's, and notice the results. The 
EPA therefore advocates strict policies to control the growth of 
vehicle miles traveled. It does this by enforcing transportation 
control measures (TCMs) that discourage automobile use and advocating 
higher funding for the CMAQ program to implement these TCMs.
    A fundamental individual freedom, the freedom of mobility, is at 
stake whenever the government proposes to restrict Americans' ability 
to choose where, when, and how to travel. There may be times when such 
restrictions are necessary, but those decisions should be made by our 
elected representatives and not by the subterfuge of a bureaucratic 
rulemaking procedure. An additional 94 million people living in at 
least 520 counties will be subject to programs designed to limit the 
use of their motor vehicles if the proposed new air quality standards 
are approved. This estimate is based on EPA figures. Estimates by 
others suggest that the additional number of people affected could be 
significantly higher than 94 million.
    Such constraints on motor vehicle use not only restrict personal 
mobility but they can be a serious obstacle to economic growth and 
productivity increases. In addition, transportation control measures 
have proven to be substantially less effective at reducing mobile 
source emissions than have technological solutions such as cleaner 
burning fuels and cleaner running cars. By every measure, these 
technological improvements have also been significantly more cost 
effective than programs intended to change travel behavior.
                     transportation and air quality
    The aim of the Clean Air Act is to bring all U.S. areas into 
compliance with current air quality standards. The Clean Air Act also 
requires that State and local transportation improvement plans 
contribute to a reduction in pollutants. ISTEA complements the Clean 
Air Act by giving increased decisionmaking power to metropolitan 
planning organizations (MPO's) regarding the expenditure of Federal 
transportation dollars. ISTEA also gives these communities authority to 
use Federal highway funds for mass transit, air quality enhancements 
and other non-highway projects.
    The Clean Air Act's largest challenge, however, is the requirement 
that State and regional transportation improvement plans in 
nonattainment and maintenance areas ``conform'' to State implementation 
plans. The State implementation plan includes an estimate of emissions 
from all sources including cars and trucks (mobile sources) and the 
amount of reductions necessary in each category to meet the standards. 
If actual vehicle emissions exceed the estimate in the State 
implementation plan, the transportation plan or the State 
implementation plan must be modified. If the State fails to modify its 
transportation plan or State implementation plan appropriately, Federal 
highway funds will be withheld. This is the ``stick'' that forces State 
and local officials to craft transportation plans which include the 
right mix of projects to reduce emissions.
                 proposed standards and transportation
    The EPA proposed implementation policy which accompanies the new 
air quality proposal, states that the current conformity determination 
process will continue until State implementation plans that address the 
new standard are approved by the EPA. Depending on the standard finally 
chosen, we believe that at least 520 counties across the Nation could 
be placed in nonattainment status for at least one of the requirements 
proposed. We question whether the current model-intensive conformity 
process will still be meaningful with much larger non-attainment areas. 
For example, to make a conformity determination in rural areas will be 
a senseless and cumbersome exercise because in virtually all cases 
there are few, if any, transportation alternatives.
    Changing direction in mid-course may significantly delay or run 
counter to efforts underway to assure reasonable further progress in 
attaining air quality standards. This will be extremely confusing for 
State and local officials and the general public.
    The substantial expansion of non-attainment areas may well require 
an expansion of the transportation demand models that have experienced 
budget shortfalls and are still part of the learning curve for local, 
State and Federal officials involved in traffic data processing. The 
proposals will likely result in tighter emission budgets and make 
conformity an even more challenging process. The proposals do not 
address the cost and effectiveness of the transportation control 
measures and these may be the most costly elements of further emission 
reduction efforts.
    The impact of highway funding sanctions could also affect much 
larger areas. We do not know if the inability of some areas to develop 
plans showing that they can attain the standard will lead to more 
frequent imposition of highway funding sanctions. Does the EPA intend 
to impose highway funding sanctions on the 8-20 residual nonattainment 
areas in its partial attainment scenario? Loss of highway funding, 
ironically, can delay highway projects that improve traffic flow and 
reduce emissions. Thus, the application of highway funding sanctions by 
the EPA can exacerbate air pollution problems that the sanctions are 
intended to help solve.
    Transportation is a big part of the economic development equation. 
Highway improvements, including projects to expand capacity and reduce 
congestion, should be expedited, not burdened with new regulatory 
hoops.
                transportation control measures and cmaq
    Congress established the Congestion Mitigation and Air Quality 
Improvement Program in ISTEA primarily to help State and local 
governments meet the cost of implementing the transportation control 
measures required by the Clean Air Act. CMAQ funds--$1 billion per year 
apportioned to the States from the Highway Trust Fund--can be used for 
all but two of the TCMs listed in the Clean Air Act, plus any TCMs 
included in a State implementation plan approved by the Environmental 
Protection Agency and any projects approved by both the Federal Highway 
Administration and the Federal Transit Administration in consultation 
with the EPA.
    First and foremost, we oppose setting aside a billion dollars of 
highway funds each year exclusively to meet costs imposed on State and 
local governments by the Clean Air Act. Those air quality projects may 
or may not be a top transportation priority in a given area. By setting 
aside highway funds exclusively for such projects, Congress places a 
higher priority on them than on other transportation projects, such as 
safety improvements or additional highway capacity needed for economic 
development. We think those decisions should be made by State and local 
officials who know best what their top local transportation priorities 
are.
    A quick review of individual projects funded with CMAQ dollars over 
the first 4+ years of ISTEA yields some examples that would raise 
questions about the wise use of highway taxes. To illustrate this 
point, I picked a few projects financed with CMAQ funds in States 
across the country. This is not intended to be an inclusive list. I 
could have added many more.
     $933,000--Purchase 210 bus radios at a total cost of 
$1,165,920. The Federal (CMAQ) share was $933,000 or $4,442 per radio
     $67,000--Develop a golf cart transportation program
     $5,890,000--Construct an esplanade and ferry pier
     $146,000--Supplement transit fare-box revenues
    While I am not familiar with any of these individual projects, I 
don't doubt that they have benefited, and are appreciated by, certain 
local citizen groups. One wonders, however, how they compare in 
priority with any of the myriad safety or highway capacity needs faced 
by State and local officials. We won't ever know the answer to that 
question because those officials weren't allowed to spend CMAQ dollars 
on safety or capacity improvements.
    Again, Mr. Chairman, many of these projects may be a high priority 
and have a salutary impact on the local economy. Unfortunately, we 
cannot truly gauge the priority of these or other CMAQ-funded projects 
relative to traditional road improvements because State and local 
officials are not allowed to weigh the CMAQ-eligible projects against 
other local projects to improve mobility or safety. ISTEA doesn't give 
them a choice. They must either spend or lose their CMAQ funds on the 
limited array of EPA-approved projects.
    Mr. Chairman, the Highway Users supports efforts to eliminate the 
separate CMAQ funding category. Instead of the current CMAQ set-aside, 
we would make air quality and congestion mitigation projects eligible 
for funding under a streamlined Surface Transportation Program (STP).
    We do not support the assertion that State transportation officials 
will not consider or implement TCM's in their transportation plans if 
they do not have a specific set-aside for them. It is not the CMAQ 
program that drives these requirements. The Clean Air Act mandates that 
State transportation officials give priority consideration to TCM's in 
their clean air plans, and if attainment goals are not reached, the 
State faces highway funding sanctions. What greater incentive is there? 
America's motorists should be able to count on their highway taxes 
being used for road improvements, and State and local transportation 
officials should have greater authority to set their own transportation 
priorities.
                            cmaq and nextea
    We have several concerns with the CMAQ proposals contained in the 
Administration's ``National Economic Crossroads Transportation 
Efficiency Act'' (NEXTEA), recently introduced by Senators Chafee and 
Moynihan. We do not support the ``Hold Harmless'' provision for CMAQ 
funding, nor do we support the proposal that when a State submits its 
new SIP the CMAQ funding increase is triggered. Both provisions expend 
CMAQ funding at the expense of the more flexible STP account.
    As an alternative to the set-aside, it seems quite logical for the 
Congress to repeal CMAQ in its entirety and allow States to utilize any 
and all funding from the STP program to achieve the Clean Air Act 
goals. More of the areas that could be facing nonconformity 
determinations would be able to tailor their transportation programs to 
meet their specific circumstances.
    If the Congress chooses to retain a separate CMAQ account, we do 
support the Administration's proposal to make eligible for CMAQ funding 
two of the TCMs that show great promise for improving air quality: the 
reduction of vehicle emission during periods of cold-start conditions, 
and measures that encourage the owners of pre 1980 model year high-
emitting cars and light-duty trucks to voluntarily remove them from the 
road. These TCMs are listed in the Clean Air Act but were excluded from 
the list of TCMs made eligible for CMAQ funding in ISTEA.
    In addition, ``congestion mitigation'' projects should be eligible 
for any continued CMAQ program. Most projects currently funded with 
CMAQ dollars are air quality projects. Congestion mitigation projects, 
such as those that increase the capacity for single occupant vehicles 
in ozone and CO non attainment areas, are not currently eligible for 
CMAQ funds. For example, freeway interchanges with insufficient merge 
lanes or other capacity problems are frequently traffic choke points. 
Yet, improve- 
ments to those intersections that would ease the flow of traffic are 
generally ineligible for CMAQ funding because they create additional 
capacity for single occupant vehicles. Congress should correct this 
problem to help alleviate congestion in any renewed CMAQ program.
                               conclusion
    Mr. Chairman, improving air quality is an important national goal 
and the transportation sector of our economy certainly has a role to 
play. Our central points are as follows: current and emerging 
technologies will ensure the continuing decline of mobile source 
emissions without the new air quality standards. We should not burden 
vast areas of the country with new regulatory hoops the proposed 
standard changes will create. The transportation control measures 
needed to meet the new standards could cause significant economic 
hardship and will--echoing comments of the U.S. Department of 
Transportation--require lifestyle changes by a significant part of the 
U.S. population.
    Finally, the Clean Air Act gives transportation officials strong 
incentives to make air quality projects a top priority. We urge 
Congress to give those officials a truly flexible Surface 
Transportation Program account that will allow them to weigh all their 
local transportation needs, including air quality improvements, when 
establishing funding priorities.
    I appreciate the opportunity to have presented the Highway Users' 
views on the air quality standards proposals and their impact on 
transportation and the CMAQ program. I would be pleased to answer any 
questions that you might have.
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         CLEAN AIR ACT: OZONE AND PARTICULATE MATTER STANDARDS

                              ----------                              


                        TUESDAY, APRIL 29, 1997

                             U.S. Senate,  
             Subcommittee on Clean Air, Wetlands,  
                     Private Property and Nuclear Safety,  
                 Committee on Environment and Public Works,
                                                    Washington, DC.

                 IMPACT ON STATE AND LOCAL GOVERNMENTS

    The subcommittee met, pursuant to recess, at 2 p.m. in room 
406, Senate Dirksen Building, Hon. James Inhofe (chairman of 
the subcommittee) presiding.
    Present: Senators Inhofe and Sessions.
    Also present: Senator Baucus.

 OPENING STATEMENT OF HON. JAMES M. INHOFE, U.S. SENATOR FROM 
                     THE STATE OF OKLAHOMA

    Senator Inhofe. The subcommittee will come to order.
    I assure you there will be more Members coming in from time 
to time and staff. There are a couple of meetings that are 
still taking place and they're there.
    Today's hearing will be the fifth we've had. We've had four 
in this subcommittee and one in the whole committee concerning 
the proposed EPA changes in the national ambient air quality 
standards for ozone and particulate matter.
    Throughout the entire process, we've heard allegations 
through the media, other congressional hearings, and the 
testimony from witnesses before this subcommittee that the 
Administration has systematically misrepresented the facts 
behind their proposal.
    The EPA has suppressed dissenting views within the 
Administration. They've placed themselves above the law in 
regards to Small Business Regulatory Enforcement Fairness Act 
and unfunded mandates.
    Certainly we have here in this room on the three panels a 
lot of people who are concerned about unfunded mandates. As a 
former mayor, I can assure you I understand your concern.
    I have conducted these hearings as a forum to discover the 
truth and to bring to light all of the information behind the 
proposals. I've not focused on the abuses of the Administration 
because the underlying science, risk, and impacts of the 
proposals are the most important issues, and I've tried to 
avoid being sidetracked.
    However, at last Thursday's hearing I asked Mary Nichols, 
the assistant administrator for Air at the EPA, a very simple 
and di- 
rect question, whether the EPA's regulatory impact analysis 
shows that the cost of the ozone proposal outweighs the 
benefits, and she said no. This is incorrect.
    We don't have large charts, but we certainly--we've passed 
these out. I think most people have these. This is what they 
came up with after they talked about the new standards. And the 
red line, of course, is the cost line, and the green being the 
benefits.
    [The referenced charts follow:]
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    Senator Inhofe. The EPA's regulatory impact analysis for 
ozone clearly shows that the costs outweigh the benefits. The 
cost of local control strategies outweighs the benefits 
anywhere from $1.1 billion to $6.2 billion. That's the range 
that we're looking at here, depending upon the exceedances 
allowed.
    The cost for regional control strategies, which may not be 
feasible under the current law, outweigh the benefits anywhere 
from 0 to 2.4. This is the chart that shows that range.
    These figures come straight from the EPA's document, and 
the costs are only for partial attainment. Under their cost 
estimates, the country does not even attain the proposed 
standards. Elsewhere in the documents they acknowledge a number 
of costs that they don't even calculate, and they make a number 
of assumptions, such as, first, they assume in the baseline 
full implementation of the current law, without counting these 
costs but counting the benefits.
    In other words, those of you who have had to work hard, 
such as we have in our county of Tulsa, those costs that we 
have incurred to come up to the old standards are not included 
in the total cost, but the benefits are.
    Second, they assume a regional NAAQS strategy for the 
country which includes an emissions cap for utilities without 
including those costs. I think we know, in fact, the first--
before even having the first hearing, as chairman of this 
committee, when I heard about the proposed changes I went 
around to 21 counties in Oklahoma, and it was then that we 
found out what the costs were, increased cost of utilities. 
These increase costs are not considered even in these charts 
here.
    Third, they assume a national low emissions vehicle without 
counting the cost for such a program. I think those of you from 
California know what we're talking about there because you've 
already had that mandate.
    And, fourth, in a number of areas they stopped calculating 
the cost at 75 percent attainment. I mean, areas that are 
really bad, they assume that once you get the 75 percent 
there's no further cost.
    Even without adding up these hidden costs, the EPA's 
documents still show the costs outweigh the benefits; yet, an 
assistant administrator from the EPA sat in this room last week 
and told me and the witnesses the exact opposite on the record. 
They are trying to mislead the committee and they are 
misleading the American people.
    In addition, since these figures were published, the Agency 
has gone back and readjusted the benefits, decreasing all of 
the end points by 25 percent. So while the original costs 
outweighed the benefits, the current numbers outweigh the 
benefits even more than they were before.
    As a final insult to the process, the President's own 
Council on Economic Advisors has estimated the cost for ozone 
proposal at $60 billion, 10 times greater than the EPA's cost 
estimate of $6 billion. It's time for the EPA to level with the 
public.
    Public policy decisions should be conducted in an open and 
unbiased manner. The EPA has hidden behind the court order and 
data that is not available to the public. In addition, they 
have hidden the real costs and dissenting viewpoints of other 
Government agencies.
    Hopefully today we can turn to the important issues 
regarding the impact of these proposals.
    We have a very full hearing of some 14 witnesses, and that 
will be on three panels, so we're going to be somewhat 
restrictive in our timing.
    I have a statement for the record submitted by Senator 
Hutchinson.
    [The prepared statement of Senator Hutchinson follows:]
Prepared Statement of Hon. Tim Hutchinson, U.S. Senator from the State 
                              of Arkansas
    Thank you, Mr. Chairman. Once again, I am grateful that you have 
seen fit to continue these hearings on the EPA's proposal to implement 
more stringent clean air standards for ozone and particulates.
    Since the hearings began a couple months ago, we have had the 
opportunity to hear testimony where both sides of this complicated 
issue have been presented. When we began, I never expected this would 
be so complex and that there would be so many opinions, especially 
among the members of the President's Clean Air Scientific Advisory 
Committee. While I have come to expect politicians to disagree, I did 
not expect such disagreement among the scientists.
    I am also somewhat surprised that there is so much opposition to 
the plan from within the administration.
    There is opposition from the President's Council on Economic 
Advisers, the Office of Science and Technology Policy, the Department 
of Transportation, the Department of Commerce, the Small Business 
Administration, the Department of Agriculture and the Department of 
Treasury. These comments must be seriously analyzed and addressed 
before the rule is promulgated.
    According to a Monday, April 21 story in the Los Angeles Times, one 
of these documents even suggested that if implemented, ``the proposal 
could bring California's economic recovery to a grinding halt.''
    In Arkansas, we could face a similar fate. Recently, Arkansas has 
begun to see strong economic growth, especially in the Northeastern and 
Northwestern part of the State, yet investment may slow dramatically, 
even drop off completely, if these areas of growth fall out of 
attainment.
    In the reauthorization of ISTEA, Arkansas may see a tremendous 
increase in access to transportation, as we work on proposals for 
construction on the I-69 International Trade Corridor (or interstate?). 
Yet, since the implementation of these standards could threaten highway 
funding, the timely completion of I-69 or other highways in Arkansas 
may be in jeopardy.
    This week, the Arkansas State Chamber of Commerce was in town to 
meet with the congressional delegation and other national leaders. The 
issue that is overwhelmingly the most important to these leaders is the 
completion of I-69.
    Considering the scientific weaknesses surrounding these standards, 
the disagreements within the Clinton Administration and the opposition 
from so many of my constituents and State leaders, I am not comfortable 
sacrificing any funding for one of the most important economic 
facilitators in the history of Arkansas.
    Mr. Chairman, today, State Representative Scott Ferguson of West 
Memphis, Arkansas was supposed to testify before our committee 
regarding his opposition to the proposed standards.
    Unfortunately, because of family and business considerations, 
Representative Ferguson could not be with us. I would like to read a 
few of the excerpts from his testimony and have the entire testimony 
placed in the record.
    I feel it is important to note that Representative Ferguson is a 
Medical Doctor and is a member of the Public Health, Welfare, and Labor 
Committee in the Arkansas House of Representatives.
    Dr. Ferguson cosponsored a resolution in the Arkansas House, which 
was passed along with a companion resolution in the State Senate, 
stating that the EPA should retain the current standard for ozone and 
retain the current standard for PM10, until more research 
can be done on PM2.5. I would like these two resolutions to 
also be placed in the record.
    Dr. Ferguson goes on to say, ``As a medical professional and an 
elected official, it concerns me that policymakers want to move forward 
with these standards prior to a complete analysis of these issues.''
    Mr. Chairman, I know there are other doctors on the panels today 
who will be testifying, but I hope Dr. Ferguson's testimony will also 
be seriously considered as we proceed today and through the next few 
months.
    I thank the Chairman again for calling this hearing.

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    Senator Inhofe. I would now ask for the first panel of 
witnesses to be seated at the witness table. The way we've 
divided up the panels today is to start with the witnesses from 
State and local governments. The second panel and third panels 
will consist of other interested parties.
    While they're coming forward taking their chairs, I'd like 
to give you an overview of how we'll proceed during this public 
hearing.
    We have 14 witnesses who will be testifying today. As I 
also mentioned to you, some other members of the subcommittee 
couldn't be here today. Some of their staff is, and some will 
be coming in later on.
    Each witness will be given 5 minutes to give his or her 
opening statement. Your entire statement is already submitted 
for the record, and I appreciate the fact that you have already 
done that.
    We will use these little lights up here that we normally 
don't adhere to at all that closely, but since we have so many 
witnesses today we will. I think we all know what red, yellow, 
and green mean.
    Following each of the 5-minute comments by the witnesses, 
we'll ask each member of the subcommittee to ask questions and 
we'll have a round of questions and answers.
    The first panel will be: The Honorable Mayor Emma Hull, 
mayor of Benton Harbor, Michigan; The Honorable Richard 
Homrighausen, mayor of--you know, I always thought in politics 
it's easier to have an easier name. It hasn't worked out too 
well, of course--mayor of Dover, OH; The Honorable Leon G. 
Billings, delegate, Maryland General Assembly; The Honorable 
Richard L. Russman, New Hampshire State Senate; and from my 
home town, The Honorable John Selph, Tulsa County Commissioner, 
Tulsa, OK.
    With that we'll go ahead and start with Mayor Hull.

  STATEMENT OF HON. EMMA JEAN HULL, MAYOR OF BENTON HARBOR, MI

    Mayor Hull. Thank you, Mr. Chairman and members of the 
committee.
    My name is Emma Jean Hull, mayor of Benton Harbor, MI, and 
a member of the National Conference of Black Mayors' Standing 
Committee on Environmental Justice.
    Benton Harbor is located on the shores of Lake Michigan 
just an hour east of Chicago, IL, and 45 minutes from Gary, IN. 
It is a minority/majority community with a population of 
12,818, 97 percent African-American, 40 percent under the age 
of 18.
    Benton Harbor, through a local partnership with businesses 
and industries, is just beginning to address some of the 
Nation's highest at-risk factors in crime, unemployment, and 
school dropouts. Our success to date relies on local 
initiatives to retain, attract, and grow small businesses, 
address work force development, and deal with environmental 
concerns--mostly related to our brownfields redevelopment 
projects.
    In the late 1970's and early 1980's, Benton Harbor saw the 
loss of over 3,000 manufacturing jobs, with major plants 
closing in the steel appliance and automotive industries. The 
remaining empty, deteriorating, and in some instances 
contaminated buildings formed both the core of our 
environmental problems and Benton Harbor's redevelopment 
potential.
    With passage of the 1990 Clean Air Act and the 
establishment of that year as a baseline for attainment, my 
city was put at an immediate and distinct disadvantage. In the 
late 1980's and early 1990's, Benton Harbor was at its lowest 
point in its history for industry activity. This artificial low 
standard for air quality applied nationally without regard to 
local circumstances is magnified by a proximity to both Chicago 
and Gary and the prevailing westerly wind--a fact that impacts 
the expansion of existing businesses and inhibits the location 
of new businesses in Benton Harbor, as well.
    Benton Harbor was one of only 11 communities chosen by 
Governor Engler for a new innovative project called 
``Renaissance Zone Designation.'' At the hall mark of our 
application was a program to redevelop the old brownfield sites 
that used to be the home of thousands upon thousands of steel 
and heavy manufacturing employment.
    The loss of these jobs has crippled the economy of Benton 
Harbor, and the redevelopment of these acres will not only 
improve the quality of life for all of our residents, but 
greatly enhance the environment through a long-term 
redevelopment strategy.
    The local community and the State government have agreed to 
give up all taxes on any development on this property for 10 
years. That's right--no property tax, no income tax, no utility 
tax, no State or local taxes of any kind if these brownfield 
sites are redeveloped.
    Located adjacent to Lake Michigan, the redevelopment of 
these sites is crucial to bring about an harmonious balance 
between environmental protection, economic activity, and 
improved quality of life for our citizens.
    This innovative piece of legislation has been highlighted 
in such publications as ``The Wall Street Journal,'' ``The New 
York Times,'' and, as a result, the number of businesses 
seriously considering location in our community is at its 
highest level.
    The proposed most stringent ozone standards and new PM 
standards for particulate matter emissions, if implemented, 
will directly impact on my community's effort toward 
sustainable economic growth and development.
    The Renaissance Zone is just one example of how the local 
government has cooperated with the business leaders and State 
legislators in creating a long-term visionary plan for 
redeveloping our community.
    The change in the air emission standards will only 
undermine this bold and innovative approach to economic 
development.
    Furthermore, these new restrictions take away opportunities 
from the people who need it most. They are not responsible for 
the air emission coming from Chicago and other areas across 
Lake Michigan, nor are they responsible for the time chosen to 
be the baseline for the Clean Air Act when we, as a community, 
have fallen on our worse times ever.
    These new proposed standards would unfairly harm a special 
group of individuals. The small businesses affected, many for 
the first time, like printers, bakers, service station 
operators, and construction firms--are the foundation of the 
growing ranks of Benton Harbor's minority entrepreneurs. The 
anticipated high production and operation costs required by the 
proposed standards, coupled with the regulatory burdens, can 
restrict these businesses' expansion, impact their capital 
expenditures, and eventually affect the jobs of many of our 
community residents. This problem is only magnified when 
applied to the new larger businesses.
    The ability to attract new, major business and industry to 
brownfield sites is difficult. Benton Harbor and the Nation 
does not need any additional impediments.
    Mr. Chairman, many of the old industry sites of Benton 
Harbor are examples of the shift which will occur as part of 
our new proposed air emission standards. Businesses and heavy 
manufacturing left our area to find new greenfield sites.
    Undermining the efforts being made by our community to 
start new businesses and attract new industry to redevelop 
brownfield sites will all be undermined by the new proposed air 
emissions standards.
    Those new investments and job opportunities so desperately 
needed in our community will not occur. Rather, they will occur 
at other greenfield locations throughout the country that are 
not unfairly being impacted by the air emission standards.
    It is perhaps the cruelest irony of all that Benton Harbor 
made a name for itself as a community of thriving manufacturing 
base, only to lose the opportunity to regain its reputation 
because of the air that emits from Chicago and from our having 
had such low artificial standards imposed upon our community.
    Partnership is a requirement of change, and that 
partnership must include the Federal Government, local 
community, and the business community, and policymakers at the 
State level working together.
    I propose to you that the initiative underway in Benton 
Harbor will improve the economy, as I come to a close, but also 
drastically enhance the environmental surroundings of our area.
    Brownfield redevelopment is desperately needed in our area, 
as it is across the country. Changing our standards will only 
undermine many of those far-reaching initiatives, and you 
policymakers must balance what is in the best interest of all 
parties concerned.
    I propose to you that an intelligent true partnership that 
involves all of us in the way to protect the environment while 
also changing the social fabric of the community, like Benton 
Harbor--please consider the impact the proposed changes will 
have on the local partnership my community so desperately 
needs.
    Thank you for this opportunity to address this matter 
today.
    Senator Inhofe. Thank you, Mayor Hull.
    Unfortunately, there is a vote taking place right now. 
Mayor Homrighausen, if you would proceed, I will run and vote 
and come back.
    I have read your testimony very carefully. Having been a 
mayor, I wanted to see what other mayors were thinking in some 
of the problems.
    So if you'd go ahead and give your testimony, I will be 
right back and we'll have that in the record.
    [The chairman vacated the chair.]

 STATEMENT OF HON. RICHARD P. HOMRIGHAUSEN, MAYOR OF DOVER, OH

    Mayor Homrighausen. Good afternoon. My name is Richard P. 
Homrighausen, and I am mayor of the city of Dover, OH. I 
appreciate the opportunity to testify before you this afternoon 
on EPA environmental proposed rules of increasing the 
stringency of the air quality standards for ozone and 
particulate matter.
    In my comments I hope to convey to you the perspective of 
one middle America community on the potential impact of EPA's 
proposed rules.
    In addition, I will represent the perspective of the city 
of Dover Electric System, a small, municipally-owned utility 
that will likely be seriously impacted by EPA's rules.
    Finally, I am here today representing the city of Dover's 
utility trade association, the Ohio Municipal Electric 
Association, which represents 79 public power systems in Ohio, 
all of whom are concerned about the potential impact of EPA's 
rules on these small, community-owned business entities.
    Cities like Dover and public power systems like the Dover 
Electric System are significantly concerned about the negative 
impact that EPA's proposed ozone and particulate matter rules 
could have on local governments and public utilities. The EPA 
has proposed air standards which it acknowledges will not be 
achievable for many communities and which will have a 
drastically disproportionate impact on small utility systems 
and the communities which we serve.
    These disproportionate costs and impacts that may be 
imposed upon small entities have not been adequately addressed 
by the EPA, which compounds the inadequate science and health 
data on which EPA has based its drastic new standards.
    So I hope that I can convey today that these 
disproportionate impacts the rules may have on small 
communities and business entities will be ultimately placed on 
the citizens and consumers served by cities like Dover and 
public power systems like those represented by OMEA.
    Therefore, the city of Dover and the Ohio Municipal 
Electric Association call upon Congress to ensure that, first, 
the EPA performs a full assessment of the potential costs and 
impacts of the proposed ozone and PM rules on small business 
entities and local governments, including public power 
entities, prior to the finalization of the standards and their 
implementation.
    Second, Congress should require that EPA devises a plan to 
ensure no disproportionate impact from its ozone and PM rules 
on small communities and public power entities.
    Third, Congress should ensure that EPA devises an 
implementation plan for any new standards that provides the 
technical assistance and regulatory flexibility to small public 
power plants that will be necessary for these systems to comply 
with any burdensome new regulations.
    And, fourth, the Congress should statutorily exempt small 
utility units--that is, utility units that have 25 megawatts of 
capacity or less--from additional regulatory requirements, just 
as the Congress exempted small utility units from the title 
four control require- 
ments for the acid rain program under the Clean Air Act 
amendments of 1990.
    I'd like to give you a brief background on Dover's Electric 
System and public power in Ohio so that you can understand the 
context in which EPA's rules will apply.
    The city of Dover, located in Tuscarawas County in the 
northeastern portion of Ohio, has a population of 13,000. Local 
employment is supported by 55 diversified industries county-
wide. This includes the city of Dover Electric System, which 
serves 6,185 customers and consists of a coal-and gas-fired 
electric generation plant, an electric distribution system, and 
electric transmission interconnections.
    The Dover Electric Power Plant has instituted substantial 
environmental control measures in recent years, including an 
electrostatic precipitator and natural gas co-firing burners to 
reduce particulate emissions.
    I might add that the natural gas co-firing burners were the 
first of this new technology to be installed in an electric 
utility in the United States.
    The city's electric system plays a vital role in the 
competitive sale of power to Ohio customers, supplying 
relatively low-cost energy to our customers. Public power 
systems in the United States which are community owned, locally 
controlled, and not-for-profit serve one in seven Americans, or 
35 million people, and collectively possess $77 billion in 
investment in all types of generating capacity.
    Public power is inherently accountable to communities and 
their citizens because they are owned and governed by these 
communities. That is why public power stands for the 
development of a viable competitive wholesale electric market, 
improved environmental quality, and the protection of the 
public interest against market power abuses.
    Public power is disproportionately burdened by regulatory 
requirements like EPA's proposed rules. Public power utility 
generators like Dover's tend to be smaller and older than 
investor-owned systems and units. These smaller public 
utilities often suffer from dis-economies of scale and bear 
particular burdens from technology-forced requirements which 
would probably result from EPA's proposed rules.
    A number of adverse impacts could result for communities 
and public utilities from EPA's rules, including: communities, 
including Dover, would likely be thrown into ozone and PM 
nonattainment by the proposed EPA rules. As you know, 
nonattainment status can lead to burdensome regulatory 
requirements, as well as discourage the economic development 
and revitalization of our cities, as Mayor Hull previously 
mentioned.
    That only pushes businesses that wish to avoid 
nonattainment requirements into our Nation's green spaces. 
Electric utilities like Dover's may be subject to stringent 
technology forced requirements, such as selective catalytic 
reduction technology. Expensive SCR technology would be a 
particular hardship to small utility units like Dover's 15 
megawatt unit because the costs of the requirements cannot be 
spread over a large customer base, thus poten- 
tially making power from small units uncompetitive on the eve 
of electric industry restructuring.
    In addition, the EPA's regulatory impact analysis for the 
proposed ozone and PM rules acknowledge that the rules could 
have a drastically disproportionate impact on small business 
entities like Dover's small utility system.
    As in my written comments, the EPA has estimated that the 
negative economic impact on EPA's proposed ozone rule will be 
three times greater on small utility units than it will be on 
all utility units. Likewise, EPA has estimated that its 
proposed PM rule will cause a significant economic impact on 
twice as many small entities when compared to all business 
entities.
    So it appears that EPA's proposed rules could well lead to 
substantial burdens on small public power systems that could 
result in the shutdown of these plants on the eve of electric 
deregulation, a resulting loss of jobs, or, at the least, a 
substantial increase to the electric bills to the citizens, 
businesses, and other consumers served by cities like Dover.
    For these reasons, the city of Dover and the Ohio Municipal 
Electric Association call upon the Congress and the EPA to 
assess the potential impacts of these proposed rules on 
communities and small businesses prior to their implementation 
and to ensure that no disproportionate burden is placed upon 
the citizens and consumers which we serve.
    Thank you.

   STATEMENT OF HON. RICHARD L. RUSSMAN, NEW HAMPSHIRE STATE 
                             SENATE

    Mr. Russman. Thank you, Mr. Chairman and members of the 
staff and committee.
    [Laughter.]
    Mr. Russman. I appreciate your being here.
    I guess as a Republican I can start with a quote of the 
day, if you will, from Senator John McCain at the fifth annual 
Green Bow, which he said, ``When Republicans introduce bills to 
abolish the Clean Air amendment or dismiss valid environmental 
concerns as the ravings of partisan extremists, we give 
credence to our critics who question whether Republicans share 
the environmental values of the majority.''
    I have to tell you, coming from New Hampshire, that we 
think that the EPA proposals would be great.
    As a beginning, I will tell you that if the proposed rule 
is finalized, approximately 15,000 lives will be saved 
annually. Now, if you just think about that for a moment, that 
seems like an awful lot of people to me. That's a city the size 
of our capital city of Concord, which is substantial.
    I think, however, wherever you come from, that's an awful 
lot of people.
    I wonder if, on the chart that the chairman showed earlier, 
that perhaps those deaths could be shown in black as opposed to 
red or green, and I wonder where they would stand on that chart 
that was shown.
    To me it seems that the support for measures such as this 
that would save so many lives should be a no-brainer.
    EPA's rule should be promulgated. I think the EPA should 
absolutely resist pressure to issue a weakened national ambient 
air quality standard.
    Many of the proposed rule detractors would delay for 5 
years while we wait for more research. Can you imagine? If you 
multiply that out, that's 75,000 potential deaths in the next 5 
years. And even if it's only 50,000 or 25,000, think about 
that.
    The elderly population is a population that is particularly 
stricken, and I'm sure that they would be interested to know 
their quality standards and seeing that they are implemented.
    We often say, when we advocate delay, that too often 
justice delayed is justice denied.
    As far as New Hampshire is concerned, our Department of 
Environmental Services is squarely on board in support of the 
standards. Our New Hampshire business community, Business and 
Industry Association, is squarely supporting the standards. And 
I, as chairman of the Senate Environment Committee for the 
State of New Hampshire, am here to support the standards. And I 
must tell you that many of the other States in the northeast 
support the standards, as well.
    Let's face it, the Federal Government must set standards 
and the national government is in the perfect position to do 
so. Uniform minimum Federal standards must remain the 
cornerstone of our system of national environmental protection.
    State citizens are particularly dependent upon that in 
terms of protection of their health to address the interstate 
migration and the effects of pollution.
    Uniform minimal national standards are especially vital in 
areas of air pollution. Air pollution does simply not respect 
State boundaries. Federal health-based standards that provide 
minimum uniform protection for all of our citizens is a perfect 
State/Federal model that works and should be defended from any 
change.
    Now, the EPA has set health-based air standards and the 
States devise approaches and strategies for obtaining those 
compliances with the standards. The EPA prescribes the ends, 
and we'll take the responsibility to devise the means and how 
to get there.
    This Federal/State partnership allows EPA to establish 
safeguards that no State could accomplish alone and allows 
States to tailor implementation burdens in a way that best 
suits the interests of that particular State.
    Air standards provide a model for environmental federalism 
and must not be changed. State citizens receive uniform 
national protection with locally tailored and sensitive State 
solutions, and we welcome that opportunity, certainly, in the 
next component.
    Let's look at regional equity for a moment. In the 
northeast, in particular, we will benefit immensely from these 
particular standards. The ozone transport assessment group 
modeling demonstrates that ground-level smog, ozone, is 
transported great distances. Current science also indicates 
that particulate matter 2.5 fine particles also travel long 
distances because they stay airborne for so long due to their 
tiny size.
    Therefore, to the extent these standards will induce our 
neighbors in the midwest to act responsibly and curtail their 
pollution of our citizens' air, then these standards must be 
applauded and should be applauded.
    As we know from our experience with acid rain, our 
neighboring States in the midwest and elsewhere would not do 
their fair share unless mandated by the Federal Government to 
do so.
    I think that everybody else in this country would share the 
same view that people would all want to breathe clean air, and 
I doubt that there is anybody out there, when asked, that would 
say that they don't care to breathe clean air, and I suspect 
that if it was suggested that air be brought in here today for 
us to breathe for the duration of the afternoon, we probably 
wouldn't want to stick around.
    The National Caucus of Environmental Legislatures--you'll 
receive a copy of this, Mr. Chairman, along with other members 
of the committee. It has been signed by members of that caucus 
from across the country; not just the northeast, but a number 
of other States, including people from the midwestern section 
of this country.
    In closing, I would urge this committee to help and not be 
a hindrance in the EPA's attempt to avoid 15,000 unnecessary 
and avoidable deaths a year. For those in Congress who advocate 
a 5-year delay, remember the price is possibly 75,000 
unnecessary deaths. Let us not forget that many of those 
unavoidable deaths will occur among the elderly.
    For those who worry about their State's ability to 
implement the new standard, trust us. We have been in the 
business of pollution control as long as Congress, and we have 
learned a thing or two along the way, and the States, I can 
assure you, can handle it.
    Thank you very much.
    Senator Inhofe [resuming the chair]. Thank you, Senator 
Russman.
    Mr. Billings, you will be next. But, before you begin, we 
have been joined by Senator Jeff Sessions from Alabama.
    Senator Sessions, this is a panel of State and local--we 
have two mayors, State legislators, and, from the great city of 
Tulsa, OK, our county commissioner.
    Would you like to make an opening statement?

OPENING STATEMENT OF HON. JEFF SESSIONS, U.S. SENATOR FROM THE 
                        STATE OF ALABAMA

    Senator Sessions. Mr. Chairman, I would like to say a few 
things.
    Senator Inhofe. Yes.
    Senator Sessions. I want to thank you for calling these 
hearings. We did have an outstanding hearing in Oklahoma. 
Protecting the health of our citizens and maintaining quality 
air for our people to breathe is important.
    The thing that's troubling to me is about whether or not 
these proposed increased standards that are proposed by EPA, 
whether or not they, in fact, will make the health of our 
citizens better.
    It's not just the big businesses and those experienced in 
working with EPA regulations such as local officials who deal 
with that regularly who will be forced to make changes if the 
proposed standards are finalized; it's the farmer whose work 
might have to stop when ozone or dust levels rise to high. It 
could be a critical time in his harvest or planting.
    It's the struggling worker who drives an old car that may 
now not meet the standards, and even repairing it may not be 
worth the cost of the automobile.
    It's the small business owner who may have to purchase 
costly emissions control equipment at the cost of not employing 
other people or expanding his business.
    There is no one in public office who can be in local and 
county and city and State governments who is not committed to 
improving the air quality and the health of their communities. 
I know that. But it is remarkable that we have such a universal 
concern by those local government officials who will be 
implementing this. Their opinions, I think, are also based on 
their honest view of what the science is, and they are 
committed to improving the quality of the air.
    So I am interested in hearing more from this panel. Senator 
Inhofe, I appreciate very much your leadership in raising this 
issue to the public's attention, because we do not need to make 
a mistake as we go forward.
    Senator Inhofe. Thank you, Senator Sessions. I also 
appreciate the fact that you came out to Oklahoma for our field 
hearing, which was very, very well attended. We had several 
hundred people there.
    Now, Mr. Billings, a delegate from the Maryland General 
Assembly. Mr. Billings.

STATEMENT OF HON. LEON G. BILLINGS, DELEGATE, MARYLAND GENERAL 
                            ASSEMBLY

    Mr. Billings. Thank you, Senator.
    My name is Leon Billings. I represent the Kensington-Chevy 
Chase-Wheaton area of Maryland. I think I bring a unique 
perspective to the hearings as a State legislator and because I 
spent 12 years as staff director of this subcommittee when 
Senator Muskie was its chairman.
    My constituents are very strongly committed to 
environmental protection. They care about the quality of the 
air they breathe. They also care deeply about the Chesapeake 
Bay. Both would benefit from these new standards.
    Many businesses in Maryland believe that they are being 
required to make extra investments to control pollution because 
large industrial sources and power plants in other States are 
doing too little to control their emissions. They argue against 
further reductions in emissions in Maryland until something is 
done about big polluters to our west and south.
    Thus, for the people of Maryland, these new standards have 
two important benefits: they will provide additional health 
protection for our citizens and for the Bay, and they could 
reduce the burden on Maryland businesses by more fairly 
allocating the responsibility for cleanup to the large sources 
in other States.
    Mr. Chairman, in the 12 years I served this subcommittee, 
virtually every single environmental proposal we recommended to 
the Senate was met with the charge that it was too expensive. 
The rhetoric in today's debate is much the same.
    What is new is the 271 peer-reviewed air pollution health 
studies EPA evaluated prior to proposing the new standards. 
What is new is there is so much science to support standards.
    When the first air quality information was published, there 
was a crescendo of criticism regarding the adequacy of that 
data. Compared to today's information base, those critics were 
on sound ground.
    Prior to 1970, ambient air quality standards were adopted 
by localities based on citizen input, local perceptions, and 
the threat of air pollution. That process proved unacceptable 
to industry because the standards adopted were often more 
strict than indicated by federally published data.
    In 1970, the Nixon administration proposed and Congress 
adopted national ambient air quality standards. The decision to 
adopt national standards was widely advocated by the Nation's 
major polluters. They wanted to use Government science as the 
basis for air quality standards. They wanted EPA to adopt air 
quality standards. They wanted to avoid proliferation of 
differing air quality standards. They wanted those standards 
adopted in 90 days after enactment of the 1970 Clean Air Act.
    I would hope this committee would tell them, the National 
Association of Manufacturers, the Citizens for a Sound Economy, 
and their allies in the anticlean air band wagon to quit trying 
to change the rules they helped make.
    Their opportunity to affect the cost of achieving these 
standards will come in the implementation phase. We are 
currently in the information phase. The American people have a 
right to know the levels of air pollution which affect their 
health.
    Congress has never compromised this right to know. Congress 
on two occasions has provided more time to implement health-
based standards--in 1977 up to 10 years more, in 1990 up to 20 
years more--but Congress has never bowed to pressure to 
compromise science. To do so would make a process of public 
health protection political rather than scientific.
    The appropriate focus for this committee and the Congress 
will be to assure a balanced and timely implementation of the 
standards, recognizing economic needs of industry and the need 
of millions of vulnerable Americans for protection from the 
impact of smog. Congress has been doing that job for 30 years.
    We have proved that we can have a healthy and growing 
economy while moderating the health impact of pollution, and we 
have done so without compromising the public's right to know 
what healthy air is.
    Thank you.
    Senator Inhofe. Thank you, Mr. Billings.
    Commissioner Selph.

   STATEMENT OF HON. JOHN SELPH, TULSA COUNTY COMMISSIONER, 
                            OKLAHOMA

    Mr. Selph. Thank you, Mr. Chairman.
    Mr. Chairman and members of the committee, my name is John 
Selph. I'm a member of the board of directors of the National 
Association of Regional Councils, and I chair their Air Quality 
Task Force. I'm also chairman-elect of the Indian Nations 
Council of Governments, which is the planning organization for 
the Tulsa area, and I chair their Air Quality Committee, as 
well.
    On behalf of NARC, I appreciate your invitation to testify 
before the subcommittee regarding the proposed changes.
    The National Association of Regional Councils represents 
some 300-plus councils of governments, consisting of cities, 
towns, and counties in metro and rural areas across the United 
States. These regions run the gamut from nonattainment areas to 
areas that have always been in attainment. My comments reflect 
the policy positions developed by NARC. They also draw upon my 
experience as a county commissioner in Tulsa, OK, and my 
academic background, which includes a master's degree in public 
health with an emphasis on environmental science.
    Before I talk about EPA's proposed standards, let me tell 
you a little bit about Tulsa and our experience with air 
quality.
    Tulsa County was a nonattainment area, as you know, 
Senator, until 1990. We've worked very hard to achieve 
attainment status, and our county did achieve attainment status 
prior to the Clean Air Act signing in November 1990. It was 
important for us to avoid the stigma associated with being on 
the EPA's ``Dirty Air List,'' especially for economic 
development purposes.
    Since that time we've worked even harder to maintain our 
clean air status, and while our efforts have been wide-ranging, 
perhaps most notable was the creation of a nationally 
recognized ozone alert program, which is really the Nation's 
first voluntary episodic emissions control program.
    This program reflects our philosophy of seeking voluntary, 
common-sense measures that are most effective in improving air 
quality, rather than the command and control approach too often 
used by State and Federal regulators.
    Let me say that both NARC and I, along with everyone else 
on this panel, recognize the importance of improving air 
quality, and we support actions to maintain and improve the 
health of all citizens when such actions are based on sound 
scientific principles.
    In light of this we are especially concerned about the 
conflicting opinions of the scientific community regarding the 
scientific basis for establishing new ozone and PM standards. 
There appears to be no scientific consensus that changing the 
standards at this time will result in significant public health 
benefits. Indeed, the recently revised EPA exposure and risk 
assessment findings underscore this lack of consensus.
    We believe that considerable additional research including 
epidemiological studies are necessary before new ozone and PM 
standards are promulgated. Specifically, future epidemiologic 
studies should focus on the interaction between different 
pollutants and whether these effects are additive, synergistic, 
or antagonistic.
    The Clean Air Act has had a positive impact on reducing 
pollutants, thus improving air quality for all Americans. If 
EPA imposes its proposed ozone standards, the number of 
nonattainment areas in the Nation will increase dramatically, 
perhaps a threefold increase, according to EPA's estimates.
    Assigning these areas as nonattainment does not necessarily 
equate to improving air quality within the regions. In fact, 
these existing nonattainment regions are having great 
difficulty in achieving the current standards, so forcing a 
mid-course change at this time will only delay and disrupt both 
public and private initiatives designed to achieve the 
objectives of the Clean Air Act.
    Furthermore, we are not convinced that the technology is in 
place, or worse, even close at hand to help meet these proposed 
standards.
    With regard to the proposed PM2.5 standards, we 
believe that EPA lacks sufficient scientific evidence to 
justify revising the existing PM standard. Although the 
scientific evidence does, indeed, suggest some preliminary 
correlation of health effects, it seems to be inconclusive.
    Adding onto this is the lack of a monitoring system for 
PM2.5, which further supports our concerns about 
adding this standard.
    Our experience in Tulsa has shown us that the goal of 
improving air quality is both worthy and attainable if 
approached in a common-sense manner.
    In addition to our ozone alert program, by formal agreement 
with the EPA and a host of local and Federal partners we have 
become the Nation's first flexible attainment region. This FAR 
agreement, as it is called, enables us to implement a locally 
crafted strategy to reduce emissions and gives us adequate time 
to evaluate the results before having to implement more 
stringent measures to meet our goals. This avoids the one-size-
fits-all command and control approach.
    When we are allowed to develop our own programs and local 
buy-in is assured, the willingness to commit the necessary 
financial and political capital to achieve results is much more 
readily accepted.
    In conclusion, we believe that the potential impact is 
great and we must have more certainty and consensus before a 
major change such as this is initiated.
    Progress is being made in improving air quality, and more 
will come if common sense and flexibility prevail.
    I appreciate being invited to participate in the 
subcommittee's hearings. On behalf of NARC, we look forward to 
working with the committee in your important task.
    Senator Inhofe. Thank you very much, Commissioner Selph. I 
appreciate very much your being here and the work you've done 
in our home town.
    Mayor Hull, I appreciate very much your appearing here 
today. As a former mayor, as I mentioned before, I understand 
some of the problems that local officials are having to go 
through to try to achieve these changes in standards.
    As I understand it, you're out of attainment under the 
current standards; is that right?
    Mayor Hull. Yes.
    Senator Inhofe. What all have--what additional things can 
you do, as mayor of your city, and working as you said you have 
been doing with the private sector and with the various levels 
and other political subdivisions? You outlined some of the 
things that you have done. You're still out of attainment. Now 
we come along and lower these standards or raise the standards. 
What more can you do? Have you thought about that?
    Mayor Hull. As I looked at the new act, Clean Air Act, I 
thought what impact it would have on our community as we are 
struggling right now to redevelop our community, to 
partnership, as I said in my statement, with the public sector, 
with the private sector to make a difference in getting jobs in 
our community.
    Our county is 5 percent unemployment, and in our city we 
have 30 percent unemployment. What we are doing now, we are 
trying to--with the brownfield we have a lot of old service 
stations and sites that cannot be developed because we have the 
burden of the underground storage tanks that need to be removed 
that we do not have the finances to remove, and so we are 
seeking grants.
    With the Renaissance Zone, where they won't have to pay 
taxes, we are hoping businesses will come in and redevelop 
these sites to provide job opportunities.
    While, of course, I am committed to the health of our local 
citizens to have it better, there has been no scientific data 
to date to say that lowering the standards will make the health 
of our citizens better.
    Senator Inhofe. Putting it in context with other problems 
that your city faces--crime and all this--would you say this is 
the greatest health hazard to your city?
    Mayor Hull. Yes.
    Senator Inhofe. I mean, would you say that your air--the 
status right now of your ambient air in your city----
    Mayor Hull. No, no. It is not the greatest health hazard in 
our city at this time.
    Senator Inhofe. I see.
    Mayor Hull. As a matter of fact, we need jobs. We have 
high, high rate of black-on-black crime because of the fact 
that we do not have economic development. They are not working. 
We have a high school dropout rate. There are some jobs to go 
to. We need skills so that we can produce jobs in our 
community. We need economic development.
    If this standard was passed, if these acts were passed, it 
would totally wipe out our community as far as economic 
development is concerned.
    Senator Inhofe. All right. And would you consider--this 
just needs to be a yes or no question--these changes to be an 
unfunded mandate?
    Mayor Hull. Yes. I was working with the Michigan Municipal 
League, and I was working with the act to stop the unfunded 
mandates.
    Senator Inhofe. OK.
    Mayor Hull. Because we as a community cannot afford 
unfunded mandates, and if this was implemented we would have to 
fund this, and that's a mandate that we cannot fund.
    Senator Inhofe. Thank you very much.
    Mayor Homrighausen, in your testimony you cover the 
additional cost to ratepayers in your city if the proposals go 
final. I noticed the percentage increase to consumers is 
approximately 25 percent because the cost to small utilities 
would be three times greater than large utilities.
    I don't see how you can stay in business. And I'd ask the 
same question. Do you consider this to be an unfunded mandate?
    Mayor Homrighausen. Absolutely. Absolutely. That was the 
point I was trying to make today. Small public power entities, 
of which Dover is one, 25 megawatt units----
    Senator Inhofe. It's about one-seventh, I think, of the 
country is covered by these small----
    Mayor Homrighausen. Correct. One out of seven people are 
covered by public power. We're small. We can't afford the 
disproportionate burden that these new requirements would 
require, and we've asked--we feel that the EPA must reassess 
their impacts of the rules on public power communities and 
prevent any disproportionate impact.
    We just don't see where the sound science has been used, 
and we would just call for Congress and the EPA to reassess.
    Senator Inhofe. All right. Thank you very much.
    Mr. Billings, the Maryland State Legislature voted against 
the mandatory treadmill emissions test, subjecting them to 
possible EPA sanctions. That vote was about 2 to 1. I assume 
you were not in the prevailing side on that?
    Mr. Billings. I was not, Mr. Chairman.
    Senator Inhofe. I hope that, during the course of these 
meetings that we have, that people realize that we're making an 
effort to get the information from people who are acting in a 
minority, which you are, of course, in your capacity.
    What percentage of your legislative body would you say that 
you are representing in your statement today?
    Mr. Billings. On the issue of health standards, probably 
about 85 percent.
    Senator Inhofe. On the----
    Mr. Billings. On the issue of mandatory dynamometer 
testing, probably 40 percent.
    Senator Inhofe. Yes. All right. What about as far as the 
change in the national ambient air quality standards?
    Mr. Billings. I would say, if they were better informed 
than I've heard today, it would be on the order of 60 or 70 
percent, but I haven't heard any information today that would 
lead to making them better informed.
    Senator Inhofe. Mr. Russman, you talk about the fact that 
you are involved with small businesses during your testimony, 
and the fact that they would be adding small business 
implementation work group. What you failed to mention in your 
testimony is that they failed to follow the Small Business 
Review Act.
    I think you're very familiar with that. A lot of people 
aren't. But that would require the EPA to state what the effect 
would be on small business prior to--before--proposing the 
rules.
    What do you think the impact would be on small businesses 
or small entities? It's loosely defined.
    Mr. Russman. Frankly, I think that the new standards would 
be a boon to small business and entrepreneurship and creativity 
among the people that would be affected. I think that our 
economy has blossomed and grown over the years with the 
standards that were in place, despite the cry that there would 
be catastrophe. I think, on the contrary, our Business and 
Industry Association, which is the largest business group in 
the State, has held hearings, and we've taken testimony, and 
they are firmly on board with these standards.
    Senator Inhofe. You were somewhat critical of the National 
Conference of State Legislatures for the action that they've 
taken or the position that they've taken on this. Are you 
equally critical of the U.S. Conference of Mayors, the League 
of Cities, the National Association of Counties?
    Mr. Russman. I can only speak to the National Conference of 
State Legislatures. I'm the immediate past chairman of their 
Committee on the Environment, and, frankly, the notion that 
this is an unfunded mandate, the idea of giving out information 
on the value of clean air is no more an unfunded mandate than 
perhaps in New Hampshire the----
    Senator Inhofe. Implementation is expensive, and you don't 
consider that to be an unfunded mandate?
    Mr. Russman. I think that implementation will have to be 
looked at at the appropriate time, but my understanding was 
that we're looking at the health-based necessity of having new 
standards, sir.
    Senator Inhofe. Mr. Selph, what is our current ozone? Are 
we at .09 now approximately?
    Mr. Selph. In Tulsa?
    Senator Inhofe. Yes.
    Mr. Selph. Well, it depends on what area of the city you 
want to monitor. Actually, some of the prevailing winds coming 
into Glenpool, southern part of Tulsa, on an ozone alert day 
may be pretty close to .08, .09.
    Senator Inhofe. Yes. You know, we have worked with this for 
a long time, and I have to admit you've done a lot more than I 
have at the local level, and you're considered to be the real 
authority there. Have you ever approximated the costs that have 
been incurred by the taxpayers of Tulsa County in the efforts 
that you have undertaken so far?
    Mr. Selph. Of course, all of the efforts in Tulsa have been 
voluntary. The refineries, for example, voluntarily reduced the 
Reid vapor pressure (RVP) of the gasoline; all the suppliers of 
gasoline--Sun, Sinclair, and everyone else--reduces that Reid 
vapor pressure. It's required to be 9.0 in its number, and they 
reduce it to 8.2. Sun, alone, told me this week that that's 
costing them between $300,000 and $400,000.
    Senator Inhofe. Yes. It has been voluntary. Of course, 
that's, I suppose you'd say, an unfunded mandate to the 
business community, as opposed to the political subdivision.
    Mr. Selph. Well, certainly they recognize the benefits of 
staying in attainment, and they would like to stay in 
attainment, and realize that if Tulsa slips into nonattainment 
then the cost would be even greater than what it is.
    Senator Inhofe. Yes. You have a master's in public health?
    Mr. Selph. Yes, sir.
    Senator Inhofe. And you think this change would have a 
dramatic improvement on public health?
    Mr. Selph. I would like to think that it would; however, 
I've read a lot of the studies and reviewed a lot of the 
information that has been presented, and it's difficult for me 
to come to that conclusion. It seems to be so inconclusive at 
this point.
    Senator Inhofe. You know, our first hearing was the 
science. You remember, Senator Sessions, it was the science 
hearing where we had the Clean Air Scientific Advisory 
Committee well represented, and I think even the proponents of 
the rule change said that scientifically we'd be looking at 
probably 5 years before we could really get in there.
    Now I'm talking about in particulate matter, determining 
which particulate matter and which levels would be. So I think 
that's probably consistent with their answer.
    Mr. Selph. Sure it is, and you asked me about particulate 
matter of 2.5 in Tulsa. Frankly, I don't have a clue as to 
whether or not that's going to be a problem in Tulsa because we 
don't have a monitoring system. There are no monitors to tell 
us whether or not that----
    Senator Inhofe. Don't feel bad. No one else does, either.
    Mr. Selph. I understand that. I understand that the EPA is 
testing those at a cost of around $10,000 per monitor.
    Senator Inhofe. Yes, sir.
    Senator Sessions.
    Senator Sessions. Thank you, Mr. Chairman.
    Mr. Selph, with regard to the CASAC scientific advisory 
study, are you aware just how close the vote was on those 
matters? I mean, the people who are advising EPA, who had a 
moral obligation to analyze the data in every study that was in 
and to make a call on it, split almost down the middle.
    Mr. Selph. Split almost down the middle. That's correct.
    Senator Sessions. In some arguments, you could argue that 
there were more votes against the regulations than there were 
in favor of it.
    I think, Mr. Billings, that's what concerns me. I'm 
prepared to support costly things if we can get a significant 
health benefit from it, but the numbers that I'm seeing and the 
reports that I read indicate some real divergence of opinion.
    For example, there was a study in Birmingham on particulate 
matter that showed a bad effect from it. Someone else came back 
and ran the same numbers and they factored in humidity and 
there was no change in health.
    So there are a lot of things that may be in that air on a 
bad ozone day other than just ozone and particulate matter. 
Would you agree with that, Mr. Billings, that maybe we don't 
know all we need to know yet?
    Mr. Billings. Well, clearly we don't know all we need to 
know. Thirty years ago, when we did the first standards, we 
didn't know all we needed to know. Congress didn't know all it 
needed to know in 1970. In 1970, 1977, 1982, and 1979 when EPA 
revised the ozone standard, they revised it upwards. And now 
they're saying that they went in the wrong direction.
    So there's no such thing as finality in science. That's 
why, when Senator Muskie and Senator Baker and this committee 
unanimously adopted this policy, they made a decision to keep 
science separate from cost, because they wanted to get the best 
scientific judgment they could get. They assumed that they were 
getting a sound scientific judgment separate from these other 
issues that the chairman has raised.
    Now, those issues are legitimate, but they are separate 
from the scientific judgment.
    Senator Sessions. Let's talk about that. Let's really talk 
about that honestly on the table here.
    I know that there is a belief that we need to keep science 
separate from cost. I believe that's correct. I think we need 
to scientifically know what kind of damage that we may get from 
bad air. All right. What about the ultimate decision to 
implement between multiple choices of making a community better 
to live in?
    The mayors have to make--she's got a lot of choices. Maybe 
the sewer system is better. Maybe there are hazardous waste 
dumps. I mean, don't we have to, at some point before we make a 
final implementation, categorize just how much health advantage 
we get compared to just how much the cost is?
    Mr. Billings. You're absolutely right, and that's--in 
1970----
    Senator Sessions. How do you distinguish----
    Mr. Billings. In 1970 what the committee did--again in a 
bipartisan way--supported unanimously by the Senate, as well as 
the committee--was to set a deadline of 5 or 6 years to achieve 
the health standards. EPA was to promulgate the standards in 90 
days.
    Congress came back at the end of that 5- and 6-year period 
and said, ``Lo and behold, we didn't do it. We established the 
urgency of the problem, but we didn't solve the problem.''
    So they said, ``Well, we can give areas with sort of bad 
problems another 5 years, and those with really bad problems 
another 10.''
    And Congress came back in 1990 and they said, ``We haven't 
gotten there yet. There are some areas where we've had enormous 
economic growth and so on.''
    So Congress, under the leadership of this committee, said, 
``We're going to give areas that are marginal, like Tulsa, 
we're going to take them out. We're going to let other areas 
have another 3 to 5 years and other areas will get 17 to 20 
years.''
    So what Congress has done is, after it established the 
science, what the health standards are, then Congress has taken 
a very careful look at these cost issues and these 
implementation issues and these technology issues and said, 
``How long does it take, spreading our resources out so that we 
carefully spend our money, while at the same time balancing how 
much health we're going to protect, because every time we delay 
this for a year or 2 years of 5 years we are making a health 
decision, too.'' We're saying, ``Those people who are not 
protected then are going to continue to be unprotected.''
    Senator Sessions. I appreciate that, and it is a difficult 
dilemma because we don't want to undermine health. But, as the 
air gets cleaner and as it continues to get cleaner, the 
burdens imposed by moving one notch lower and the health 
benefits from moving one notch lower--burdens get higher and 
the benefits get a little less. I think we're reaching that 
area, it seems to me.
    Mr. Selph, you mentioned your situation there, and you 
talked about the winds blowing into Tulsa. Were you saying 
there's a natural effect of ozone in your area, or is that----
    Mr. Selph. We think that there are some biogenic factors at 
work, whether it's from old oil fields in the southern Tulsa 
County area or whatever the sources may be, but certainly they 
have an impact on the levels of ozone in that area.
    If I could, I'd like to go back to something that you said 
earlier about the study that was done and the effect of 
humidity.
    Certainly there are other factors at work, and that's why I 
suggested in my testimony that future epidemiological studies 
should look at the interaction effect that these co-pollutants 
have on each other, because sometimes they are additive--in 
other words, one plus one equals two. If you mix ozone with 
sulphur dioxide, for example, you may get an additive effect. 
Or you may get what's called a ``synergistic effect,'' where 
one plus one equals three. You have a more serious effect. Or 
it could be antagonistic, where one plus one equals zero, where 
they cancel each other out.
    Those type of things are difficult to research, but they do 
need to be researched.
    Senator Sessions. I think that's right. I know in the case 
of asbestos and tobacco, the combination--the cancer from 
tobacco and the cancer from asbestos add up to 8 or 10. It's 
the synergistic effect. So I think that's a good observation.
    One of the studies that we had was from New York about 
hospital admissions for asthma, and the numbers showed that 
there was something like a 1 percent increase in hospital 
admissions for asthma attacks on a bad ozone day.
    The chairman or some member of the committee had a 
scientific journal study that analyzed the problems that you 
have with these kind of analyses in public health and concluded 
that if the number didn't get to 2 or 3 percent you really 
didn't have a very good basis to take action.
    As a scientist and public health student, do you see a 
danger in making major decisions on data just that small?
    Mr. Selph. Well, I do, and those are certainly difficult 
decisions. And certainly if your family is of that 1 percent 
you might look at it from another perspective. But in terms of 
having what we consider to be significant findings, you really 
have to look at results that are greater than that.
    Senator Sessions. I'll just point out that the odd thing on 
the asthma is that ozone levels have been falling nationally 
for some time and asthma attacks are going up. I don't think 
there's any study now that can tell us what's causing it. It 
may be something entirely different.
    Thank you, Mr. Chairman.
    Senator Inhofe. Thank you, Senator.
    Before you got here I went over the--if you'll remember, 
the last time we were in this room Mary Nichols was the one who 
answered my question in the negative when I was talking about 
the cost and the benefit. I think it was just a mistake on her 
part, but this is--I think you have one of these, and this kind 
of answers some of those questions as to the cost and benefit.
    I want to thank all of you for coming. It's necessary to 
have a lot of meetings because we want input from everyone.
    Your entire statements will be entered into the record and 
we are going to be submitting questions to you in writing, and 
we'd like to have you respond because we want to hear from 
everyone.
    I hope, Mr. Billings' and Mr. Russman's appearance here, 
when really you're representing somewhat of a minority 
position, although you argue that it's not as well-informed out 
there as it should be, nonetheless, we are making an attempt to 
get everyone in here with all views.
    We appreciate very much your coming today and will 
appreciate your continued cooperation in responding to our 
questions so we can come up with the right conclusions.
    Thank you.
    And now I ask our second panel to come to the table. The 
second panel consists of: Robert Junk, president of the 
Pennsylvania Farmers Union on behalf of the National Farmers 
Union; Mr. Bob Vice, who is the president of the California 
Farm Bureau Federation for the American Farm Bureau Federation; 
Mr. Paul Hansen, executive director of the Izaak Walton League 
of America; Dr. Kevin Fennelly, medical doctor, staff 
physician, the Division of Environmental and Occupational 
Health Sciences, National Jewish Medical and Research Center; 
and Dr. Christopher Grande, executive director of the 
International Trauma Anesthesia and Critical Care Society.
    Welcome to all of you. I would say to our two witnesses, 
our two experts representing some of the agricultural concerns, 
that I've spent a lot of time throughout western Oklahoma and 
throughout southern Oklahoma in our ag communities to find that 
there is a great deal of concern from both the Farmers Union, 
the Farm Bureau, and their members.
    We'll start off with Mr. Robert Junk, the president of the 
Pennsylvania Farmers Union.

 STATEMENT OF ROBERT C. JUNK, PRESIDENT, PENNSYLVANIA FARMERS 
               UNION, FOR NATIONAL FARMERS UNION

    Mr. Junk. Thank you, Mr. Chairman.
    Good morning, Mr. Chairman and members of the committee. My 
name is Robert Junk. I am the president of the Pennsylvania 
Farmers Union. I'm also a member of the board of directors of 
the National Farmers Union and appear here today on behalf of 
the National Farmers Union.
    The National Farmers Union is a general agricultural 
organization representing 300,000 family farmers and ranchers. 
We thank you for the opportunity to comment on the proposed 
changes of air quality standards and emissions of particulate 
matter.
    The National Farmers Union has a long history of supporting 
conservation programs because the family farmers, as stewards 
of the land, are concerned about the environment. Significant 
levels of emissions are already controlled because farmers and 
ranchers are using good soil and water conservation practices 
and are keeping their equipment in good operational condition. 
It is simply in their best interest to do so because they seek 
to preserve the land to pass on to future generations.
    The National Farmers Union is concerned that the proposed 
changes to the air quality standards for fine PM and ozone will 
greatly increase the regulations of farm operations and 
increase costs to farmers, both directly and indirectly. We are 
additionally concerned that there is currently no funding in 
place to offset these costs other than what farmers will be 
required to pay.
    At this point in time, I would like to summarize the rest 
of my testimony for means of time.
    I think there are three points that we have to look at when 
we are addressing the proposed changes here. We need realistic 
goals based on sound science. For example, Paul Johnson, head 
of the NRCS, made a comment: ``We believe and will coordinate 
research programs, and Federal, State, and local participation 
is necessary in order to begin answering these questions.''
    I think it is important that we take a look at that whole 
issue because of the fact that, again, we have to establish 
realistic goals. What is something that we can achieve? And 
then also it has to be based on the sound science that supports 
to achieve those goals.
    I think the next issue we need to take a look at is a 
practical model. I think we're all aware of the Clean Water 
Act. The Clean Water Act has accomplished a number of different 
things out there today, and one of the biggest things that the 
Clean Water Act has incorporated out there in the agricultural 
community is the outreach in education to farmers.
    I think what we need to do is take a look at how the 
conservation districts, along with the States, can partner 
together to provide this adequate information to deliver to the 
farmers to give them their practical practices that can be done 
to achieve some of the standards that we would like to see in 
clean air.
    A little bit back in history of myself, currently I serve 
on the Chesapeake Bay Advisory Committee in Pennsylvania, and 
am the vice chairman of the Agricultural Advisory to DEP. Both 
of those agencies are working on water quality.
    Again, I reach out to the fact that one of the basic 
problems we are having here with the air quality standards is 
the fact that we are not doing the outreach and education that 
we have done currently under the water quality issue. I think 
it is important that we take a look at that.
    I think the other area that we need to--the third point 
that I would like to talk about is the Federal funds to achieve 
goals, basically making it a priority, not just for one agency 
but for all relative agencies. I think we need to, again, work 
for partnershiping to assure that the funding is there to help 
achieve our goals.
    For example, one of the biggest issues I think we're facing 
is retrofitting old and new equipment--the clarification 
between what is new and what is old when we go looking at these 
new standards coming into place. How do we associate a new 
tractor that was just purchased, and now we have these 
standards? Who is responsible for making that tractor comply 
with the new regulations?
    It's very costly. Farmers today have a difficult time being 
able to pass these additional costs on out of their products. 
It's important that we continue to look at that.
    One other comment real quick I'd like to make is dealing 
with the USDA. The Department of Agriculture questioned EPA's 
proposed standards on PMs and charged that the new standards 
are not based on adequate scientific evidence and would have a 
large economic impact on tens of thousands, if not hundreds of 
thousands of small business farms. I think that is a very 
important issue.
    In Pennsylvania we have a very heavy urban-based community. 
Also, we have farms right outside of these urban areas. We are 
suppressed by urban sprawl.
    If these new standards go into place, these emission 
standards may not even be coming from the actual farm 
community, but the actual farm community would have to abide by 
the same standards.
    So, in conclusion, at this point in time the National 
Farmers Union would encourage no changes within the standards 
until we have some good scientific base to back up these 
changes, along with being able to identify the source point.
    Thank you very much.
    Senator Inhofe. Thank you very much, Mr. Junk.
    We've been joined by Senator Baucus.
    Senator Baucus, would you like to have an opening 
statement?
    Senator Baucus. No. Thank you very much, Mr. Chairman.
    Senator Inhofe. All right. We've just completed our first 
panel, which was mostly county, State, and city officials.
    Mr. Vice.

   STATEMENT OF BOB VICE, PRESIDENT, CALIFORNIA FARM BUREAU 
        FEDERATION, FOR AMERICAN FARM BUREAU FEDERATION

    Mr. Vice. Thank you, Mr. Chairman, Senator Sessions, 
Senator Baucus. Thank you for the opportunity to be here today 
to testify before this committee on a very important issue--air 
quality.
    I am Bob Vice. I'm a farmer from southern California. I 
raise avocados and citrus in Fallbrook, north San Diego County. 
I'm the president of the California Farm Bureau Federation, and 
today I'm representing the American Farm Bureau Federation, of 
which I serve on the board of directors. It's the Nation's 
largest general farm organization, with more than 4.7 million 
members nationwide.
    I'm pleased to have the opportunity to discuss with you 
today the impact that the new air standards would have on the 
agricultural community.
    My comments focus primarily on the Environmental Protection 
Agency proposal to revise the national ambient air quality 
standards for particulate matter.
    There has been and there continues to be a tremendous 
amount of conservation activities by farmers and ranchers 
across this country. These activities include such things as 
conservation tillage techniques, or so-called ``no-till'' 
planting, planting cover crops, planting trees and vegetation 
for wind breaks. All of these activities reduce wind erosion of 
the soil which, in turn, provides cleaner air.
    Farmers are cleaning the air and should get credit for 
those activities, but make no mistake that we are all for clean 
air, and this debate today really is about how to continue to 
achieve those goals.
    Agriculture is concerned because the EPA estimates show 
that 34.3 percent of the fine particulate matter can be 
attributed to agriculture and forestry. And, regarding this 
questionable large estimate, I quote Dr. Calvin Parnell, a 
professor of agricultural engineering at Texas A&M University, 
and a member of the Depart- 
ment of Agriculture's Task Force on Air Quality. He says--and 
we agree--``the data used to develop this inventory was based 
on erroneous emission factors published by EPA for cattle feed 
yards, for feed mills, grain elevators, and dust from farmers' 
field operations.''
    Furthermore, I quote The Honorable Larry Combest, chairman 
of the House Agriculture Subcommittee on Forestry, Resource 
Conservation and Research. He says--and we also agree--``The 
Science employed in developing this rule is not up to par, and 
I'm concerned that farmers will bear the brunt of a bad policy 
based on equally bad science. We don't have the research yet to 
know whether we could actually attain these standards, how much 
it will cost the agriculture industry and the consuming public, 
and how much agriculture activities actually contribute to air 
pollution problems.''
    Today, however, I want to focus on an actual situation 
those of us involved in California agriculture already face in 
regard to the present PM10 serious nonattainment 
area for central and southern California. Agriculture in other 
areas of the country may face the same situation if new PM 
standards are imposed. Let me expand on one of our air 
district's experiences in dealing with the present 
PM10 standards in regard to agriculture.
    The emission inventory for agriculture that is used by EPA 
has proven to have many flaws. Inaccurate estimations of the 
number of times a farmer drives their tractors over a field is 
just one major example. It was estimated that farmers tilled an 
alfalfa field eight times a year. The actuality is that alfalfa 
fields aren't tilled at all, aren't disked at all. They're cut. 
There is quite a difference between disking and cutting hay.
    It is estimated that rice fields were disked 13 times a 
year. Rice fields are disked one time a year. Rangeland two 
times a year. To my knowledge, there isn't any normal practice 
where you disk rangeland.
    But probably the most blatant example of inaccurate 
inventory which would have cost the agricultural industry 
hundreds of thousands of dollars was the initial emissions 
inventory for combustion engines used on irrigation pumps in 
the San Joaquin Valley. The original inventory estimated that 
nitrogen oxide emissions, a precursor to PM10, was 
at 626 tons per day from the irrigation pumps in San Joaquin 
Valley.
    This would have been the highest emission category for any 
nitrogen oxide in the San Joaquin Valley, including all cars 
and trucks.
    Driven by agricultural inquiries as to this study, a new 
study was commissioned that was based on actual interviews with 
farmers about their pumps. The new study determined that 
nitrous oxide emission for these pumps was actually 32 tons a 
day, not 626 tons a day.
    We have only begun to address agriculture's concern about 
PM10 estimates, many of which are unaddressed and 
incorrect.
    Concerning these discrepancies, it's unbelievable that we 
are now facing again the same problems, only this time with 
smaller particulate matter.
    In attempting to resolve some of the agricultural emissions 
surrounding the PM10 and PM2.5, it became 
necessary to conduct a multiyear, multifaceted air quality 
study. Such a study was developed and is now underway in 
California. However, it will not be completed, it is estimated, 
for 5 years.
    I want to emphasize that this study is the first 
comprehensive study that will actually measure, not estimate, 
PM10 emissions. In order to avoid the mistakes that 
we made with PM10, this study and others like it 
must be completed before the costly implementation activities 
and attainment deadlines and regulations are set in place.
    In conclusion, I want to emphasize that a shotgun approach 
will only serve to put American agricultural out of competition 
with other countries and put agricultural producers out of 
work.
    Because U.S. agricultural commodity prices are really tied 
to global prices, a farmer cannot simply pass on the cost of 
doing business to the consumer. Therefore, any increase in 
operational cost of farming becomes significant and must be 
based on accurate information that really justifies the 
expenditures.
    We want to be careful that we're not tipping the balance of 
regulation in this country so far as to force the grocers and 
the brokers to place their orders with food purchased from 
other countries.
    The agricultural community enjoys breathing clean air as 
much as anyone, but we don't want to waste money on control 
measures that will have little or no effect on the air in this 
Nation.
    The USDA must maintain a strong presence and discussion 
continuing these standards, and we recommend it extend their 
comments on the issue in regard to economic impacts of the 
standards on farms and ranches.
    USDA, the Small Business Administration, and the USDA's 
Agricultural Air Quality Task Force must continue to demand 
that the concerns of American farmers and ranchers are 
addressed at the EPA in order to sustain a healthy abundant 
food supply.
    Senator Inhofe. Thank you, Mr. Vice.
    Mr. Hansen.

  STATEMENT OF PAUL HANSEN, EXECUTIVE DIRECTOR, IZAAK WALTON 
                       LEAGUE OF AMERICA

    Mr. Hansen. Thank you, Mr. Chairman, Senator Sessions, 
Senator Baucus. I am Paul Hansen, executive director of the 
Izaak Walton League of America, which is celebrating its 75th 
year of working to conserve, maintain, protect, and restore the 
soil, forests, water, and other natural resources of the United 
States.
    Protection of the Nation's air quality is part of the Izaak 
Walton League's mission and is of vital importance to our 
members, the majority of whom live in our Nation's agricultural 
communities.
    We've worked on clean air issues since the first Federal 
Air Pollution Act, which you may remember was passed during the 
Eisenhower Administration. You've already heard testimony on a 
few of the benefits this new standard would realize for the 
health of our people and our natural environment. I want to 
implore you today to consider the findings of the Department of 
Agricultural's national crop loss assessment network data which 
was released during the Reagan Administration.
    We were involved in this NCLAN study and cosponsored a 
symposium in 1982 with the Boyce Thompson Institute at Cornell 
University, at which many of the findings were released and 
discussed.
    In 1990 I personally followed up on that information and 
conducted a literature review of the effects of air pollution 
on crops, a summary of which is available for you here today.
    I'm here today to tell you that there is a great deal of 
science that shows unequivocally that the benefits of this 
standard would by far exceed the costs to the American farmer. 
The new ozone standard would provide millions of dollars in 
agricultural benefits each year.
    At air pollution levels today, well below those that are 
commonplace, ozone can reduce the yield of commodity crops like 
corn and soybeans by 10 percent or more, depending on the 
particular cultivator. Dirty air costs our country 
approximately one billion bushels of corn and two million 
bushels of soybeans each year. Based on the 1992 agricultural 
consensus figures, that cost is approximately $3 billion in 
lost revenue.
    This figure is consistent with the figure found in 1982 by 
NCLAN, where researchers calculated the air pollution losses 
alone to only four major crops--corn, wheat, soybeans, and 
peanuts--amounted to between $1.9 and $4.5 billion annually.
    Because these figures did not include other potentially 
sensitive crops or other pollutants or some of the potentially 
synergistic effects we heard about earlier, or environmental 
stresses such as disease and drought, these figures are likely 
to be much higher than the ones that NCLAN found.
    It's very well established in the literature the effects of 
ozone on crops is very insidious and, in most cases, invisible 
even to experts such as those we have here today. A 10-percent 
reduction, which can be common at ozone levels found throughout 
much of the soybean growing region, while highly significant in 
terms of yield, would be effectively invisible, even to the 
trained eye. Can you imagine holding in your hand soybeans, and 
then another handful of soybeans that would weigh 10 percent 
less? It would be very hard to see.
    In the last 2 years, much more recently, three groups of 
experts on ozone's vegetative impacts have reconfirmed the 
seriousness of ozone's impacts on commodity crops, forests, and 
other vegetation, which were first measured by NCLAN in 1982.
    These groups include the agricultural forest and ecological 
scientists convened at the Southern Occident Study Workshop in 
1995, the Department of Interior, and the independent Clean Air 
Scientific Advisory Committee. All three have recommended a 
secondary standard for ozone to help protect our Nation's crops 
and vegetation from the effects of ozone. All have emphasized 
that crops and vegetation are much more sensitive to ozone 
impacts than even humans are.
    I know that concern has been expressed regarding the cost 
of implementing a new PM2.5 standard, particularly 
in agricultural areas. I'd like to close by addressing this 
issue.
    First, it's essential that standards be set at levels that 
are protective of human health, not levels regulated industries 
consider cost-effective.
    More importantly, the new particular matter standard 
applies to PM2.5, not PM10. EPA has not 
recommended any tightening levels of PM10. The 
distinction is important because all PM2.5 is the 
product of combustion, and almost all PM10 is 
created by earth-moving activities such as construction, 
mining, or agricultural practices like tilling.
    Third, on most farms the primary source of combustion is 
diesel-fueled farm equipment. This equipment is responsible for 
a very tiny amount of the primary pollutants that create 
PM2.5. The amount of these pollutants created by 
farm equipment is so small that they're insignificant when 
compared to emissions from other PM2.5 sources. It 
is highly unlikely that they would be regulated under any 
compliance plan.
    Farm equipment also creates only about 1 percent of the 
national nitrogen oxide emissions and almost no sulphur dioxide 
emissions.
    Finally, the history of pollution control suggests strongly 
that, even if control on diesel fuel does become necessary, 
these controls will cost a lot less than predicted.
    One industry lobbyist has suggested that our children can 
stay home on bad air days. Well, farmers don't have that 
option.
    On balance, if you take a good look at the science, I think 
that you will see that the new standard has a net benefit to 
the Nation's farmers.
    Mr. Chairman, I would like to thank you again for the 
opportunity to address this new standard's agricultural impacts 
and to try to shed light on one of the hidden victims of the 
Nation's polluted air, the American farmer.
    I would greatly encourage you to add to the list of people 
who testify at your hearings some of the Nation's experts, such 
as Dr. Howard Hack or Dr. Alice Cowling, who have been parts of 
these committees and were part of the NCLAN study back in 1982.
    Thank you.
    Senator Inhofe. Thank you, Mr. Hansen.
    We had made an attempt to involve as many people as 
possible, and apparently there is an infinite number of experts 
out there.
    Dr. Fennelly.

  STATEMENT OF DR. KEVIN P. FENNELLY, M.D., STAFF PHYSICIAN, 
  DIVISION OF ENVIRONMENTAL AND OCCUPATIONAL HEALTH SCIENCES, 
          NATIONAL JEWISH MEDICAL AND RESEARCH CENTER

    Dr. Fennelly. Thank you, Mr. Chairman and members of the 
subcommittee. My name is Kevin Fennelly. I'm an academic 
physician at the National Jewish Medical and Research Center in 
Denver, Colorado. I'm board certified in pulmonary medicine and 
in occupational environmental medicine, and my time is evenly 
divided between patient care and clinical and epidemiologic 
research.
    My research interests include the epidemiology of the 
health effects of particulate air pollution, so I am familiar 
with the scientific literature in this area.
    I'm testifying today as a concerned physician, scientist, 
and citizen in support of the EPA proposal for a new 
particulate matter standard.
    I wish to emphasize three points: No. 1, particulate air 
pollution causes human suffering, not just statistics; No. 2, 
there is biological plausibility to support the epidemiologic 
findings of adverse health effects associated with particulate 
air pollution; and No. 3, the risks of adverse health effects 
due to particulate air pollution are comparable to other risks 
which our society has not found acceptable.
    I have personally seen patients who report worsening of 
their asthma symptoms associated with air pollution in Denver, 
Phoenix, Los Angeles, and the San Francisco Bay area, and 
colleagues have reported similar encounters to me.
    I am disturbed by recent comments which have trivialized 
the respiratory symptoms associated with air pollution. Allow 
me to suggest a simple exercise for those of you who may not 
have experience with respiratory diseases.
    Simply take a drinking straw and breathe through it for 
several minutes. Or, better yet, try to walk about and climb 
some stairs. Then imagine feeling that way for hours or days. 
It is not a trivial discomfort.
    Another disturbing suggestion I have heard is that patients 
with lung diseases should simply medicate themselves more to 
cope with air pollution. This is irrational and violates basic 
medical principles.
    A common criticism of the EPA proposal is that the 
epidemiologic studies are not supported by biological 
plausibility. Although we still have much to learn, this is not 
true. In the killer fog of London in 1952, 60 percent of over 
500 autopsies demonstrated both heart and lung disease.
    Godleski and colleagues recently presented preliminary 
findings of an inhalation toxicology study coherent with these 
pathologic findings. Animals with chronic bronchitis who were 
exposed to urban air particulates had a much higher death rate 
than did the unexposed animals.
    Other animal studies have demonstrated lung inflammation 
and injury, especially with exposures to the very small or 
ultrafine particles.
    In my written testimony I have cited several recent papers 
on the basic biological mechanisms underlying these 
inflammatory responses.
    The critical question is how much risk we, as a society, 
are willing to accept. In our history, cancer hazards have 
often been regulated if the risk were greater than 1 per 
100,000. In fact, the Clean Air Act amendments of 1990 mandated 
that the EPA regulate air pollutant emissions to reduce the 
lifetime cancer risk to less than 1 in 1,000,000.
    I suggest that an increased risk of death from heart or 
lung disease should be assigned equal value to the increased 
risk of death from cancer.
    In my written testimony, I calculated incidence rates for 
deaths attributable to short-term exposures to particulate air 
pollution in Denver, Philadelphia, and Los Angeles. For Los 
Angeles, this risk is 250 per 100,000 persons over 10 years; 
thus, the risk of acute cardiopulmonary death associated with 
particulate air pollution over only one decade is greater than 
a lifetime risk of cancer previously deemed unacceptable by 
Congress and the Supreme Court.
    Furthermore, acute mortality is only the tip of the 
iceberg. These estimates do not include the many chronic and 
nonfatal health effects of particulate air pollution.
    These issues are extremely complex, and in our struggles to 
be objective by analyzing quantitative data it is easy to 
become known by the numbers. Behind those statistics are real 
people suffering with real symptoms. There are adequate data to 
support more stringent regulation of particulate air pollution, 
and the lack of absolutely certainty cannot be an excuse for 
inaction.
    We could improve the public health by implementing even 
more protective standards, such as those proposed by the 
American Lung Association. At minimum, I urge you to support 
the proposed changes in the particulate air pollution standard 
as proposed by the Environmental Protection Agency, but with 
retention of the existing PM10 standard.
    Thank you for this opportunity to share my concerns.
    Senator Inhofe. Thank you, Dr. Fennelly.
    Dr. Christopher Grande.

    STATEMENT OF DR. CHRISTOPHER M. GRANDE, M.D., EXECUTIVE 
  DIRECTOR, INTERNATIONAL TRAUMA ANESTHESIA AND CRITICAL CARE 
                            SOCIETY

    Dr. Grande. Good afternoon. My name is Dr. Christopher 
Grande, and I'm a practicing physician from Baltimore, MD. I'm 
a board-certified anesthesiologist and intensive care 
specialist in trauma injury. I have authored and edited 
numerous medical books and have had about 30 articles published 
in professional journals.
    I'm also executive director of the International Trauma 
Anesthesia and Critical Care Society, or ITACCS for short. 
ITACCS is a 10-year-old professional association of more than 
1,000 trauma specialists and emergency room physicians, nurses, 
and related professionals.
    I also hold a master's degree in public health from Johns 
Hopkins University School of Public Health.
    I would like to thank the committee and Chairman Inhofe for 
inviting me to provide ITACCS' views on the proposed ozone and 
particulate matter standards.
    Before I specifically address the standards, though, I 
would like to first give the committee some important 
background information.
    As Dr. Fennelly pointed out, every day I'm in the hospital 
emergency room I see patients and problems vying for critical 
resources, from acute asthma patients to traumatic injuries. 
These are all competing public health priorities--all competing 
for limited available public health resources.
    The focus of ITACCS is traumatic injury, often accidental 
in nature, such as that caused by motor vehicle, on-the-job, or 
household accidents. Injury is the leading cause of death for 
those under the age of 45, and it is the fourth-leading cause 
of death overall in the United States--about 150,000 deaths per 
year.
    Trauma cuts across all of society. The injured person is 
not someone else. The injured patient is you, your child, your 
spouse, your parent.
    The average age of injury victims is 20. Death from injury 
is the leading cause of years per life lost in the United 
States--more than twice the number of years per life lost as 
the next-leading cause, cancer, and three times that of heart 
disease.
    According to 1990 statistics from the Centers of Disease 
Control and Prevention, traumatic injury was responsible for 
approximately 3.7 million years of potential life lost. In 
contrast, cancer was responsible for 1.8 million years of 
potential life lost, and heart disease was responsible for 1.3 
million years of life lost.
    What does this tell us? The National Academy of Sciences 
concluded in 1985 that trauma was the No. 1 public health 
problem in the United States. This situation remains unchanged 
today.
    How is this relevant to the debate over ozone and 
particulate matter standards? It can be simply put in three 
words: public health priorities. The fact is that society has 
limited resources that it can spend on public health. As such, 
responsible public policy dictates that such resources be spent 
so as to achieve the biggest bang for the buck.
    ITACCS is not convinced, neither should the public be, that 
the proposed ozone and particulate matter standards are a smart 
way for us to spend our limited resources. But I want to make 
it clear that we are not singling out only proposed ozone and 
particulate matter air quality standards. The proposed 
standards are merely the latest example in what we see as a 
disturbing trend over the last two decades where scarce public 
health resources are diverted from more clearly demonstrated 
beneficial uses.
    The unintended consequence of this diversion might be a 
decrease in the overall effectiveness and efficiency of public 
health care delivery.
    As the makers of our laws and the ultimate allocators of 
our public health resources, Congress should take the lead in 
rationally allocating our limited resources. But how would 
Congress know what is a priority and what is not? The process 
behind the proposed ozone and particulate matter air quality 
standards has not been helpful.
    First, the proposed rules do not provide a ranking or 
comparison between the estimated health effects attributed to 
ozone and PM and those of other public health needs.
    One of the health end points associated with the proposed 
rules is asthma. No doubt, asthma is a serious issue and our 
public health resources should be directed at asthma. But a 
recent study published in the February 1997, issue of 
``American Journal of Respiratory and Critical Care Medicine,'' 
a journal of the American Lung Association, helps place air-
pollution-induced asthma in perspective.
    In this study, which includes a study design that has been 
characterized as the most reliable on potential health effects 
of ambient ozone--that is, the study model of children 
attending asthma camp--air pollution was associated with a 40 
percent increase in asthma exacerbation in children. It sounds 
bad, but what does this really mean?
    Assuming, for sake of argument, that the author's 
conclusion is reasonable, this increase in asthma exacerbation 
equates to one extra use of an inhaler amongst one in seven 
severe asthmatics on the worst pollution day.
    However, close scrutiny of this study reveals that many 
confounding risk factors for asthma exacerbation were not 
considered by the study authors. These risk factors include: 
changes in temperature, atmospheric pressure, anxiety, physical 
exertion, dust, and fumes, and many more--all recognized to be 
active factors.
    Moreover, the study is inconsistent with the general 
observation that, while asthma has increased over the last 15 
or so years, air pollution has decreased.
    As stated earlier by the chairman, there appears to be no 
generally accepted explanation for this phenomenon; therefore, 
the study does not satisfactorily link ambient ozone with 
asthma exacerbation.
    Before we commit our scarce resources, wouldn't it be 
useful to know exactly where this very uncertain health effect 
ranks amongst other real public health priorities?
    If asthma qualifies as a public health concern, appropriate 
levels of funding should be targeted at programs that have been 
proven to be effective but not fully implemented.
    Senator Inhofe. Mr. Grande, we're running out of time. 
Could you conclude quickly?
    Dr. Grande. Certainly.
    The long and the short of it, Mr. Chairman, to cut to the 
end of this, is that asthma, as Dr. Fennelly so astutely 
pointed out, is an important health problem. It needs to be 
examined within the context of other important health problems. 
I'm not here to talk about my disease, trauma, today, but if I 
were, I have the hard statistics to back up any statement that 
I would want to make that would allow trauma to compete for 
allocation of other scarce health resources.
    Any disease should be qualified as a public health crisis 
and then appropriate levels of funding should be decided 
through a competitive analysis based upon sound data.
    Senator Inhofe. Thank you, Dr. Grande.
    Let me start off with the two gentlemen representing the 
Farmers Union and the Farm Bureau. We passed a law, the Small 
Business Regulatory Standards Act, that requires that, prior to 
putting out a rule, that we deliberate the effects that it 
would have on what they call ``small entities.'' It's somewhat 
vague in its interpretation, but generally they're talking 
about people with less than 10 employees or individuals. I 
think they're really talking about the farmers of America here.
    Apparently, we've heard from these hearings here that this 
wasn't going to have any noticeable impact. Would you agree 
with this, that we are--that it's not going to have the impact 
on what is defined as small entities or firms?
    Mr. Vice. I certainly wouldn't agree with that at all. I 
think it would have a large impact.
    Senator Inhofe. There are two areas, two laws that we've 
talked about several times. That's one of them. The other is 
the unfunded mandates. We've heard from the last panel that 
they expressed themselves pretty clearly on that.
    Mr. Vice, you heard testimony from Mr. Hansen. They claim 
that farms would benefit more from these standards and that the 
only real cost would be controls on diesel-fueled farm 
equipment, which he doesn't seem to think will be necessary.
    Last week we had a witness from the Southwest Coastal 
Management District in California--which you probably know that 
individual. They said that the diesel vehicles would need to be 
controlled, along with small, two-stroke engines.
    How would these controls, in your determination, affect 
farmers?
    Mr. Vice. Well, I think it will affect it greatly. In fact, 
the latest information I have is that the emissions, alone, is 
estimated to be--the total emissions, according to a chart that 
was put out by the Air Resources Board, indicates that almost 
over a third of all the emissions are from agriculture.
    If we start trying to mitigate that, it is going to be a 
tremendous cost to agriculture. I agree with Mr. Hansen that 
there would be crop loss. I think there have been studies that 
would indicate that.
    What we do disagree on is how much. In fact, I have a 
report by EPA's own Scientific Committee reporting on crop loss 
that says that two of the experts--it said the open-end 
chambers experiments, by their very design and execution, 
produces results that over-estimate the effects of ozone on 
plant yield.
    I think that we have a lot of work to be done in this area, 
and I don't disagree with anyone about the fact that this is a 
health problem that needs to be addressed.
    My testimony and my concern is that we have bad science 
dictating how much of this is coming from the agricultural 
community.
    When you have a study that says farmers disk a hay field 
eight times, we know that that's not right.
    Senator Inhofe. You're from California, and you, Mr. Junk, 
are from Pennsylvania, so we're kind of in the middle there out 
in Oklahoma. I probably speak for Senator Baucus, too.
    We have a different type of a problem--that is, a normal 
wind velocity that is there on a daily basis.
    I was in western Oklahoma all day yesterday, all the way 
from Altus up to Woodward. They are very much concerned about 
this because on a normal day--in fact, you can't find a day 
that doesn't have what we feel would put them into the 
position, as far as the new standards on particulate matter, of 
being out of compliance.
    Would you tell me again--you talked about the faulty 
information or assumptions that we had on disking of rice 
fields. I found that to be kind of interesting, although I 
don't really think about disking of rice fields, but I don't 
know that you don't disk the rangeland, because we have a lot 
of that out there. Where did that come from?
    Mr. Vice. That was figures that were used in the study on 
PM10 particulate matter, 10 microns, and how much 
was coming from the agricultural community.
    It was estimated that the dust contributed this vast 
amount, and when they extrapolated back of how the dust ended 
up in the air it was because of these number of trips through 
fields that tractors made, and that's where the estimation of 8 
times disking a hay field came up, 13 times on rice, and 2 on 
rangeland. That was part of the study that was put together on 
ambient dust.
    Senator Inhofe. Yes. And who did this study?
    Mr. Vice. It was done, as far as I know, by EPA.
    Senator Inhofe. OK. Mr. Hansen, you mentioned that--and 
I've heard in the last five hearings all kinds of estimates on 
premature deaths. I think the figure you used was 15,000. The 
figure that the EPA used at one time--they've used several 
figures--at one time was 20,000, and then we had a group coming 
in here that said it was 60,000.
    I guess I'd ask you and the two doctors to get a--how do 
you arrive? You know, obviously someone is wrong, but if you're 
trying to promote a program that might be a flawed program or a 
premature program not based on science, the first thing you 
want to do is get the public thinking that there are thousands 
and thousands of premature deaths out there.
    Give us your estimate as to how they can determine, Dr. 
Fennelly and Dr. Grande, premature deaths, and why there is 
such a divergence in these estimates?
    Dr. Fennelly. I'll go ahead.
    I believe most of that, or at least the early work, was 
done by Dr. Joel Schwartz, and it does involve a lot of 
computations that I think results in some of the disparity in 
results, because essentially you have to try to get estimates 
of how much particulate matter pollution there are in various 
cities across the country, and then for each day try to 
estimate how much over baseline, if you will, the pollution is, 
and then what fraction of deaths would be attributable to that.
    But, as you said, what I've heard is consistent with your 
comments, and that is more in the 40,000 to 60,000 per year 
range.
    Senator Inhofe. That's not really what I said. I said that 
there is a disparity that I don't understand because I don't 
have that kind of a background.
    My beloved mother-in-law died on New Year's Day. She was 94 
years old. I've often wondered if she showed up in the 
statistics.
    Dr. Fennelly. Well, she may if she was in a city where 
there was high air pollution on that particular day.
    Senator Inhofe. Yes.
    Dr. Fennelly. But because of the epidemiologic nature you 
can't isolate any one person.
    Senator Inhofe. Dr. Grande, any thoughts on that?
    Dr. Grande. I agree with a lot of the way that Dr. Fennelly 
has explained the process of collecting the data. On a specific 
point, the number that you brought up, I heard the 15,000 to 
20,000. Let me point out that I am not an expert on ozone or 
air quality standards, but I do have training and background in 
public health and biostatistics, and, as far as that 15,000 or 
20,000 deaths per year disparity, it was my understanding, as 
acknowledged recently by the EPA and then reported in major 
newspapers such as The Washington Post, the simple error of 
using an arithmetic mean instead of using an arithmetic median 
reduced this estimate mortality from fine particulate matters 
down from 20,000 to 15,000.
    Now, having reviewed, as I have, a fair amount of the data 
and literature, both from the physical sciences side of this as 
well as the clinical science side of it, and as an educated 
observer, it seems to me that the right hand is not talking to 
the left hand about this data, and that's one of the problems. 
A lot of this clinical studies which really would represent, if 
you will, where the rubber meets the road have yet to be done.
    But, in general, reviewing the collection of data that I've 
seen on this--and I've heard people much more educated and 
astute about this comment the same, which is that it's an 
extremely poor collection of data. It's based on a number of 
assumptions which, if--it's almost like a house of cards. If 
you pull out one card, everything through that entire 
assumption could fall apart.
    Senator Inhofe. I understand.
    Senator Baucus.
    Senator Baucus. Thank you, Mr. Chairman.
    Gentlemen, obviously the goal here, as in most hearings, is 
to find the truth. Usually there is a grain of truth in what 
everybody says, and it's usually true that people kind of take 
their own positions in representing their own organizations, 
which tend to be a little more extreme than the middle. That's 
not always the case, but I think it's a fair assumption.
    So I'm going to take that assumption and assume that each 
of you is taking a position which is tilted a little bit more 
toward your organization's usual point of view rather than 
where the real truth actually lies here--that is, somewhere in 
between--and attempt to try to find that.
    Now, there are some who say that even though 
PM10 is an issue with respect to wind and dust and 
so forth, that what we're really getting at here is not 
PM10 at all but PM2.5. And those people 
say--and this is EPA's data. Right away that's going to raise a 
red flag. Some people are going to say, ``It's EPA, therefore 
it's wrong,'' but I'm going to assume that it's accurate until 
it's proven wrong.
    According to EPA, wind-blown dust is really only a small 
part of PM2.5--in fact, it's about 10 percent of 
PM2.5--and that farm activities are responsible for 
about one-third of wind-blown dust, and therefore a calculation 
is that farm activities are responsible for only about 2 to 3 
percent of the total PM2.5 problem, and that's 
somewhere along the lines of what you were saying, Mr. Hansen, 
if I heard your testimony correctly.
    And the rest of PM2.5, comes from combustion, 
and farm activities obviously through diesel combustion are 
part of that.
    But its this analysis that I am referring to--again this is 
off of the EPA web page--that essentially, with respect to 
PM2.5, farm activities are about 2 to 3 percent of 
the problem, and with respect to that part--and if we're to 
even look at diesel fuel and combustion, which would be diesel 
combustion, that when a State implements a plan, a State has 
all kinds of options on how to implement a plan.
    Perhaps a State might want to say, with respect to diesel 
combustion on farms, that that's not going to be touched; that, 
rather, they might look at diesel fuel off coast with ships or 
highways, or trucks--diesel combustion from trucks, for 
example.
    I know that farmers have a pretty good lobby, and my sense 
is that farmers will do a pretty good job in not being part of 
the problem.
    So what I'm really trying to get at here is first you, Mr. 
Hansen, and I'll ask you, Mr. Vice, to comment just on that 
general proposition that if you really look at the actual data 
that farm activities are really a very small part of 2.5, and 
then the next point is with respect to what we do about that if 
this proposed regulation were to go into effect, that it is 
true that there are lots of ways to deal with that, and one is 
through the State implementation plan, and when the States do 
devise their implementation plans there are a myriad number of 
ways that they can deal with the combustion part of it.
    So, Mr. Hansen, your observations? You know, we're all 
Americans. We're here together. We're just trying to find a 
common solution here.
    Mr. Hansen. Thank you. Mr. Chairman, Senator Baucus, I 
think you're absolutely correct that State implementation plans 
are very unlikely to include farm equipment and that 
PM2.5 is really not going to be affected by 
agricultural activity to any great extent.
    Diesel engines are already regulated by EPA and will 
continue to be. And we should point out that EPA has expressed 
their willingness to collect PM2.5 monitoring data 
for 3 years before PM2.5 implementation, so we 
should know a great deal more about this very question before 
anything before the States would be asked.
    Senator Baucus. So what you're saying is if this were to go 
into effect it would be about 10 years before it's felt?
    Mr. Hansen. Very likely.
    Senator Baucus. And lots of different options and 
alternatives during that 10 years to try to figure out an 
answer to this.
    Mr. Vice.
    Mr. Vice. Thank you, Senator Baucus. I couldn't agree more 
with you that we--this is an issue that, as we like to say, the 
science is in the following mode as to some of the regulations 
that are being proposed.
    For example, we started 2 years ago with the reformulated 
diesel in California during the winter months. We today do not 
know how much good effect or bad effect that's having. We think 
it's good, but, quite frankly, we don't have the figures in 
from that yet.
    There is a study that's being implemented right now, a 
good, hard study that measures what is the emissions out of 
farm equipment diesel and trucks hauling on the highway 
products with the reformulated diesel in the winter months. We 
don't have those figures yet.
    What we're saying is, ``Let's don't rush to implement 
standards where we don't have the hard evidence.'' We have 
estimates on what the emissions really are. Give us a chance to 
find out what those hard numbers are so we can make intelligent 
decisions rather than just rush into something.
    Senator Baucus. Yes.
    Mr. Vice. And I appreciate your estimate of the farm lobby, 
but I would maintain that anybody that sees over one-third of 
the emissions coming from agriculture isn't going to want to 
leave agriculture out of the formula to try to fix it.
    Senator Baucus. But we've determined it's not one-third; 
it's about 2 to 3 percent.
    Mr. Vice. Well, according to EPA's figure it's 34.5 percent 
is agriculture and forestry.
    Senator Baucus. Not with respect to PM2.5.
    Mr. Vice. This is the PM2.5 pie chart.
    Senator Baucus. Well, I have different EPA data. What I 
have is, once you calculate it out, it's about 2.5 from 
PM10--from PM2.5.
    Mr. Vice, I'm just curious--Mr. Chairman, one more 
question?
    Senator Inhofe. Sure.
    Senator Baucus. I was just struck with Mr. Hansen's point 
that the ozone standards will actually increase crop yields. Do 
you agree with that or not? As I understand, it's USDA data. I 
don't know where you got that information.
    Mr. Vice. I think there's crop damage. I don't agree that 
it's anywhere to the extent that Mr. Hansen has indicated. We 
think there are some--we know that there are some decrease.
    I was pointing to the EPA's Scientific Committee on that 
subject, where they admit in their own information that the 
figures that fall in their report are highly over-estimated. 
That's their Scientific Committee's report.
    Senator Baucus. Have you seen that, Mr. Hansen, that 
document that Mr. Vice is referring to, where apparently there 
is some acknowledgement that the data is over-stated?
    Mr. Hansen. I've not seen this. I do have data from USDA, 
1984, which has a list of the reductions for various cultivars. 
I'd be glad to submit this for your consideration.
    Senator Baucus. Mr. Chairman, if we could just have both 
documents submitted for the record, we could go through it and 
try to determine what's going on here.
    Mr. Hansen. The numbers are very high for some cultivators.
    Senator Baucus. Thank you.
    Thank you, Mr. Chairman.
    Senator Inhofe. Senator Sessions.
    Senator Sessions. Thank you very much, Mr. Chairman.
    I think we do have a serious public policy decision to 
make.
    Dr. Grande, I want to express my appreciation to you for 
your remarks. As somebody who just joined this committee, just 
joined this body, I came in here and would ask certain 
questions like, ``If we're going to deal with asthma and the 
ozone levels cost $6 billion to implement, could we save more 
asthmatics by spending $6 billion more on treatment and care of 
asthmatics?'' And I'm told, ``Oh, no, you can't ask that 
question. That deals with cost, and we're not here to talk 
about cost.'' But obviously we're here to talk about cost.
    You had the courage to come in and say some things I 
thought were very, very worthwhile.
    Let me ask you this: is it your understanding on the 15,000 
premature deaths that many of those would represent terminally 
ill patients that are in very weakened positions? Would that be 
factored into the numbers?
    Dr. Grande. I think my understanding of the terminology or 
the phrase used is premature deaths in the context of this 
discussion on ozone and air quality and PM. There are a lot of 
what we would call ``confounding factors,'' and particularly if 
you look at the mean age of these so-called ``premature 
deaths.'' They tend to be skewed toward the older age groups, 
and they seem to show that there is an association with some 
other underlying cardiopulmonary diseases. And whether Mr. X 
was going to die on Tuesday from whatever it was that killed 
him versus on Wednesday, and whether air quality had anything 
to do with that or not I think is a very difficult issue to 
prove.
    It would be nice if we could prove it, but I don't think 
there have really been any legitimate efforts to try to prove 
that.
    As far as the comment that you made in terms of whether we 
can more intelligently or effectively or efficiently spend the 
money that we are going to spend for asthma, which is a public 
health problem, I think Dr. Fennelly, as a pulmonologist, sees 
far more patients with chronic asthma than I do. I see patients 
with acute asthma that come into the emergency department or 
the ICU.
    Yes, it's true that it's a very dramatic presentation of 
somebody gasping for their next breath, but I have to also tell 
you that, as somebody working in those environments, the 
medications that I have available to me now allow me to rapidly 
and effectively reverse that ``death's door'' situation, 
whereas the same patient, same age, comes through the door 
after having been in a car accident with a head injury and I 
can't do anything about that.
    So if you wanted to ask me if that next patient coming 
through the door was a relative of mine and where am I going to 
spend my next dollar, I would have to say on something else. 
Or, if you wanted me to spend it on that, you've got a much 
larger job to prove it to me that that's an effective 
allocation.
    Senator Sessions. Well, it is a very troubling moral 
dilemma for us to wrestle with, and I think, with regard to 
trauma deaths, as you point out, many of those are otherwise 
healthy with long life expectancies.
    I think that's something that, as we consider--and I think 
it's important to understand, and I think most of us do that 
are thoughtful, that any burden that we place on local 
government, farmers, industry, or individuals that's a cost is 
the equivalent of the Federal Government taxing them and doing 
that for them.
    In other words, it is a drain on their resources, and 
before we do that we ought to ask, if we're going to drain that 
resource, where would we spend it to get the most benefit for 
the most people.
    One of the things that's troubling me has been the numbers. 
I do find that strange. Mr. Chairman, you pointed out the cost/benefit 
study error that is very significant, I think, very 
troubling that EPA would miss that, and then we have them 
cultivating hay fields 8 times or 13 times a year. Anybody that 
knows anything about--I mean, that's out of the range. That's 
not an error. I mean, that's just dreamland numbers. If you 
know about farming, you know that's not true.
    So I don't know where we are on all those things, but they 
are matters that concern me.
    Dr. Fennelly, do you know how the premature death numbers 
are calculated? Do you know? Can you tell us, in your best 
judgment, because it still concerns me that 15,000 may be 
prematurely dying. I think that's a very significant figure. I 
don't mean to minimize it, but how is that calculated?
    Dr. Fennelly. Well, these are difficult epidemiologic 
methods. They generally are based on time series studies where 
you add in all the variables that you know about that 
contribute to a health outcome--in this case mortality--and, 
for example, we know that season, temperature, humidity, day of 
the week, a number of factors are involved, and so you create a 
base model and say that this is the variability that we would 
see.
    Senator Sessions. Day of the week?
    Dr. Fennelly. Day of the week. Monday mornings are a very 
bad time, just so you know.
    Senator Sessions. Police say the full moon is a bad time.
    Dr. Fennelly. Not that we know of. And then on top of that 
you add the air pollution variable, or whatever exposure you're 
interested in, to see if there's an excess in that amount.
    Part of the problem now is that--and the reason the science 
has come to the forefront is because of the great computing 
power that we have now and the improvement in statistical 
methods. In a way, this is--I sort of feel like people are 
shooting the messengers when they get mad at the epidemiologist 
for coming up with these studies, because these are very 
sensitive tools.
    It's the same as going into your doctor feeling fine and 
then having your doctor say your blood pressure is elevated and 
you need to take this, and you say, ``I didn't perceive a 
problem. What's the deal?'' In a sense, on a population basis, 
I guess that's the best type of corollary I can offer.
    The problem is these are very small effects, I'll grant you 
that, but they're distributed through a large number of people 
across the country.
    You'll probably remember in 1984 the Bhopal disaster. More 
than 2,000 people were killed in that disaster due to an acute 
release of methyl isocyanate. But in a way we have become numb 
by the numbers because we're talking about, ``Well, is it 
40,000 or 60,000?'' Just as an aside, I think the 15,000 we're 
talking about are the amount of lives saved. The 40,000 to 
60,000 are the total mortality attributed to particulate air 
pollution. Either way, it's a lot more than 2,000.
    And so in a sense we have to deal with our improved 
technology, our improved ability to detect these very subtle 
effects.
    I'll grant you, these are very difficult decisions to make 
based on public health priorities and all the priorities that 
you face.
    Senator Sessions. Not only that, but the question is, If 
somebody had severe emphysema and would be adjudged to be 
terminally ill, if they died when there was a bad ozone or 
particulate day, that would be part of the statistics number; 
is that right? And so it is fair to say if more died on a bad 
air, during bad pollution, that is an adverse health effect.
    Dr. Fennelly. Yes.
    Senator Sessions. But we're talking about that kind of 
effect, aren't we?
    Dr. Fennelly. Yes.
    Senator Sessions. Premature death? Is that the right 
phrase?
    Dr. Fennelly. We're looking at the excess of total deaths 
on those particular days.
    Senator Sessions. Excess of total deaths on the days in 
which the pollution is bad?
    Dr. Fennelly. Right, compared with lesser pollution.
    Senator Sessions. Thank you.
    Senator Inhofe. Thank you, Senator Sessions.
    I want to thank the panel very much. You will be receiving 
some questions in writing.
    Yes, Mr. Junk?
    Mr. Junk. I apologize. I'd like to make a comment to your 
first question that you asked earlier about the small business 
impact.
    Senator Inhofe. Yes.
    Mr. Junk. I think it's important that we take a look at 
that issue because of the fact that I don't believe that it has 
been recognized within the agricultural community of what 
impact this will have on the small family farm operations.
    USDA has stated concerns held by farm groups that the new 
standards may impose significant cost on farmers, particularly 
the 71 percent of U.S. farms with annual sales of less than 
$40,000. That's a large segment of agriculture that's going to 
be impacted dramatically by these standards, especially when we 
look at not just the tractor that is driven on that farm, but 
the inputs that they have to purchase off the farm such as 
fertilizer, such as pesticides, such as other associated 
products used to produce that crop, along with the livestock 
operations as far as the emissions from the livestock 
operations, also.
    How does that affect the poultry farm, the dairy farm, the 
beef farmer? Those are critical issues that need to be 
addressed and need to be addressed on economic impact to the 
whole industry.
    Senator Inhofe. I appreciate that, Mr. Junk, and I think 
also the fact that if you're talking about small entities 
you're talking about, whatever definition you use, the impact 
on utility rates is going to be about an increase of 8 percent, 
as we have determined that it's in that range, anyway. That 
affects everybody.
    Our time has expired for this panel. I appreciate very much 
your being here. I know your time is very valuable. You will be 
receiving some questions in writing.
    Mr. Vice. Mr. Chairman, could I leave two documents for the 
record?
    Senator Inhofe. Yes.
    Mr. Vice. The letter that was in question, the amount of 
crop loss. That's EPA's own scientific panel. Plus the pie 
chart on 2.5 that Senator Baucus was concerned about that shows 
that they believe it's 29. I'd like to submit both of those for 
the record.
    Senator Inhofe. Yes. Without objection that will be made a 
part of the record.
    I'd invite our third and final panel to come forward to the 
witness table. I'd like to welcome Mr. Harry Alford, who is the 
president of the National Black Chamber of Commerce; Mr. Frank 
Herhold, executive director of the Marine Industries 
Association of South Florida; Mr. Jeffrey Smith, executive 
director of the Institute of Clean Air Companies; and Mr. Glenn 
Heilman, vice president, Heilman Pavement Specialties, 
Incorporated, for the National Federation of Independent 
Business.
    We will start with Mr. Alford.

STATEMENT OF HARRY C. ALFORD, PRESIDENT AND CEO, NATIONAL BLACK 
                      CHAMBER OF COMMERCE

    Mr. Alford. Good afternoon, Mr. Chairman.
    As you know, my name is Harry Alford, president and CEO of 
the National Black Chamber of Commerce. The NBCC is made up of 
155 affiliated chapters located in 43 States. We have three 
divisions, nine regions, 43 district offices. We have them in 
Tulsa, Oklahoma City, and Lawton, for your information, Mr. 
Chairman.
    Through direct membership and by our affiliated chapters, 
the NBCC directly speaks on behalf of 60,000 black-owned 
businesses and represents a total populous of black-owned firms 
which, according to U.S. Census, is over 620,000.
    The NBCC is opposed to the two proposals presented by the 
EPA that would set a more stringent ozone standard and 
establish a new standard for emissions at or below 
PM2.5.
    The Clean Air Act of 1990 has made much progress in 
improving our environment. We sincerely feel that the 
continuance of this process will further improve the 
environment. To put more stringent demands on our businesses 
will have extreme adverse impact on business, in general, with 
even higher stakes for small businesses, per se. If big 
business gets a cold, small business gets the flu, and black-
owned businesses suffer pneumonia.
    An example of the above can be found in our campaign to 
develop business partnerships with the automobile industry. We 
have approached and are working with principals within the 
management of Ford, Chrysler, and General Motors. One success 
story is at the time of preliminary discussions with Chrysler 
we had no black-owned architect, civil engineer, or 
construction company performing work of over $1 million. Today, 
after just 1 year of interaction, we have businesses in such 
disciplines actively working on or negotiating over $100 
million worth of Chrysler expansion.
    This is just one example. These three auto makers have 
expansion plans in cities located in the midwest, southwest, 
southeast, and northeast. This is an expansion investment of 
$37.9 billion, which is the equivalent of the total annual 
sales for all black-owned businesses combined.
    Just competing for this business and winning 10 percent 
would increase the total output of America's black-owned 
businesses by over 10 percent. It's a goal worth going after; 
however, it may not exist for the black segment of this economy 
if the new standards go into effect. This is just the auto 
industry. We're busy creating alliances with the oil industry, 
electrical utilities, telecommunication companies, etc.
    The potential for economic parity and true capitalism in 
black communities, the missing link is before us. Viable 
employment through economic infrastructure in currently 
distressed neighborhoods is going to be the answer to improved 
health care, education, family values, and the decrease in 
hopelessness, crime, welfare, and violence. There is just no 
other way to do it.
    We've heard coming out of EPA terms such as ``environmental 
justice'' and ``environmental racism.'' Such terms are not 
accurate in their description. They imply that the evils of big 
business conspire in back rooms to wreak havoc on minority 
communities by dumping toxic and hazardous materials, etc. The 
coincidence of en- 
vironmental hazards in minority communities is a matter of 
economics. Property values and shifts in desirable business 
properties are the main reasons. Minority populations just 
happen to live there after a cycled geographical shift in these 
communities.
    However, if there was ever a policy or proposed regulation 
that could be considered directly adversarial to a particular 
segment of our population, we may now have it. The proposed 
standards are going to hit urban communities the hardest. Of 
the 620,000 black-owned businesses, at least 98 percent of them 
are located in urban areas. Hispanic and Asian businesses 
probably can claim the same.
    As mentioned above, black-owned businesses are presently at 
the end of the business food chain. If business suffers, black 
businesses will suffer the most. The main vehicle for black 
community development is business startup and growth. The 
proposed standards will become predatory to black-owned 
businesses in all black communities, and we must vehemently 
protest them.
    The NBCC has been quite successful since its inception in 
1993. We have black church organizations, educators, political 
leaders, and traditional civil rights organizations talking 
about economics, the lack thereof, like never before. Corporate 
America has been waiting on black communities to focus on the 
principles of capitalism, which is the blood line for our 
future security.
    The time is before us, and I foresee a rapid change to 
economic empowerment for communities that have suffered for too 
long. The EPA's attitude and proposals are counter to this 
trend and thus pose the biggest threat.
    The increased cost that will pain the Fortune 500 and maim 
small businesses will obliterate minority businesses, 
especially black-owned businesses. The end result is lost jobs 
and the lack of capital infusion.
    I personally lived in Detroit and Chicago during economic 
downturns. What was experienced by dwellers of these urban 
communities and others was not a pretty sight at all. Shame on 
us if we allow this to happen once again because we quickly 
moved to make the earth pristine in a fashion that will surely 
hurt our economic infrastructure.
    Let us work in harmony toward making the environment as 
safe as possible without making those who have the least 
resources pay the most.
    The National Black Chamber of Commerce pleads with Congress 
to strongly consider the ills of the proposed standards and 
encourage EPA to be more thoughtful and universal in its 
approach.
    Thank you, sir.
    Senator Inhofe. Thank you, Mr. Alford.
    Mr. Herhold.

   STATEMENT OF FRANK F. HERHOLD, EXECUTIVE DIRECTOR, MARINE 
 INDUSTRIES ASSOCIATION OF SOUTH FLORIDA, FOR NATIONAL MARINE 
                   MANUFACTURERS ASSOCIATION

    Mr. Herhold. Chairman Inhofe and subcommittee staff, good 
afternoon. My name is Frank Herhold. I'm the executive director 
for the Marine Industries Association of South Florida, which 
represents over 700 marine businesses. I'm also here on behalf 
of the National Marine Manufacturers Association, which is the 
national trade association representing over 1,500 boat 
builders, marine engine, and marine accessory manufacturers.
    I'm here today to explain why the EPA's proposed revisions 
to the national ambient air quality standards will be bad for 
recreational boating. What is bad for recreational boating is 
bad for the State of Florida and the Nation.
    There are currently 750,000 registered boats in the State 
of Florida, and the latest annual marine retail sales figures 
topped $11 billion in Florida.
    To put this into perspective, my home county, Broward 
County, alone, the marine industry represents a total economic 
output of $4.3 billion, employs almost 90,000 people, and has 
an average growth rate of 6.5 percent. Boating brings dollars 
and jobs to the State of Florida.
    The Clean Air Act amendments of 1990 have placed a 
significant technical and economic challenge on the 
recreational boating industry. The new marine engine 
regulation, marine engine emission regulation, which was 
finalized in July 1996, will require that all new marine 
engines reduce hydrocarbon emissions by 75 percent. Economic 
impact estimates have this regulation costing the industry over 
$350 million, increasing the cost per boat engine by as much as 
15 percent. Regardless, we have made the commitment to bring 
forth a new generation of marine engines featuring cleaner 
technology.
    Additionally, the Clean Air Act will also regulate air 
emissions from boat manufacturing plants, with a maximum 
achievable controlled technology standard scheduled to be 
promulgated in the year 2000. This regulation will also be very 
costly, raising the cost of boats, thus directly reducing the 
number of people who can afford to enjoy boating.
    Needless to say, the proposed revised national ambient air 
quality standards will have a devastating effect on the 
recreational marine industry. Without drastically re-
engineering American society, States will be forced to press 
emission sources for further reductions, many of which, like 
the recreational boating industry, have reached the point of 
diminishing returns.
    A couple of years ago, when the national ambient air 
quality standard for ozone was initially set at .12 parts per 
million, some State regulators in nonattainment areas 
considered bans on recreational boating as a method to meet the 
requirements of their State implementation plans.
    The Washington, DC, Council of Governments, COG, actually 
proposed a ban on recreational boating right here in Washington 
in 1993. This proposal raised immediate opposition from 
boaters, marinas, marine retailers, waterfront restaurants, and 
other affected groups.
    COG eventually reversed its decision after the affected 
parties spent considerable resources to educate COG as to the 
proposal's adverse effects.
    This EPA proposed revised standard will again force States 
to reconsider such episodic bans, and this time States may be 
pushed to implement episodic restrictions on recreational 
boating throughout the Nation.
    I'm appealing to you to stop EPA's attempts to revise the 
standards at this time. It is my understanding that the 
scientific studies the EPA is using to defend this proposal do 
not take into account either the specific constraints in air 
pollution or the mitigating factors that affect human health.
    I feel that EPA would be premature to impose such a 
burdensome standard without first identifying the specific 
benefit and real cost of the proposal. We've been hearing this 
element throughout the discussions this afternoon.
    Even if we fail to convince EPA that it is making a 
horrible mistake, at a minimum let us somehow prevent States 
from using episodic bans as a means to obtain compliance. 
Episodic bans will negatively affect a person's decision to 
first of all purchase a boat, knowing that on the hottest days 
of the summer our government can take away his or her freedom 
to operate it. Not since Congress passed the luxury tax have 
boaters faced, in our opinion, a more serious threat.
    If this standard is finalized in its current proposed form, 
consider the burden it will place on States, our marine 
industry and its workers, and the millions of people who just 
simply want to spend a summer afternoon on the water with their 
family.
    In south Florida we have a saying, ``Boating is the 
lifestyle of south Florida.'' In fact, it was on the cover of 
the Southern Bell phone book 2 years ago. It really is a 
lifestyle.
    In conclusion, everybody needs to realize that America's 
air is cleaner and will continue to improve as the benefits 
from recently and soon-to-be-initiated Clean Air Act 
regulations are realized.
    What we do not need now is more regulation. What we do need 
now is the time and resources to implement those regulations 
that are already on the books.
    Boaters want clean air and clean water, and the 
recreational marine industry is ready to assist both Congress 
and EPA in this rulemaking process.
    Thank you very much for the opportunity to testify.
    Senator Inhofe. Thank you, Mr. Herhold.
    Mr. Smith.

STATEMENT OF JEFFREY C. SMITH, EXECUTIVE DIRECTOR, INSTITUTE OF 
                      CLEAN AIR COMPANIES

    Mr. Smith. Thank you, and good afternoon, Mr. Chairman.
    I am Jeff Smith of the Institute of Clean Air Companies, 
which is a national association of companies that supply air 
pollution control technology for stationary sources that emit 
all of the pollutants that contribute to PM and ozone.
    This afternoon I will briefly note the impact of the 
proposed standards on our industry and offer a few thoughts, as 
well, on the overall cost of the proposal.
    Suppliers of control technology for the pollutants that 
would be affected by the EPA proposal are, themselves, mostly 
small businesses. We employ tens of thousands of people, and 
these firms, in general, have suffered disappointing earnings 
recently, which have necessitated severe downsizing and, in 
many cases, job losses.
    The EPA proposal would benefit these businesses at an 
important time; thus, resolving the admittedly tough clean air 
issues we face in a way that protects public health and the 
environment has an important side benefit: it would also 
promote the air pollution control industry, which creates jobs 
as compliance dollars are recycled in the economy.
    This industry is currently generating a modest trade 
surplus, which does its part to help offset the billions of 
dollars this Nation is currently hemorrhaging each month on 
international trade, and is providing technological leadership 
that can continue to be deployed in the fast-growing overseas 
markets for U.S. air pollution control technology.
    Now, no one, of course, knows what the overall cost of the 
proposal would be, but I do think that it's well to remember 
several of the lessons that we've learned in the last 27 years 
in implementing the Clean Air Act, and one of these is 
illustrated, oddly enough, by my experience nearly a decade ago 
when I sat before various House and Senate committees and 
presented detailed implementation cost estimates for the acid 
rain provisions of what later became the Clean Air Act 
amendments of 1990.
    At that time, regulated industry claimed the removal cost 
of SO2, which is the leading precursor to acid rain, 
as well as the leading precursor to fine PM, would reach 
thousands of dollars a ton, while EPA claimed a more modest sum 
of $1,500 to $2,000 a ton was about what we could expect.
    I disagreed at the time, arguing that market and technical 
data supported a dollar-per-ton remove cost of about $500, but 
I was wrong, too. We overestimated the cost, as well, because 
today, in 1997's inflated dollars, a ton of SO2 can 
be removed for about $110 a ton.
    The preeminent lesson, we feel, in our Nation's 27-year 
history under the Clean Air Act is that actual compliance costs 
turn out to be much lower than the costs predicted at the 
outset of a regulatory action. Why? I believe the answer is 
because regulated industry, markets, even the technology 
suppliers turned out to be a lot smarter than forecasters like 
myself could give them credit for being at the outset of a 
regulatory action.
    I think this is going to be even more true in light of 
today's emphasis on flexibility, market-based compliance, and 
pollution prevention.
    Those who would predict gargantuan cost impacts for EPA's 
proposal I think ignore this important lesson and also under-
estimate the wisdom of State and local officials who, after 
all, will be on the front lines implementing these standards.
    Everyone has an interest in rational, prudent, cost-
effective clean air policy, and the cost-effectiveness of 
various compliance options will be considered during 
implementation, and there is no reason not to believe that, as 
has always been the case, all of us--regulated industry, 
government officials, technology suppliers--will discover ever-
more cost-effective compliance solutions, especially since 
nearly a decade exists between now and when the impact of the 
standards would be felt.
    For our part, members of the Institute, the air pollution 
control technology industry, continue to invest in our research 
and development to improve removal efficiencies while lowering 
costs and simplifying operation. We have to. The air pollution 
control tech- 
nology is innovative and highly competitive, and improvements 
in cost-effectiveness are what give business or technology a 
competitive edge over another. In this respect it's a little 
bit like the personal computer industry.
    In closing, the Institute expresses its appreciation to 
you, Mr. Chairman, and the subcommittee for providing a forum 
for dialog on this important issue and for letting this 
industry participate in this hearing.
    If EPA's proposal to revise the PM and ozone health-based 
standards goes forward, the U.S. air pollution control industry 
is ready to do its part to help our Nation achieve its goals 
cost-effectively.
    Based on historical precedent, the current pace of control 
technology innovation, the use of market-based incentives, the 
years between now and the compliance deadlines, and competition 
within the air pollution control technology industry and among 
technologies, we are confident that the actual cost of 
compliance will be less than most of us today imagine.
    Again, thank you very much, sir.
    Senator Inhofe. Thank you, Mr. Smith.
    Mr. Heilman.

 STATEMENT OF GLENN HEILMAN, VICE PRESIDENT, HEILMAN PAVEMENT 
   SPECIALTIES, INC., FOR NATIONAL FEDERATION OF INDEPENDENT 
                            BUSINESS

    Mr. Heilman. Thank you, Mr. Chairman, and good afternoon.
    My name is Glenn Heilman, and I'm a vice president of 
Heilman Pavement Specialties, Incorporated, which is a small, 
family-owned business that has been in operation for 41 years. 
We are located in Freeport, PA, which is just above Pittsburgh.
    Thank you for giving me the opportunity to testify on 
behalf of the National Federation of Independent Business 
regarding the recently proposed national air quality standards 
for ozone and particulate matter.
    In addition to being a small business owner, I also 
volunteer and serve as chairman of Pennsylvania's Small 
Business Compliance Advisory Panel. This panel is mandated by 
section 507 of the Clean Air Act amendments to help small 
businesses as part of the Small Business Stationary Technical 
and Environmental Compliance Assistance Program.
    This program has been enormously successful, despite under-
funding, and has become a model for small business programs and 
other environmental legislation.
    Our small business program conducts seminars, offers a 
toll-free confidential hotline, low interest loans, and many 
other outreach efforts for small businesses. Every State has 
such a program in varying degrees of effectiveness. These 
programs are valuable tools to improve our air quality and are 
overseen by the Environmental Protection Agency.
    In my position as chairman, I am keenly aware of the 
progress we're making in cleaning our air. What appears to be 
ignored is that our air quality has improved significantly 
since the passage of the Clean Air Act, and the 1990 amendments 
have not even been fully implemented.
    It is, therefore, imperative that only requirements that 
are essential be mandated. What I suggest is that we move 
toward more complete compliance with existing standards before 
revising them.
    As a small business owner, the economic impact and 
burdensome regulations of the proposed standards would 
significantly affect and threaten the livelihood of my 
business. As a manufacturer of road pavement, my business 
operates asphalt plants and hauls stone as raw material. The 
moving of equipment and material creates minor particulate 
matter.
    I also have air emissions from my heavy truck and off-
highway equipment. Some of this equipment is old but works 
well, and I simply could not afford to buy new equipment to 
comply with the proposed regulations.
    As a small business owner, I'm active and involved because 
I have to be. Careless regulations will put me out of business. 
Not only will small business owners lose life savings and 
investment, but our employees lose their jobs and our 
communities suffer economically. For that reason, I am shocked 
and I'm disappointed that the EPA has declined to consider the 
effect of this proposed rule on small business.
    Last year Congress passed and the President signed a law 
that requires the EPA to assess the impact of regulations on 
small business. To date, the EPA has refused to do this on the 
ozone and particulate matter study. Because this regulation is 
likely to have a great impact on a variety of small businesses, 
I hope that the EPA will carefully consider the consequences 
before they impose this new standard.
    Rather than implementing new regulations for clean air, I 
recommend utilizing and encouraging the use of present means to 
achieve air quality improvements. There are technologies 
presently available to help clean our air. In our company, we 
voluntarily look for ways to improve the environment.
    In 1980, my father developed a new ozone-friendly 
technology for asphalt roads. This technology is exemplified in 
a material called ``HEI-way General Purpose Material'' or HGP. 
A 2-year university study documents that HGP emits seven times 
less VOC--Volatile Organic Compounds--in the form of low 
molecular weight normal and branched alkane hydrocarbons than 
the present technology used to pave roads.
    Additionally, this technology also eliminates a significant 
water pollution threat to rural streams and wetlands.
    Under standard technology, present road paving materials 
allow more than 1,000 gallons, or three tons of gasoline-type 
VOC to evaporate into our troposphere for every mile paved. HGP 
reduces this VOC air pollution by 85 percent.
    On a nationwide basis, of the nearly four million miles of 
roads in the country, this technology is applicable to over 60 
percent of them. In Pennsylvania, alone, if just 1 percent of 
the roads were paved each year with HGP instead of the standard 
technology, over 3,000 tons of VOC air pollution would be 
eliminated.
    The HGP technology could be more widely used to lower VOC 
air emissions as soon as EPA allows for discreet emission 
reduction credits under the new source review.
    In closing, it is important to keep in mind the unique 
nature of a small business owner when examining our reaction to 
environmental legislation and regulation. Small business owners 
wear many hats. Two of the most important are being both a 
business owner and a citizen of the community. We drink the 
water, we breathe the air, we fish the lakes. We want to help 
the environment for ourselves and our children; however, we 
also expect the Government to be fair and responsible.
    The new regulations as proposed by EPA for ozone and 
particulate matter are unnecessary and they will result in an 
enormous regulatory burden and threaten a business that my 
family has spent 41 years to build.
    A viable framework is in place. It consists of new, 
environmentally friendly technologies such as HGP, and couples 
these initiatives with existing programs. The system is 
working. Let's use what we have.
    Thank you, Mr. Chairman.
    Senator Inhofe. Thank you.
    Mr. Heilman, let me kind of start with you here. Your 
comments are both as a small businessman and representative of 
the position of the NFIB; is that correct?
    Mr. Heilman. Yes, it is, sir.
    Senator Inhofe. And the NFIB I know is--I had an occasion 
to talk to some of their staff here in Washington. They're very 
much concerned about it.
    I'd just like for the record, since I'm very much concerned 
about the Small Business Review Act--I was involved in that 
when we passed it, and the whole idea was to be able to 
quantify the effect on small businesses before we promulgate or 
propose rule changes. I would assume, from your statement, that 
you don't believe that they complied with that act?
    Mr. Heilman. No, I don't believe that they have done any of 
the regulatory flexibility act analysis. Furthermore, no small 
business review panels, as I understand, are to be conducted. 
They have not been done.
    In doing so they, in my opinion, dropped the ball. Let me 
tell you that in my business, as far as looking at the cost in 
retrofitting our diesel trucks and putting in some dust control 
at $15,000 a truck for our small business at seven trucks, 
that's over $100,000, and our dust control would be over 
$20,000. That would be very prohibitive for us to go out and 
hire new people at those costs.
    Senator Inhofe. I think you've also taken the position that 
if we continue just under the standards there today and the 
efforts that people are making on both a voluntary and a 
mandatory basis, that the air is getting cleaner.
    Mr. Heilman. No question. We have a long way to go with 
these compliance advisory panels that each State has.
    Senator Inhofe. Mr. Alford, I heard you say that 98 percent 
of the businesses, but I didn't get the number of businesses 
you were talking about.
    Mr. Alford. It's 620,000 black-owned businesses per the 
U.S. Bureau of Census for 1992, and of that, if we look at the 
industry, 98 percent of that 620,000 are in urban areas.
    Senator Inhofe. Did it also say about how many people that 
affects? I mean, did it have an average size of those 620,000 
businesses?
    Mr. Alford. Yes. The mean, sir, would be 32.5 billion 
divided by that 620,000.
    Senator Inhofe. All right.
    Mr. Alford. I've got my calculator.
    Senator Inhofe. That's a job for the staff. I'm sure 
they've already got that done.
    You also mentioned the environmental justice program. This 
does bother me a little bit. Do you know whether Agency has 
actually looked at the impacts in regard to the environmental 
justice, that term we used?
    Mr. Alford. We had a meeting. The Hispanic Chamber of 
Commerce had representatives, the National Indian Business 
Association, and the National Black Chamber met with 
Administrator Browner. And when I brought up the term 
``environmental justice,'' truthfully she just became very 
condescending, almost indignant, I guess, to where black 
businesses fit in this picture and started talking about jobs 
that had been created through her efforts of brownfields.
    I asked for that documentation, and that was about 2 months 
ago, and I still haven't received it.
    Senator Inhofe. You said there were two other groups?
    Mr. Alford. The Hispanic Chamber of Commerce, which 
represents the Hispanic business community----
    Senator Inhofe. And the other one?
    Mr. Alford [continuing]. And the National Indian Business 
Association.
    Senator Inhofe. OK. Do they share your sentiments, and 
would they endorse your testimony today?
    Mr. Alford. Absolutely.
    Senator Inhofe. OK.
    Mr. Alford. Absolutely.
    Senator Inhofe. I know you don't have information there, 
but for the record I would like to know what the statistics 
show that membership--the number of companies that would be 
involved there, too.
    Mr. Alford. Sure. Hispanic businesses--I'd better look it 
up and provide it to you.
    Senator Inhofe. You can get that for the record at a later 
time.
    Let me just ask you this. What do you think would have the 
greatest impact on health--economic development and jobs or 
these standards?
    Mr. Alford. If you've got money you can provide insurance 
and good health care for your families. You can also send your 
kids to school.
    Senator Inhofe. Well, I appreciate it very much. You've 
brought a different perspective that I was not aware of.
    Mr. Herhold, you talk about your position is that the 
national ambient air quality standards should not be revised. 
Is the basis of your argument that the regulation is going to 
cost too much? If so, how do you place a price tag on it?
    Mr. Herhold. First of all, let me just say, as a citizen, I 
strongly support clean air and don't think we can or should put 
a price tag on it. But, as a businessman, I understand that for 
anything to work you need to have a return on your investment. 
Sometimes you can spend a lot of time and money on something 
and accomplish nothing.
    Finally, as a boater, I can tell you that boaters demand no 
less than clean air and clean water, and anyone who works on 
the water or recreates on the water is a very environmentally 
sensitive, very environmentally tuned individual. In short, 
boaters will always vote for the environment.
    In answer to your question, no, I don't think we can put a 
price tag on clean air.
    Senator Inhofe. Are all boaters fat cats?
    Mr. Herhold. No.
    Senator Inhofe. I spent 40 years in aviation, and there 
always is this myth that floats around out there that all 
people in aviation--it's really a cross-section of America, and 
I would assume that boaters fall in that same category.
    Mr. Herhold. You know, family recreational boating is as 
affordable as a second car. The real problem is a boat is 
purchased with discretionary income. People don't need boats 
like they need that first car, that second car, and they won't 
purchase a boat until they have the financial security, peace 
of mind that comes from, ``Hey, I need some relaxation. I've 
got some money in my jeans. Let's go out and purchase a boat.''
    Senator Inhofe. Yes. There was a study done that was really 
revealing, I thought, back during 1993 when the Administration 
was proposing a very large luxury tax on both airplanes and 
boats, and it shocked a lot of people to see that they're not 
just talking about fat cats, as the Administration was 
implying.
    Mr. Herhold. The lesson of the luxury tax was that the 
boaters voted with their pocketbook. They just simply didn't 
buy boats. I mean, that wasn't the way it was supposed to work, 
from the Government's point of view. But they either bought 
boats offshore from other countries and kept them offshore, 
which was damaging, or they just simply didn't buy them, or 
they kept the old boats. Normally you upgrade every 3 years or 
so.
    Senator Inhofe. It's a jobs issue?
    Mr. Herhold. Yes. Absolutely.
    Senator Inhofe. Mr. Smith, I couldn't help but think--and I 
appreciate your very straightforward testimony and honesty that 
perhaps you could be a beneficiary of this if it came through. 
It's a little bit like H&R Block testifying to the Ways and 
Means Committee to complicate the tax forms.
    [Laughter.]
    Mr. Smith. I think probably, quite apart from any parochial 
benefit to our industry, though, is the essential point in 
looking at cost, as you said in your opening remarks, that I 
think we are benefited by looking at the history of 
implementation of the Clean Air Act and the way those costs 
have gone.
    Actually, I think that the control technologies that will 
be used--it's almost impossible to speculate what they'll be. 
They'll be site-specific. The city of Benton Harbor and the 
State of Michigan and others will come up with control 
technologies that would suit the circumstances.
    But I do think that probably the predominant way of 
compliance will be through pollution prevention approaches, 
eliminating the pollution in the first place, perhaps through 
devices and technology such as Mr. Heilman just mentioned. This 
is the first time I heard that.
    I think, with regard to technology, in a lot of cases, Mr. 
Chairman, it's just going to be upgrading of existing 
technology rather than installation of new technology.
    Senator Inhofe. Yes.
    Mr. Smith. Which is not good news for our industry. But I 
do appreciate that.
    Senator Inhofe. I was saying that in jest, and I think you 
know that.
    But I also wonder, because at previous hearings we've 
talked about this getting to PM2.5, that the 
technology and the monitoring device and all that isn't there. 
You're in the business of getting people to comply and to clean 
up the air, which is good. I'm glad you're doing that. But if 
the technology is not there and the capability is not there to 
monitor for 2.5, how would you go about cleaning it up?
    Mr. Smith. My understanding from the technical experts in 
the industry is that this would not be a technology-forcing 
proposal. If you look at the fine PM, for example, in the 
eastern part of the United States, according to the EPA data, a 
lot of it is formed through emissions of sulphur dioxide and 
nitrogen oxide, which we have a very long record in controlling 
cost-effectively.
    Senator Inhofe. Yes. All right. Well, I appreciate very 
much the time that you have given. You've certainly given a 
very broad perspective.
    I have to say, back when I was mayor of Tulsa, Mr. Alford, 
Coleman Young and I became pretty close friends, and he 
familiarized me with some of the problems of which I was not 
familiar at that time with some of the large metropolitan 
areas, and the statistics that you have given us would be very, 
very helpful.
    I think also the previous panel, in hearing testimony from 
the unfunded mandates, all too often, even though the law 
should have covered the private sector as well as political 
subdivisions, that was something we were able to get through, 
but we do intend to do it because I know it is significant. 
Unfunded mandates are just as damaging to the private sector as 
they are the public sector.
    We thank you very much for coming. There will be more 
questions that will be forwarded to you to be answered for the 
record.
    We appreciate your being here very, very much. Thank you.
    We are now in recess. Thank you very much.
    [Whereupon, at 4:42 p.m., the subcommittee was adjourned, 
to reconvene at the call of the chair.]
    [Additional statements submitted for the record follow:]
         Statement of Emma Jean Hull, Mayor, Benton Harbor, MI
    Good Day Ladies and Gentlemen, my name is Emma Jean Hull, Mayor of 
Benton Harbor, Michigan, and Treasurer of the National Conference of 
Black Mayors, Inc. and a member of its standing committee on 
Environmental Justice. Benton Harbor is located on the shores of Lake 
Michigan just an hour east of Chicago, Illinois and 45 minutes from 
Gary, Indiana. It is a minority/majority community with a population of 
12,818, 97 percent African American, 40 percent under the age of 18. 
Benton Harbor through local partnerships with business and industry is 
just beginning to address some of the nation's highest at-risk factors 
in crime, unemployment and school-drop outs. Our success to date relies 
on local initiatives to retain, attract and grow small businesses, 
address workforce development and deal with environmental concerns--
mostly related to our brownfield redevelopment projects.
       some examples of benton harbor's local partnership efforts
    The city works in partnership with:
     Northside Business Association (27 minority businesses 
working with the chamber to promote minority leadership)
     SBA Technical Assistance Project (Lake Michigan College, 
Cornerstone Alliance, a local non-profit economic development 
corporation and city working to make individuals and small businesses 
bankable)
     Community Renewal through the Arts (28 area arts groups 
using the creative arts industry for economic development)
     Micro Loan Program (4 local lenders provide startup moneys 
for self sufficiency through self employment)
     Benton Harbor Skills Center (Benton Harbor Area Schools 
and Cornerstone to provide basic job and life skills training)
     Community Partnership for Life Long Learning (all area 
school systems working toward school to work and career based 
curriculum)
     Site Reclamation Grant to Redevelop Harbor (the State of 
Michigan and Alliance for multi-modal transportation center)
     Site Reclamation Grant for Buried Tank Removal (the State 
of Michigan)
     Purchase and Demolition of Deteriorated 
Industrial/Commercial Buildings (the State of Michigan and Cornerstone 
Alliance)
    In the late 1970's and early 1980's, Benton Harbor saw the loss of 
over 3,000 manufacturing jobs with major plant closings in the steel, 
appliance and automotive industries. The remaining empty, deteriorating 
and in some instances contaminated buildings form both the core of our 
environmental problem and Benton Harbor's redevelopment potential. With 
passage of the 1990 Clean Air Act and the establishment of that year as 
the base line for attainment, my city was put at an immediate and 
distinct disadvantage. In 1990, Benton Harbor was at its lowest point 
for industrial activity. This artificially low standard for air 
quality, applied nationally without regard to local circumstances, is 
magnified by our proximity to both Chicago and Gary and the prevailing 
westerly winds. A fact that impacts the expansion of existing business 
and inhibits the location of new business in Benton Harbor as well.
    The proposed and more stringent ozone standard and new PM standard 
for particulate matter emissions if implemented will directly impact on 
my community's efforts toward sustainable economic growth and 
development. The small businesses affected, many for the first time, 
like printers, bakers, service station operators and construction firms 
are the foundation of growing ranks of Benton Harbor's minority 
entrepreneurs. The anticipated higher production and operations costs 
required by the proposed standards coupled with regulatory burdens can 
restrict these businesses' expansion, impact their capital expenditures 
and eventually affect the jobs of many of our community's residents. 
This problem is only magnified when applied to new larger businesses. 
The ability to attract major new business and industry to brownfield 
sites is difficult. Benton Harbor and the Nation does not need any 
additional impediments.
    Legislation is meaningless, unless implementation at the local 
level is assured. I support clean air and the intent of the Clean Air 
Act of 1990. I only ask that its implementation and any proposed change 
be fair, balanced and sensitive to the relationship between local 
government, industry and business--especially, as in Benton Harbor's 
case, small business. Partnership is a requirement of change. Please 
consider the impact the proposed changes will have on the local 
partnerships my community so desperately needs. Thank you for this 
opportunity to address this matter today.
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  Prepared Statement of Leon G. Billings, Delegate, Maryland General 
                                Assembly
    Mr. Chairman, I am a State legislator with a unique perspective. 
Not only do I live in the suburbs of the nation's capital, but I spent 
15 years on the staff of the U.S. Senate, 12 of which were as staff 
director of this Subcommittee when it was chaired by Senator Edmund S. 
Muskie of Maine.
    I represent the legislative district which reaches from the 
District line several miles into Maryland on both sides of Connecticut 
Avenue. While it is considered a wealthy district, it is quite 
economically and ethnically diverse. It has some of the highest incomes 
in Montgomery County and some of the lowest.
    My constituents are very strongly committed to environmental 
protection. I would hazard a guess that my constituents care at least 
as much about the Chesapeake Bay as people who depend on a healthy Bay 
environment for their livelihood. My constituents also care very deeply 
about the quality of the air we breathe.
    As a measure of concern, Mr. Chairman, I would point out that 
during the entire controversy surrounding Maryland's newly required 
enhanced motor vehicle inspection program, I did not receive a single 
communication from any constituent protesting the new dynamometer test. 
In fact, nearly 50 percent of Montgomery County motorists voluntarily 
take the dynamometer test. So, perhaps it will not surprise you that I 
support these new, more strict ambient air quality standards--as a good 
representative of my district. I say this because air pollution's 
victims often are those least able to defend themselves--the very 
young, the chronically ill, the elderly. I also support them as a 
grandfather of four and, because I am now classified as an ``older 
American,'' I support them for personal reasons.
    The State of Maryland has done a great deal to clean up its air 
pollution. We've had centralized auto emission testing for 17 years and 
voluntary dynamometer testing for more than 2. Our power plants and 
factories have made great strides toward reducing emissions as their 
part of complex plans to achieve current ambient air quality standards.
    Many businesses and industries in Maryland believe that they are 
being required to make extra investments to control pollution because 
large industrial sources and power plants in Virginia, West Virginia, 
Ohio, Indiana and Pennsylvania are doing too little to control their 
emissions. These Maryland businesses have argued against further 
reductions in emissions from Maryland sources until something is done 
about these big polluters to our west and south.
    Thus, for the people of Maryland, these new standards have two 
important benefits:
    1. They will provide additional health protection for our citizens, 
especially our children and our elders; and
    2. They could reduce the burden on Maryland businesses by more 
fairly allocating the responsibility for cleanup to the large sources--
sources that today are uncontrolled or poorly controlled--sources whose 
emissions are transported to us from other States to us.
    It is interesting to note that the people who challenge these new 
standards generally are not scientists but representatives of 
institutions that pollute. American business and industrial interests 
simply don't want to pay more money to achieve a greater level of 
pollution control. But that is nothing new. I began my service to this 
committee in 1966. Every single environmental proposal this Committee 
recommended to the Senate, usually unanimously, was met with the charge 
that it was too expensive.
    In 1970, then-Ford executive Lee Iacocca called the Clean Air Act 
``a threat to the entire American economy and to every person in 
America.'' He was wrong, of course. Today's cars are marvels of 
engineering. And the Big Three automakers recently announced first 
quarter profits totaling more than $4.5 billion.
    The rhetoric in today's debate is much the same. What is new is the 
271 peer reviewed air pollution health studies EPA evaluated prior to 
proposing the new standards. What is new is there is so much science to 
support standards. When the first Federal air quality information was 
published in 1966-67, there was a crescendo of criticism regarding the 
adequacy of data. Compared to today's information base, those critics 
were on sound ground.
    Mr. Chairman, in this context I would like to make an historical 
point. I find it ironic that the National Association of Manufacturers 
and its allies are protesting these new national ambient air quality 
standards. Prior to 1970, ambient air quality standards were adopted by 
localities in their air quality control regions based on citizen input 
and local perceptions of the threat of air pollution. That process 
proved unacceptable to industry because the standards proposed were 
often more strict than might be indicated by the federally published 
air quality criteria documents.
    In 1970, the Nixon Administration proposed and Congress adopted 
national ambient air quality standards. The decision to adopt national 
ambient air quality standards was widely advocated and supported by the 
nation's major polluting industries. They were the ones who wanted to 
use government science as the basis for air quality standards. They 
were the ones that wanted EPA to adopt the air quality standards. They 
were the ones who wanted to avoid the proliferation of and often 
differing air quality standards around the country.
    Now EPA is doing the job that business wanted and Congress adopted 
in 1970. And now NAM and its allies don't like the result so they want 
to change the rules of the game.
    EPA has nearly 30 years of experience and, as many lawsuits have 
affirmed, it is good at its job.
    I would encourage this Committee to tell the NAM and the Citizens 
for a Sound Economy and the various other groups who have lined up on 
the anti-clean air bandwagon to quit trying to change the rules that 
they helped make.
    Their opportunity to affect the cost of achieving these standards 
will come in the implementation phase. We are currently in the 
information stage. And the American people have a right to know the 
levels of air pollution which affect their health.
    Congress has never compromised this right to know. Congress has on 
two occasions, 1977 and 1990, provided more time to implement health 
based standards--in 1977, up to 10 years more; and in 1990, up to 20 
years.
    But Congress has never bowed to pressure to compromise science. To 
do so would make a process of public health protection political rather 
than scientific.
    EPA has evaluated the science and proposed its judgment. The 
appropriate focus for this Committee and the Congress will be to assure 
a balanced and timely implementation of the standards that recognizes 
the economic needs and interests of industry and the need that millions 
of vulnerable Americans have for protection from the impact of smog on 
their lives.
    Congress has been doing that job for 30 years. We have proved that 
we can have a healthy and growing economy while moderating the health 
impact of pollution. And we have done so without compromising the 
public's right to know what healthy air ought to be.
    Thank you.
                                 ______
                                 
                                        House of Delegates,
                                       Annapolis, MD, May 16, 1997.
Hon. James M. Inhofe, Chair,
Subcommittee on Air, Wetlands, Private Property
  and Nuclear Safety,
Committee on Environment and Public Works,
U.S. Senate, Washington, DC.
    Dear Senator Inhofe: Thank you again for the opportunity to 
participate in your recent hearings on the newly proposed national 
ambient air quality standards. I particularly appreciate the 
opportunity to respond to the questions Senator Baucus submitted in 
writing.
    Answer to Question 1. Prior to 1970, the Federal Clean Air Act 
provided for the consideration of economic and technological 
feasibility with respect to a number of the regulatory requirements 
authorized. The 1970 Act eliminated considerations of economic and 
technical feasibility with respect to most regulatory authority which 
impacted on health standards. But in the history of Federal clean air 
law there has never been any economic feasibility analysis required of 
the health-related ambient air standards, though from time to time that 
has been proposed unsuccessfully by polluting industries.
    The most significant debate over including a cost factor with 
respect to ambient standards occurred during the debate over the Public 
Health Service's publication of an Air Quality Criteria document for 
sulfur dioxide. Coal and related industries argued that publication of 
data on the effects of sulfur dioxide on health should be accompanied 
by an analysis of the cost of achieving levels of air quality which 
would reflect those criteria. To the best of my recollection, this 
proposal never advanced to the stage of a legislative amendment because 
it was absurd on its face, as has been the discussion of cost in 
association with the current ambient air quality standards.
    While the terminology has changed over thirty years, the facts 
remain the same: air quality standards are nothing more or less than 
the best professional judgment of the Environmental Protection Agency 
and its scientific advisors on the levels of air pollution at which 
health effects occur. Senator Muskie and his colleagues on the 
committee on which you now serve unanimously agreed time and again that 
the public had a right to know the level of air pollution at which 
their health may be put at risk. They also unanimously agreed that when 
regulators and the Congress decided how and when those standards would 
be achieved, that would be the appropriate time for consideration of 
economic and technical feasibility.
    As Senator Howard H. Baker stated at a hearing on air quality 
standards on July 29, 1968:

          ``Air Quality criteria are intended to delineate, on the 
        basis of the best available scientific and medical evidence, 
        the effects of individual contaminants, combinations of 
        contaminants, or categories of contaminants or the constantly 
        changing, somewhat indeterminate environment of man. Thus, 
        economic and technological considerations are not relevant with 
        regard to the establishment of ambient air quality criteria; 
        they will be given full attention in the standard-setting 
        procedures.''

    Answer to Question 2. As I indicated in my testimony, prior to 1970 
the Federal air quality criteria information (the data which indicated 
what scientists said were the levels of air pollution at which health 
effects occurred) were made available to State and local air pollution 
control agencies for the purpose of determining air quality standards 
and establishing implementation plans. A review of the hearings held in 
the late 1960's and early 1970's by the subcommittee which you now 
chair would reveal that not only did community-based air quality 
standards decisions result in very rigorous demands for protection from 
air pollution, but they triggered a significant level of citizen 
activism. ``Citizens for Clean Air'' groups sprang up across the 
country. In the eyes of many, air quality standards became a political 
decision, not a health-based scientific judgment.
    The Nixon Administration, responding to the business community, 
decided that a Federal Government scientific judgment was preferable to 
the politically powerful clean air demands of citizen activists. The 
result was the 1970 Act provision for national ambient air quality 
standards. Thus, because the national ambient air quality standards are 
a product of a Republican President responding to demands of the 
business community, you can appreciate why I find today's opposition to 
national standards by the business community and many Republican 
leaders to be so ironic.
    I hope these answers are responsive to your needs. If I can be of 
further assistance, please let me know.
            Sincerely,
                                  Leon G. Billings.
                                 ______
                                 
  Prepared Statement Hon. Richard L. Russman, State Senator from New 
                               Hampshire
    Mr. Chairman and members of the subcommittee, my name is Richard 
Russman, and I am a State senator from New Hampshire. I want to thank 
you for this opportunity to testify about the clean air standards for 
ozone and particulate matter that have been proposed by the 
Environmental Protection Agency (EPA).
    As you know, New Hampshire is one of the northeastern States that 
is affected by ozone transport, so we have a very strong interest in 
seeing action taken to address the emission of precursors that lead to 
ozone formation. The respiratory problems caused by excessive ozone 
exposure will continue to plague the citizens of my State, not to 
mention the health of natural resources, if action is not taken. In 
addition, I believe the people of New Hampshire agree that the threat 
of fine particulate matter must be addressed, as called for by the 
American Lung Association and our Governor, the Honorable Jeanne 
Shaheen.
    I understand that this subcommittee is concerned about the process 
undertaken by the EPA in promulgating rules to address ozone and 
particulate matter problems. Let me say at the outset, I am a proponent 
of the proposed rules and believe the EPA is going about the process of 
issuing final rules in a responsible manner. These standards must be 
established by relying on health based criteria only; that is very 
specific in the Clean Air Act.
    Recently, the National Conference of State Legislatures (NCSL) sent 
a letter to Ms. Mary Nichols, Assistant Administrator for Air and 
Radiation at EPA, citing numerous problems with the issuance of the 
proposed rule and compliance with Federal statutes and executive 
orders. I disagree with the premise and findings of that letter and, as 
the core of my testimony, I will explain my reasoning to the members of 
the subcommittee today.
    First let us remember that this is a proposed rule--not final. Many 
of the arguments raised against the rule are based on the requirements 
necessary when an agency promulgates a final rule. For that reason 
alone, many of the arguments raised by the NCSL have no validity.
    Second, many opponents criticize EPA for not seeking outside 
opinions or consultation with the States. Nothing could be further from 
the truth. Since February, 1994, EPA Administrator Browner has been 
seeking the advice of affected parties on the issuance of these rules. 
Under the authority of the Federal Advisory Committee Act (FACA), EPA 
established working groups to address ozone, particulate matter and 
regional haze problems. These working groups depend upon the opinions 
of State and local governments, industry, small businesses and other 
interested parties to formulate strategies for attainment.
    These strategies are designed to help States with implementation 
programs, which are solely a State and local government responsibility. 
I do not believe the EPA simply is passing the buck when they claim 
they are not demanding specific regulatory activities. As you know, the 
EPA grants authority to the States to implement the rules as they see 
fit through a State implementation plan. The NCSL recognizes this in 
its letter to the EPA, stating that implementation of the Clean Air Act 
is being carried out by State and local governments.''
    I don't believe it would be a stretch to say that the Congress and 
much of the country would be up in arms if the EPA directed the 
specific actions that States and localities must take. States have 
asked for and been given authority to implement many Federal 
regulations. This is one of those cases where granting primacy 
(regulatory authority) has and should continue to work.
    In addition to bringing in the views of affected parties through 
the FACA process, EPA extended the comment period on the rule for 21 
days. That extension has allowed more than 40,000 comments to be 
received via the mail and nearly 18,000 phone and electronic comments 
to be delivered.
    The date for issuing the final rule also was extended after a 
request by the Administrator. It is important to note that the 
opponents of the rule were the primary constituency asking for that 
extension. In response to this, Ms. Browner returned to the judge who 
issued the initial ruling on particulate matter and petitioned for the 
delay.
    Finally, since issuing the proposed rules, EPA has expanded the 
representation on the PACA working groups to include more 
representatives from local governments and small businesses. These 
actions were not required, but were carried out by the EPA to ensure 
adequate input from those expressing most concern. Not once in their 
letter does the NCSL recognize these ongoing efforts.
    With the chairman's approval, I would like to submit for the record 
the membership of those working groups so that members of the committee 
will have an idea of the access that various interests have had to the 
rulemaking process.
    One concern raised by the NCSL letter that I would like to 
reinforce to you is the issue of funding. We all agree there will be 
some costs in implementing these rules, although those costs are 
several years away. With this in mind, the concern about section 105 
funding, which provides technical and financial assistance to States, 
is one that is universal among States. Realizing the role that States 
and localities play in implementing the nation's environmental laws, I 
hope the Congress will see the wisdom in providing adequate funding to 
the EPA to assist in this implementation.
    While I am not a member of President Clinton's party, I would like 
to state that I commend him for the efforts he has made to reform the 
regulatory process. Since 1993, with the issuance of Executive Order 
12866, this administration has made a concerted effort to streamline 
regulations and to provide justifications for rulemaking. While cost 
benefit analyses are not a criteria of the Clean Air Act, the EPA 
complied with the Executive Order and provided the necessary 
justifications, including analyses of costs and benefits, to the Office 
of Information and Regulatory Affairs (IRA) at the Office of Management 
and Budget (OMB). Your committee and the entire Congress has access to 
these documents, which I suspect are more thorough than documentation 
for any other rule the EPA has ever promulgated
    In addition to administrative efforts to improve regulatory 
efficiency, the Congress passed and the President signed numerous 
pieces of legislation, specifically the Small Business Regulatory 
Enforcement and Fairness Act (SBREFA), that create obligations for the 
agencies in establishing rulemaking and give the Congress on oversight 
role before major rules can go into effect
    I believe this is an appropriate role for the Congress to play, and 
I think that is one reason that we are having this debate today. 
However, I do not believe the Congress should try to inject false 
arguments into the debate when the Clean Air Act is very specific--
rules are to be promulgated following health based standards, which are 
to be reviewed at least every 5 years. In this case, the statute has 
been backed up by the courts regarding standards for particulate 
matter.
    The regulatory impact analysis prepared by the EPA attempts to 
quantify benefits that sometime cannot be quantified, yet the estimated 
benefits far outweigh the overall costs. The Federal Register notice on 
the proposed rule states clearly that the regulatory impact analysis 
for the rules ``will be available at the time the implementation 
strategy is proposed.'' I fully expect the analysis to be available and 
comprehensive when the final rule is issued.
    The EPA has focused on health and the primary standard. I have come 
to the realization that the secondary standard, welfare, might provide 
significant additional benefits if those were quantified. Regardless, 
efforts to meet the primary standard also will benefit the welfare of 
Americans.
    As you know, vegetation is harmed by ozone exposure. Unlike most 
susceptible human populations, it has few means of staying indoors. 
Agriculture and tourism continue to be the major economic indicators 
for many districts in this country represented by members of this 
committee. I am disappointed to see the agricultural community oppose 
the rule because increased incidences of high ozone exposure have 
reduced some crop outputs by more than 10 percent. Indeed, CASAC 
unanimously recommended that EPA adopt a secondary standard for ozone 
more stringent than the primary standard.
    In addition, forest ecosystems from the southern Appalachians to 
the northern Adirondacks are threatened by high levels of ozone. Many 
States promote their natural areas for tourism, yet these beautiful 
mountains so far removed from urban settings are threatened by the 
precursors of ozone and the resulting ``burn'' that occurs at higher 
elevations.
    The benefits of protecting agricultural production (including 
timber) and tourism economies will be well worth modifying emissions 
standards for all the communities that depend upon these natural 
resources to support their economies. These impacts and benefits must 
be considered in any discussion of costs.
    I also would like to submit for the record, with the chairman's 
approval, the recent findings of the Northeast States for Coordinated 
Air Use Management. These findings back up the need for more stringent 
ozone standards.
    In the case of standards for particulate matter, I believe the 
benefits will be substantial. I find it distasteful to try to quantify 
the value of a life, let alone trying to do it for 15,000 individuals. 
The premature death caused by particulate matter and the debate 
surrounding the impacts reminds me of the debate about cigarette smoke. 
Scientist after scientist testified that smoking did not cause lung 
cancer and that epidemiological tests could not show causality. Just as 
we reached a clear indication with cigarette smoke, the data now 
supports the link between particulate matter and respiratory illness.
    Since the 1970's industry has tried to analyze the costs of 
complying with environmental regulations. I don't believe it has ever 
made accurate estimates.
    Will there be some costs in implementing these regulations? Yes, 
and the EPA has made the best estimates available given the 
uncertainties of how the rules will be implemented at the local level.
    In establishing the health based standards, EPA should not consider 
costs. In considering implementation strategies, EPA should and has 
consulted affected parties to consider costs, even before they have 
issued a final rule.
    I will remind you of the excessive costs estimated by the utility 
and industrial sector during the 1990 Clean Air Act debates. We all 
know that those horrific scenarios did not and will not play out. Nor 
has the American economy gone down the tubes, if you will excuse the 
expression. On the contrary, technology has expanded to meet industrial 
demand, and States have found innovative and cooperative ways to meet 
attainment standards.
    We may not be able to reach 100 percent attainment compliance in 
the next 10 years, but the effort to achieve those standards will be of 
value to every man, woman, and child in this country. That is a 
significant benefit.
    In conclusion, Mr. Chairman, we have in place a regulatory system 
that is more scrutinized today than at any time in recent history. I 
believe that is a good thing. But I also believe that when agencies are 
following their mandates, they should be given the necessary support to 
implement the laws the Congress has passed.
    That concludes my testimony. Thank you again for the opportunity to 
participate, and I will be happy to answer any questions from members 
of the committee.
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 Prepared Statement of John Selph, Tulsa County Commissioner, Oklahoma
    Mr. Chairman and Members of the Committee, my name is John Selph. I 
am a member of the Board of Directors of the National Association of 
Regional Councils (NARC) and I chair NARC's Air Quality Task Force. I 
am chairman-elect of the Indian Nations Council of Governments (INCOG), 
the Metropolitan Planning Organization for the Tulsa area, and I chair 
INCOG's Air Quality Committee.
    On behalf of NARC, I appreciate your invitation to testify before 
the Subcommittee regarding the U.S. Environmental Protection Agency's 
(EPA) proposed changes to the Clean Air Standards. The National 
Association of Regional Councils represents some 300+ councils of 
government consisting of cities, towns and counties in metropolitan and 
rural areas from throughout the United States. These regions run the 
gamut from areas in severe non-attainment to regions that have always 
been in attainment. My comments reflect the policy positions developed 
by NARC. My comments also draw from my experience as a County 
Commissioner in Tulsa, Oklahoma and my academic background, which 
includes a Masters Degree in Public Health with an emphasis in 
Environmental Sciences.
    Before I discuss EPA's proposed standards, let me tell you a little 
about Tulsa and our experience with air quality. Tulsa County was a 
non-attainment area until 1990. We worked very hard locally to achieve 
attainment status, and our county achieved attainment status prior to 
the signing of the Clean Air Act Amendments in November, 1990.
    It was very important for us to avoid the stigma associated with 
being on the EPA non-attainment list, especially for economic 
development purposes. Since that time, we have worked even harder to 
maintain our clean air status. While our efforts have been wide-
ranging, perhaps most notable was the creation of the nationally 
recognized Ozone Alert! Program, the nation's first voluntary episodic 
emissions control program. This program reflects our philosophy of 
seeking voluntary, common sense measures that are most effective in 
improving air quality, rather than the command and control approach too 
often used by the State and Federal regulators.
    Let me also say that both NARC and I recognize the importance of 
improving air quality, and we support actions to maintain and improve 
the health of all citizens when such actions are based on sound 
scientific and economic principles. In light of this, we are especially 
concerned about the conflicting opinions of the scientific community 
regarding the scientific basis for establishing new Ozone and 
Particulate Matter standards. There appears to be no scientific 
consensus that changing the standards at this time will result in 
significant public health benefits. Indeed, the scientific testimony 
presented previously to this committee, and the recently revised EPA 
exposure and risk assessment fundings, underscore this lack of 
consensus.
    EPA has stated that the proposed changes are policy-based rather 
than science-based. EPA also has stated that it believes existing clean 
air law requires that its analysis of the impact of the changes be 
based solely on the health aspects, and that adverse economic 
consequences that may result from the changes may not be considered in 
setting the standard. In light of these concerns, we feel that 
considerable additional research, including additional epidemiological 
studies, are necessary before new ozone and particulate matter 
standards are promulgated. Specifically, future epidemiological studies 
should focus on the interaction between different pollutants and 
whether these effects are additive, synergistic or antagonistic.
    The Clean Air Act has clearly had a demonstrable impact on reducing 
pollutants, thus improving air quality for all Americans. If EPA 
imposes its proposed ozone standards, the number of non-attainment 
regions nationally will increase, by EPA's own estimates, from 68 areas 
currently to 185 areas--nearly a threefold increase. EPA's action of 
designating additional areas as non-attainment will do nothing to 
improve air quality in our most polluted regions. In fact, these 
existing non-attainment regions are having great difficulty in 
achieving the current standards, so forcing a mid-course change at this 
time will only delay and disrupt both public and private initiatives 
designed to achieve the objectives of the Clean Air Act. Furthermore, 
we are not convinced that the technology is in place, or even close at 
hand, to help us meet these proposed standards.
    With regard to the Proposed PM2.5 standards, we believe 
that EPA lacks sufficient scientific evidence to justify revising the 
existing Particulate Matter standard. Although the scientific evidence 
does suggest some preliminary correlation of health effects, it is as 
of yet inconclusive. The current studies have not clearly defined 
public health effects from fine particles well below the existing 
standard. Additionally, the significant uncertainty and limited 
research regarding ambient concentrations of PM2.5 due to 
the limited number of ambient air monitors in place support our 
concerns about the addition of this standard. We feel that in light of 
these concerns, which were substantiated at previous subcommittee 
hearings, considerable further study is necessary before an additional 
particulate matter standard is promulgated. To this end, we are pleased 
to note that EPA has requested $28.4 million for particulate matter 
research.
    Our experience in Tulsa has shown us that the goal of improving air 
quality is both worthy and attainable if approached in a common sense 
manner. In addition to our Ozone Alert! Program, Tulsa, by formal 
agreement with EPA and a host of other Federal, State and local 
partners, has become the nation's first Flexible Attainment Region 
(FAR). The FAR agreement enables us to implement a locally crafted 
strategy to reduce emissions, and gives us adequate time to evaluate 
results before having to implement more stringent measures to meet our 
goals. This avoids the ``one size fits all'' command and control 
approach which historically has been imposed by EPA. The FAR agreement 
came about because our local governments and private industry are 
committed to working together to improve air quality. The necessary 
ingredients to make this initiative work are flexibility and common 
sense. When we are allowed to develop our own program and local ``buy-
in'' is assured, the willingness to commit the necessary financial and 
political capital to achieve results is more readily accepted.
    Recently, one of our refineries in Tulsa was the subject of an EPA 
enforcement action. The refinery, as part of its penalty, proposed to 
reduce the Reid Vapor Pressure (RVP) of its gasoline to 8.0 psi and pay 
a significant financial payment to EPA. Refineries and pipeline 
companies in the Tulsa area voluntarily reduce the RVP of their 
gasoline to 8.2 psi during the ozone season. The Federal mandated level 
is 9.0 psi. We are told that the initial reaction of EPA was to reject 
the proposal and to require the refinery to identify another project to 
undertake as a Supplemental Environmental Project. The net effect on 
the Tulsa area would have been a net reduction measured in pounds of 
emissions rather than the tons needed to maintain our attainment 
status. We expressed our concern to EPA and, thankfully, common sense 
prevailed. We understand that the agency has reversed its position, has 
accepted the 8.0 psi RVP, and has also directed that part of the fine 
go to the Tulsa area to finance free bus rides during the upcoming 
ozone season. We think this action by EPA will give us a significant 
boost in meeting our air quality goals. The action makes sense--a 
violation is enforced, and citizens--rather than just the U.S. Treasury 
will directly benefit.
    In essence, improving air quality can be achieved without severely 
disrupting the economy, and without increasing unfunded mandates. The 
imposition of standards, which even EPA states may be unachievable, 
will severely dampen the enthusiasm needed to maintain the momentum for 
improvement. Moreover, in the current ISTEA reauthorization debate 
there is discussion about eliminating the Congestion Mitigation and Air 
Quality Program. Without the CMAQ program, we would end up losing an 
important tool necessary to meet the long range goals of improved air 
quality. I would like to point out, however, that the current ISTEA 
legislation does not provide for areas that are in attainment, like 
Tulsa, to receive CMAQ funds to undertake air quality improvement 
programs. We would recommend that consideration be given to expanding 
the eligibility for receiving CMAQ funds to those areas that are in 
attainment that have a formal program in place designed to reduce 
emissions. An ounce of prevention is worth a pound of cure.
    In conclusion, Mr. Chairman, we believe that more thought and study 
must be accomplished before the standards are changed. The potential 
impact is great, and we must have more certainty and consensus before a 
major change, such as this, is initiated. Progress is being made in 
improving air quality and more will come if common sense and 
flexibility prevail.
    I appreciate being invited to participate in the Subcommittee's 
hearings. On behalf of NARC, we look forward to working with the 
committee in your important task.
    Thank you for the opportunity to testify today. I respectfully 
request that my full statement be made a part of the official hearing 
record; and I will be happy to answer any questions you may have.
                                 ______
                                 
  Prepared Statement of Robert C. Junk, Jr., President, Pennsylvania 
                             Farmers Union
    Good morning, Mr. Chairman and members of the committee. My name is 
Robert Junk. I am president of the Pennsylvania Farmers Union. I am 
also a member of the board of directors of the National Farmers Union 
and appear here today on behalf of NFU.
    The National Farmers Union, a general agricultural organization 
representing 300,000 family farmers and ranchers, takes this 
opportunity to comment on the proposed changes to air-quality standards 
for ozone and particulate matter (PM).
    The National Farmers Union has a long history of supporting 
conservation programs, because the family farmers, as stewards of the 
land, are concerned about the environment. Significant levels of 
emissions are already controlled because farmers and ranchers are using 
good soil and water conservation practices and are keeping their 
equipment in good operating condition. It is simply in their best 
interest to do so because they seek to preserve the land to pass on to 
future generations.
    National Farmers Union is concerned that the proposed changes to 
the air-quality standards for fine PM and ozone will greatly increase 
the regulation of farm operations and increase costs to farmers both 
directly and indirectly. We are additionally concerned that there is 
currently no funding in place to offset these costs other than what the 
farmer will be required to pay.
    The costs of the proposed standards for ozone and fine particulate 
matter will fall heavily on individuals and State and local 
governments. Farmers, along with other other U.S. taxpayers, will pay 
for the new rules in many ways--through higher local and State taxes or 
through cuts in important State and local programs and services, 
including police and fire protection, education, help for the poor and 
homeless and other public programs. In a joint letter to the 
Environmental Protection Agency (EPA) Administrator Carol Browner, the 
National League of Cities, the Conference of Mayors, the National 
Governors' Association, the National League of Counties, the National 
Conference of State Legislators, and other State and local 
organizations said the ``proposed new standards would have an enormous 
impact . . . on the ability of State and local officials to meet other 
urgent priorities.''
    The new rules will change the way people live. The changes will 
range from the serious and expensive (higher State and local taxes and 
cuts in programs and services) to the moderately expensive (higher 
costs for things like electricity, cars and gasoline) to the 
aggravating and inconvenient (driving restrictions, increased 
automobile inspection and maintenance programs and mandatory car 
pooling).
    State and local official are not the only ones criticizing EPA's 
proposals. Criticism of the proposals are widespread within the Clinton 
Administration--a fact which EPA did not disclose to the public. A 
number of Federal agencies, including the Treasury Department, the 
Office of Science and Technology, the Department of Commerce, the 
Department of Transportation, and the Small Business Administration, 
all said in documents just made public that the new standards are not 
justified. Another agency, the President's Council of Economic 
Advisors, said the EPA's estimates of the cost of the new rules--a 
combined $8.5 billion, according to the EPA--is considerably off the 
mark. According the council's estimates, the cost of the ozone 
standards alone will be $60 billion a year.
    How can we justify increased standards for air-quality in rural 
America when the Conservation Reserve Program is now facing significant 
funding reductions? To improve the quality of our air, we should 
increase funding for these conservation programs rather than impose 
more regulations on farmers. In order to meet new standards, according 
to a report of the State and Territory Air Pollution Program 
Administrators and the Association of Local Air Pollution Control 
Offices (STAPPA/ALAPCO), the agricultural sector may face tighter 
operational and processing controls to reduce particulate matter 
emission. STAPPA/ALAPCO's proposed particulate emission control options 
for agriculture include:
     Wind breaks--and other residue management systems to 
reduce wind erosion.
     Conservation tillage--use of special equipment to avoid 
mixing in residues.
     Crop management--planting of legumes of grasses to build 
soils, grassed
    waterways.
     Cover crops--planting alfalfa and winter wheat to protect 
vegetation.
     Dust controls for storage areas--tarps, covers.
     Grain elevators--cyclones, fabric filters, vents 
application of oils to grain to control dust.
     Grain Transportation--covers on conveyer belts, bucket 
elevators, etc.
     Feed mills--moisture control measures and cleaning
    The U.S. Department of Agriculture and the Small Business 
Administration questioned the EPA's proposed standards on PM and 
charged that the new standards ``are not based on adequate scientific 
evidence'' and would have a ``large economic impact'' on ``tens of 
thousands, if not hundreds of thousands of small businesses'' and 
farms. USDA further claimed that ``it is premature for the EPA to 
change the existing standard until scientific evidence is correctly 
obtained and interpreted.'' USDA also noted the concerns held by farm 
groups that the new standards ``may impose significant costs'' on 
farmers, particularly the 71 percent of U.S. farms with annual sales of 
less than $40,000. The documents also suggest that the proposed 
regulations may drive up farming costs such as fuel, fertilizers, 
pesticides, and necessary chemicals.
    When farmland regulations of this kind are determined, EPA and 
other government agencies should take into account the contribution of 
agricultural lands to improved air quality. Despite the fact that 
agriculture is not a major emitter of PM, the standards proposed by EPA 
would lead local and State governments to tighten regulation on farm 
operations. Because it is difficult to measure accurately the amount of 
fine particulate matter in the air, it is likely that under the new 
rules, arbitrary limits on what a farmer can till soil, harvest crops, 
or apply fertilizer could become an unfortunate reality. Although rural 
areas generally record low levels of pollution, these same areas could 
soon be in violation of the stricter standards if these proposed rules 
become law.
    Because the proposed standards would stiffen the regulations of 
particulate matter, the impact of the new regulations would be 
significant to farmers. Fuel and energy costs are the third largest 
non-agricultural input supply expense for American farmers, and under 
the proposed rules farmers will be required to pay even more for 
transportation costs. Furthermore, Federal, State or local regulators 
could decide that rural roads, including those on private lands, would 
need to be improved to meet the EPA's proposed standards, which could 
be very costly to farmers.
    Agricultural operations have been interpreted as being a 
``significant source'' of emission for particulate matter. Various 
agricultural facilities are presently being regulated in non-attainment 
zones primarily in the Southwest and Far West. Under the proposed 
PM2.5 standards, new non-attainment zones may be proposed 
across the United States, potentially affecting all agricultural 
operations and family farms.
    We urge EPA to work closely with USDA and others to ensure the 
availability of the best data pertaining to emissions from agricultural 
activities and the effects of control programs on agriculture and rural 
communities. National Farmers Union is concerned about the potential 
effects that implementing control programs, designed to help areas 
attain the new standard, could have on small farms. EPA defines small 
entities in the Regulatory Impact Analysis (RIA) as establishments with 
less than 100 employees. In many areas of the country, agriculture is 
characterized by owner-operator firms that typically employ few, if 
any, hired workers.
    USDA's most recent data show that 71 percent of U.S. farms have 
annual sales of less than $40,000, while fewer than 6 percent have 
annual sales greater than $250,000. In 1994 and 1995, farmers spent 
about $170 billion on farm inputs and services. Both direct and 
indirect energy inputs account for about 22 percent of the total 
expenditures for agricultural production, according to USDA. However, 
direct and indirect energy account for a considerable higher percentage 
of farmers and variable expenses. With energy constituting a high 
percentage of variable expenses for many major crops and for livestock, 
farmers are sensitive to changes in variable expenses because 
production decisions are based on the prices of variable inputs. 
Production and/or use of many of these inputs could be affected by 
emission control programs, including fuel that powers farm equipment, 
electricity, fertilizers, pesticides, and other agricultural chemicals. 
Because a large proportion of farms are small entities, increased costs 
for farm inputs would surely have a negative impact on their financial 
performance.
    We are also concerned that existing equipment on farms will be 
required to be altered to adhere to the new standard, resulting in 
significant expense to farmers during EPA review; we consider it to be 
an important time to define what equipment is considered ``old'' or 
``new''. Until now, we have been unable to determine a clear definition 
of these terms for farm machinery. Examples of PM emissions from 
agriculture include dust from cultivation and harvesting, wind-blown 
dust from feedlots, grain elevators and grain mills, and diesel soot. 
Emission of PM also include PM precursors such as ammonia, which rises 
from feedlots and dairies, diesel emissions, nitrogen oxides and sulfur 
dioxides from industrial boilers, soot from fires and spray drift from 
crop protection products.
    National Farmers Union is concerned about the characterization of 
pollution in particular air sheds. Where does the pollution come from, 
and what activity caused it? What percentage of the total pollution 
inventory results from an activity? Are there cost-effective control 
strategies that reduce pollution while maintaining productivity? We 
believe a well coordinated research program with Federal, State and 
local participation is necessary in order to begin answering these 
questions. Without answers, controls could be costly and ineffective.
    In the spirit of cooperation, we believe it is imperative that USDA 
develop a specific Memorandum of Understanding (MOU) with EPA to 
transfer technical expertise and support for those air-quality issues 
derived by the Clean Air Act Scientific Advisory Committee which 
significantly involve or affect the agricultural industry. Agricultural 
scientists possess the knowledge to provide this expertise which will 
maintain USDA confidence and integrity among the agricultural industry 
producers. This must be a serious and outgoing commitment by USDA to 
provide this avenue of knowledge, research, development, and technology 
transfer.
    We found that many current, agricultural air-quality issues require 
additional understanding and knowledge well beyond that which exists 
today. Examples are the unknowns about particulars emitted by wind-
blown dust, field operations and nonroad-engine emissions. We would 
recommend you consider a departmental air-quality research initiative 
to provide the level of understanding of the environmental impacts this 
issue demands, in the same way in which we addressed water quality 
issues in recent years that is cooperatively handled by several 
agencies.
    We believe agricultural producers will continue to implement many 
of the air-control measures to benefit our environment. It is 
imperative that farmers be provided the knowledge and flexibility to 
design and voluntarily apply air-quality controls locally. Each area of 
the country faces different air-quality challenges. We urge you to 
encourage increased cooperation with EPA scientists, USDA officials, 
agricultural producers and others to arrive at control strategies that 
work. For example, some EPA regulations require a reduction in 
agricultural burning. However, the conservation practice ``Prescribed 
Burning'' which has proven to be an effective tool for some selected 
production systems to control pest and diseases. This method does not 
applicable in every case; therefore it is critical to have locally led 
efforts to achieve conservation goals.
    In conclusion, before more research can be completed to determine 
exactly how much PM 2.5 is emitted on farm operations, we 
strongly urge that no changes are made to current standards. As the 
control measures required under the Clean Air Act continue to be met, 
further reductions in particulate and ozone emissions will continue to 
decrease, and air-quality will continue to improve. We support the 
conservation practices and other measures taken as part of the Clean 
Air Act, and we look forward to continuing to work with you on this 
important matter.
 excerpts from article v of national farmers union 1997 policy manual 
                                section
O. Conservation
    We support the development of a one-stop conservation planning 
system for agriculture through the Natural Resources Conservation 
Service (NRCS). A single conservation plan jointly developed by the 
farm operator and the NRCS should be established to fulfill the 
requirements for the current maze of land and water regulations of 
various governmental agencies.
    Conservation programs should be good for the environment, reward 
stewardship of land and water resources, discourage speculative 
development of fragile land resources, strengthen family farming and 
enhance rural communities.
    The objective of the conservation plan must be to reduce and 
control wind and water erosion, prevent non-point pollution, and 
enhance the soil and water capacities of the land.
    The plan should designate which highly erodible soils should not be 
tilled and which may be tilled with approved conservation practices. It 
should clearly map and document both existing and drained wetlands, as 
well as any drains and channels. The plan should outline the 
conservation of wetlands, as well as the maintenance of drains and 
channels. It should also provide for meeting soil erosion goals and 
controlling non-point pollution.
    Such a conservation planning system should replace the existing 
sodbuster, swampbuster, Corps of Engineers flood-plain and other 
regulations which impact agricultural lands. The plan should be 
supervised and approved by the USDA committee process, with the 
technical assistance of the NRCS.
    Once the plan is filed with NRCS and implemented, a producer should 
be deemed to be in compliance with all Federal agencies. Producers 
should be allowed to remedy inadvertent or unavoidable failures to 
carry out conservation plan practices, and penalties should be based on 
the degree of the violation. Loss of full Federal farm program benefits 
should be imposed only in cases of purposeful destruction of 
conservation practices. Current conservation compliance requirements 
allow too few options to account for local involvement, climatic 
conditions, and geography, which are beyond producer control.
1. Government Programs
    Government conservation programs should be funded at levels that 
will ensure the continued protection of our nation's soil and water 
resources. Such financing should be on a long-term basis, providing 
Federal commitments for at least 5 years ahead and providing 
conservation assistance on a level designed to meet the needs as shown 
in the Federal land conservation inventory and the appraisals under the 
Resource Conservation and Recovery Act of 1976 and other Federal 
studies.
    The needs are so widespread and urgent that any ``targeted 
conservation'' program would, if it were motivated by something more 
than budget savings, have to call for a vast expansion of Federal 
conservation investment. We request that Federal financing to meet 
clean water and air standards of the Environmental Protection Agency 
(EPA) be available to farmers from funds appropriated by Congress for 
this purpose, and that such funds be administered through the farmer-
elected committees.
    We urge continued improvement and acceleration of the small 
watershed programs.
    We support the continuation and expansion of the Environmental 
Quality Incentives Program which includes, the Agricultural 
Conservation Program (ACP), Water Quality Incentives Program, Great 
Plains Conservation Program, the Colorado River Basin Salinity Control 
Program, and other soil and water programs, and we urge full 
appropriation of funding directed to family farmers and ranchers.
    We urge that ACP be funded at not less than the $500-million level 
as originally authorized by the Soil Conservation and Domestic 
Allotment Act of 1937, and we strongly urge that the conservation cost-
sharing delivery system for all rural Federal conservation cost-sharing 
funds be through the farmer-elected committee system.
    Farmers should be able to put strips into grass for soil 
conservation purposes and use these strips year after year for 
diverting and conserving without losing base.
2. Agricultural Resources Conservation Program
    We support the Environmental Conservation Acreage Reduction Program 
(ECARP). We urge full funding of the three branches of ECARP--the 
Conservation Reserve Program (CRP), the Wetlands Reserve Program, and 
the Water Quality Incentives Program--to ensure proper implementation.
    We also support greater emphasis on improved farm management 
techniques. Teaching farmers to be the best possible stewards of their 
resources is a better long-term approach to sustainability than simple 
land retirement.
    We recommend that the payments due to cooperating farmers in ECARP 
be in cash, rather than in certificates or CCC commodities.
    We support the 25-percent-per-county acreage limit for ECARP.
    The CRP program needs to be closely monitored by the Natural 
Resources Conservation Service (NRCS) and the Farm Service Agency (FSA) 
with enough funding to enforce contract requirements for adequate weed, 
insect, and fire control. Enrollees should be allowed to manage 
permanent vegetative cover to enhance wildlife habitat and ecosystem 
health.
    In extending the Conservation Reserve Program and CRP contracts, we 
recommend that the program be better focused to serve the needs of 
family farmers and ranchers and to protect highly erodible land (HEL) 
and other environmentally sensitive lands.
    CRP lands which can qualify for the Wetlands Reserve or Water 
Quality Incentive programs should be extended and transferred to those 
programs through voluntary participation.
    All CRP lands currently enrolled in the program should be re-
evaluated for contract. The most environmentally sensitive land should 
be given first opportunity for contract.
    CRP lands diverted into long-term timber and forestry conservation 
projects should be given a high priority for contract re-enrollment. We 
recommend that planting property to shelterbelts or other conservation 
measures be encouraged through reduced property taxes on those acres. 
We recommend that producers who destroy shelterbelts or wooded areas 
establish the same number of acres of new trees for a minimum of 10 
years.
    We favor CRP contracts and contract extensions for periods of not 
less than 10 years. We favor programs which maintain CRP lands in 
private ownership in the hands of resident family farm and ranch 
operators.
    Incentives to aid beginning farm and ranch families should be 
offered on land that was previously enrolled in CRP, but is not 
environmentally sensitive under the new rules and will not be re-
enrolled.
    We urge that financial and technical assistance be provided to 
producers in preparing CRP acreages for sustainable agricultural 
systems that will meet established conservation standards. In addition, 
land managed with appropriate organic standards while enrolled in CRP 
should be eligible for organic certification upon leaving the program.
    In times of extended drought conditions or other weather disasters, 
haying or grazing on CRP acres should be allocated to all livestock 
producers based on need. The FSA farmer-elected county committees 
should be given authority to set the date of harvest, based on the 
nutritional value of hay. These regulations should be in place so the 
procedures are known in advance. The maximum landowner income from the 
haying and grazing should not exceed the annual CRP contract amount 
from that farm.
3. Sodbuster and Swampbuster Provisions
    We support provisions which give the secretary greater authority in 
handling sodbuster and swampbuster violations.
    The goal of soil conservation practices should be to reduce soil 
losses to tolerable levels, or ``T-levels.'' We recommend that 
alternative conservation systems be used only in cases of financial 
hardship, after recommendation of local conservation officials.
    We call upon Congress to designate the FSA as the single agency to 
regulate swampbuster provisions.
4. Wetlands
    Wetlands deserve protection in order to preserve harmony with the 
nation's land and its resources and natural systems on which all life 
depend.
    Requiring re-certification of wetlands at 5-year intervals creates 
a moving target for producers in their compliance efforts. While we 
support a single, coordinated approach to wetlands protection, we 
believe that producers must be provided full opportunity to participate 
in the development and review of such joint regulation. We reaffirm our 
support for making the NRCS and FSA the lead agencies in wetlands 
delineations on agricultural land.
    We support the joint efforts of these agencies to propose a single 
set of definitions and rules in the proposed revisions to the 1989 
Federal Manual for Identifying and Delineating Jurisdictional Wetlands, 
which are pending release. However, the proposed manual's exemption of 
the prairie pothole region of the United States from its coverage 
leaves many farmers with no chance for an improvement in wetlands 
procedures. This critical error must be corrected in the final manual, 
since commodity production and farm survival are at stake.
    In addition, we recommend:
    (1) that any and all wetlands determinations throughout the United 
States rely on the presence of all three of the following mandatory 
wetland criteria simultaneously appearing on the same site year-round: 
(a) hydrology; (b) a predominance of hydric soil; and (c) a prevalence 
of hydrophilic vegetation;
    (2) that all existing wetland determinations be reevaluated under 
the proposed manual's uniform definitions and procedures with the 
elimination of buffer zones;
    (3) that the Federal Government consult with State and local 
governments to develop a unified, mutually agreeable management program 
to protect our nation's wetlands;
    (4) that a wetlands management program balance wetland values and 
the needs of the various States and their political subdivisions and 
individual property rights;
    (5) that any leaseholder, renter, or owner be compensated equitably 
for the taking of any lands through the classification of wetlands;
    (6) that for the protection and preservation of our natural 
resources as well as our human resources and our free-enterprise system 
and democratic way of life, the final interagency manual be revised 
with greater consideration for the food and fiber producers of the 
United States;
    (7) that regulations ought to be amended to allow farmers to 
mitigate wetlands in a given acreage, provided that there is no net 
loss of wetlands in that acreage; and
    (8) that Congress study the impact of current and any new wetlands 
proposals on agricultural producers, family timber operations, and 
rural communities and give careful consideration in identifying and 
separately regulating any artificially created wetlands. Induced 
wetlands should be exempt from wetland restrictions.
5. Predator and Rodent Control
    Since the 1931 Animal Damage Control Act (ADC) mandates that the 
Federal Government protect the livestock industry from predatory loss, 
we recommend that the original intent of the law be enforced.
    Judicious use of control practices must be continued on Federal, 
State, and private lands to control coyotes and other predators.
    To the extent that an adequate ADC program is not available to 
farmers, we recommend that a federally financed indemnity program be 
instituted to pay for livestock losses.
                                 ______
                                 
   Prepared Statement of Bob Vice, President, California Farm Bureau 
      Federation, on behalf of the American Farm Bureau Federation
    Thank you, Mr. Chairman, for the opportunity to provide testimony 
for this important hearing on air quality. I am Bob Vice. I own and 
operate a wholesale citrus and avocado nursery and farm avocados near 
Fallbrook, California. I am President of the California Farm Bureau 
Federation and today I am representing the American Farm Bureau 
Federation, the nation's largest general farm organization with more 
than 4.7 million member families. Our members grow every type of farm 
commodity found in America. I am pleased to have the opportunity to 
discuss with you today the impacts of new air standards on the 
agricultural community. My comments focus primarily on the 
Environmental Protection Agency's proposal to revise the National 
Ambient Air Quality Standard (NAAQS) for particulate matter.
    As a preface to my comments, I think that it would be appropriate 
to share with you a portion of Farm Bureau's policy on air quality that 
was adopted by delegates to our annual meeting. It clearly outlines the 
position of America's farmers and ranchers regarding the importance of 
clean air. It reads, in part:

          We support a healthy environment. We support government 
        policies that: Are based on sound scientific evidence; provide 
        incentives to industries seeking to become more energy 
        efficient or to reduce emissions of identifiable atmospheric 
        pollutants; seek cooperation of organizations and governments, 
        foreign and domestic, to develop better understanding and 
        research on the implications of atmospheric pollution and the 
        means of preventing it.

    The evidence is quite strong that conservation has been a priority 
for farmers and ranchers for many years. There has been, and continues 
to be, a tremendous amount of conservation activity by farmers and 
ranchers across the country. These activities include such things as 
protecting wildlife habitat, creating wetlands, grassed waterways and 
field buffer strips. We also use conservation tillage techniques and 
cover crops, and plant trees and vegetation for windbreaks.
    All these activities reduce wind erosion of the soil, which in 
turn, provides cleaner air. The Conservation Reserve Program alone will 
idle up to 36.4 million acres across the country that provides 
vegetation that stabilizes soil and prevents windblown dust. Wind 
erosion on 84 percent of the nation's rangeland, 86 percent of the 
cropland, and virtually all of the pasture land is now less than the 
tolerable soil loss rate--meaning, the rate at which soil erosion can 
occur without surpassing the natural rate of soil regeneration (which 
is 2-12 tons per acre per year). And soil lost to wind erosion 
continues to decrease as farmers expand these extremely environmentally 
beneficial practices (Attachment I). Farmers are cleaning the air and 
should get credit for those activities.
    Make no mistake: we are all for clean air, and this debate today is 
about how to continue to achieve those goals.
    Agriculture is concerned because EPA estimates that 34.3 percent of 
fine particulate matter can be attributed to agriculture and forestry. 
Regarding this questionably large estimate, I quote Dr. Calvin Parnell, 
a professor of Agricultural Engineering at Texas A&M University and a 
member of the U.S. Department of Agriculture's Task Force on Air 
Quality. He says, and we agree, that:

          The data used to develop this inventory was based on 
        erroneous emission factors published by EPA for cattle feed 
        yards, feed mills, grain elevators and dust from farmers' field 
        operations.

    Those comments were made last week in a hearing held by a 
subcommittee of the House Agriculture Committee. Furthermore, I quote 
the Honorable Larry Combest, Chairman of the House Agriculture 
Subcommittee on Forestry, Resource Conservation, and Research from that 
same hearing. He says, and we agree, that:

          The science employed in developing this rule is not up to 
        par, and I'm concerned that farmers could bear the brunt of a 
        bad policy based on equally bad science. We don't have the 
        research yet to know whether we can actually attain these 
        standards, how much it will cost the agriculture industry and 
        the consuming public, and how much agriculture activity 
        actually contributes to air pollution problems. (Attachment 
        II).

    We share these same concerns. We also commend and extend the 
comments raised by the USDA, the USDA Task Force on Air Quality and the 
Small Business Administration in regards to economic impacts of this 
standard on farms and ranches (Attachment III).
                          california situation
    Today, however, I want to focus on actual situations those of us 
involved in California agriculture already face in regard to the 
present PM10 Non-Attainment Area for central and southern 
California, as determined by the 1990 Amendments to the Clean Air Act. 
Under this status, a major portion of California's agriculture has been 
faced with a number of challenges which, in many cases, are yet to be 
resolved. Agriculture in other areas of the country may face the same 
situation if a new PM standard is imposed.
    The money, time and resources we have spent attempting to meet the 
PM10 ambient air quality standard have given us plenty of 
reasons to know that we cannot jump immediately into a new air quality 
standard of which we know so little about. It is an absolute necessity 
to allow science surrounding PM2.5 to develop, so that 
intelligent, reasonable and justifiable decisions can be made.
    Let me expand on one of our air district's experiences in dealing 
with the present PM10 standard. These are examples of 
situations agriculture has faced in the San Joaquin Valley Unified Air 
Pollution Control District.
Example 1
    The emission inventory for agricultural tillage operations was the 
focus of the initial discussions with the air district. There are two 
major problems identified in this inventory. First, the actual number 
of passes the equipment makes per acre, and second, the PM10 
emission produced from each type of operation such as disking, ripping 
or furrowing. This problem was due to the fact that information, 
published by the EPA, indicated that alfalfa was disked eight times per 
year, rice 13 times per year and rangeland twice per year. This greatly 
overestimated the emissions and made agriculture the prime target. 
First, farmers disc and seed alfalfa maybe only once every three or 
more years, not eight per year, and farmers don't even disc rice or 
rangeland at all, much less 13 and two times per year, respectively.
    Some of the control measures suggested for agriculture operations 
included: sprinkler irrigation on fields prior to planting; water tanks 
mounted on tractors and water sprays on the back of disking equipment 
(without taking into account that water is of a premium in California); 
and the use of shaking equipment to shake trucks and farm implements 
prior to exiting a field or unpaved road onto a paved road (this would 
supposedly eliminate the carry-out of mud or dirt, which would later be 
entrained into the atmosphere by cars or trucks on paved roads). These 
irrational and impractical controls would have done little if nothing 
to clean the air and would have been extremely costly for California 
agriculture, had they not been corrected.
    Just by updating the inventory with current acreage information for 
each crop and correcting the number of passes per acre for tillage 
equipment, the agricultural PM10 emission inventory for 
tillage operations was reduced 30 percent.
Example 2
    At one point it was discussed that farms should be permitted by 
their local air districts. In the San Joaquin Valley alone, it was 
speculated that over 31,000 permits would need to be written for farms. 
Each silage pile, unpaved road and equipment storage yard, to name a 
few, would have been permitted. The District estimated that it would 
need 70 additional permitting engineers to process air quality permits 
just for farms.
Example 3
    As I indicated, information used by the air districts identifies 
agriculture as a primary source of PM10 emissions. For the 
past 5 years, California's agriculture community has fought to address 
the deficiencies in those inventories. One example is windblown dust 
emissions from agricultural lands. In the original inventory, it was 
assumed that all farming in California was ``dryland'' farmed. It 
assumed that the land was not irrigated, and that there was no 
vegetation cover, or cover canopy, from the crops. Once irrigation and 
vegetation cover was put into the wind erosion equations, the wind 
erosion PM10 emission inventory was reduced an incredible 80 
percent from 410 tons per day of PM10, to 58 tons per day of 
PM10.
Example 4
    Probably the most blatant example of an inaccurate inventory,which 
would have cost the agricultural industry thousands of dollars, was the 
initial emission inventory for combustion engines used to drive 
irrigation pumps. The original inventory estimated nitrogen oxide (NOX) 
emissions (a precursor of PM) at 626 tons per day from all the pumps in 
the San Joaquin Valley. This would be the highest emissions category 
for NOX emissions in the San Joaquin Valley exceeding all the mobile 
sources including all cars and trucks, which together only emit 353 
tons per day. Driven by agricultural inquiries, a new study was 
commissioned that was based on actual interviews with 360 farmers. The 
new study determined that the NOX emission for these pumps is only 32 
tons per day.
    We have only begun to address agriculture's concerns with 
PM10 estimates, many of which are still unaddressed and 
uncorrected. Furthermore, other PM10 issues are still 
arising. For example, EPA is also looking at NOX and ammonia (NH3) from 
soils as contributors to ambient levels of PM10. This could 
mean farmers will also have to address the application of fertilizers 
and pesticides as an air quality concern, not to mention livestock. 
Yet, recent studies performed in the Valley indicate that there are 
very little NOX or NH3 emissions from the soil. Questions about how 
much particulate matter is released into the air through natural 
occurrences, such as high wind or volcanoes, also remain to be 
addressed (Attachment Ill).
    Considering all these discrepancies, it is unbelievable that we are 
now again faced with the same problems, only this time with smaller 
particulate matter. Based on the 1994 Emissions Inventory for the 
National Particulate Matter Study, fugitive dust emissions from 
agriculture have been listed as the third largest source of 
PM2.5 nationwide, falling behind paved and unpaved roads. 
This is hard to believe, since there has never been any actual 
PM2.5 emission data taken on agricultural tillage equipment 
using EPA approved PM2.5 samplers. All of these examples 
only emphasize the necessity to fully study PM2.5 before 
deadlines are set and rules are developed.
                            california study
    In attempting to resolve some of the previously mentioned issues, 
it became necessary to conduct a multi-year, multi-faceted air quality 
study. Such a study was developed and is now underway in California. 
This study, known as the California Regional Particulate Matter Air 
Quality Study (CRPMAQS), will address all areas of PM10 and 
PM2.5 issues. This includes emissions determinations and 
quantifications, data analyses, demonstration studies, ambient air 
quality measurements and model development. USDA is playing a major 
role in this study by helping to fund emissions studies for 
agricultural activities and operations. Once completed, it will be the 
source by which decisions on particulate matter will be made in 
California, and will serve to aid other areas in the Nation and the 
world in their particulate matter decisionmaking process.
    This comprehensive study, however, will not be completed for 
roughly 5 years. I want to emphasize that this study is the first 
comprehensive study that actually measures, instead of estimating, 
agriculture's PM2.5 emissions. In order to avoid the 
mistakes made for PM10, this study and others like it must 
be completed before costly implementation activities, attainment 
deadlines and regulations are set in place for yet a new PM standard.
                               conclusion
    In conclusion, I want to reiterate that much work is yet to be done 
in the agriculture industry before a new standard is set for 
particulate matter. We must develop an accurate measurement method for 
PM2.5 in order to determine and quantify the significant 
sources of PM2.5 and we must complete the necessary research 
to understand the true nature and formation of PM2.5, so as 
not to make the same mistakes that we are making with agricultural 
PM10 emissions.
    A shotgun approach will only serve to put American agriculture out 
of competition with other countries and put agricultural producers out 
of work. Because U.S. agricultural commodity prices are tied to world 
prices, a farmer cannot simply ``pass on'' the cost of doing business 
to the consumer. In other words, ``we are ``price takers'' and not 
price makers.'' Therefore, any increase in operational costs of farming 
becomes significant and must be based on accurate information that 
justifies the expenditures.
    We also want to be careful in not tipping the balance of regulation 
in this country to far as to force our grocers to fill market orders 
with food purchased from other countries that do not always meet the 
same safeguards and health standards as U.S.-produced commodities.
    The agriculture community enjoys breathing clean air as much as 
anybody, but it doesn't want to waste money on control measures that 
have little or no effect on cleaning up the air of this Nation.
    Finally, the USDA must maintain a strong presence as discussions 
continue on these new standards. The USDA, the Small Business 
Administration and the USDA Agricultural Air Quality Task Force must 
continue to demand that the concerns of America's farmers and ranchers 
are addressed by the EPA in order to ensure a continued safe, abundant, 
healthy and affordable U.S. food supply.
    I end on a note of caution as expressed by Paul Johnson, Chief of 
the USDA's Natural Resources Conservation Service, as he remarked in 
last week's hearing that:

          When local air quality administrators make decisions about 
        which pollution control programs to implement, they will 
        consider factors such as the percentage of total pollution in 
        the airshed that is caused by a specific activity or source, 
        and costs and benefits of implementing a set of controls on 
        these activities. Agriculture is practiced throughout the 
        country using many different technologies on a variety of soils 
        and in a variety of climates. Conditions, technology and 
        practices, along with a number of other factors determine 
        emissions. Agricultural emissions are highly variable within 
        and across airsheds and must be evaluated carefully.
    Thank you.
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  Prepared Statement of Paul Hansen, Executive Director, Izaak Walton 
                           League of America
    Mr. Chairman and Members of the Subcommittee: I am Paul Hansen, 
Executive Director of the Izaak Walton League of America, which is 
celebrating its 75th year of working to conserve, maintain, protect and 
restore the soil, forest, water and other natural resources of the 
United States. I appreciate having the opportunity to talk with you 
today about the Environmental Protection Agency's proposal for new 
national air quality standards for ozone and fine particulate matter, 
commonly referred to as PM2.5.
    Protection of our nation's air quality is a part of the Izaak 
Walton League's mission and an issue of vital importance to League 
members, many of whom live in the nation's agricultural communities. We 
have worked on clean air issues since the first Federal Air Pollution 
Act, which was passed during the Eisenhower Administration. With the 
adoption of new air quality standards just months away, the League is 
concerned that the health, environmental and economic benefits that new 
standards would provide be understood, recognized and considered as you 
review this critical decision.
    Today, I want to touch on a few of the benefits this new standard 
would realize for the health of our people and our natural environment, 
but I especially want to implore you to consider the findings of the 
U.S. Department of Agriculture's National Crop Loss Assessment Network, 
which was released during the Reagan Administration. We were involved 
in the NCLAN study, and cosponsored a symposium in 1982, with the Boyce 
Thompson Institute at Cornell University, at which many of the findings 
were released and discussed. I personally conducted a literature review 
of the effects of air pollution on crops in 1990, a summary of which is 
available here today for your consideration.
    You know that the new air quality standards would protect public 
health by preventing approximately 15,000 premature deaths and 250,000 
to 400,000 illnesses each year. The proposed ozone standard of .08 ppm 
would provide much needed health protection to anyone who spends time 
outdoors working, exercising or relaxing. This includes, of course, 
farm owners, operators and employees. The particulate matter standard 
for PM2.5 would protect, among others, anyone with heart or 
lung disease. Most importantly, both standards would improve 
protections for our children's health.
    You also know that new limits on ozone and fine particulate matter 
pollution would further reduce emissions of air pollutants that deposit 
on our rivers, lakes and streams and degrade water quality necessary 
for wildlife, fisheries, and water-based recreation. As you know, ozone 
and particulate matter pollution are secondary, not primary pollutants. 
This means that they are not emitted directly but instead are created 
from a mixture of primary pollutants including nitrogen oxides and 
sulfur dioxides. By reducing emissions of these primary pollutants, the 
new standards would help to prevent the acidification of our rivers, 
lakes, streams, and other special aquatic ecosystems such as the 
Chesapeake Bay.
    Most critical to the responsibilities of this Committee, the new 
ozone standard would provide millions of dollars in agricultural 
benefits each year. At air pollution levels well below those that exist 
in our air today, ozone can reduce the productivity of commodity crops 
such as corn and soybeans by 10 percent. This means that dirty air 
costs our country approximately one billion bushels of corn and more 
than two hundred million bushels of soybeans each year--at today's 
prices almost three billion dollars in revenues.
    It is well-established in the literature that the effects of ozone 
on crops is very insidious, and, in most cases, invisible. With 
soybeans, for example, there are no fewer beans, but lighter beans. A 
10-percent reduction, which can be common at ozone levels found 
throughout much of the soybean growing region, while highly significant 
in terms of yield, would be effectively invisible--even to the trained 
eye.
    In the last 2 years, three groups of experts on ozone's vegetative 
impacts have reconfirmed the seriousness of ozone's impacts on 
commodity crops, forests, and other vegetation, which were first 
measured by the National Crop Loss Assessment Network in 1982. A 
workshop sponsored by the Southern Oxidants Study in 1995 convened 
agricultural, forest, and ecological scientists with extensive 
experience studying the effects of ozone on ecosystems to discuss the 
need for a new ozone standard. The Workshop recommended that EPA adopt 
a seasonal secondary standard that would provide vegetation with 
additional protection during the growing season.
    More recently, the Department of the Interior recommended that EPA 
adopt a more protective secondary standard because the proposed primary 
standard of .08 ppm was not adequate to protect natural and cultural 
resources.
    Finally, the Clean Air Scientific Advisory Committee (CASAC) that 
reviewed the research behind the proposed standards advised EPA that a 
secondary standard, more stringent than the primary, was needed to 
protect vegetation from ozone.
    I know that concern has been expressed regarding the cost of 
implementing a new PM2.5 standard, particularly in 
agricultural areas, and 1 would like to close by addressing that issue.
    First, it is essential that our air quality standards be set at 
levels that are protective of human health, not at levels that 
regulated industries and others consider cost-effective.
    Second, the new particulate matter standard applies to 
PM2.5, not PM10. EPA has not recommended any 
tightening of levels of PM10 pollution. The distinction is 
important because almost all PM2.5 is a product of 
combustion and almost all PM10 is created by earth moving 
activities such as construction, mining, and agricultural practices 
like tilling.
    Third, on most farms, the primary source of combustion is diesel 
fueled farm equipment. This equipment is responsible for a very small 
amount of the primary pollutants that create PM2.5. The 
amounts of these primary pollutants created by farm equipment are so 
small they are insignificant when compared to emissions from other 
PM2.5 sources. Farm equipment creates about 1 percent of 
national nitrogen oxide emissions and almost no sulfur dioxide 
emissions.
    Finally, the history of pollution controls strongly suggests that 
even if controls on diesel fueled vehicles become necessary, these 
controls will cost far less than predicted. Reductions in sulfur 
dioxide emissions, for example, which cost less than $100 per ton today 
were predicted to cost as much as $1,500 per ton. Reduced crop yields 
are much more likely than tighter pollution controls to negatively 
impact a farmer's bottom line.
    In closing I would like to again thank you for the opportunity to 
address the proposed new standards' agricultural impacts and to shed 
light on one of the hidden victims of our nation's polluted air, the 
American farmer.
          new standards will impose few burdens on the farmer
    The Izaak Walton League believes the impact that these standards 
will have on our nation's agriculture industry have been mis-
characterized by some. Industry opponents to the new PM2.5 
standard, for example, claim the new standard will create a horrible 
regulatory burden for farmers. These opponents are assuming that EPA 
will target the same farming activities for PM2.5 as it did 
in developing strategies for controlling PM10. However, this 
assumption is mistaken.
    EPA's principle interest in implementing the new air quality 
standards is to bring areas of non-attainment into attainment. Most 
projected non-attainment areas are urban areas where fine particulate 
matter pollution is a product of combustion. Therefore, the major 
targets of regulatory focus are very likely to be sources of combustion 
in urban areas: electric utilities, buses, and large commercial 
boilers, for example.
    The changes EPA is proposing to the PM10 program--which 
do not include a tightening of PM10 pollution limits--
actually result in fewer regulatory burdens on agricultural activities. 
For example, by proposing a switch to a ``98th percentile'' form for 
measuring compliance with the PM10 standard, EPA is 
proposing to allow more than six exceedances every year to be 
``excused'' instead of just one. In comments critical of this element 
of EPA's proposal, the California Air Resources Board calculated that 
in the Great Basin Valley peak PM10 levels 68 percent above 
the standard would be legal under the new proposal.
    Finally, there has been testimony in the U.S. House of 
Representatives that the new PM2.5 standard will also affect 
farmers who use nitrogen-based fertilizers and, because of the 
volatilizations of ammonia, dairies with manure lagoons. In reality, 
combustion sources such as factory boilers and electric utilities emit 
many times the level of PM2.5 particles than do manure 
lagoons. They are not likely to be regulated under the State 
Implementation Plans developed to implement these standards.
                                 ______
                                 
Prepared Statement of Kevin Fennelly, MD, Staff Physician, Division of 
Environmental and Occupational Health Sciences, National Jewish Medical 
                          and Research Center
    Mr. Chairman and Members of the Subcommittee: Thank you for the 
opportunity to speak with you today regarding the particulate matter 
standard proposed by the Environmental Protection Agency (EPA). My name 
is Kevin Fennelly; I am an academic physician at the National Jewish 
Medical and Research Center in Denver, Colorado. I am board-certified 
in pulmonary medicine and in occupational-environ- 
mental medicine, and my time is evenly divided between patient care and 
clinical-epidemiological research. Most of the patients I see have 
asthma or chronic obstructive pulmonary disease (COPD), although I care 
for patients with a wide spectrum of more unusual respiratory diseases. 
My research interests include the epidemiology of the health effects of 
particulate air pollution, so I am familiar with the scientific 
literature in this area.
    I am testifying today as a concerned physician, scientist, and 
citizen. I support the EPA proposal, although a more stringent standard 
would provide additional public health benefits. I wish to emphasize 
three points. (I) Particulate air pollution causes human suffering, not 
just statistics. (II) There is biological plausibility to support the 
epidemiological findings of adverse health effects associated with 
particulate air pollution. (III) The risk of adverse health effects due 
to particulate air pollution is comparable to other risks which our 
society has not found acceptable.
     i. particulate air pollution causes human suffering, not just 
                               statistics
    In discussing these issues with our local and State leaders, I 
realized that we physicians and scientists have not done an ideal job 
of communicating the meaning of recent scientific studies on 
particulate air pollution. The data have often been expressed in very 
abstract terms which are difficult to understand. My primary goal today 
is to try to bridge the gap between the scientific data and the 
clinical effects. I hope to prevent you from being numbed by all the 
numbers which you have undoubtedly seen, and to recall that behind all 
those statistics are people suffering from very real diseases.
    As a physician specializing in lung diseases, I have seen patients 
who report worsening of their asthma symptoms on days of visible air 
pollution in Denver, Phoenix, Los Angeles, and the San Francisco Bay 
Area. These patients have told me of this association after a 
nonspecific inquiry about the triggers of their asthma symptoms, and 
they have not been aware of my research interest in air pollution. 
Colleagues have reported similar encounters. In Denver, our air 
pollution is predominated by particulate matter, so at least for our 
local patients, particulate air pollution is likely to contain the 
offending agent(s). Asthma is a common disease characterized by 
symptoms to multiple triggers, including respiratory infections, cold 
air, exercise, and other factors, including air pollution. Because of 
this, it is impossible in any one patient to quantify how much air 
pollution contributes to the disease. This speaks to the need for 
epidemiological studies of groups of individuals to assess the relative 
contribution of factors such as air pollution.
    Aside from asthmatics, another group susceptible to the effects of 
particulate air pollution are the elderly with heart or lung disease. 
Again, since these diseases are so common, it is impossible for any one 
physician on any 1 day to notice changes in the pattern of illness or 
death which might be attributable to particulate air pollution. Even 
with the hundreds of deaths which occurred during the air pollution 
disaster in London in 1952, doctors did not appreciate the full 
magnitude of that public health disaster until the epidemiologic data 
were available.
    I have been disturbed by comments in the lay literature which have 
trivialized the occurrence of respiratory symptoms associated with air 
pollution. Breathing is our most basic notion Without breath there is 
no life, and it should be understandable that shortness of breath can 
be a distressing symptom. Allow me to suggest a simple exercise for 
those of you who may be fortunate enough to have escaped experiencing 
shortness of breath yourself or to have observed it in a family member. 
Simply take a drinking straw and breathe through it for several 
minutes, or better yet, try to walk about and climb some stairs. Then 
imagine feeling that way for hours or days. It is not a trivial 
discomfort.
    The other disturbing suggestion I have heard is that patients with 
lung diseases should simply medicate themselves more to cope with air 
pollution. This is illogical and violates good medical practice. As an 
occupational pulmonologist, I engage considerable resources removing 
patients from exposures which may be causing or aggravating their 
asthma. In the case of urban air pollution, it is obviously impossible 
for patients to avoid breathing the air in their community. Although 
inhaled bronchodilator medicines may be able to relieve symptoms 
temporarily, ongoing inhalation exposure will continue to aggravate the 
inflammation in the bronchial tubes which characterizes asthma and 
COPD. With more severe exacerbations, patients may have to use 
corticosteroid tablets or injections, which can have serious adverse 
effects if used repeatedly.
  ii. there is biological plausibility to support the epidemiological 
  findings of adverse health effects associated with particulate air 
                               pollution
    I will defer to Dr. Carl Shy's expertise in epidemiology to review 
the large numbers of studies which have found adverse health effects 
associated with particulate air pollution, but I wish to offer a few 
observations. Critics of these studies have suggested that they are 
inconclusive or that they have been done by a small group of biased 
researchers from Harvard. In fact, there are now a large number of 
studies of various designs which have been done in various cities, 
countries, and climates, and by various investigators studying multiple 
outcomes: death rates, hospitalizations, emergency department visits, 
pulmonary function changes, asthma medication use, and symptoms. There 
has been a striking consistency in the findings of these studies. There 
have been a few studies which have not found similar results, but these 
have typically suffered from designs and methods which resulted in a 
lack of statistical power or the lack of a biologically plausible 
hypothesis.
    Some critics of the EPA proposal have suggested that 
epidemiological studies are not valid science or use some sort of 
statistical sleight-of-hand. Advances in computing power and in 
statistical methods have improved the science of modern epidemiology 
considerably, which is similar to the advances due to improved 
technology in other fields. It is true that there have been 
epidemiologic studies of various suspected hazards which have resulted 
in associations which were later found to be spurious. In those cases 
the cause and effect relationship was readily dismissed after 
additional epidemiological and toxicological studies did not support 
the findings. However, this surely cannot be an indictment against the 
field of epidemiology; similar processes occur in every scientific 
field. In summary, it is highly unlikely that the epidemiological 
findings are due to chance or some other aberrations.
    A common criticism expressed in the lay press has been the small 
magnitude of the effects of the epidemiological studies. There have 
been references to the opinions of some scientists who only ``accept'' 
relative risks over 2 or 3 (or some other arbitrary number) in order to 
consider an association ``significant''. In fact, there is no consensus 
or ``gold standard'' in the scientific community for any criteria in 
this regard. Such criteria might be useful as a screen in assessing the 
value of one or even a few studies on a given subject. However, when 
there is a large body of literature which has demonstrated consistent 
results, as is the case regarding the health effects of particulate air 
pollution, we must accept the data as they are. The magnitude of the 
effects are indeed small at current levels of particulate air 
pollution, but they are consistent with the effects which occurred 
during severe air pollution episodes, such as in London, 1952. Indeed, 
this point satisfies another criteria for establishing a cause-and-
effect relationship: a reasonable exposure-response relationship.
    The impact on the public health is determined not only by the 
magnitude of the effect, but also by how many people are exposed and 
how frequently they are exposed. Highly toxic environmental hazards 
easily gain the attention of the media and the public. Conversely, 
exposure to urban air pollution is such a common experience that most 
people perceive very little risk. However, it can be as serious a 
public health risk, albeit much more insidious, since there are large 
numbers of susceptible people frequently exposed to low concentrations 
of pollutants. Most of us were shocked at the accidental release of 
methyl isocyanate in Bhopal, India in 1984. There were at least 2000 
deaths from that disaster [1], but the number of individuals dying from 
particulate air pollution each year clearly exceeds that number.
    A common criticism of the EPA proposal for the particulate matter 
standard is that the epidemiological studies are not supported by 
biological plausibility. Although we still have much to learn, this is 
not true. In the air pollution disaster in Donora, PA of 1948, there 
were symptoms in 88 percent of those with asthma, 77 percent of those 
with heart disease, and 79 percent of those with chronic bronchitis[2]. 
There were 12 deaths in the Donora Borough during that week, which was 
six times the expected rate. Autopsies were performed on three of these 
patients. All three had evidence of capillary dilatation, edema, and 
hemorrhage in the lung with purulent bronchitis and bronchiolitis, 
which are inflammatory changes in the medium-to-large and small 
airways, respectively. All three of these patients had evidence of 
chronic cardiovascular disease. Similarly, in the killer fog of London 
in 1952, approximately 300 (60 percent) of over 500 autopsies 
demonstrated both heart and lung disease[3]. Thus, the pathological 
data were consistent with the concurrent and more recent 
epidemiological findings of increased deaths due to heart and lung 
diseases.
    Godleski and colleagues[4] recently presented preliminary findings 
of an inhalation toxicology study which was coherent with these 
pathological findings. They exposed rats with experimentally induced 
chronic bronchitis to concentrated urban air particulates. Those 
animals had a higher death rate (37 percent) than the controls (0 
percent) as well as airway inflammation and marked constriction of the 
bronchial tubes.
    Other animal studies have demonstrated lung inflammation and injury 
due to particulate matter, especially with very small particles 
described as ``ultrafine''[5]. There are a growing number of reports of 
investigations of the basic biological mechanisms responsible for this 
inflammatory response, including free radical activity[6], 
prostaglandins[7], and endotoxin-induced activation of genes for 
cytokines, or chemical messengers[8]. Another recent study[9] found 
that there is a marked increase in particle deposition in subjects with 
chronic obstructive lung disease, which may help explain the increased 
susceptibility of these individuals to the effects of particulate air 
pollution.
    Although much more research is needed to elucidate the biological 
mechanisms causing the effects of particulate air pollutants, these 
early studies are already producing exciting results supporting the 
biological plausibility of the epidemiological findings. Some critics 
of the EPA proposal have called for more scientific certainty before 
taking action. As a pulmonologist, these arguments seem to echo the 
history of the science and public policy regarding cigarette smoking. 
Early epidemiological studies identified cigarette smoking as a risk 
factor for lung cancer and cardiovascular disease, but the strategy of 
the tobacco industry for years has been to repeatedly demand that more 
research is needed to confirm the hazards of cigarette smoking. 
Although we have learned a tremendous amount about the adverse health 
effects of cigarette smoking, we still do not know with absolute 
certainty exactly how smoking induces cancer and cardiovascular 
disease. However, few reasonable people now question the deleterious 
effects of cigarette smoking. Absolute certainty can be achieved only 
with complete convergence and consistency of all studies in all 
disciplines, including epidemiology, inhalation toxicology, dosimetry, 
and others. This has never happened, and it is highly unlikely that it 
will ever happen due to the nature of science as a human endeavor.
    iii. the risk of adverse health effects due to particulate air 
pollution is comparable to other risks which our society has not found 
                               acceptable
    Just as ``absolute certainty'' is impossible, there is no such 
thing as ``zero risk.'' From a regulatory perspective, I can appreciate 
that this scientific literature is disturbing since there is no 
suggestion of a threshold concentration associated with these health 
effects. Therefore, the critical question becomes one of ``acceptable 
risk'' and of our societal values. Just as there is no gold standard 
for what constitutes a ``significant'' relative risk, there is no 
consensus as to what is an ``acceptable risk'' in our society. However, 
there are precedents suggesting at least a reasonable range. In the 
history of regulatory action in the U.S., the EPA and other agencies 
have often regulated hazards if the cancer risk were greater than 1 per 
100,000[10]. The Clean Air Act Amendments of 1990 mandated that the EPA 
regulate hazardous air pollutant emissions to reduce the lifetime 
cancer risk if it finds such risk to be higher than one in one million 
(See Sec. 112(f)(2)). In 1978, the Supreme Court suggested that an 
occupational risk of cancer due to benzene exposure of 100 per 100,000 
warranted regulatory consideration[11]. Thus, there is a range of 
lifetime risks for cancer from 100 per 100,000 to 1 per 1,000,000 which 
history suggests is not ``acceptable'' to our society. These data refer 
to risks for cancer, but it seems that an increased risk of death from 
heart or lung disease should be considered the same as an increased 
risk of death from cancer. I would like to suggest an approach to help 
understand and communicate this issue: the use of incidence rates. EPA 
has typically performed risk assessments of carcinogenic hazards and 
expressed the risk in terms of deaths per 100,000 population. A similar 
metric is used frequently in describing infectious disease risks, but I 
have not seen it used to describe risks from exposures to air 
pollution.
    For example, to estimate the number of deaths attributable to 
PM10 in Denver, I assumed (1) a threshold effect of 30 mcg/m3 
and (2) a 3.4 percent increase in respiratory deaths and a 1.4 
percent increase in cardiac deaths for each 10 mcg/m3 increase in 
PM10 (average estimates suggested by Dockery and Pope[12]). 
Using the daily count of deaths and the daily PM10 
concentrations for the city of Denver from 1990-92, I thus calculated 
57 deaths, or an average of 19 cardiopulmonary deaths per year 
attributable to particulate air pollution. Since the population of the 
city of Denver in 1990 was 467,652, the annual crude cardiopulmonary 
mortality rate attributable to PM10 is 19/467,652, or 4 per 
100,000. Since there were 1,745 cardiopulmonary deaths from 1990-92, 
3.3 percent (57/1745) were attributable to PM10. This 
conservative estimate is consistent with Lipfert's recent estimate that 
air pollution may account for 3-5 percent of deaths in affected urban 
areas; his esti- 
mate included lung cancer deaths as well.[13] If the annual risk of 
death due to particulate air pollution is thus conservatively estimated 
at 4 per 100,000, then the cumulative risk over only 10 years of 
residence in this mildly polluted urban area would be 40 per 100,000. I 
also calculated similar risks for Philadelphia or Los Angeles using 
data provided in the EPA Staff Paper.[14] (See tables 1 and 2.) These 
estimates are substantantially larger, at 23 and 25 per 100,000 
population per year respectively, or 230 to 250 per 100,000 population 
over 10 years. Thus, the risk of acute cardiopulmonary death associated 
with particulate air pollution over a decade is greater than the 
``unacceptable'' lifetime risk of cancer discussed above.
    These risk estimates obviously do not include the many other 
nonfatal health effects of particulate air pollution, some of which are 
listed in tables 1 and 2. Although much emphasis has been placed on the 
studies of increased deaths associated with particulate air pollution, 
we know that mortality is only the ``tip of the iceberg'', i.e., that 
there are probably many more less serious adverse health effects if an 
exposure is able to produce death[15]. (See figure 1.) Unfortunately, 
there is not one composite measure which sums the many fatal and 
nonfatal health effects of an exposure such as particulate air 
pollution.
    Such a discussion of quantitative risk estimates also does not 
include the qualitative aspects of risks associated with air pollution 
which the public has not found acceptable, such as these exposures 
being involuntary, uncontrollable, and affecting children[16].
                              iv. summary
    These issues are extremely complex, and in our struggles to be 
objective by providing quantitative data, it is easy to become numbed 
by the numbers. When I see patients who have increased respiratory 
symptoms on days of high air pollution, they sometimes ask me why 
nobody is doing anything to improve Denver's ``Brown Cloud''. I try to 
reassure them that great improvements in air quality have been achieved 
over the last two decades. However, I think that we need to heed the 
medical maxim: ``Listen to the patient.'' Behind the statistics are 
real people suffering with real symptoms. I congratulate the EPA in its 
review of the recent scientific literature and in recognizing the 
importance of PM2.5. There are adequate data to support more 
stringent regulation of particulate air pollution, and the lack of 
``certainty'' should not be an excuse for inaction. We could improve 
the public health by implementing even more protective standards, such 
as those proposed by the American Lung Association. At minimum, I urge 
you to support the proposed changes in the particulate air pollution 
standard as proposed by the Environmental Protection Agency.
    Thank you for this opportunity to share my concerns.
                               references
    1. Melius J.M. The Bhopal Disaster. In: Rom W., ed. Environmental 
and Occupational Medicine. Boston: Little, Brown, and Company, 
1992:921-926
    2. Shrenk H.H. Public Health Service. Bulletin Number 36. 1949
    3. Ministry of Health. Mortality and morbidity during the London 
fog of December 1952. Reports on Public Health and Medical Subjects, 
Number 95. 1954
    4. Godleski J., Sioutas C., Katler M., Koutrakis P. Death from 
inhalation of concentrated ambient air particles in animal models of 
pulmonary disease (Abstract). In: Second Colloquium on Particulate Air 
Pollution and Health. Park City, UT, 1996
    5. Oberdorster G., Gelein R.M., Ferin J., Weiss B. Association of 
particulate air pollution and acute mortality: involvement of ultrafine 
particles? Inhalation Toxicology 1995;7:111-124
    6. Li X.Y., Gilmour P.S., Donaldson K., MacNee W. Free radical 
activity and pro-inflammatory effects of particulate air pollution 
(PM10) in vivo and in vitro. Thorax 1996;51:1216-1222
    7. Samet J.M., Reed W., Ghio A.J., Devlin R.B., Carter J.D., Dailey 
L.A., Bromberg P.A., Madden M.C. Induction of prostaglandin H synthase 
2 in human airway epithelial cells exposed to residual oil fly ash. 
Toxicology and Applied Pharmacology 1996; 141:159-168
    8. Dong W., Lewtas J., Luster M.I. Role of endotoxin in tumor 
necrosis factor alpha expression from alveolar macrophages treated with 
urban air particles. Experimental Lung Research 1996;22:577-592
    9. Kim C.S., Kang T.C. Comparative measurement of lung deposition 
of inhaled fine particles in normal subjects and patients with 
obstructive lung disease. American Journal of Respiratory Critical Care 
Medicine, 1997;155:899.-905
    10. Nicholson W.J. Quantitative risk assessment for carcinogens. 
In: Rom W., ed. Environmental and Occupational Medicine. Second ed. 
Boston: Little, Brown and Company, 1992:1386
    11. Karstadt M. Quantitative risk assessment: qualms and questions. 
Teratogen Carcinogen Mutagen 1988;8:137-152
    12. Dockery D.W., Pope C.Ad. Acute respiratory effects of 
particulate air pollution. Annual Review of Public Health 1994;15:107-
132
    13. Lipfert F.W., Wyzga R.E. Air pollution and mortality: issues 
and uncertainties. Journal of the Air and Waste Management Association 
1995;45:949-966
    14. Review of the National Ambient Air Quality Standards for 
Particulate Matter: Policy Assessment of Scientific and Technical 
Information: Office of Air Quality Planning and Standards Staff Paper. 
Research Triangle Park, NC: United States Environmental Protection 
Agency, 1996
    15. American Thoracic Society, Guidelines as to what constitutes an 
adverse respiratory health effect, with special reference to 
epidemiologic studies of air pollution. American Review of Respiratory 
Diseases 1985;13 1:666-668
    16. Slovic P. Perception of risk. Science 1987;236:280-285
    [GRAPHIC] [TIFF OMITTED] T6586.441
    
    [GRAPHIC] [TIFF OMITTED] T6586.442
    
    [GRAPHIC] [TIFF OMITTED] T6586.443
    
   Prepared Statement of Dr. Christopher Grande, Executive Director, 
     International Trauma Anesthesiology and Critical Care Society
    Good morning. My name is Dr. Christopher Grande. I am a practicing 
physician from Baltimore, Maryland. I am a board-certified 
anesthesiologist and intensive care specialist in trauma injury. I have 
authored and edited numerous medical books and have had about 30 
articles published in professional journals.
    I am also Executive Director of the International Trauma 
Anesthesiology and Critical Care Society or ``ITACCS'' for short. 
ITACCS is a 10-year old professional association of more than 1,000 
trauma specialists and emergency room physicians, nurses, and related 
professionals.
    I also hold a masters degree in public health from the Johns 
Hopkins University School of Public Health.
    I'd like to thank the committee and Chairman Inhofe for inviting me 
to provide ITACCS' views on the proposed ozone and particulate matter 
standards.
    Before I specifically address the standards, though, I'd first like 
to give the committee some important background information.
    Everyday I'm in the hospital emergency room , I see patients and 
problems vying for critical resources. From acute asthma patients to 
traumatic injuries. These are all competing public health priorities. 
All competing for limited available public health resources.
    The focus of ITACCS is traumatic injury, often accidental in nature 
such as that caused by motor vehicle, on-the-job, or household 
accidents.
    Injury is the leading caused of death for those under the age of 
45.\1\ And it is the fourth leading cause of death overall in the 
United States. About 150,000 deaths every year.\2\
    Trauma cuts across all of society. The injured person is not 
someone else. The injured patient is you, your child, your spouse, your 
parent.
    The average age of injury victims is 20. Death from injury is the 
leading cause of years-of-life-lost in the U.S.--more than twice the 
number of years of life lost as the next leading cause, cancer, and 
three times that of heart disease.
    According to 1990 statistics from the Centers for Disease Control 
and Prevention, traumatic injury was responsible for approximately 3.7 
million years of potential life lost.\3\ In contrast, cancer was 
responsible for 1.8 million years of potential life lost. Heart disease 
was responsible for 1.3 million years of potential life lost.
    What does this tell us? The National Academy of Sciences concluded 
in 1985 that trauma was the ``No. 1'' public health problem in the 
U.S.\4\ This situation remains unchanged today. How is this relevant to 
the debate over the ozone and particulate matter standards?
    It can be simply put in three words, ``public health priorities.''
    The fact is that society has limited resources that it can spend on 
public health. As such, responsible public policy dictates that such 
resources be spent so as to achieve the ``biggest bang for the buck.''
    ITACCS is not convinced, and neither should the public be, that the 
proposed ozone and particulate matter standards are a smart way to 
spend our limited resources.
    But I want to make it clear that we are not singling out only the 
proposed ozone and particulate matter air quality standards. The 
proposed standards are merely the latest example in what we see as a 
disturbing trend of the last two decades where scarce public health 
resources are diverted from more clearly demonstrated beneficial uses.
    The unintended consequence of this diversion might be a decrease in 
the overall effectiveness and efficiency of public health care 
delivery.
    As the makers of our laws and the ultimate allocators of our public 
health resources, Congress should take the lead in rationally 
allocating our limited resources.
    But how would Congress know what is a priority and what is not?
    The process behind the proposed ozone and particulate matter air 
quality standards has not been helpful.
    First, the proposed rules do not provide a ranking or comparison 
between the estimated health effects attributed to ozone and PM and 
those of other public health needs.
    One of the health endpoints associated with the proposed rules is 
asthma. No doubt asthma is a serious issue and public health resources 
should be directed at asthma. But a recent study \5\ published in the 
February 1997 American Journal of Respiratory and Critical Care 
Medicine a journal of the American Lung Association helps place air 
pollution-induced asthma in perspective.
    In this study, which employs a study design that has been 
characterized \6\ as the most reliable on the potential health effects 
of ambient ozone--i.e., the study model of children attending asthma 
camp--air pollution was associated with a 40 percent increase in asthma 
exacerbation in children. It sounds bad, but what does this really 
mean?
    Assuming for sake of argument that the authors' conclusion is 
reasonable, this increase in asthma exacerbation equates to one extra 
use of an inhaler among one in seven severe asthmatics on the worst 
pollution day. However, close scrutiny of this study reveals that many 
confounding risk factors for asthma exacerbation were not considered by 
the study authors. These risk factors include changes in temperature, 
atmospheric pressure, anxiety, physical exertion, allergens, dust, and 
fumes.
    Moreover, this study is inconsistent with the general observation 
that while asthma has increased over the last 15 or so years, air 
pollution has decreased. There appears to be no generally accepted 
explanation for this phenomenon.
    Therefore, this study does not satisfactorily link ambient ozone 
with asthma exacerbation.
    Before we commit our scarce resources wouldn't it be useful to know 
exactly where this very uncertain health effect ranks among other real 
public health priorities?
    If asthma qualifies as a public health concern, appropriate levels 
of funding should be targeted at programs that have been proven to be 
effective, but not fully implemented. Such programs include appropriate 
research, public and patient education, increased compliance with 
asthma medication schedules, intelligent avoidance of triggering 
factors, etc.
    Just last week, President Clinton issued an Executive order 
requiring Federal agencies to pay more attention to environmental 
health and safety risks that disproportionately affect children. While 
it is easy to agree with the intent of the Executive order, it is not 
clear that air pollution disproportionately affects children. What is 
clear is that traumatic injury disproportionately affects children, and 
it has been clearly identified as the leading cause of death in 
children.\7\
    Second, the proposed rules do not provide an accurate estimate of 
what their associated opportunity costs are.
    For example, if a community is forced to spend its resources 
implementing the ozone and particulate matter air quality standards, 
what other public health needs will the community sacrifice? A new 
trauma center? Training for its paramedics? A new ambulance?
    Filling these other public health needs can produce results that 
cut across many public health problems. For example, ambulances and 
trauma centers benefit everyone from asthmatics to heart attack and 
trauma victims.
    It would seem to be good public policy to develop and rely on an 
analysis of opportunity costs.
    Third, the true uncertainties associated with the proposed ozone 
and particulate matter air quality standards have not been fully 
presented.
    For example, it has been estimated and widely reported that chronic 
exposure to fine particulate matter causes 20,000 deaths per year. In 
fact this estimate appears to be based on very uncertain epidemiology.
    It was acknowledged recently by EPA \8\ and reported in major 
newspapers such as The Washington Post \9\ that the simple error of 
using an arithmetic ``mean'' instead of an arithmetic ``median'' 
reduced the estimated mortality from fine particulate matter by 5,000 
deaths.
    It could very well be that chronic exposure to fine particulate 
matter, in fact, causes no deaths. On this point, it is greatly 
troubling that the data underlying this estimate has yet to be made 
publicly available.\10\ Given that major confounding factors for 
mortality appear to be omitted from the analyses--factors like lack of 
exercise, poor diet, and prior health history--weak epidemiologic 
associations could easily vanish with more thorough analysis.\11\
    In stark contrast to what has been hypothesized about particulate 
matter and mortality, we know that about 150,000 people die every year 
from injury. These are real deaths, not those calculated through 
debatable assumptions and statistics.
    One year ago the television show Dateline NBC featured the story of 
Robert Meier.\12\ In April 1995, Mr. Meier was driving through rural 
Oklahoma heading home for Easter. Just before 4 o'clock that Saturday 
afternoon, Meier's van careened off the highway, slamming through a 
guardrail. His van rolled over five times before plummeting into a 
ravine. Within a few minutes rescue personnel were at the scene.
    The ambulance took Mr. Meier to Shawnee Regional Hospital. But the 
doctor on duty determined that Mr. Meier had serious internal injuries 
and needed to be transferred to another hospital better equipped to 
treat them. But as Mr. Meier bled profusely from a ruptured aorta, no 
hospital in the area would accept him because critical resources were 
not available.
    It was not until half past midnight, 8 hours after his accident, 
that a surgeon was found to operate on Mr. Meier. This delay cost Mr. 
Meier his life.
    Mr. Meier was fully covered by health insurance. He had done his 
part. But because of a lack of crucial resources, the system failed.
    Stories like this one are common. But they should not be, nor do 
they have to be. Proven solutions are possible now, but must compete 
for attention and funding.
    More than 25 studies indicate that between 20,000 and 25,000 
Americans who die each year from injury could be saved if regional 
trauma systems were in place across the Nation ensuring prompt access 
to a qualified trauma center.
    In 1973, Congress enacted the Emergency Medical Services System Act 
to help States improve their trauma systems. But lack of Federal 
support made this an unfunded mandate that States could not afford to 
implement on their own. And as a result, significant deficiencies exist 
in trauma systems across the country like the one that resulted in Mr. 
Meier's death.
    But how would Congress know this when currently there is no 
mechanism to identify, compare, and prioritize public health needs. The 
ozone and particulate matter proposals in their present formats are 
prime examples of this defect in how we do public health in America.
    I understand that a bill was introduced in the last Congress which 
would have required the comparative ranking of health risks. This would 
be helpful for prioritizing our public health needs. I urge that 
Congress continue along this track.
    Stimulated by this latest raid on our scarce public health 
resources, ITACCS is establishing a new forum to facilitate public 
debate on the allocation of public health resources. The mission of the 
National Forum for Public Health Priorities will be to provide 
policymakers with information necessary to prioritize public health 
needs.
    Those who wish to commit the public's limited resources should be 
required to justify such proposed commitments against all other 
competing needs. And, as a major allocator of public health resources, 
Congress must ensure that the public health is not short-changed by 
unproductive expenditures.
    Thank you for your attention. I will be happy to answer any 
questions you may have.
                                 notes
    1. Journal of the American Medical Association. 1994;27:495.
    2. National Safety Council. 1993. Accident Facts.
    3. Centers for Disease Control and Prevention: Years of potential 
life lost before ages 65 and 85--United States, 1989-1990. MMWR 41:313, 
1992.
    4. National Research Council. 1985. Injury in America: A Continuing 
Public Health Problem.
    5. Am J Crit Care Med 1997;155:654-660.
    6. See EPA Criteria Document for Ozone.
    7. National Safety Council, Accident Facts (1996 ed.).
    8. EPA Press Release, April 2, 1997.
    9. The Washington Post (April 3, 1997).
    10. The Wall Street Journal (April 7, 1997).
    11. See, e.g., American Journal of Respiratory and Critical Care 
1995; 151:669-674 (the ``Pope'' study).
    12. Dateline NBC (March 17, 1996).
                                 ______
                                 
  Prepared Statement of Harry C. Alford, President and CEO, National 
                       Black Chamber of Commerce
    My name is Harry C. Alford, President and CEO, National Black 
Chamber of Commerce. The NBCC is made up of 155 affiliated chapters 
located in 43 States. We have three (3) divisions--Eastern, Central, 
Western; nine (9) regions and 43 district offices. Through direct 
membership and via our affiliated chapters, the NBCC directly speaks on 
behalf of 60,000 Black-owned businesses and represents the total 
populace of Black-owned firms which, according to the U.S. Census 
Bureau of Statistics, is over 620,000.
    The NBCC is opposed to the two proposals presented by the EPA that 
would set a more stringent ozone standard and establish a new PM 
(particulate matter) standard for emissions at or below 2.5. The Clean 
Air Act of 1990 has made much progress in improving our environment. We 
sincerely feel that the continuance of this process will further 
improve the environment. To put more stringent demands on our 
businesses will have an extreme adverse impact on business in general 
with even higher stakes to lose for small businesses per se. If big 
business gets a ``cold'', small business gets the ``flu'' and Black-
owned business suffers ``pneumonia''.
    An example of the above can be found in our campaign to develop 
business partnerships with the automobile industry. We have approached 
and are working with principals within the management of Ford, Chrysler 
and General Motors. One success story is that at the time of 
preliminary discussions with Chrysler, we had no Black-owned architect, 
civil engineer or construction company performing work of over $1 
million. Today, after just 1 year of interaction we have businesses in 
such disciplines actively working on or negotiating over $100 million 
worth of Chrysler expansion.
    That is just one example, these three auto makers have expansion 
plans set for the cities of Arlington, TX, Oklahoma City, Kansas City, 
Fairfax, MO, Shreveport, LA, Janesville and Kenosha, WI, Belvedere and 
Chicago, IL, St. Louis, Ft. Wayne, Kokomo and Indianapolis, IN, Flint, 
Lansing and Detroit, MI, Toledo, Twinsburg, Lima, Dayton, Cincinnati, 
Cleveland and Warren, OH, Louisville and Bowling Green, KY, Springhill, 
TN, Athens, MS, Atlanta, Eastern, NY, Linden and Edison, NJ, Wilmington 
and Newark, DE, Baltimore, and Norfolk, VA. This is an expansion 
investment of $37.9 billion which is the equivalent of total sales for 
all Black-owned businesses combined! Just competing for this business 
and winning 10 percent would increase the total national output of 
America's Black-owned businesses by over 10 percent.
    It's a goal worth going after. However, it may not exist for the 
Black segment of this economy if the new standards go into effect. This 
is just the auto industry. We are busy creating alliances with the oil 
industry, electrical utilities, telecommunication companies, etc. The 
potential for economic parity and true capitalism in Black 
communities--THE MISSING LINK--is before us! Viable employment through 
an economic infrastructure in currently distressed neighborhoods is 
going to be the answer to improved health care, education, family 
values and the decrease in hopelessness, crime, welfare and violence. 
There just is no other way to do it.
    We have heard coming out of EPA terms such as Environmental Justice 
and Environmental Racism. Such terms are not accurate in their 
description. They imply that the ``evils of big business'' conspire in 
back rooms to wreak havoc on minority communities via dumping of 
toxic/hazardous materials, etc. The coincidence of environmental hazards 
in minority communities is a matter of economics. Property values and 
shifts in desirable business properties are the main reasons. Minority 
populations just happen to live (after a cycle of geographical shifts) 
in these communities.
    However, if there was ever a policy or a proposed regulation that 
could be considered directly adversarial to a particular segment of our 
population we may now have it. The proposed standards are going to hit 
urban communities the hardest. Of the 620,000 Black-owned businesses at 
least 98 percent of them are located in urban areas (U.S. Census). 
Hispanic and Asian businesses probably can claim the same. As mentioned 
above, Black-owned businesses are presently at the end of the business 
``food chain''. If business suffers, Black businesses will suffer the 
most. The main vehicle for Black community development is business 
startup and growth. The proposed standards will become predatory to 
Black-owned businesses and all Black communities and we must vehemently 
protest them.
    The NBCC has been quite successful since its conception in 1993. We 
have Black church organizations, educators, political leaders and 
traditional civil rights organizations talking about economics--the 
lack thereof--like never before. Corporate America has been waiting on 
Black communities to focus on the principles of capitalism which is the 
bloodline for our future and security. The time is before us and I 
foresee a rapid change in economic empowerment for communities that 
have suffered for too long. The EPA's attitude and it's proposals are 
counter to this trend and, thus, pose the biggest threat. The increased 
costs that will pain the Fortune 500 and maim small businesses will 
obliterate minority businesses, especially Black owned businesses. The 
end result is lost jobs and lack of capital infusion.
    I personally lived in Detroit and Chicago during economic 
downturns. What was experienced by dwellers of these urban communities 
and others was not a pretty sight at all. Shame on us if we allow this 
to happen once again because we quickly move to make the Earth 
``pristine'' in a fashion that will surely hurt our economic 
infrastructure.
    Let us work in harmony toward making the environment as safe as 
possible without making those who have the least resources pay the 
most. The National Black Chamber of Commerce pleads with Congress to 
strongly consider the ills of the proposed standards and encourage EPA 
to be more thoughtful and universal in its approach.
                                 ______
                                 
    Prepared Statement of Frank Herhold, Executive Director, Marine 
                Industries Association of South Florida
    Mr. Chairman and subcommittee members, good afternoon my name is 
Frank Herhold. I am the Executive Director for the Marine Industries 
Association of South Florida, which represents over 640 marine 
businesses. I am also here today on behalf of the National Marine 
Manufacturers Association (NMMA), which is the national trade 
association representing over 1500 boat builders, marine engine and 
marine accessory manufacturers.
    I am here today to explain why the EPA's proposed revision to the 
National Ambient Air Quality Standards (NAAQS) will be bad for 
recreational boating. What is bad for recreational boating is bad for 
the State of Florida and the Nation. There are currently 750,000 
registered boats in the State of Florida and the latest annual marine 
retail sales figures topped $11 billion in Florida. To put this into 
perspective, in Broward County alone, the marine industry represents a 
total economic output of $4.3 billion employing 88,390 people, with an 
average growth rate of 6.5 percent. Boating brings dollars and jobs to 
the State of Florida.
    The Clean Air Act Amendments of 1990 have placed a significant 
technical and economic challenge on the recreational boating industry. 
The new marine engine emission regulation which was finalized in July 
1996 will require that all new marine engines reduce hydrocarbon 
emissions by 75 percent. Economic impact estimates have this regulation 
costing the industry over $350 million, increasing the cost per boat 
engine by as much as 15 percent. The Clean Air Act will also regulate 
air emissions from boat manufacturing plants with a MACT (Maximum 
Achievable Control Technology) standard scheduled to be promulgated in 
the year 2000. This regulation will also be costly raising the price of 
boats, thus directly reducing the number of people who can afford to 
enjoy boating.
    Needless to say, the proposed revised NAAQS will have a devastating 
effect on the recreational marine industry. Without drastically 
reengineering American society, States will be forced to press emission 
sources for further reductions, many of which like the recreational 
boating industry, have reached the point of diminishing returns.
    Several years ago, when the NAAQS for ozone was initially set at 
.12 ppm, some State regulators in non-attainment areas considered bans 
on recreational boating as a method to meet the requirements of their 
State Implementation Plans. The Washington DC Council of Governments 
(COG) actually proposed a ban on recreational boating in 1993. This 
proposal raised immediate opposition from boaters, marinas, waterfront 
restaurants, and other effected groups. COG eventually reversed its 
decision after the affected parties spent considerable resources to 
educate COG as to the proposal's adverse effects. This EPA proposed 
revised standard will again force States to reconsider episodic bans 
and this time States may be pushed to implement episodic restrictions 
on recreational boating throughout the Nation.
    I am appealing to you to stop EPA's attempts to revise the 
standards at this time. It is my understanding that the scientific 
studies that EPA is using to defend this proposal do not take into 
account either the specific constituents in air pollution or other 
mitigating factors that effect human health. I feel that EPA would be 
premature to impose such a burdensome standard without first 
identifying the specific benefit and real cost of the proposal. Even if 
we fail to convince EPA that it is making a terrible mistake, at a 
minimum, let's somehow prevent States from using episodic bans as a 
means to attain compliance. Episodic bans will negatively effect a 
person's decision to purchase a boat, knowing that on the hottest days 
of the summer the government can take away his or her freedom to 
operate it. Not since Congress passed the luxury tax have boaters faced 
a more serious threat. If this standard is finalized in its current 
proposed form, consider the burden it will place on States, industry 
and its workers, and the million of people who just want to spend a 
summer afternoon on the water with their family.
    In conclusion, everyone needs to realize that America's air is 
cleaner and will continue to improve, as the benefits from recently and 
soon to be initiated Clean Air Act regulations are realized. What we do 
not need now is more regulation. What we need now is the time and 
resources to implement those regulations that are already on the books. 
Boaters want clean air and clean water and the recreational marine 
industry is ready to assist both Congress and the EPA in this 
rulemaking process. Thank you for the opportunity to testify.
                                 ______
                                 
 Prepared Statement of Jeffrey Smith, Executive Director, Institute of 
                       Clean Air Companies, Inc.
    Good afternoon. My name is Jeffrey C. Smith and I am the Executive 
Director of the Institute of Clean Air Companies, Inc. (``the 
Institute'' or ``ICAC''). The Institute is pleased to participate in 
today's hearing, and applauds the Subcommittee for providing this 
opportunity to share different ideas and views on the important matter 
of EPA's proposed revisions to the particulate matter and ozone ambient 
standards (NAAQS).
    By way of introduction, ICAC is the national association of 
companies that supply air pollution control and monitoring technology 
for emissions of air pollutants, including emissions of sulfur oxides 
(SOx), nitrogen oxides (NOx), volatile organic 
compounds (VOCs), and particulate matter (PM), which contribute either 
directly or as precursors to fine particulate matter and ozone in the 
atmosphere. ICAC businesses compete with each other, offer the full 
spectrum of technologies available, and serve all stationary source 
emitters that would be affected by the revised standards.
    This afternoon I will briefly address, qualitatively, the impact of 
the proposed standards on the U.S. air pollution control technology 
industry and the overall cost of the proposal.
    The U.S. air pollution control industry supports EPA' proposal to 
revise the ozone and particulate matter ambient standards. Suppliers of 
control technology for the pollutants that would be affected by the EPA 
proposal employ tens of thousands of people, and these firms in general 
have suffered disappointing earnings which have necessitated severe 
downsizing in many cases. The EPA proposal would benefit these 
businesses at an important time.
    I should note also that nearly all suppliers of technology to 
control the emissions that are precursors of ozone and fine particulate 
matter are small businesses. Indeed, for the control of volatile 
organic compounds, a leading precursor of ozone, I estimate that over 
95 percent of the 100+ control suppliers are ``small businesses'', 
i.e., have fewer than 500 employees. In the great majority of cases, 
these companies have far fewer than 500 employees.
    Thus, resolving the admittedly tough clean air issues we face in a 
way that protects public health and the environment has an important 
side-benefit: it would also promote the air pollution control industry, 
which creates jobs as compliance dollars are recycled in the economy. 
This industry is currently generating a modest trade surplus to help 
offset the billions this Nation hemorrhages each month on international 
trade, and is providing technological leadership that can continue to 
be deployed in the fast-growing overseas markets for U.S. air pollution 
control technology.
    With regard to the overall cost of the EPA proposal, I note first 
the Institute's support for the two-step process of setting ambient air 
quality standards, and then addressing implementation and cost issues. 
This process has received bipartisan support and worked well for over 
two decades. By clearly separating health science and cost/implementation 
issues, the process actually allows the public, as well as Federal and 
State government authorities to rationally parse out an then balance all 
policy issues. In short, no emitting source will have to comply with the 
new standards before costs are thoroughly examined.
    No one of course knows what the exact cost of the proposal will be. 
To be sure, there will be an implementation cost, but it is well to 
remember several important lessons of the past 27 years in implementing 
the Clean Air Act.
    One of these is illustrated by my experience nearly a decade ago 
when I sat before various House and Senate Committees and presented 
detailed implementation cost estimates for the acid rain provisions of 
what became the Clean Air Act Amendments of 1990. Regulated industry 
claimed the removal costs of SO2, the leading precursor to 
acid rain as well as a precursor to fine particulate matter, would 
reach thousands of dollars a ton, while EPA claimed a more modest sum 
of $1,500 to $2,000 a ton was about what we could expect. I disagreed, 
arguing that market and technical data supported a dollar-per-ton-
removed cost of about $500. But I overestimated the cost, too, since 
today, in 1997's inflated dollars, a ton of SO2 is removed 
for only $110 a ton.
    The preeminent lesson of our Nation's 27-year history under the 
Clean Air Act is that actual compliance costs turn out to be much lower 
than the costs predicted at the outset of a regulatory action because 
the regulated community, markets, and control technology suppliers are 
smarter and more efficient at reducing costs than forecasters predict. 
This is even more true in light of today's emphasis on flexibility in 
compliance and authorized use of and credit for market-based approaches 
and pollution prevention.
    Those who predict gargantuan cost impacts ignore this important 
lesson, and also underestimate the wisdom of State and local officials 
who will be implementing these standards. Everyone has an interest in 
rational and prudent clean air policy, and the cost effectiveness of 
various compliance options will be considered during implementation. 
And there is no reason not to believe that, as has always been the 
case, all of us--regulated industry, government officials, and 
technology suppliers--will discover ever more cost-effective compliance 
solutions, especially since nearly a decade exists between now and when 
the impact of new standards would be felt.
    For our part, members of the Institute continue to invest in 
research and development to improve removal efficiencies while lowering 
costs and simplifying operation. We have to. The air pollution control 
technology industry is innovative and highly competitive. And 
improvements in cost-effectiveness are what give one business or 
technology a competitive advantage over another.
    It is no exaggeration to say that the clean air policy choices we 
make in 1997 will determine the amount of air pollution that affects 
the health and environment of ourselves and our children over the next 
decade and beyond. Ten years is a long time, nearly a life-time for 
childhood. We must, therefore, choose correctly, informed both by 
lessons learned from our nearly three decades of Clean Air Act 
experience, and by a vision for the future which reflects, as does 
every opinion poll, the American public's demand for a clean and 
healthy environment.
    In closing, the Institute again expresses its appreciation to the 
Subcommittee for providing a forum for dialog on this important issue. 
In our view, EPA has taken the proper course by its efforts to 
establish ozone and particulate matter standards that protect public 
health. If those health-based standards are revised, the U.S. air 
pollution control industry is ready to do its part to help our Nation 
achieve its clean air goals cost-effectively. Based on historical 
precedent, the current pace of control technology innovation, the use 
of market-based incentives, the years between now and compliance 
deadlines, and competition within the air pollution control technology 
industry and among technologies, we are confident that the actual cost 
of compliance will be less than most of us today imagine.
                                 ______
                                 
 Prepared Statement of Glenn Heilman, Vice President, Heilman Pavement 
                           Specialties, Inc.
    Good Morning. My name is Glenn Heilman. I am the Vice President of 
Heilman Pavement Specialties, Inc., a small family owned business that 
has been in operation for 41 years. We are located in Freeport, 
Pennsylvania which is just above Pittsburgh. Thank you for giving me 
the opportunity to testify on behalf of the National Federation of 
Independent Business regarding the recently proposed national air 
quality standards for ozone and particulate matter.
    NFIB is the nation's largest small business advocacy group 
representing 600,000 small businesses in all fifty States. NFIB's 
membership reflects the general business profile by having the same 
representation of retail, service, manufacturing and construction 
businesses that make up the nation's business community.
    In addition to being a small business owner, I also volunteer and 
serve as Chairman of Pennsylvania's Small Business Compliance Advisory 
Panel. This panel is mandated by Section 507 of the Clean Air Act 
Amendments to help small business as part of the Small Business 
Stationary Technical and Environmental Compliance Assistance Program. 
This program has been enormously successful despite underfunding and 
has become a model for small business programs in other environmental 
legislation.
    Our small business program conducts seminars, offers a toll-free 
confidential hotline, low interest loans and many other outreach 
efforts for small businesses. Every State has such a program in varying 
degrees of effectiveness. These programs are valuable tools to improve 
our air quality and are overseen by the Environmental Protection 
Agency.
    In my position as Chairman, I am keenly aware of the progress we 
are making in cleaning our air. What appears to be ignored is that air 
quality has improved significantly since passage of the Clean Air Act, 
and the 1990 amendments have not even been fully implemented. It is 
therefore imperative that only requirements that are essential be 
mandated. What I suggest is that we move toward more complete 
compliance with existing standards before revising them.
    As a small business owner, the economic impact and burdensome 
regulations of the proposed standards would significantly affect and 
threaten the livelihood of my business. As a manufacturer of road 
pavement, my business operates asphalt plants and hauls stone as a raw 
material. The moving of equipment and materials creates minor 
particulate matter. I also have air emissions from my heavy truck and 
off- 
road equipment. Some of this equipment is old, but works well. I simply 
cannot afford to buy new equipment to comply with the proposed 
regulations.
    As a small business owner, I am active and involved because I have 
to be. Careless regulations will put me out of business. Not only will 
small business owners lose life savings and investment, but our 
employees lose their jobs and our communities will suffer economically. 
For that reason, I am shocked and disappointed that the EPA has 
declined to consider the effects of this proposed rule on small 
business.
    Last year, Congress passed and the President signed a law that 
requires the EPA to assess the impact of regulations on small business. 
To date, the EPA has refused to do this on the ozone and particulate 
matter standard. Because this regulation is likely to have a great 
impact on a variety of small businesses, I hope that the EPA will 
carefully consider the consequences before they impose this new 
standard.
    Rather than implementing new regulations for clean air, I recommend 
utilizing and encouraging the use of present means to achieve air 
quality improvements. There are technologies presently available to 
help clean our air. In our company we voluntarily look for ways to 
improve the environment. In 1980 my father developed a new, ozone-
friendly technology for asphalt roads. This technology is exemplified 
in a material called HEI-WAY General Purpose Material or HGP. A 2-year 
university study documents that HGP emits seven times less Volatile 
Organic Compounds (VOC)--in the form of low molecular weight normal and 
branched alkane hydrocarbons--than the present technology used to pave 
roads. Additionally, this technology also eliminates a significant 
water pollution threat to rural streams and wetlands.
    Under standard technology, present road paving methods allow more 
than 1000 gallons (or three tons) of gasoline-type VOC to evaporate 
into our troposphere for every mile paved. HGP reduces this VOC air 
pollution by 85 percent. On a nationwide basis, of the nearly 4 million 
miles of roads in the country, this technology is applicable to over 60 
percent of them. In Pennsylvania alone, if just 1 percent of the roads 
were paved each year with HGP instead of the standard technology, over 
3000 tons of VOC air pollution would be eliminated. The HGP technology 
could be more widely used to lower VOC air emissions as soon as EPA 
allows for Discrete Emissions Reduction Credits (DER) under the New 
Source Review.
    In closing, it is important to keep in mind the unique nature of a 
small business owner when examining our reaction to environmental 
legislation and regulations. Small business owners wear many hats. Two 
of the most important are being both a business owner and a citizen of 
a community. We drink the water, breathe the air, and fish in the 
lakes. We want a healthy environment for ourselves and our children. 
However, we also expect the government to be fair and responsible.
    New regulations as proposed by EPA for ozone and particulate matter 
are unnecessary, will result in an enormous regulatory burden and 
threaten a business that my family has spent 41 years to build. A 
viable framework is in place. It consists of new, environmentally 
friendly technologies, such as HGP, and couples these initiatives with 
existing programs. The system is working. Let's use what we have.
                                 ______
                                 
            Statement of Associated Builders and Contractors
    Associated Builders and Contractors (ABC) thanks the Senate Clean 
Air, Wetlands, Private Property and Nuclear Safety Subcommittee for the 
opportunity to submit a statement on the Environmental Protection 
Agency's (EPA) proposed rules on ozone and particulate matter in the 
atmosphere. ABC believes that the EPA is proposing new Federal air 
quality regulations for ozone smog and fine particles that could have 
crippling effects on hundreds of thousands of American construction 
workers and cost consumers and businesses billions of dollars, with 
little or no health benefit.
    ABC is a national trade association representing over 19,000 
contractors, subcontractors, material suppliers, and related firms from 
across the country and from all specialties in the construction 
industry. ABC's diverse membership is bound by a shared commitment to 
the merit shop philosophy of awarding construction contracts to the 
lowest responsible bidder through open and competitive bidding. This 
practice assures taxpayers and consumers the most value for their 
construction dollar. With 80 percent of the construction performed 
today by open shop contractors, ABC is proud to be their voice.
    After careful review of the technical and health information and 
analyses in the Criteria Document and the Staff Paper prepared by EPA 
for this rulemaking, the Clean Air Scientific Advisory Committee 
(CASAC), the agency's expert review panel established by the Clean Air 
Act and appointed by the Administrator, concluded there were 
significant uncertainties and unanswered questions that had to be ad- 
dressed before EPA proceeds with the Particulate Matter (PM) 
rulemaking. Additionally, the same panel concluded there was no health 
basis to establish new National Ambient Air Quality Standards (NAAQS) 
for ozone. ABC concurs with CASAC's opinion and strongly advises EPA to 
reaffirm the current standards for PM and ozone while initiating a 
targeted research program to resolve the questions and uncertainties 
identified during the just-completed review process.
    The proposed tightening of the ozone and PM NAAQS, in conjunction 
with the highway funding sanction authorities and Metropolitan Planning 
Organizations (MPOs) approval requirements of the Clean Air Act 
Amendments (CAAA) and 1991 Intermodal Surface Transportation Efficiency 
Act (ISTEA), pose enormous restrictions to the transportation 
construction industry throughout the United States. The combination of 
these new regulatory requirements endanger tens of thousands of jobs 
and create major new constraints to mobility.
    Additionally, ABC is concerned that the EPA has not adequately 
taken into account the affect these costly new requirements will 
undoubtedly have on the American worker and average motorists. If the 
EPA succeeds in changing the standard such limitations as mandatory 
employee carpooling, centralized state-run emissions inspections, and 
the use of more expensive reformulated gasoline are only a few of the 
policies that will adversely affect small business. Other transit 
initiatives could be higher vehicle taxes and higher tolls in peak 
driving times.
    Non-vehicle remedies could place restrictions on the use of power 
tools, lawn mowers, and snow blowers as well as other equipment. ABC 
shares with all Americans an interest in efforts to preserve, protect 
and enhance the natural environment. Pollution prevention is in our 
nation's interest; however, efforts to reduce emissions must be 
balanced with considerations for the safety of those operating the 
equipment, as well as the cost and technological feasibility of 
achieving any prescribed reductions. Many construction industry workers 
rely upon non-road engines in their daily efforts to safely build 
construction projects on time and on budget. The performance and 
reliability of these engines directly impact a contractor's ability to 
successfully execute their contracted responsibilities on the 
construction job site.
    The EPA initially claimed the new PM/ozone standard will extend the 
lives of as many as 20,000 people a year (recently revised down to 
15,000 people). Clearly, the extent of this health risk is of concern. 
However, exactly which components in urban air are causing the health 
problems is not yet well understood. The EPA's preference for 
regulating every fine particle in the air before understanding the real 
causes and quantifiable health benefits is not a prudent strategy. ABC 
is concerned that:
    (1) The EPA has failed to properly characterize PM concentrations 
across the United States. Key technical analyses have not been 
completed. For example, the EPA has not determined the chemical 
composition or size of the particulate matter that is linked to the 
supposed increases in mortality and morbidity. The EPA has also failed 
to identify the biological mechanism that would explain the link 
between PM2.5 and increases in mortality. The use of a 
nationwide PM2.5/PM10 ratio to estimate 
PM2.5 concentrations is insupportable from the limited 
PM2.5 data available.
    (2) The EPA has failed to accurately analyze the impact of the new 
standard. The EPA has stated its refusal to conduct a small business 
analysis for these rules. The Regulatory Impact Analyses (RIAs) are 
incomplete; no analysis was conducted on the proposed secondary ozone 
standard, no analysis was conducted on impacts to small businesses, the 
unfunded mandates act was not addressed, and the analyses do not 
estimate the full cost of attaining the proposed standards throughout 
the country (there are ``residual nonattainment areas''). The RIA for 
ozone rulemaking does not use the proposed standards in the Notice of 
Proposed Rulemaking as the basis for its costs and benefits 
projections.
    (3) The EPA has used questionable health impact studies to justify 
their actions. There is virtually no PM2.5 exposure data on 
either the general population or on susceptible populations. The use of 
community-based epidemiological studies are not appropriate because 
individual personal exposures do not correspond to these community-
based studies.
    Due to the predominance of small businesses within the construction 
industry. ABC remains concerned that compliance with the Clean Air Act 
Amendments could have significant adverse effects. We continue to 
encourage the Congress to give serious consideration to the impact 
these new requirements would have on small businesses.
    Associated Builders and Contractors strongly urges that there be no 
change in the ozone or particulate matter standards at this time until 
more comprehensive scientific studies can be performed. Again, ABC 
appreciates this opportunity to submit a statement for the record.
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                       Food Industry Environmental Council,
                                          McLean, VA, May 27, 1997.
Hon. John Chafee, Chairman,
Senate Environment and Public Works Committee,
U.S. Senate, Washington, DC.
    Dear Chairman Chafee: The Food Industry Environmental Council 
(FIEC) is pleased to submit these comments for the record for the 
Senate Environment and Public Works Committee's recent hearing 
addressing the Environmental Protection Agency's (EPA) proposed 
revisions to the National Ambient Air Quality Standards (NAAQS) for 
ozone and particulate matter.
    As you may know, FIEC is a coalition of food processors and food 
trade associations representing over 15,000 facilities employing 
approximately 1.5 million people in the United States. FIEC members 
operate facilities and distribute finished food products worldwide. If 
EPA were to revise the NAAQS for ozone and particulate matter as 
proposed, the processing and distribution of food in the United States 
would be impacted significantly.
    The proposed revisions to the ozone standard would replace the 
current primary NAAQS with a standard using an 8-hour averaging 
interval and would replace the current secondary NAAQS with a standard 
based on a SUM06 formulation. The proposal for fine particulate would 
expand the current PM10 NAAQS with two standards using 
PM2.5 as the pollutant indicator. One of the new standards 
would be based on a 24-hour averaging interval; the second new standard 
would be based on an annual averaging interval.
    Under the proposed more stringent NAAQS, it would appear that State 
governments would have no option but to seek to achieve emissions 
reductions from many small sources which have not been subject to 
regulation in the past, which could have a particularly broad impact on 
the agriculture and food processing sector. This revised regulatory 
approach would multiply significantly the range of potential control 
options, creating a pyramiding impact on each segment of the food 
supply chain.
    These impacts, without question, would create particularly 
significant regulatory burdens for large and small food processors, 
including many facilities and growers that rely on part-time and 
seasonal labor. Indeed, FIEC questions whether EPA has evaluated 
appropriately and thoroughly the potential impact of its proposals. 
While FIEC members fully support the goals of the Clean Air Act, the 
coalition questions the scientific basis that has been cited by the 
agency for proposing more stringent NAAQS for ozone and PM at a time 
when current regulatory programs are resulting in documented air 
quality improvements.
    Because the proposed new NAAQS would impact each segment of the 
food production supply chain without any reliable indication of benefit 
to the public health, FIEC urges EPA to reaffirm the current PM 
standards and initiate a targeted research program to resolve the 
serious and pertinent questions raised in the Clean Air Scientific 
Advisory Committee's (CASAC) review of the scientific basis relied on 
by the agency to support the proposed rule. FIEC urges the agency to 
withdraw the proposed rule for ozone and to continue instead to build 
on the documented progress that has been gained through reliance on the 
current NAAQS.
            air quality is improving under current standards
    The National Air Quality and Emissions Trends Report, 1995 issued 
recently by EPA shows that over the past 25 years, emissions and 
ambient concentrations of the six major air pollutants have decreased 
nationally by almost 30 percent. Furthermore, the significant reduction 
in the number of nationwide ``non-attainment'' areas for ozone from 98 
areas in 1990 to 66 areas at the present time, abatement from existing 
State Implementation Plans (SIPs), and EPA's own forecast of continuing 
reductions in ozone precursor emissions under current and prospective 
Clean Air Act programs (such as the Title IV, acid rain program, and 
the Title III, hazardous air pollutants program) provide clear 
indications that the current standards are promoting improved air 
quality.
        impact on ``farm to table'' food production and delivery
    The United States boasts the finest ``farm to table'' food 
distribution system in the world. Unlike other countries, in which up 
to 50 percent of foodstuffs may be lost between the farm and the table, 
the United States loses less than 10 percent of foodstuffs through 
production and distribution channels. Likewise, U.S. consumers spend 
far less of their gross disposable income on food than consumers in any 
other industrialized nation. In large part, efficiencies in growing, 
processing and distributing food keeps costs to American consumers 
down.
    There is broad consensus that the proposed new NAAQS would create 
new ``non-attainment'' areas for ozone and particulate matter. More 
specifically, it has been estimated that the proposed new standards 
would swell to roughly 335 the number of counties and areas that would 
qualify for ``non-attainment'' status for ozone, and 167 counties that 
would be considered ``non attainment'' for particulate matter. FIEC is 
concerned that ``non-attainment'' may spill over to rural areas which 
currently do not monitor ozone levels.
    Significantly, these largely rural areas are the core of production 
agriculture and food processing. Farm mechanization, farming practices, 
distribution to and from processing facilities, process details and 
post processing distribution are likely to be affected by the proposal, 
thereby compromising the ability of the agriculture and food processing 
sectors to continue to provide an abundant, economical food supply to 
consumers.
    At the start of the food production chain, the new standards 
implicate tighter emission and use controls for farm equipment, and 
restrictions on fertilization and crop protection application, among 
other potential control options, which could have a broad impact on 
crop yield and quality. New mobile source controls, including tighter 
emission controls for vehicles used to transport commodities to 
processing plants, would impact directly the quality and timely 
delivery of raw ingredients used in post harvest production.
    State governments, which already have placed controls on numerous 
areas, likely would be pressed to target food processing plants, which 
are negligible sources of emissions, as new control sources in order to 
comply with the proposed more stringent NAAQS. Finally, the expedient 
and economical distribution of finished foods, a critical link in 
assuring foods from the farm reach consumers' tables, would be impacted 
by control strategies such as reformulated fuel requirements, engine 
emission standards, alternative fuel programs, inspection requirements, 
retrofitting and rebuilding of existing engines, and operational 
restrictions. These control options would jeopardize the efficient 
system which keeps an abundant and economical supply of fresh and 
wholesome foods on American consumers' tables.
                       impact on small businesses
    Many growers and food processing facilities rely on part-time and 
seasonal labor and therefore fall under the Small Business 
Administration's (SBA's) definition of ``small business.'' FIEC is 
concerned EPA has failed to consider the national impact of the 
proposed standards on small businesses, which have made such a vital 
contribution to the recent strength of the U.S. economy.
    Importantly, FIEC questions whether EPA's proposal is in direct 
violation of the Small Business Regulatory Enforcement Fairness Act of 
1996 (5 U.S.C. Sec. Sec. 601 et. seq.) better known as ``SBREFA,'' 
which was passed last year by Congress with overwhelming bipartisan 
support. Under SBREFA, EPA is required before publishing a proposed 
rulemaking to issue an initial Regulatory Flexibility Analysis and to 
convene an advocacy review panel to collect small business input and 
make findings on the determinations reached in EPA's initial 
``regulatory flexibility'' submission. Rather than taking these steps, 
the agency issued a certification that the proposed rule, if 
promulgated, would not have a significant economic impact on a 
substantial number of small entities. This certification was clearly 
inappropriate in this instance, given the significance of the likely 
impact of the proposal on small businesses.
  limitations and shortcomings with the health data relied upon by epa
    CASAC, the agency's expert review panel established by the Clean 
Air Act, reviewed the technical and health information and analyses in 
the Criteria Document (CD) and the Staff Paper (SP) prepared by EPA for 
this rulemaking and concluded there were significant uncertainties and 
unanswered questions that had to be addressed. FIEC is concerned the 
proposed decision to set a PM2.5 (fine particle) and a more 
stringent NAAQS for ozone does not reflect adequately the considerable 
uncertainty reflected in CASAC's analysis, and recommends EPA reaffirm 
the current standards and initiate a targeted research program to 
resolve the questions raised during the recently completed review 
process.
Particulate Matter
    Court ordered deadlines have hindered the standards development 
process, as evidenced by the fact that the effect of exposure to 
ambient fine particle concentrations was not analyzed adequately by 
EPA. CASAC stated in its June 13, 1996, letter that the court 
``deadlines did not allow adequate time to analyze, integrate, 
interpret, and debate the available data on this very complex issue.'' 
Importantly, a number of comments provided to the agency identify many 
areas in which there is a critical need for additional analytical work 
or data collection. CASAC stated that, ``The agency must immediately 
implement a targeted research program to address these unanswered 
questions and uncertainties.'' FIEC agrees with CASAC and others that 
data and analytical shortcomings and research gaps are serious problems 
which should be addressed before a revised standard is adopted.
    EPA's proposed decision to establish a fine particle standard is 
flawed because it fails to address numerous sources of uncertainty. In 
its June 13, 1996, closure letter CASAC stated that there are ``many 
unanswered questions and uncertainties associated with establishing 
causality of the association between PM2.5 and mortality.'' 
EPA's decision to regulate PM2.5 in the face of these 
uncertainties, cannot be justified.
    The agency has ignored a number of pertinent scientific issues in 
its overall approach to the review and risk assessment process. These 
include:
     contradictory results of other investigators (such as Drs. 
Moolgavkar, Roth, Stryer and Davis) as compared with those of the 
researchers emphasized in the SP;
     the paucity of PM2.5 data and EPA's reliance on 
a single nationwide PM2.5/PM10 ratio;
     no access to PM2.5 monitoring data for outside 
review and analysis;
     a lack of supporting toxicological and human clinical 
data;
     little correlation between central monitors and personal 
exposure;
     substantial measurement error associated with monitoring 
of ambient particulate matter;
     insufficient link between the epidemiological results and 
a specific component of air pollution (size or chemical composition);
     the confounding influence of meteorological conditions 
such as temperature and humidity, and other environmental irritants, 
allergens and agents; and
     no identified biological mechanism--that is, the lack of 
an identified physical cause for the alleged adverse health effects.
    EPA has greatly oversimplified its approach to assessing the risk 
associated with exposure to fine particles. EPA's approach:
     generates misleadingly precise estimates of risk;
     greatly understates the degree of uncertainty associated 
with those risk estimates by not considering uncertainty about PM-
health endpoint causation, nor does it consider, if PM is causal, 
uncertainty about the identity of the causative agent(s); and
     produces inflated risk estimates by ignoring the 
confounding effects of copollutants and meteorological variables, as 
well as background levels of particulate matter.
    The most fundamental concern about the PM risk assessment and EPA's 
reliance on it for its proposed decision is the agency's failure to 
consider, or even to acknowledge sufficiently, the important 
uncertainties noted above. Instead, the risk assessment simply assumes 
that PM causes excess mortality and morbidity and that all PM species 
within a particular size range contribute equally to that risk, solely 
in proportion to their mass. Such assumptions substantially 
underestimate health risk uncertainty, implying a greater degree of 
certainty than actually exists.
    EPA's proposed decision also does not account adequately for 
confounding bias in the epidemiological studies. The influence of 
confounders, such as stressful meteorological conditions and 
copollutants, has not been considered adequately by the agency. Much of 
the quantitative analysis in the SP which EPA relies on in its proposed 
rule is based inappropriately on studies which do not consider 
adequately these confounders. The final CD (page 13-92, 93) states, ``. 
. . confident assignment of specific fractions of variation in health 
endpoints to specific air pollutants may still require additional 
study.'' Similarly, the SP states ``. . . a more comprehensive 
synthesis of the available evidence is needed to evaluate fully the 
likelihood of PM causing effects at levels below the current NAAQS,'' 
and ``[a]s noted above, it is too difficult to resolve the question of 
confounding using these results from any single city because of the 
correlations among all pollutants'' (page V-54).
    EPA dismisses the recent reanalyses of PM10 and total 
suspended particulate (TSP) epidemiological studies presented by the 
Health Effects Institute (HEI) and others which conclude a single 
causative agent cannot be identified among components of air pollution. 
EPA also ignores inconsistent and contradictory findings which resulted 
when different investigators analyzed data from the same location, 
e.g., Philadelphia, Steubenville, Utah, Birmingham and London.
    Another major problem with the agency's proposal is that almost all 
the epidemiological studies upon which it relies uses PM10 
or even TSP as the metric. EPA's Federal Register notice notes that of 
38 daily mortality analyses listed in Table 12-2 of the Criteria 
Document ``most found statistically significant associations'' between 
PM and mortality. EPA fails to note that only two of those studies used 
PM2.5 as the metric. Moreover, the two studies that used 
PM2.5 do not support EPA's proposed decision to establish 
fine particle standards. Importantly, neither study analyzed 
copollutants, and the results do not indicate that fine particles are 
the causative agent.
    The agency proposal relies on studies that were conducted with data 
sets that have not been included in the docket for analysis by other 
investigators, as required by law. One key data set which falls into 
this category is the Harvard School of Public Health data consisting of 
particulate matter data for the ``Six Cities'' study. As noted by EPA 
in the SP and at other forums, the results of this study played a 
leading role in the development of the proposed rulemaking. FIEC urges 
EPA to comply with the Clean air Act and make these data sets available 
in the rulemaking docket for assessment by other investigators. 
Further, FIEC recommends EPA reaffirm existing PM standards at least 
until such time as these assessments are complete, and conflicting 
conclusions are resolved.
    It should be noted that as early as May, 1994, in a letter to EPA 
Administrator Browner from CASAC, the agency was asked to ``take steps 
to assure that crucial steps linking exposure to particulate matter and 
health responses are available for analysis by multiple analytical 
teams. . .'' The CASAC letter also requested that ``the EPA should take 
the lead in requesting that investigators make available the primary 
data sets being analyzed so that others can validate the analyses.''
    The agency has noted that a biological mechanism by which 
PM2.5 could cause health effects has not been identified. 
Existing animal and chamber studies do not support a causal link 
between PM2.5 and mortality or morbidity. FIEC agrees with 
the conclusion reached in a January 5, 1996, letter by many members of 
CASAC that ``the case for a PM2.5 standard is not 
compelling.'' This was reiterated numerous times at the May 16-17, 
1996, CASAC meeting. The revised CD itself concludes, ``A number of 
studies using multiple air pollutants as predictors of health effects 
have not completely resolved the role of PM as an independent causal 
factor'' (page 13-92).
    Since EPA has not established that fine particles are causing 
health effects, the proposed decision to establish new fine particle 
standards is not justified, and control programs designed to attain 
them would waste billions of dollars in unnecessary emission control 
costs. If, on the other hand, PM-health endpoint associations later 
prove to be causative and the causative agent(s) have not been 
controlled sufficiently (or at all), billions of dollars spent on the 
wrong emission control measures will have been wasted, with no public 
health improvement.
Ozone
    According to CASAC, EPA's own analysis shows that none of the ozone 
standards under consideration by the agency--including one about as 
stringent as the current standard--is ``significantly more protective 
of the public health.'' The significant uncertainties surrounding the 
agency's scientific basis for the new standard, considered together 
with the agency's acknowledgement that the costs of implementing the 
proposed new NAAQS for ozone could far exceed any benefit to be gained 
from the new standard, undermine any public policy justification for 
moving forward with the proposal. The agency simply has not made the 
case that the new standard is a necessary or appropriate regulatory 
response to a significant public health risk.
            Chamber Studies
    The chamber studies, on which EPA relies to support its proposal, 
are not representative of actual ozone exposure patterns recorded at 
monitoring stations or experienced by individuals. The activity 
patterns under which these lab studies were performed clearly do not 
represent daily patterns of sensitive populations targeted by the 
standards, and the concentration and exposure patterns do not represent 
actual patterns recorded at monitoring stations or experienced by 
individuals. Serious artifacts were introduced through experimental 
methods used in these studies, including the methods by which the ozone 
was produced and the composition of the air that was breathed by 
participating individuals. These studies clearly do not provide 
consistent, unambiguous results on which to base the proposed new 
standards.
            Camp Studies
    EPA also relies on a series of camp studies to support the proposed 
standards. The principal limitation of these studies is the inability 
to separate the influence of a single constituent, in this case ozone, 
from other potential environmental irritants. These irritants could 
include weather factors such as high temperatures, and naturally-
occurring irritants such as pollen and organic compounds. None of the 
camp studies is capable of identifying the contributing influence of a 
single constituent within the air mixture.
            Risk Assessments for Outdoor Children and New York City 
                    Hospital Admissions
    These data do not support the need for more stringent standards. 
After carefully reviewing the EPA Staff Paper, CASAC in its November 
30, 1995, closure letter stated:

          [B]ased on the results [of the two risk assessments], the 
        Panel concluded that there is no 'bright line' which 
        distinguishes any of the proposed standards (either the level 
        or the number of allowable exceedances) as being significantly 
        more protective of public health. For example, the differences 
        in the [estimated] percent of outdoor children responding 
        between the present standard and the most stringent proposal 
        (8-hour, one exceedance, 0.07 ppm) are small and their ranges 
        overlap for all health endpoints. [The initial results 
        presented in the Staff Paper for risk assessment for hospital 
        admissions, suggest considerable differences between the 
        several options. However, when ozone-aggravated asthma 
        admissions are compared to total asthma admissions, the 
        differences between the various options are small].

    A closer examination of the hospital admissions risk assessment 
shows that greater improvements in public health would be realized 
through attainment of the existing ozone NAAQS (from the ``As Is'' case 
to the ``Existing Standard'' option) than reliance on any of the 
alternative standards under consideration by EPA. CASAC could not link 
any improvement in public health to the adoption of any of the 
alternative options considered by EPA and ultimately concluded that 
``the selection of a specific level and number of allowable exceedances 
is a policy judgment.''
                               conclusion
    Because the proposed new NAAQS for fine particulate mater and ozone 
would impact each segment of the food production supply chain without 
any reliable indication of benefit to public health, FIEC urges EPA to 
reaffirm the current standards and initiate a targeted research program 
to resolve the serious and pertinent questions raised in CASAC's review 
of the scientific basis relied on by the agency to support the proposed 
rule.
    FIEC appreciates the opportunity to comment on this rulemaking.
            Sincerely,

                                       American Bakers Association,
                                    American Frozen Food Institute,
                                           American Meat Institute,
                       Biscuit & Cracker Manufacturers Association,
                               Chocolate Manufacturers Association,
                                  Grocery Manufacturers of America,
                                    Independent Bakers Association,
                             Institute of Shortening & Edible Oils,
                             International Dairy Foods Association,
                               Midwest Food Processors Association,
                        National Agricultural Aviation Association,
                             National Cattleman's Beef Association,
                                National Confectioners Association,
                              National Food Processors Association,
                           National Oilseed Processors Association,
                                        National Pasta Association,
                             Northwest Food Processors Association,
                                            Snack Food Association,
                                     Tortilla Industry Association.
                                 ______
                                 
              National Caucus of Environmental Legislators,
                                    Washington, DC, April 28, 1997.
President William J. Clinton,
The White House, Washington, DC.
    Dear President Clinton: This month the Nation celebrates the 27th 
anniversary of Earth Day. At the time of this observance, one of our 
most important public health issues and environmental concerns, is the 
Clean Air health standards proposed by the United States Environmental 
Protection Agency (EPA) to update the National Ambient Air Quality 
Standards (NAAQS) for ozone and particulate matter.
    The National Caucus of Environmental Legislators (NCEL) was 
established by like-minded State legislators who share the bipartisan 
goal of States' involvement in protecting the environment. For these 
reasons, and to counter the campaign of misinformation of those opposed 
to strengthening public health standards, we urge your Administration 
to adopt air quality standards which protect the health of all our 
citizens.
    State governments, acting in partnership with the Federal 
Government, play an indispensable role in the effort to protect natural 
resources and combat environmental degradation and pollution. State 
implementation of Federal law is the cornerstone of our current system 
of environmental protection. States are particularly dependent upon the 
State-Federal partnership and Federal pollution control laws when 
dealing with the interstate migration and affects of pollutants. 
Federal, uniform standards of air pollution are essential; State 
lawmakers universally recognize that air pollution does not respect 
State boundaries. For this reason, we applaud EPA's efforts to address 
ozone and particulate matter ambient air pollution at the Federal 
level.
    We support the concept that health standards for air pollutants 
should be based on peer reviewed science and designed to better protect 
human health. According to that scientific data, the current standards 
for ozone and particulate matter, in place since 1979 and 1987, 
respectively, are inadequate to protect our children, the elderly and 
the one-third of the American population who suffer from some form of 
respiratory ailment.
    As State legislators, we have a responsibility to ensure that all 
of our constituents are able to breathe clean air, giving special 
attention to sensitive populations such as children, the elderly and 
individuals with pre-existing respiratory diseases. We expect EPA to 
set clean air standards which will achieve this objective. To implement 
these standards we expect EPA to provide sufficient funding to monitor 
and to characterize these pollutants so that States have the resources 
necessary to determine when, where and how often the new standards are 
exceeded.
    According to EPA's estimates, the new particulate matter standards 
would save at least 15,000 lives each year, and the new ozone standard 
would result in up to 400,000 fewer incidents of aggravated coughing or 
painful breathing and 1.5 to 2 million fewer incidents of decreased 
lung functions. Furthermore, the updated standards would benefit 
millions of Americans by decreasing incidences of breathing problems, 
asthma attacks, bronchitis, and heart and lung disease. These new 
standards are supported by 19 of 21 members of the Clean Air Scientific 
Advisory Committee. In addition, a recent EPA study of the costs and 
benefits of the Clean Air Act from 1970 through 1990 found that every 
dollar spent on clean air regulation compliance resulted in $45 in 
benefits to public health and the environment.
    With respect to the air quality standard for ozone, EPA determined 
that the current standard is inadequate to protect human health, and 
EPA's Clean Air Scientific Advisory Committee unanimously recommended 
that the standard should be based on an 8-hour exposure to ozone. Over 
180 scientific studies on the effects of ozone found that serious 
health problems occur at exposure levels lower than the current 
standards, and that longer exposures may have more significant 
consequences.
    We understand that these new standards will challenge State and 
local government to develop better air pollution control programs. The 
costs these standards impose are appropriately considered in the 
implementation process; the standards themselves should reflect solely 
the best scientific information on the effects of air pollutants on 
public health.
    In conclusion, based on the near unanimous findings of the EPA's 
Clean Air Scientific Advisory Committee, we support efforts to assure 
Federal clean air standards for ozone and particulate matter protect 
the health of all Americans, especially our children.
            Respectfully,
                                Senator Richard L. Russman,
                                                     New Hampshire.
                                 Delegate Leon G. Billings,
                                                          Maryland.
                                        Senator Byron Sher,
                                                        California.
                                  Senator Rebecca I. White,
                                                     West Virginia.
                               Representative Andy Nichols,
                                                           Arizona.
                         Representative Deborah F. Merritt,
                                                     New Hampshire.
                               Assemblyman Richard Brodsky,
                                                          New York.
                                    Delegate James Hubbard,
                                                          Maryland.
                                Representative Jay Kaufman,
                                                     Massachusetts.
                            Assemblywoman Loretta Weinberg,
                                                        New Jersey.
                            Representative David Levdansky,
                                                      Pennsylvania.
                                Representative Ralph Ayres,
                                                           Indiana.
                           Representative Mary M. Sullivan,
                                                           Vermont.
                       Representative John R. Bender, Ph.D,
                                                              Ohio.
                                Representative Brian Frosh,
                                                          Maryland.
                                        Senator Pat Pascoe,
                                                          Colorado.
                                Representative Joe Hackney,
                                                    North Carolina.
                          Representative Mary Ellen Martin,
                                                     New Hampshire.
                                 ______
                                 
       Northeast States for Coordinated Air Use Management,
                                                    March 24, 1997,
Senator James Inhofe,
Russell Senate Office Building,
Washington, DC.
    Dear Senator Inhofe: On behalf of the Northeast States for 
Coordinated Air Use Management (NESCAUM), a regional association of the 
eight States of Connecticut, Massachusetts, Maine, New Hampshire, New 
Jersey, New York, Rhode Island, and Vermont, I appreciate this 
opportunity to express our support for the Environmental Protection 
Agency's recently proposed revisions to the ozone and particulate 
matter National Ambient Air Quality Standards (NAAQS). Since 1967, 
NESCAUM has provided a forum for its member States to exchange 
information on air quality issues including those related to public 
health and welfare, and promote regional cooperation on pollution 
control strategies. Over the past several months, technical and policy 
staff from the environmental agencies in the eight northeast States 
have carefully examined EPA's proposed revisions to the NAAQS. Attached 
are detailed comments that we have submitted collectively, as well as 
comments supporting the proposed standards submitted independently by 
Massachusetts, New York, and Vermont.
    The NESCAUM States support EPA's proposals to revise the ambient 
air standards for ozone and particulate matter and support the process 
by which EPA has developed the proposed revisions. By relying on input 
received from independent national experts from academia, industry, and 
other organizations, EPA has rightly concluded that the primary ozone 
and particulate standards must be tightened in order to protect public 
health. We commend EPA on effectively utilizing the Clean Air Science 
Advisory Committee peer review process.
    The primary mission of the environmental agencies in the Northeast 
is to protect public health and welfare. We firmly believe that the 
standards for ozone and particulate matter must be based solely on the 
best scientific assessment of the need to protect the public health and 
welfare. Some have commented that EPA should apply cost-benefit 
analysis in setting the standards. To put it simply, setting public 
health standards based on cost is bad science, bad policy, and just 
plain wrong. The public has a right to know when its health is at risk, 
particularly when individuals can take cautionary actions to diminish 
their exposure to harmful air pollutants.
    Cost considerations are now and shall remain paramount as we move 
to adopt and implement pollution control strategies necessary to 
achieve health-based standards. As any environmental regulator can 
attest, it is virtually impossible to impose an air quality control 
requirement that cannot be justified on economic grounds. The question 
is not whether we factor cost into our analysis, but when. The 
appropriate answer is in implementing programs, not when determining 
the levels of pollutant concentrations that are needed to protect 
public health.
                             ozone standard
    The NESCAUM States support the level and form of the primary ozone 
standard proposed by EPA (8-hour, 80 parts per billion). Although there 
is no exposure threshold that guarantees absolute protection for the 
entire population, we believe that the level of the 8-hour standard as 
proposed (80 parts per billion) is clearly more effective at protecting 
public health than the current standard. The 8-hour averaging time more 
realistically reflects the true regional nature of the ozone problem 
and will encourage more rational control strategies. Moreover, the form 
of the proposed ozone standard correctly targets areas with chronically 
elevated pollution levels. Under the proposed regime, States will be 
far less vulnerable to bouncing between attainment and nonattainment 
status on the basis of changes in summertime weather.
    Having standards that reflect current scientific understanding of 
ozone formation will lead to more effective control programs. The 
existing standards reflect the outdated belief that ozone is a local, 
urban problem. In 1991, a National Research Council committee, 
synthesizing the best available information on ozone formation and 
transport in the eastern United States, observed that:

          High ozone episodes last from 3-4 days on average, occur as 
        many as 7-10 times a year, and are of large spatial scale: 
        >600,000 km\2\. Maximum values of non-urban ozone commonly 
        exceed 90 ppb during these episodes, compared with average 
        daily maximum values of 60 ppb in summer. An urban area need 
        contribute an increment of only 30 ppb over the regional 
        background during a high ozone episode to cause a violation of 
        the National Ambient Air Quality Standard (NAAQS) [120 ppb] in 
        a downwind area. . . . Given the regional nature of the ozone 
        problem in the eastern United States, a regional model is 
        needed to develop control strategies for individual urban 
        areas. (National Research Council. 1991. Rethinking the ozone 
        problem in urban and regional air pollution. National Academy 
        Press. Washington, DC. pp. 105-106).

    In recognition of the need for regional controls, the NESCAUM 
States have urged EPA to develop and implement national control 
programs such as those currently proposed to address ozone precursor 
emissions from heavy duty diesel engines, consumer and commercial 
products (e.g., Architectural and Industrial Manufacturing Rules), 
standards on locomotive engines, rules affecting heavy duty highway and 
off-road vehicles, and controls including utility controls which may 
arise out of conclusions from the work of the Ozone Transport 
Assessment Group (OTAG). Our efforts to adopt effective reduction 
strategies will be greatly enhanced by having a standards regime that 
correctly reflects the physical reality of ozone formation. For a 
fuller discussion of the regional nature of our ozone problem see the 
attached report entitled ``The Long-Range Transport of Ozone and Its 
Precursors in the Eastern United States.''
                      particulate matter standard
    The NESCAUM States also believe that the regional nature of fine 
particulate matter will be effectively addressed by the proposed annual 
fine particulate matter standard. Based on our review of the available 
science, the levels proposed by EPA should motivate substantial 
reductions in regional levels of PM2.5 and provide 
protection against high pollution concentrations that may occur on a 
day to day basis. The epidemiological evidence is extremely compelling 
and indicates that the existing particulate matter standard 
(PM10) is not sufficient to protect people from a range of 
serious health effects associated with fine particulate matter. 
Cumulative long-term exposures to high pollution concentrations are of 
great concern, and the proposed annual PM2.5 standard will 
provide protection against these high levels. This annual standard is 
likely to be especially important in the NESCAUM region since there 
appears to be a significant regional problem in which long-range 
pollution transport, particularly of sulfates, nitrates, and organic 
aerosols, and soot plays a major role. It should be noted that the 
Northeast States recommended a tighter daily standard in previous 
testimony (in Philadelphia, PA, July 25, 1996), and we have asked EPA 
to closely examine the daily standard to ensure that it adequately 
protects against exposure to local ``hotspots''.
                               conclusion
    We believe that implementation of revised standards can result in 
more rational, equitable, and effective emission reduction strategies. 
Moreover, by integrating the implementation of the ozone and 
particulate matter standards, we believe that EPA and the States will 
achieve important public health improvements using the most cost-
effective and flexible means available.
    Thank you, again, for this opportunity to present the Northeast 
States' support of EPA's proposed ozone and PM standards.
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      Statement of the United Steelworkers of America, AFL-CIO.CLC
    The United Steelworkers of America represents 540,000 workers in 
the United States. Our ranks also include 281,000 retired American 
members. Most of our members work in the steel, rubber, chemical, 
mining, nonferrous metals, and general manufacturing industries which 
are major contributors to particulate and ozone pollution. They live in 
the urban and industrial areas most affected by particulates and ozone. 
Their families have much to gain from properly considered regulations 
which reduce the risk of dirty air--and much to lose should poorly 
crafted ones cause serious economic dislocation in our major extractive 
and manufacturing industries. We take a keen interest in this 
rulemaking.
                       1. the proposed standards
    The USWA supports EPA's proposals for PM2.5 and ozone. 
Under the Clean Air Act, the primary air quality standards must be 
based on health considerations alone. The evidence currently in the 
record is more than sufficient to establish the need for strengthening 
the NAAQS for ozone, for adding a new standard for fine particulates, 
and for modifying the averaging methods for determining compliance.
    In developing the proposals, the EPA staff considered more than 
5,000 scientific studies and medical reports. This review was the most 
extensive EPA has ever conducted for public health standards. The two 
largest studies--the Harvard six-city study and the American Cancer 
Society study--found increased mortality at particulate levels well 
below the current standards. Other, smaller studies were consistent 
with these findings. EPA estimates that the particulate standard alone 
will prevent 20,000 premature deaths per year; the Natural Resources 
Defense Council estimates 64,000 deaths per year from fine particulate 
pollution. The evidence suggests that the excess mortality primarily is 
due to fine particulates, less than 2.5 micrometers in diameter. The 
studies also show a strong link between ground-level ozone and 
decreased lung function, increased asthma, and more severe respiratory 
infections. Fine particulates and ozone disproportionately affect 
children and the elderly.
    Taken as a whole, the studies are compelling. We believe that EPA 
has clearly demonstrated that the new PM2.5 standard and the 
revised ozone standard are necessary to protect public health.
    EPA has also proposed a change in the averaging method for the 
current PM10 standard, to one based on the 98th percentile 
of the distribution of monitored concentrations at the highest monitor. 
It has been charged that this method is less stringent than the current 
method based on one allowed exceedance per year. However, the proposed 
statistical method gives a much fuller picture of the actual situation, 
and will result in a more realistic determination of the need for 
additional controls. We support the change.
                         2. additional research
    EPA's proposals are well supported by the current evidence. 
However, additional research is essential. We do not yet know the 
ambient levels of PM2.5 in most parts of the country. We do 
not have a clear picture of how the sources and the components of 
PM2.5 vary by region. We do not have a sufficient 
understanding of how existing programs aimed at PM10 affect 
ambient concentrations of PM2.5. These issues are critical 
to the intelligent design of control strategies. Direct, government-
funded research into process-specific control technology would also 
help industry meet the new standards.
    Further research might also help us refine the standards 
themselves. It is possible that PM2.5 is not the best 
particulate fraction on which to concentrate. It has also been 
suggested that most of the health risk is caused by particular species 
within PM2.5, such as acid aerosols or reactive metals.
    For these reasons, EPA, in cooperation with the National Institute 
for Environmental Health Sciences, should commit to an aggressive 
program of research. The program should not be used to delay 
implementation of the revised standards; however EPA should be willing 
to modify those standards should the research so indicate.
                           3. implementation
    The USWA is grateful for EPA's willingness to add us to the 
Subcommittee for the Development of Ozone, Particulate Matter and 
Regional Haze Implementation Programs. Although the Subcommittee is 
already very large, we hope it will be open to other labor 
organizations who may wish to join. Plant workers, acting through their 
unions, have much to contribute to a discussion of effective controls.
    National ambient air quality standards are based on health 
considerations alone. This puts a special burden on those who must 
devise strategies for meeting the standards. Public health will not be 
protected by implementation strategies which clean the air only at the 
cost of massive economic dislocation.
    Economics becomes important in the next phase of this effort, as we 
explore different control options. Unfortunately, EPA's economic 
analysis usually focuses on the overall cost of a regulation to the 
affected industries or to the economy as a whole. We believe that 
employment is a much more important consideration. Employment and 
income are strongly correlated to health. Other economic variables are 
not. EPA should work toward compliance methods which protect, and if 
possible increase, the level and quality of employment.
    While the current phase of rulemaking is concerned only with health 
risks, much of the public debate has centered around a supposed 
conflict between jobs and environment. Our experience teaches a 
different lesson. Improving the environment usually creates jobs. Some 
of our members make pollution control equipment. Others make the steel, 
aluminum, rubber, plastic and glass that goes into it. Others design, 
install, operate and maintain the equipment. An increasing number of 
jobs in our union, and in the workforce generally, depend on 
environmental protection. Of course, it is possible to devise control 
strategies that really do destroy jobs, but that need not happen. 
Protecting the environment while protecting jobs will take careful 
planning, and the cooperative efforts of industry, labor, government at 
all levels, and the environmental community--but it is possible, and it 
is essential. EPA should do all it can to facilitate the process.



         CLEAN AIR ACT: OZONE AND PARTICULATE MATTER STANDARDS

                              ----------                              


                        THURSDAY, JULY 24, 1997

                           U.S. Senate,    
 Committee on Environment and Public Works,
               Subcommittee on Clean Air, Wetlands,
                      Private Property, and Nuclear Safety,
                                                    Washington, DC.

                        IMPLEMENTATION STRATEGY

    The subcommittee met, pursuant to notice, at 10:56 a.m. in 
room 406, Dirksen Senate Office Building, Hon. James Inhofe 
(chairman of the subcommittee) presiding.
    Present: Senators Inhofe, Thomas, Hutchinson, Graham, 
Allard, and Sessions.

 OPENING STATEMENT OF HON. JAMES M. INHOFE, U.S. SENATOR FROM 
                     THE STATE OF OKLAHOMA

    Senator Inhofe. The subcommittee will come to order.
    The purpose of today's hearing is to examine the EPA's 
implementation plan for the new ambient air quality standards 
for ozone and particulate matter, and I want to emphasize the 
word ``plan'' because what the EPA is planning today is not 
necessarily what will happen tomorrow. I don't think their plan 
is based on reality and, therefore, will not happen.
    First, from what I read the EPA is rewriting the Clean Air 
Act and their plan is outside of congressional authority. 
Congress has not given authority to the EPA to do the 
following: a cap and trade program for utility emissions. I 
understand that, of course, we do have the cap and trade 
program in other areas, such as acid rain. But it is my 
position that we do not have it in this case.
    Second, to maintain two different ozone standards at the 
same time. This is somewhat controversial. But it's my 
understanding that they will be attempting to maintain the 
ozone standards at .12 in some areas, and at the same time .08 
in other areas.
    Third, a transitional reclassification system.
    It's my feeling and my interpretation that the authority is 
only there for attainment or nonattainment. These are just some 
examples of areas where I believe the EPA is trying to exceed 
their legal and congressional authority. Because they lack 
authority, they open themselves up to numerous possible 
lawsuits by States and regulated community and private 
citizens' suits. They have already been sued under SBREFA, the 
Small Business Regulatory Enforcement Act. The result of these 
suits will be a court implementation plan which ignores the 
flexibility in safeguards the EPA is promising, and which makes 
those flexibility promises meaningless.
    To understand this one only has to look at the past history 
of the Agency. As Senator Santorum said in Tuesday's Ag 
hearing, the EPA talks about flexibility, but never delivers. 
You only have to look at recent EPA threats in Pennsylvania and 
Virginia to see that ``flexibility'' to their mind means ``EPA 
mandates.'' Furthermore, whenever EPA talks about flexibility 
implementation, or stretching out requirements, they are 
quickly sued by radical environmental groups, and then the 
Agency is quick to roll over and enter into binding consent 
agreements.
    It is important to note that this frustration is felt not 
only in Congress, but more so in the States and communities. I 
received a letter this week from the heads of 13 State 
environmental agencies calling for congressional intervention 
to stop these standards because of scientific uncertainties, 
lack of clear benefits, and questions surrounding the 
implementation. I would like to enter this letter into the 
record, and point out to my colleagues on this subcommittee 
that the States which signed these letters include Oklahoma, 
Idaho, Alabama, Virginia, and Montana, with all of these States 
being represented on this committee.
    The only witness at today's hearing is Mary Nichols, the 
Assistant Administrator for Clean Air at the EPA. I understand 
that Ms. Nichols will be leaving the EPA in Washington, DC 
shortly to return to California. Because of this I thought it 
would be important to hear how Ms. Nichols believes this will 
be implemented since all of the planning has occurred under her 
watch. If and when this is ever fully implemented it is 
important that a record be built which codifies the EPA's 
promises.
    Ms. Nichols, I will say to you that while we have had 
differences in the past, and we continue to have differences, I 
think when you get out to California you will have some 
different views on some of these things, and we'd be more in 
agreement, and I've always enjoyed working with you.
    I'll look forward to hearing now from Ms. Nichols.
    [The prepared statement of Senator Inhofe follows:]
  Prepared Statement of James Inhofe, U.S. Senator from the State of 
                                Oklahoma
    The hearing will now come to order. The purpose of today's hearing 
is to examine the EPA's implementation plan for the new National 
Ambient Air Quality Standards for ozone and particulate matter. I want 
to emphasize the word plan, because what the EPA is planning today is 
not necessarily what will happen tomorrow. I do not think their plan is 
based on reality and therefore will not happen.
    First, from what I read, the EPA is rewriting the Clean Air Act and 
their plan is outside of Congressional authority. Congress has not 
given authority to the EPA for the following:
     A Cap and Trade program for utility emissions.
     To maintain two different ozone standards at the same 
time.
     A transitional classification system.
    These are just a few examples of areas where I believe EPA is 
trying to exceed their legal and Congressional authority.
    Because they lack authority, they open themselves up to numerous 
possible lawsuits by States, the regulated community, and private 
citizen suits. They have already been sued under SBREFA. The result of 
these suits will be a court directed implementation plan which ignores 
the ``flexibility'' and safeguards the EPA is promising and which makes 
those flexibility promises meaningless. To understand this one only has 
to look at the past history of the Agency. As Senator Santorum pointed 
out in Tuesday's Agriculture hearing, the EPA talks about flexibility 
but never delivers. You only have to look at recent EPA threats in 
Pennsylvania and Virginia to see that flexibility to their mind means 
EPA mandates. Furthermore, whenever EPA talks about flexible 
implementation or stretching out requirements they are quickly sued by 
radical environmental groups and the Agency is quick to roll over and 
enter into binding consent agreements.
    It is important to note that this frustration is felt not only in 
Congress, but more so in the States and communities. I received a 
letter this week from the heads of thirteen State environmental 
agencies calling for Congressional intervention to stop these standards 
because of the scientific uncertainties, lack of clear benefits, and 
questions surrounding the implementation. I would like to enter this 
letter into the record and point out to my colleagues on the Committee 
that the States which signed included Oklahoma, Idaho, Alabama, 
Virginia, and Montana, with all of these States being represented on 
this Committee.
    The only witness at today's hearing is Mary Nichols, the Assistant 
Administrator for Air at the EPA. I understand that Ms. Nichols will be 
leaving the EPA and Washington, DC. shortly to return to California. 
Because of this I thought it was important to hear how Ms. Nichols 
believes this will be implemented since all of the planning has 
occurred under her watch. If and when this is ever fully implemented it 
is important that a record be built which codifies the EPA's promises.
    I look forward to hearing how Ms. Nichols believes this will be 
implemented and I wish her luck in her future endeavors.

    Senator Inhofe. I see that the ranking minority is here, 
Senator Graham. First of all, I think you want to get on record 
voting on the nomination, the Clark nomination.
    Senator Graham. Yes, Mr. Chairman. Thank you, and I have 
done so with our committee staff. I might have an opening 
statement to file. I thank you for convening this hearing and 
look forward to receiving the testimony of the witnesses.
    Senator Inhofe. Thank you, Senator Graham.
    I've been informed by the staff that you probably should be 
on record with your vote on S. 399, the McCain bill, and then 
S. 1000 and S. 1043. These are naming bills you are familiar 
with.
    Senator Graham. I would like to be recorded aye on all 
those.
    Senator Inhofe. Thank you, sir.
    Senator Thomas.

 OPENING STATEMENT OF HON. CRAIG THOMAS, U.S. SENATOR FROM THE 
                        STATE OF WYOMING

    Senator Thomas. Thank you, Mr. Chairman. Thank you for 
holding this hearing, to discuss ozone and particulate matters, 
standards promulgated by EPA.
    Since EPA released the proposed regulations in November, 
this committee has held numerous hearings regarding this 
matter, and heard concerns of many of the Nation's Governors, 
State, county and local officials and the business community. 
Furthermore, we've heard from the scientists on EPA's own Clean 
Air Scientific Advisory Committee, heard them testify there's 
no bright line, and that they need more time to conduct 
additional research into PM and ozone. Unfortunately EPA and 
the Administration have refused to listen.
    President Clinton endorsed EPA's standards in spite of 
public opposition from more than 250 Members of Congress, 27 
Governors, labor unions and many small businesses throughout 
the country. These standards could end up being the most 
expensive in history, and severely limiting economic growth. 
With so many areas of the country having problems meeting 
current environmental standards, these regulations could throw 
new counties into nonattainment. Additionally, these counties 
currently in nonattainment will probably never reach 
compliance.
    It's my understanding that Administrator Browner has been 
meeting with Members of Congress and various industries, 
telling them not to worry about the new rules because they 
won't affect their interests. Most recently she informed the 
agricultural community of that when she testified before the Ag 
Committee earlier this week, Mr. Chairman. It seems that EPA's 
really doing some soft-pedaling on the impacts of the new air 
quality rules and, in fact, perhaps distorting the facts. I'm 
interested in Ms. Nichols telling us how EPA can guarantee 
these promises when they don't even know what the 50 States 
will end up regulating.
    I've always had strong reservations about EPA's regulations 
and do not believe that Congress will back them. The chairman 
of this subcommittee has done an outstanding job on this issue, 
and I intend to help him in any way I can. I do support 
additional research and was pleased the Senate passed the EPA-
HUD and the Independent Agencies appropriation, which included 
funding for PM2.5 research. It's my intention to 
work with the Appropriations Committee in guiding that on 
through.
    So, Mr. Chairman, I'm anxious also to hear what Ms. Nichols 
has to say about the real implementation strategy. It may 
change tomorrow, but it is our duty to exercise oversight and 
determine if the EPA has legal authority to do the things it 
claims it will do, and I appreciate your having the hearing. 
Thank you.
    Senator Inhofe. Thank you, Senator Thomas.
    Senator Hutchinson.

OPENING STATEMENT OF HON. TIM HUTCHINSON, U.S. SENATOR FROM THE 
                       STATE OF ARKANSAS

    Senator Hutchinson. Thank you, Mr. Chairman.
    Ms. Nichols, I also want to join in the chorus wishing you 
the best in California, and your new endeavors out there. Thank 
you for coming today, and Mr. Chairman, thank you for taking 
such an active role on these proposed air standards, and the 
hearings that we've now had. As I've said repeatedly, it seems 
out of those hearings that one thing was clear--there's an 
awful lot that is unclear; there's a lot of difference among 
scientists. That is why I have the position that it is far 
better for us to seek more data, have more time before we 
implement standards that are going to have such a dramatic 
impact.
    Arkansas is a rural, primarily agricultural State. It is 
growing, but it currently has a relatively small amount of 
heavy industry and a relatively small population, two and a 
half million. Now, that is exactly the type of State that one 
would think was going to be minimally impacted by EPA standards 
on ozone and particulates. Unfortunately, that's just not the 
case. It is already anticipated that several counties in 
eastern Arkansas are going to be out of attainment under these 
new standards. One county, Crittenden County, is already out of 
attainment for ozone and, as the Mayor of west Memphis, AR 
said, would be out of attainment even if the entire city was 
plowed up and used for farmland. With Memphis so close, right 
across the river, there's just very little that west Memphis 
can do to achieve air quality under the guidelines of the EPA. 
Other counties, such as Arkansas County and Ashley County, are 
almost exclusively agricultural in nature.
    Ms. Browner testified before the Agriculture Committee on 
Tuesday, and has repeatedly asserted, that agriculture would 
not be affected by these new standards. And she would assure 
through Secretary Glickman that that would not be the case. The 
reductions could be achieved and attainment realized by going 
after big power plants. Well, that's fine, except that in 
Arkansas and Ashley Counties they don't have any power plants. 
It's all agricultural. One county that does have a power plant 
is Jefferson County, where Pine Bluff is, just to the west of 
Arkansas County, but according to EPA's own documents they will 
``not'' be out of attainment. But to me that creates an 
interesting paradox, how you get two counties that are 
agricultural that are out of attainment with no power plant. 
You have Jefferson County, with a power plant, that's going to 
be in attainment. If you go after the power plant you are not 
going to solve the problem of the two agricultural counties.
    So I think agriculture is going to take a beating in the 
United States over the next few years between what the EPA 
wants to do with ozone and particulates, and what the 
Administration is saying they want to do in relation to global 
climate and the effects on an agricultural State like Arkansas. 
Those effects will be overwhelming. But really what we are 
seeing with PM and ozone is really step one, with the 
conference in December possibly leading us to step two, which 
will be equally devastating.
    So I appreciate the hearing today. I look forward to the 
testimony.
    Mr. Chairman, there's been much said about children, and I 
think about the tremendous costs of these new standards, and if 
we would take just some of those resources and put that into 
children's health care, put that into asthma research. The 
evidence seems clear to me that changing the ozone standards is 
not going to--the big question is, how many lives does that 
save? How much impact does that have on asthma? If we really 
care about children, the enormous costs associated with these 
new standards, we could take that, put that in children's 
health care, and do far more to benefit the children of this 
country.
    But I look forward to the testimony and I thank you for 
calling the hearing.
    Senator Inhofe. Thank you, Senator Hutchinson.
    We have plenty of time for the remainder of the opening 
statements.
    Senator Allard.

 OPENING STATEMENT OF HON. WAYNE ALLARD, U.S. SENATOR FROM THE 
                       STATE OF COLORADO

    Senator Allard. Thank you, Mr. Chairman. Again I'd like to 
thank you. I think you are doing a great job of pursuing this 
particular issue. We do need to have a number of hearings in 
order to get a thorough understanding of what these regulations 
do and don't do, and understand the science that's behind them.
    I come from a State that's rather unique. It's one of the 
fastest growing areas in the whole country. Because of our high 
altitude we have some particular problems related to the high 
altitude is- 
sues, and I think that's an issue that we have to deal with in 
our States that other States probably don't have to deal with, 
and obviously what science we do in relation to that, I'd be 
very interested in. I have a newspaper clipping here in front 
of me that talks about how these rules and regulations in 
effect are going to increase the particulate matter in Denver, 
and it's an article in the--and if you have time to address 
that, I may not be here to ask that question because I do have 
a bill up in another committee. If I get back I'll probably 
bring that question back for you to answer. But even if you 
don't get a chance to answer it here in the committee, I'll try 
and submit a question to you. You can come back to us in 
writing.
    Also, Carol Browner had made a number of comments in front 
of the Ag Committee here on the Senate side, and I have some 
questions in regard to that.
    I'm not sure the rules and regulations allow, on the Clean 
Air provision, any agency to set out a certain group to be 
treated differently from anybody else, and when you keep that 
in mind, she says it's not going to have any impact on 
agriculture. I have a hard time understanding how it's not 
going to have an impact without a provision in there that would 
allow her to set out a certain group as exempt from provisions. 
I just don't think those are there, but maybe I need some 
education in that regard.
    So I think the bottom line is that these new rules and 
regulations that are being proposed are going to affect 
everybody in this country. I think people have to understand 
fully how it's going to affect them, how much it's going to 
cost, and best we can to educate the science behind it, and for 
that reason I commend the Chairman and commend those that are 
going to testify today for your input on this most important 
issue.
    Thank you very much.
    Senator Inhofe. Thank you, Mr. Allard. Senator Allard--I 
would also observe agriculture isn't the only area that she 
said would be exempt. The Conference of Mayors is going to be 
exempt and small business and others, so we'll need to find out 
how they are going to do that.
    Senator Sessions.

OPENING STATEMENT OF HON. JEFF SESSIONS, U.S. SENATOR FROM THE 
                        STATE OF ALABAMA

    Senator Sessions. Thank you, Mr. Chairman. I really do 
believe this is an important subject for our Nation to deal 
with, and it must be confronted honestly and directly. The air 
does appear to be getting cleaner in America, because we took 
some tough stands and we've made progress and we're continuing 
to make progress. But as we accelerate the demands to reach an 
even more naturally pure level of air, it adds costs to our 
Nation. It seems to me that costs can get so high that it does, 
in fact, make us noncompetitive in the world marketplace. There 
is a limit to which we can burden ourselves. It seems to me, 
Mr. Chairman, there's no difference between a tax and a 
regulation. There's no difference in telling the Tennessee 
Valley Authority that they've got to spend $2 billion, and 
that's what the Director testified here, that he thought these 
regulations would cost them on their clean air requirements, to 
spend $2 billion on improving the air, which they are passing 
on to the ratepayers in that regard or imposing a tax of $2 
billion, and so there the power industry serves America. It 
serves people. To burden them extraordinarily is a burden on 
the average rate payer. It's a tax on the rate payer, and we 
ought to ask ourselves if we're going to have the TVA rate 
payers pay $2 billion in extra regulative fees, or tax fees? 
Would it be better, as Senator Hutchinson says, to spend that 
money on asthma research, or emphysema research, or heart 
research, or AIDS research? This is an appropriation of the 
resources of our Nation. It just cannot be done without being 
oblivious to the impact it has on the Nation's wealth, and how 
it ought to be allocated for the overall good of America, and 
since we do have the reports of the CASAC committee, EPA's own 
committee, questioning the benefits from it, I just think that 
I don't want to be involved. I don't want to have to question 
these issues. I know you don't, Mr. Chairman. We do not want to 
be here. But we've got to be here because we're charged with 
setting public policy for America, and I hope that we can ask 
the questions honestly, and not be intimidated by political 
maneuverings, and try to do what's right for the country. 
That's what I want to do, and I am interested in proceeding, 
and thank you for your leadership.
    Senator Inhofe. Thank you, Senator Sessions.
    If it's all right Ms. Nichols, we'll recess for just a few 
minutes, go vote twice, and be right back.
    [Recess.]
    Senator Inhofe. We'll reconvene our meeting, and I would 
acknowledge that Mr. Jonathan Cannon, General Counsel for the 
EPA, has joined Ms. Nichols at the table, and we welcome you 
also, and while we normally have opening statements confined to 
5 minutes, we won't confine you to 5 minutes, Ms. Nichols, 
because you are the only witness today. So we recognize you now 
for opening statements. I would observe that several others are 
up behind me and will be here shortly.

 STATEMENT OF MARY D. NICHOLS, ASSISTANT ADMINISTRATOR FOR AIR 
AND RADIATION, ENVIRONMENTAL PROTECTION AGENCY; ACCOMPANIED BY 
                  JON CANNON, GENERAL COUNSEL

    Ms. Nichols. Thank you, Mr. Chairman.
    I do have a rather lengthy written statement which I know 
has been submitted for the record. I will try to keep my 
opening brief because you raised a number of important 
questions and I believe other members have questions as well.
    I do appreciate your interest and your continuing oversight 
of our----
    Senator Inhofe. You might move the microphone closer, if 
you would please.
    Ms. Nichols. Yes.
    The ozone and particulate matter standards, which were 
announced by the President last month and published last week, 
are the most significant step we've taken in a generation to 
protect the American people, and especially our children, from 
the hazards of air pollution. Together they will protect 125 
million Americans, including 35 million children, from the 
adverse health effects of breathing polluted air. They will 
prevent approximately 15,000 pre- 
mature deaths, about 350,000 cases of aggravated asthma, and 
nearly a million cases of significantly decreased lung 
functions in children.
    Clearly the best available science shows that the previous 
standards were not adequately protecting Americans from the 
hazards of breathing polluted air. Revising these standards 
will bring enormous health benefits to the Nation. That is why 
we took action on clean air.
    Mr. Chairman, you asked me to come before the committee 
today to discuss how EPA intends to implement these new air 
quality standards. In brief, we intend to work closely with the 
States to take advantage of the recent progress we've made in 
understanding the regional nature of air pollution, and the 
most cost-effective ways to reduce it, using the power of the 
marketplace. We also intend to assure that States making good 
progress toward attaining the current, or the old standards, 
will continue that progress, uninterrupted, with a minimum of 
additional burden.
    Perhaps the most innovative aspect of this implementation 
strategy is that it allows the States to use a market trading 
system to address pollution on a regional scale. The heart of 
this system is a voluntary trading plan for emissions from 
utilities, one designed collectively by the 37 States that 
participated in the Ozone Transport Assessment Group, which we 
call OTAG, that will address violations far downwind and will 
provide the most cost-effective pollution reductions by 
achieving the bulk of reductions from major sources rather than 
small businesses or farmers.
    Based on OTAG's recommendations, in September 1997, EPA 
will propose a rule requiring States in the OTAG region that 
are significantly contributing to nonattainment or interfering 
with maintenance of attainment in downwind States to submit 
State implementation plans to reduce their interstate pollution 
and describing the trading plan which the States can adopt if 
they so choose. Based on EPA's review of the latest modeling, a 
regional approach, coupled with the implementation of other 
already existing State and Federal Clean Air Act requirements, 
will allow the vast majority of areas which currently meet the 
1-hour ozone standard to meet the 8-hour standard without 
additional local controls.
    In addition to this regional approach, EPA will also 
encourage the States to design strategies for attaining the 
particulate and ozone standards that focus on getting low-cost 
reductions first. Such strategies will include the use of 
concepts such as a Clean Air Investment Fund, which would allow 
sources facing control costs higher than $10,000 per ton for 
any of these pollutants, some of which they may exceed by about 
a factor of four under any controls which are currently 
required. Anybody who had a cost of over $10,000 per ton would 
be allowed to pay a set annual amount/ton to fund cost-
effective emissions reductions from nontraditional or smaller 
sources.
    Compliance strategies like this will likely lower the cost 
of attaining the standards through more efficient allocation, 
minimizing the regulatory burden for small and large pollution 
sources, and serving to stimulate technology innovation as 
well.
    To insure that the final details of the implementation 
strategy are practical, incorporate common sense, and provide 
for appro- 
priate steps toward cleaning the air, input is needed from many 
stakeholders, including representatives of State and local 
governments, industry, environmental organizations, and Federal 
agencies. EPA will continue seeking advice from a range of 
stakeholders, and, after evaluating their input, will propose 
the necessary guidance to make these approaches work.
    In particular, EPA plans to continue working with the 
Subcommittee on Implementation of Ozone, Particulate Matter, 
and Regional Haze Rules, which EPA established, to develop 
innovative, flexible, and cost-effective implementation 
strategies. EPA plans to issue all guidance and rules necessary 
for this implementation strategy by the end of 1998.
    EPA will continue to work with the Small Business 
Administration because small businesses are particularly 
concerned about the potential impact resulting from future 
control measures to meet the revised PM and ozone standards. In 
partnership with the SBA, EPA will work with States to include 
in their SIPs flexible regulatory alternatives, which minimize 
the economic impact and paperwork burden on small businesses to 
the greatest degree possible, consistent with public health 
protection.
    In summary, Mr. Chairman, EPA believes that the new ozone 
and particulate matter standards will provide important new 
health protection and will improve the lives of Americans in 
coming years. Our implementation strategy will insure that 
these new standards are implemented in a cost-effective and 
flexible manner. We hope to work closely with State and local 
governments, other Federal agencies, and other interested 
parties in order to accomplish this goal.
    Mr. Chairman, that includes my prepared statement, and I 
look forward to answering your questions.
    Senator Inhofe. Well, thank you, Ms. Nichols.
    This is a very obvious question that I've wondered about, 
Ms. Nichols. Given the EPA implementation schedule of at least 
6 years for ozone and, I think, 9 years for PM, and taking into 
account the new standards issued on--were issued on July 16, 
and ignoring existing programs, how many lives would be saved 
in the next 5 years?
    Ms. Nichols. Mr. Chairman, you're asking about the impact 
of the new standards on top of the old standards?
    Senator Inhofe. I'm talking about with those things that 
were not in the--not going to go on in the absence of the 
adoption of these standards. Just these standards, which we all 
agree are not going to go into effect for 6 or 9 years. How 
many lives in the next 5 years would be saved?
    Ms. Nichols. I understand the question. Let me answer it 
this way, if I may. We have not estimated lives saved prior to 
the time when the standards are expected to be, at least, 
partially implemented in 2010. What we have said is that we 
want to layer the new standards on top of the existing 
standards because we recognize, based on the history of the 
Clean Air Act in the past, that from the time a standard is set 
until the time that the actual pollution reductions are being 
achieved, until you know, when industry has had time to design 
the technologies, when the regulations have come into effect, 
does take a period of years, in some cases a decade or more, 
and so setting the standard just begins that process, and we 
acknowledge that the setting of the standard, in and of itself, 
does not cause the health benefits to be achieved.
    Senator Inhofe. So it's safe to say that zero lives will be 
saved in the next 5 years?
    Ms. Nichols. It would be safe to say that the lives that 
will be saved in the next 5 years are attributable primarily to 
today's standards, however it would be important, I think, to 
note that----
    Senator Inhofe. The change in standards that would not be 
in effect for the period of time that we're talking about, 6 
years or 9 years, they won't be in effect?
    Ms. Nichols. Mr. Chairman, this is, I think, where we are 
having a semantic difference. The standards will be in effect, 
assuming that Congress doesn't overturn them, the issue is what 
will people be doing during that period of time, and what we 
believe people will be doing during that period of time is 
continuing work on the current, or the old standards, and also 
beginning the planning for that work that they will be doing on 
the new standards. So it's correct to say that there will not 
be new regulations in place, implementing those new standards, 
but there will be a lot of planning work, and in some cases, I 
think there will be industries that will choose when they're 
making decisions about which technologies to purchase or what 
investments to make, that will be looking toward the new 
standards. So we will see some actual impact of the standards 
in terms of----
    Senator Inhofe. Will there be one life saved in the next 5 
years?
    Ms. Nichols. The lives that will be saved in the next 5 
years, and I don't have a number for those although we could 
get that for you, will be lives that are attributable to 
today's standards, I believe, primarily. Although again----
    Senator Inhofe. That's today's standards. I'm talking about 
with the new standards will there be a life saved in the next 5 
years?
    Ms. Nichols. I think it's difficult to quantify whether 
there would be, based on the choices that people will make in 
looking toward the new standards, but I think there is a down 
payment on those new standards that will have an impact, and 
we'll just have to try to get back to you to see if we can add 
some additional quantification to that.
    Senator Inhofe. Well, let's assume then that there won't be 
any new--any lives saved in the next 5 years. I mean, I still--
I haven't heard anything that you've said that would imply to 
me or that would persuade me to the notion that any lives are 
going to be saved in the next 5 years.
    Ms. Nichols. Let me say it this way, and I----
    Senator Inhofe. And then I would have to say, what will we 
do about what CASAC, and the scientific community would suggest 
postponing these until such time as science determines whether 
or not they're--since we're not going to be changing--making 
the changes anyway?
    Ms. Nichols. Mr. Chairman, I don't believe that CASAC told 
us to defer making a decision on the standards. I believe CASAC 
asked us, by a vote of 19-2, to set a standard for fine 
particles. There was some dispute, which you have gone into in 
previous hearings, as to whether the 24-hour or the annual 
standard should be controlling, what the precise level should 
be, but there was not a question about whether to set a 
standard, and the reason for that is that CASAC recognized that 
the planning work that needs to be done by States and by 
industries in order to achieve a standard, takes many years to 
accomplish, and so the setting of the standard only begins that 
process.
    You are correct to point out that it won't all be completed 
within that 5-year period.
    Senator Inhofe. You can set, but not implement, and you are 
saying by setting and not implementing there are--there are 
going to be--there could be some lives saved because this 
somehow changes behavioral patterns?
    Ms. Nichols. No, Mr. Chairman. What I am saying is that 
implementation includes a great deal of planning work, and in 
the course of doing that planning there will be actual 
decisions made, actions taken, that will have an effect, but we 
haven't tried to quantify that.
    Senator Inhofe. Were you at the Ag hearing on Tuesday?
    Ms. Nichols. Yes, I was.
    Senator Inhofe. Carol Browner said, and this is a quote, 
``We will have the next 5-year review before anyone reduces 
pollution.'' Now what parts of this would you implement that 
would save lives now? I guess that's what I am asking.
    Ms. Nichols. Mr. Chairman, as the Administrator said, and I 
agree with this, there are not regulations that will be in 
effect requiring people to reduce more pollution than is 
required to be reduced for the old standards prior to the next 
5-year review. But because the standards are in effect, there 
will be people taking actions, and I do believe that some of 
those actions will, in fact, be beneficial toward attainment of 
the new, as well as the old, standards.
     Senator Inhofe. But that Ag hearing on Tuesday, 
Administrator Browner cited the OTAG program as a way for 
Eastern States to meet the new ozone standards painlessly. In 
response to Senator Landrieu's question she identified 
Louisiana as an example, saying they currently have four 
parishes in nonattainment and three more new parishes expected. 
She said that OTAG would provide cleaner air in all seven 
parishes without requiring new controls in these seven 
parishes. Does that accurately--do you recall her making that 
statement?
    Ms. Nichols. In general that's consistent with what I 
heard, sir.
    Senator Inhofe. Well, how will these parishes get cleaner 
air if they don't have--without any new controls?
    Ms. Nichols. Ah, the----
    Senator Inhofe. Where would the controls be placed to 
result in cleaner air in Louisiana?
    Ms. Nichols. The key here is the controls on large 
generators of electric power and other very large generators 
who----
    Senator Inhofe. Where?
    Ms. Nichols [continuing]. Who will be located throughout 
the OTAG region. I'm not aware, sir, of whether there are any 
power plants located in the parishes that you identified. So I 
can't respond to that particular part of your question. In 
general, the power plants are located around the country. In 
many States they are frequently located in areas or counties 
that are actually designated as attainment areas today, because 
the immediate area around that facility may be meeting the 
standards, but that plant is contributing, because of the 
problem of long-range transport of pollution, that plant is 
causing or contributing to a problem----
    Senator Inhofe. Where is that plant located that you are 
referring to?
    Ms. Nichols. There are many of them. I was saying a plant--
--
    Senator Inhofe. Would you say to the west of Louisiana?
    Ms. Nichols. There are plants probably within Louisiana 
that are subject to this type of a control program.
    Senator Inhofe. I was quoting the Administrator when she 
said that OTAG would provide cleaner air in all seven parishes 
without requiring any new controls in those seven parishes. 
Would you conclude that there are no--none of these plants as 
you'd describe them in those seven parishes?
    Ms. Nichols. I would have to go back and consult a map of 
the OTAG region and where the power plants are. What the 
Administrator was referring to in her testimony is the modeling 
work that was done by OTAG, in which the States that 
participated in OTAG did various modeling runs looking at 
control strategies, and the conclusion was that with a cap on 
the utility emissions of nitrogen oxides in that region, that 
includes Louisiana, that every county or parish which would not 
meet, based on today's data, the new ozone standard would come 
into attainment. So its based on that modeling work.
    Senator Inhofe. But she said no new controls would take 
place in any of the seven parishes.
    Ms. Nichols. As I said, sir----
    Senator Inhofe. There has to be--if this is somehow going 
to end up in favorably affecting our environment, somewhere 
there have to be controls, and I think in the opening 
statements that were heard on this side of the aisle--one of 
the things that is a little frustrating is that each group that 
appears--they say, ``Oh, no, don't worry about it. You're not 
going to be affected. This is just going to be the other 
people,'' or whatever is stated is, ``Well, you're not going to 
be affected. It's someone to the west of you.'' But sooner or 
later someone is going to have to be affected, and new controls 
are going to have to go in, and my question to you is you know 
you can't build support for a program that has no basis in 
science by continuing to say that no one's going to be 
affected. It's going to be the guy--somebody else.
    Somewhere in this case, somewhere there's going to have to 
be controls to bring the results that it--were described in the 
seven parishes in Louisiana.
    Ms. Nichols. Yes, Mr. Chairman, what we are referring to by 
the OTAG strategy is a system of controls on power plants 
around the 37 State region, which was modeled as part of the 
OTAG work. I can't at this moment tell you precisely which 
power plants in Louisiana, whether they are in those seven 
parishes or not, are the ones that would need to be 
participating in a control program. Clearly someone----
    Senator Inhofe. But, wait a minute, wait a minute. None of 
them are in there. None of them would be there in the seven 
parishes, because that's what the Administrator said.
    Ms. Nichols. As I said, I would have to check the location 
of where the power plants are. I think what the Administrator 
was referring to was the issue of whether there would be a need 
for additional controls on local businesses above and beyond 
the OTAG control program. We've assumed the OTAG control 
program going into effect. We're not denying, in fact we're 
encouraging people to understand what the implications----
    Senator Inhofe. But that's not what she said. She said that 
the--she said the OTAG would provide cleaner air in all seven 
parishes without requiring new controls in these seven 
parishes. That doesn't mean new controls on some businesses or 
some industries or some farms or----
    Ms. Nichols. Yes.
    Senator Inhofe. So you're saying there would be no controls 
in these--you're going to have cleaner air without any new 
controls in the seven parishes. You agree with the 
Administrator?
    Ms. Nichols. I agree that beyond OTAG there would not be a 
need for further, any further, local controls in those seven 
parishes for the new ozone standard. We're just talking ozone.
    Senator Inhofe. So OTAG then, that's regional so somebody 
else is going to have to have new standards so that they'll be 
able to clean up their air in Louisiana, but it won't be in 
Louisiana. So where's it going to be?
    Ms. Nichols. It may be elsewhere in Louisiana. That's why I 
mentioned the fact that I'm not certain where the power plants 
that were modeled are located, sir.
    Senator Inhofe. Senator Hutchinson.
    Senator Hutchinson. Thank you, Mr. Chairman, and I 
certainly--I agree with your comments that it seems to be that 
EPA is giving assurances to all these various sectors that, 
``Don't worry. It's not going to be that bad, and that you're 
not going to be negatively impacted,'' and--would you just kind 
of reiterate for me, as a Senator from an agricultural State, 
what those reassurances are? I mean, what do I tell the farmers 
in the delta?
    Ms. Nichols. Well, Senator Hutchinson, if I could just step 
back a second. I think the point we're trying to get across 
with this implementation strategy is that we want these new 
health standards to come into effect in a way that's orderly, 
that doesn't disrupt the work that many communities are already 
doing, that many industries are already doing, and that 
provides an ample amount of time, in the case of the fine 
particles standard, to develop the most cost-effective possible 
control strategies.
    With respect to the particulate standard, we are taking 
advantage of the provisions of the Clean Air Act that allow for 
a period of time during which areas are designated as 
unclassifiable, and in which further monitoring can be done, as 
well as an additional review of the research in order to 
develop the most cost-effective possible control strategies.
    With respect to the conversations with agriculture, during 
the inter-agency review process that we engaged in within the 
Administration, as well as in response to the public process, 
the public comments and so forth, we heard a lot about the 
concerns of agriculture. I, myself, serve as a member of an Air 
Quality Advisory Committee that the Department of Agriculture 
has set up under the Farm bill that was passed in the last 
Congress, and we worked with the Department of Agriculture on a 
memorandum of agreement--the memorandum itself is in process, 
but it's reflected in a letter that Carol Browner sent to 
Secretary Glickman on a couple of specific issues.
    Because we wanted to make sure that States were focusing on 
the most cost-effective methods first in order to start 
thinking about the new fine particle standard. We believe, 
based on the work that's been done to date, that agricultural 
practices in general shouldn't be the focus of people's 
activities when they are thinking about how to meet a new fine 
particle standard, and that's not based on just a policy choice 
that we've made. It's based on our science review on the 
information that we have available about where the particles 
are coming from, and so we have sought to have conversations 
both with the department and with groups that represent the 
agricultural interest in order to explain to them why this is 
so and why we would like to work with them and others to make 
sure they are not the focus of attention when it comes to 
planning for attainment.
    Senator Hutchinson. OK, that was a lengthy answer. If I 
could distill that. What I got was that you're having 
conversations with the Department of Agriculture, that you're 
working on a memorandum, and that you don't want agriculture to 
be the focus.
    Ms. Nichols. It's not just that we don't want them to be 
the focus, it's that based on the information that we know 
about fine particles today, we don't believe that they will be 
the focus because their particular particles are not what we're 
worried about.
    Senator Hutchinson. So you don't believe it's going to be 
the focus. Now what if a State, when they come up with their 
implementation plan to cite, they're going to make it the 
focus, and they're going to--really going to come in with some 
very strong regulations regarding all the things, all the 
concerns that have been expressed by the farming community.
    Is there any--when you talk about your conversations with 
the Department of Agriculture, is there any assurances that the 
States won't do that?
    Ms. Nichols. I think there are several kinds of assurances. 
First of all, there's the time period. No State is going to be 
submitting a plan for attainment of the new fine particles 
standard until 2005-2008. During that period of time we will be 
working with the States in developing both guidance and 
regulations for the States, to tell the States what they should 
put into their State implementation plans. One----
    Senator Hutchinson. Will you tell them what to put in?
    Ms. Nichols. We tell the States a number of specific things 
about what needs to be in an implementation plan. One of the 
things that we do tell States is what types of monitoring 
information we're going to require, what types of assurances 
they need to submit to show that the PM2.5 standard 
is going to be achieved. The reason why we don't think that 
States would be pursuing PM2.5 strategies, such as 
the kinds of things you may be alluding to that farmers would 
fear, is that those practices are not going to be able to--they 
won't show that those things are actually going to achieve the 
PM2.5 standard because they are not aimed at 
PM2.5.
    Senator Hutchinson. Well, first of all let me just say that 
I think farmers--that the impact upon agriculture goes far 
beyond whether or not they're going to be able to go out a plow 
up their fields, and whether that's going to--that increase--if 
you go after power plants, you increase energy costs, that 
dramatically impacts the farming community.
    But, it was interesting to me, she talked about these 
implementation plans that you actually dictate to the States, 
at least some of what they have to put in based upon your own 
decision as to whether or not it will put them in attainment. 
And it--my understanding of what the EPA's argument is on why 
they are not subject to, and required to abide by, the Small 
Business Regulatory Fairness Act, it is because you're not 
actually implementing the standards, the States are, and yet 
you have just told me that when the State plans, you're going 
to come in and specifically, in some areas, dictate. So that 
seemed to me that that undercuts your entire legal argument 
that you're not subject to the Small Business Regulatory 
Fairness Act.
    Senator Inhofe. Senator Hutchinson, I might observe that 
even though he was not on the schedule to be here, we do have 
Jonathan Cannon, who is the General Counsel. We're glad he is 
here, and he might want to respond to that.
    Ms. Nichols. Well, could I just--before I turn to Mr. 
Cannon for legal advice--just respond to the point that Senator 
Hutchinson was making about how we work with the States on 
developing implementation plans, because that is a matter of 
practice, and if I may say, having run a State environmental 
agency before I came to this job, it is a dynamic process. But 
the way it works is EPA sets an air quality standard. That's 
the goal. The State has to come up with a program to achieve 
it. EPA has to approve those plans. Our basis for approving or 
disapproving those plans is whether they demonstrate that a 
State is able to attain the standard. That's our only role. The 
State has a choice about which measures it puts into the plan, 
but we would look at those measures to see whether the measures 
were going to be getting PM2.5----
    Senator Hutchinson. Well, Ms. Nichols, I was only taking 
what you said in your original answer, and that was that you 
tell the States in certain areas what they've got to put in the 
plan and that, to me, seems to totally undermine your argument 
that this is a State decision, and therefore, you are not 
subject to the Small Business Regulatory----
    Ms. Nichols. If I may just finish. There are some elements 
of what goes into a plan that are mandatory, for example air 
quality data. We mandate to the State they have to give us the 
air quality data. If they don't give us the air quality data, 
their SIP isn't approved. That is a mandatory element of a SIP. 
However, the choice of the control strategies, if they add up 
to the amount of reductions that are needed to meet the 
standards, is the State's. That's all I was trying to----
    Senator Hutchinson. What I'm trying to say is that I don't 
think you can have it both ways, and I guess the courts will 
ultimately decide that, and I know Mr. Cannon will respond to 
that, but I think what you have just told me in your answer 
really undercuts your argument, and the assurances you are 
giving the agricultural sector flies in the face of your legal 
arguments that you're not subject to the Small Business----
    Ms. Nichols. Mr. Hutchinson, the controls that we're 
talking about, the reason why I'm focusing on agriculture here, 
I'll just try put it in a different way. The emissions that 
agriculture, itself, is causing whether it's their tilling 
practices, or dust blowing from fields, applications of 
fertilizers, etc. As we have looked at those emissions, in most 
instances it's not PM2.5 that they are emitting. 
Addressing those practices is not going to be approvable 
because it isn't going to be solving the problem. That's the 
only reason I'm suggesting that we have some degree of 
assurance that those measures won't be in the plan. It's not 
because we're going to be dictating to the States that they 
shouldn't use them.
    Senator Hutchinson. But you did say that there are areas 
that you do dictate. That there are mandates on the States on 
what they have to have in the implementation plans, and that if 
they don't have them you come in and tell them you must have 
that by law.
    Ms. Nichols. But those are the procedural, or basic 
framework, elements of the plan. They are not the choices of 
the control measures, except to the extent that the Clean Air 
Act may specifically dictate some measures be included.
    Mr. Cannon. I'd like----
    Senator Inhofe. Would you pull the microphone a little 
closer so that we could hear you, Mr. Cannon?
    Mr. Cannon. I think Ms. Nichols has summarized the law 
accurately. There are within the requirements of the statute 
applicable to State implementation plans, specific requirements 
as to the form of those plans and some of the particular 
requirements. But generally the States have at their discretion 
to determine the means and measures by which they are to 
achieve attainment of the standard, and EPA is required to 
approve the plan once submitted. If the State's plan 
demonstrates it's going to----
    Senator Hutchinson. I wonder if you----
    Mr. Cannon. I think Ms. Nichols' point is for agricultural 
enterprises, to the extent that they are not the source of the 
problem----
    Senator Hutchinson. But what if a State decided they were 
to write a plan and they came in with some very stringent 
requirements and regulations on agricultural sector tilling and 
whatever else, but they had enough other measures that would 
bring the State into attainment? They weren't solely dependent 
upon the agricultural changes? In that case they would be in 
compliance with your requirements, correct? I mean you couldn't 
say, ``Take that out because it's unnecessary, because that's a 
focus that's not really essential''?
    Ms. Nichols. Actually, Senator, in my past experience, this 
isn't an issue that we faced in the particular way you're 
describing. But there are many States that have measures on the 
books which are over and above what's called for by the Clean 
Air Act, over and above what's mandatory, and EPA does not make 
those measures federally enforceable. So, in other words, there 
may be on the books some State regulations that are part of the 
State program that they choose to do for whatever reasons, but 
we do not include those----
    Senator Hutchinson. So the reassurances to the farming 
sector are really dependent upon the goodwill and good faith of 
the States, and the implementation plans that they might 
design.
    Ms. Nichols. I think that the reassurance to the States are 
that EPA is not No. 1 either advising or encouraging States to 
do things that would not be effective with respect to looking 
at agriculture and second, that we will give guidance to the 
States as to what they should be looking at based on our 
technical knowledge in this area, and that, again, that's not 
agriculture.
    Senator Hutchinson. So you--I take it you do that now, that 
you give guidance to the States and yet we find many States 
that have standards that exceed the standards of EPA. Some----
    Ms. Nichols. Under the framework of the act, any State is 
always free to set more stringent air standards, and there are 
a number of States in this country that have air quality 
standards that are stricter than EPA's standards. What we do 
try to do is set a floor, the basic level that we believe is 
what the act told us to do for a national air quality standard.
    Senator Hutchinson. Well, I know I have taken a long time. 
It seems to me though, that it's a very tenuous legal position 
to say we're not subject to SBREA, but--because we're leaving 
that to the States, and then to say we give them guidance. We 
tell them the data they've got to have. We give the floor. 
That's, I think, a very tenuous position.
     Administrator Browner in her comments last Thursday to the 
Center for National Policy stated that reducing utility 
emissions was, in her words, the first small step in addressing 
the Nation's air quality problems. What percentage of the 
emissions are you attempting to regulate with these new 
standards, or what percentage of the emissions will come from 
power plants, and what other steps does your agency intend to 
take after reducing utility emissions if those reductions do 
not achieve the first--the desired results? If she's saying 
this is the first step, what do you see is going to come from 
that first step and after the first step, what else has to be 
done?
    Ms. Nichols. The reductions in utility emissions of 
Nitrogen Oxides that we refer to as the OTAG program, or the 
Cap and Trade program, will reduce the percentage of emissions 
by different amounts in different States. But overall, it will 
reduce the contributions that any States are making to the 
interference with attaining or maintaining the standards in 
their downwind States. To a sufficient degree that the new 
areas that won't achieve the ozone standard will be brought 
into attainment, old areas that have not yet achieved the 
standard we believe are capable of reaching attainment with 
what they're already doing to achieve the 1-hour standard 
that's on the books, plus what they'll get from OTAG, from the 
utilities strategies, except for a couple of major urban areas 
which will continue to have serious attainment problems.
    Based on the modeling that we've done to date, New York, 
Chicago, Atlanta, Houston, and Los Angeles are the areas that 
don't come into attainment just as a result of the controls 
that are already on the books or in the process of being 
implemented, including all of the national measures that EPA is 
responsible for, such as cleaner engines for trucks, 
locomotives, buses, etc.
    Senator Hutchinson. So what do they do?
    Ms. Nichols. Those areas will need additional local 
controls, and at this point the kinds of controls that they 
would be looking at would be controls on emissions of volatile 
organic compounds and some additional reductions on Nitrogen 
Oxides emissions. There are a number of technologies----
    Senator Hutchinson. Can you put that in practical terms as 
to what they might have to do?
    Ms. Nichols. Sure. We have listed a number of technologies 
that are coming into play over the next few years. We have not 
specifically put out emissions estimates for these technologies 
because we are talking about a period after the year, 2010, and 
frankly, at this point, we have technologies which have been 
invented, which have been demonstrated, but which have not been 
put into production at a level where we can quantify the exact 
reductions.
    Senator Hutchinson. The year, 2010, sounds very reassuring, 
but my understanding is that the modeling that was conducted 
during the OTAG process showed that even with 85 percent 
reductions in utility emissions in the Eastern United States 
there would be numerous areas still that could not achieve 
attainment under the old ozone standards. So it seems that the 
2010 date is not very reassuring when they can't even comply 
with the existing--with the ozone standards--the old ozone 
standards.
    Thank you, Mr. Chairman.
    Senator Inhofe. Thank you, Senator Hutchinson.
    Senator Sessions, let me just bring you up to date with a 
couple of things that we've been covering. I--I was trying to 
establish from Ms. Nichols, yet admittedly they're not going to 
be implemented until, in the case of ozone, 6 years; in the 
case of particulate matter, 9 years; how she can say that it 
will save lives by doing it today, even though it won't be 
implemented--and I--she has answered me, but I didn't 
understand her answer.
    The other area that we pursued was a statement that was 
made to Senator Landrieu in the Ag Committee meeting, I think 
that's where it was, where they said there are seven parishes 
that would be out of attainment, but that they would be able to 
come back into attainment without any--requiring new controls, 
and this gets into the OTAG thing where you can always plainly 
say well, we are going to control someone to the west of you or 
something like this.
    Then, of course, Senator Hutchinson pursued the issue, 
since he is from an ag State as you and I are, how ag can be 
for all practical purposes exempt, and so that's where we are 
right now.
    Senator Hutchinson.
    Senator Sessions. Sessions.
    Senator Inhofe. Sessions, yes.
    Senator Sessions. Mr. Chairman, it is a--and I am very 
sorry I was not promptly able to return.
    It does appear, would you not agree, Ms. Nichols, that 
there is a focus on the electric power generating industry. 
They are going to take some additional pressures in this 
regard?
    Ms. Nichols. Yes, Senator. We've identified this particular 
sector as the result of the work we did with the States on OTAG 
as the one which has the most available reductions in the sense 
that, in may instances, they have done less to control their 
emissions than many other sectors, and where there are cost-
effective reductions that could be put in place that would make 
a big difference in achieving the--both the old standards and 
the new standards.
    Senator Sessions. But I think there's some concern that 
they're targeting that industry. It has the ability to pass on 
its increased costs directly almost to its customers. They're 
for the most part, until we achieve deregulation, they are 
State controlled monopolies. As Attorney General, we had a 
minor role to play with the Public Service Commission in 
reviewing the rate proposals of the power companies. I've just 
received word, I think the last week that, or earlier this 
week, that TVA plans to increase its rates 5 percent, the first 
increase in 10 years. According to numbers we have from them, 
they spent, let's see, they'll be spending now $4 billion on, 
really I guess the acid rain controls and other previous 
controls, and they're estimating, contrary to what I said 
earlier, $2 billion or another $3 billion to meet these 
standards if they go into effect. Have you--and of course those 
will be paid by rural utilities--Tennessee Valley Authority 
members in Tennessee and Alabama, Mississippi, Georgia, 
wherever. Are you sure you're not asking too much of the 
utility industry, because it will be passed straight to the 
customers?
    Ms. Nichols. Senator, you've raised a very good issue about 
what's going on with the utility industry, and, of course, it 
does differ State by State. Many States are proceeding with 
restructuring of their utilities even before there's a Federal 
mandate to do so. But, in any event, as the industry does 
restructure and as competition becomes more prevalent in the 
industry, there's a great opportunity to both reduce the cost 
of electricity to the consumers and also to deal with the 
pollution problems that this industry does create at the same 
time. Clearly there is a cost, as I indicated earlier. The 
reason why we are in favor of a cap and trade system, which 
would be implemented across State lines and throughout the 
region, is that we believe that you can achieve the greatest 
possible reductions at the lowest cost if you follow the model 
that was used in the acid rain program, because while any 
individual utility may face higher costs if they have to 
install equipment, such as a scrubber, when the entire group of 
companies in a region is participating in a cap and trade 
system, then it's possible for the higher cost utility to 
purchase excess emissions allowances from another utility and, 
in effect, reap the savings for their customers, and when you 
are dealing with a regional pollutant, such as nitrogen oxides, 
we believe that this is a very appropriate way to go about 
reducing the pollution rather than making any one source 
responsible for just what's in their area.
    Senator Sessions. Well, I've got to say that I really can't 
agree with that in the sense that competition may drive down 
costs, which we would hope it would, and that would benefit 
everybody, but if we're going to not benefit from that because 
of pollution controls that are more severe than necessary, then 
we have taken money and allocated resources of this Nation in 
areas that are not a benefit. According to TVA, the proposed 
standards could lead to increased energy costs in the TVA 
region of 11 percent, resulting in 40-50,000 fewer jobs, is 
what I have in a report from them. Have you--does that cause 
you any concern?
    Ms. Nichols. I'm always concerned about cost numbers and 
job figures of that sort, Senator. TVA did actively 
participate, along with many other utilities, in the OTAG 
process, and, as you know, the Department of Energy, which has 
some authority over the TVA, also was very active in the inter-
Agency review process on the standards and on the 
implementation strategy. They have endorsed this cap and trade 
program while recognizing that there's a need to fine tune both 
the allotments and the methodology as we move forward with the 
program. So, it may be that there may be some differences in 
terms of the amounts that different States would have to 
contribute based on their location and their impact on other 
States. But in terms of the general principle that there is a 
need to cap and to allow for cross-border trading, I believe 
that there is general support of that as a method.
    The issue that you raise, of course, is, it needed to clear 
up the air, and I think that on that front we have pretty good 
evidence, based on a ranking of other types of control 
measures, that the utility NOX emissions are at this 
point the single largest factor in terms of creating the cross-
border ozone transport problems.
    Senator Sessions. Well, the concern is that to me--I'll 
just tell you what my concern is. I think that's a way that 
hides the cost. If you said that people had to change their 
automobiles directly, and they're no longer going to have 
diesel engines, they're no longer--this innate--they feel that. 
But if you take--whack the utilities and they pass it along in 
increased rates, nobody really knows what's happened, and I 
know I may be talking about a subject people don't want to talk 
about anymore, but there are two nuclear reactors in the TVA 
system sitting idle today, one of them 80 percent complete, 
that would have polluted--provided no air pollution, and EPA 
regulations or the international energy--nuclear energy 
regulations have really stopped that, and that's been a real 
burden on the whole power industry in the Tennessee valley. So, 
I wanted to raise that point.
    Did you discuss the fact that in the implementation 
standards that you've issued, or made public, are the vast 
majority of areas that do not currently meet the new ozone 
standards will be able to do so without any addition new 
pollution controls and measures? Is that the position--that's 
your position on that?
    Ms. Nichols. Yes, Senator Inhofe, I think----
    Senator Sessions. You discussed that, you think, 
thoroughly?
    Ms. Nichols. Well, I'll be happy to go further if you----
    Senator Sessions. I don't want to----
    Senator Inhofe. Further, maybe he'll----
    Senator Sessions. I'd just like to know how you can reduce 
them without any burden on anyone.
    Ms. Nichols. Well, Senator, I think maybe there is a 
missing word of ``local'' in that sentence, and, if so, we 
should clarify the point. I think the point there is that with 
the OTAG controls, with the utility cap and trade system in 
place, we believe there is not a reason or a necessity for 
additional local control measure in the areas that meet today's 
ozone standard, but will not meet the 8-hour new standard. In 
other words, those areas which today are essentially marginal, 
they are close to the old standards, they don't quite make the 
new standards. Because of the regional benefits of the capping 
of the utility emissions, those areas will be able to come into 
attainment with that plus the additional cleaner cars, cleaner 
fuels, and other measures that are already being provided by 
the Federal Government, in effect, that are already part of 
today's Clean Air Act. So the point is that there would not be 
a need for local controls on businesses in those areas.
    Senator Sessions. So then you are going to take it out of 
the utility industry?
    Ms. Nichols. Sir, I hate to sound like a defender of the 
auto industry, and they probably wouldn't want me to do it. But 
I would say that if you look at the amount that they have 
controlled and the amount that has been already passed on to 
consumers, in order to clean up those tailpipe emissions, we 
are talking, in the case of cars, about reductions of 90 
percent twice over, and at cost levels that well exceed the 
$1500 per ton that we believe is what it's going to cost for 
these NOX controls. Admittedly, the consumer is the 
one who ultimately sees these costs. There's no question about 
that. But we believe that those costs are quite modest in 
comparison with the costs that have already been borne by other 
industries.
    Senator Sessions. What about the particulate matter, the PM 
count, how much are you expecting out of utilities on that, and 
can--will they be able to meet the burden in utilities alone?
    Ms. Nichols. Clearly at this point, Senator, we are not in 
a position to spell out the entire control program for 
PM2.5. We do know that the acid rain program that is 
in effect today for controlling sulfur emissions from utilities 
will achieve about 40 percent of the reductions that we think 
are needed for PM2.5. So, in other words, this 
industry has already made, or is in the process of making a 
very significant down payment on controls of PM2.5. 
The NOX reductions that we are hoping to get from 
the OTAG program will also help with PM2.5. One of 
the benefits of doing both the ozone and the PM standards at 
the same time is that we can, in effect, take credit for 
measures that really will work for both, because the Nitrogen 
Oxide emissions, in addition to forming ozone, also are causing 
formation of nitrates which are one of the large ingredients of 
the fine particle problem. So, I think at this point it is fair 
to say that these controls we are looking at under OTAG will 
get us to where we need to go, at least for the next decade or 
so. After that I can't say.
    Senator Sessions. You are not prepared to say what other 
industries that you'd be--that would be expected to bear 
burdens to get the PM standards in attainment?
    Ms. Nichols. Well, sir, I think in general what we know 
about PM2.5 today is that it's primarily a product 
of combustion of fuels. So it's undoubtedly looking at all 
sorts of combustion sources and looking at the quality of the 
fuels. But we really do want to do further research before we 
pinpoint which specific types of control measures would be the 
most beneficial.
    Senator Sessions. Let me ask you this, Ms. Nichols, let's 
say that we're not supposed to worry about this because it's 
going to be 6 years before it takes effect. Why don't we wait 
about 3 years, and do a lot of research in the interim, and 
maybe we could identify particular types of emissions that are 
more particularly health adverse, and utilize those resources. 
Again we are spending American citizens resources in the most 
effective way. Would you respond to that thought?
    Ms. Nichols. Senator, I think, maybe I would just go back 
to the structure of the Clean Air Act, which is unique among 
Federal environmental statues, at least to my knowledge, in 
that it sets ambitious goals, clearly says set the goal without 
regard to the cost, just based upon your public health 
information, the best science that you have, and then take your 
time and work out the attainment strategies. Over time, we 
think this approach has worked in the sense that we've seen 
time and time again that when you set a goal, even if it's an 
ambitious goal and at the time industry didn't know how they 
would attain, if you give them the time and the flexibility to 
get there, that they will come up with innovative controls. We 
think the market-based approach that Congress wrote into the 
1990 amendments and urged us to use is a further way to make it 
clear that we shouldn't just be using prescriptive regulations 
to get there.
    But ultimately, without a goal, people don't know where 
they are trying to head, and they don't make the kind of 
investments in research that are really necessary. I'm not just 
talking about health research or monitoring research. I'm 
really talking about the kinds of things that can only be done 
by the private sector when they look at what kinds of 
technologies and processes they can come up with. So having the 
standard out there, as we have done, gives them that target. We 
hear from industry frequently if we give them the time to do 
it, that they can meet standards. What they don't want is to be 
told precisely how to do it.
    Senator Sessions. Well, I agree that the American and much 
of the world's business community is incredibly efficient and 
if they have to do something, they will. But we need to be sure 
as public policy that what we ask them to do is the best thing 
for them to do. If it's going to cost $30 billion to meet an 
ozone standard that maybe is not necessary to meet, we could--
if TVA had $3 billion, goodness knows what we could do for the 
Tennessee River. We could buy huge tracts of land, preserve it 
for species and environmental concerns that could be there for 
the rest of our lives.
    So I think we've got to think in terms of that. I just 
don't believe that the science is so clear that you can reach 
that level that the act triggers in that you've got to act 
today. I don't believe that you have to act today under the 
act. One more question and I'll finish. What is the EPA's 
latest evaluation of the cost of meeting both the PM and ozone 
standards?
    Ms. Nichols. I just want to turn to the summary of the RIA 
here. For the particulate matter and ozone standards combined--
--
    Senator Sessions. If you could break them up that would be 
helpful?
    Ms. Nichols. I'll do both for you. For the combined 
standards, the partial attainment costs are $9.7 billion, and 
of that the particulate matter cost is $8.6 billion and the 
ozone cost is $1.1 billion.
    Senator Sessions. Is that annually?
    Ms. Nichols. These are--yes, these are annual numbers.
    Senator Sessions. Well, I think there'll be much 
disagreement about that. Are you aware of the Scientific 
American article of January or December, earlier this year in 
which it discussed the fact that decline in particulate matter 
contributes to acid rain?
    Ms. Nichols. No, sir, I'm not.
    Senator Sessions. A lot of the particulate matter are base 
that neutralize acid, and really it was a very interesting 
article. So I just point that out to say that if we knew more 
about what type of items were causing the environmental damage, 
the--we could expend our resources better.
    Mr. Chairman, I congratulate you on the work that you've 
done. The Alabama Department of Environmental Management has 
testified at your hearing in Oklahoma that our State would go 
from two counties, I think, out of attainment to at least 20, 
and perhaps 67. This would be a major detriment to the economic 
growth of Alabama. There've been a lot of studies done that 
state that poverty is an adverse health factor--perhaps one of 
the clearest--poorer people are less healthy. If increased 
attainment targets keep us from being competitive in the world 
market, a plant may not be built in Alabama. It may be built in 
Mexico or Brazil.
    The County Commissioners in Jefferson and Shelby Counties 
are working to improve the air and they're making progress. 
They're going to be awfully depressed if they are faced with 
new standards that they cannot possibly meet. They are making 
progress at great effort, and they expressed their concerns to 
me. There's a county just outside of Birmingham--a rural county 
that oddly has one of the testing machines--it appears it will 
be out of attainment if you increase the standard, and it has 
almost no industry. So we don't want to hurt the working 
Alabamians and the working Americans.
    I think we've don't want to have a fuss over this issue. I 
certainly don't. But I think we're going to have one because 
I'm not going to participate in a procedure that has marginal, 
if any, health benefits, but significantly adverse economic 
benefits the people of my State.
    Ms. Nichols. Mr. Sessions.
    Senator Sessions. Yes.
    Ms. Nichols. If I could just comment on one point that you 
made. First of all, I agree with you. You think you need to be 
satisfied that we've carried out our responsibilities properly 
and we do welcome your oversight.
    I did want to say something about the counties that you 
mentioned though, because I think that there's quite a bit of 
misapprehension or misinformation. Perhaps it was based on some 
of the ranges that were in the proposal which came out last 
November. We do have data and we have to be cautionary because 
it is current data. It doesn't reflect new monitoring that will 
be done. But the information that I have indicates that there 
are four counties in Alabama that don't meet today's .08 8-hour 
standard with the fourth maximum concentration. That would be 
Clay, Jefferson, Madison, and Shelby counties based on what we 
know today. That there are two, and this is only based on, 
again, current data, not with all the new monitoring in place, 
that would be Etowa and Mobile, that wouldn't meet the 
PM2.5. Now obviously we have more work to do, and we 
realize that we've got to come up with measures that people 
will feel can be met. But we do want to assure you of our 
desire to work with you on that and to work with your State to 
come up with a program that will succeed.
    Senator Sessions. Well, the problem is that we don't have 
the monitors. There is a monitor, I think, in Clay County, 
which is a rural county, and it's put it out of attainment. The 
other counties don't have monitors, and we upped the standards 
and put out more monitors. Someone has been there for 30 years, 
a champion of clean air for the State and Nation, and he says 
this is going to be impossible to meet. He predicts that over 
20 counties will be out of attainment. So I don't know where it 
would actually come out.
    Ms. Nichols. Well, we need to put the monitors out there. 
Our plan for the monitoring is that we will be putting out 
about 1500 across the entire country for the basic Federal 
monitoring network. We've sought the funding for the Federal 
Government to pay so we don't put that burden on the States, 
and our belief is that with 1500 monitors we'll be 
concentrating on the major populations centers. From the point 
of view of cost-effectiveness, of controls, and of actually 
meeting the health goals, it doesn't make sense to be sticking 
the monitors in the middle of rural areas, at least to begin 
with. We need to be trying to measure what the impacts are on 
the population centers first.
    Senator Sessions. Well, that's an odd approach, I mean, it 
seems the rules should be kept even wider. So those are my 
concerns, Mr. Chairman. I do recall in this room some weeks ago 
we had the physician from Pennsylvania, emergency room 
physician, and he was most articulate, and he documented how a 
few million dollars, this kind of money that we are expending 
on this, how many lives it would actually save in the emergency 
rooms, such as proposals to get people there quicker and better 
equipment all over American rural and small towns. He said you 
could actually save tremendous numbers of lives. He was very 
passionate about that, and he thought that it was unwise for us 
to deal with a situation that was very ephemeral and uncertain, 
and ignore an area that was certain. So I think that's where we 
are coming from.
    Ms. Nichols. No, I hear you. I mean, I think it's a very 
valid point. I guess the only thing that I would say in 
response, and I realize this is sort of back to the Clean Air 
Act again, but I think the concept behind the law is that this 
is something, that is the air, that every single American 
experiences. The costs may be more focused, but the effects are 
felt by everybody to some degree or another. So, perhaps, in a 
way you could say that it's, you know, the lungs of the people 
that are the one's that are really paying the cost of the 
existing levels of pollution, and we need to do a better job of 
measuring it. There's no question about that. To quantify it, 
to try to put a monetary value on things that can be monetized. 
But when you get down to it, it is to some degree an issue 
about values, about, you know, what the public wants.
    Senator Sessions. Well, I think we want improved health for 
America, and I have no doubt that the people expect us to spend 
their resources in the most efficient way to improve their 
health. That's what we're struggling with.
    Thank you, Mr. Chairman.
    Senator Inhofe. Ms. Nichols, I want to be sure that we 
don't leave that figure of $9.7 billion unchallenged in this 
meeting, because I have not seen anyone who has done an 
analysis of what they would anticipate the cost to the American 
people that's anywhere near that low of a figure. The Reasoner 
Foundation out in California came out with a range from $90 
billion to $150 billion a year. Now that--this is big. It means 
an average family in Alabama of four would have to pay about 
$1,600 a year. I mean, this is big.
    I also have to observe that, it kind of reminds me of 
something I heard a long time ago when I first got into 
politics. When you talk about tax increases they say, ``Don't 
tax me. Don't tax thee. Tax that guy behind the tree.'' That's 
exactly what you guys are doing. You're saying well, this isn't 
going to affect the U.S. Conference of Mayors and the cities 
and communities. This isn't going to affect the farm, the ag 
community. This isn't going to affect small business, just 
those big, tall smokestacks out there. It just isn't true. You 
have to know it isn't true.
    Now let me ask you as far as the statement that was made 
during the meeting out in California, to the U.S. Conference of 
Mayors--``don't worry, you're not going to be affected by 
this.'' Do you agree with that?
    Ms. Nichols. I'm not sure what statement----
    Senator Inhofe. Well, let me ask you the question. Do you 
think that these communities are going to be adversely affected 
in terms of us saying what they have to do, or telling the 
States to tell them what they have do to, and that is an 
unfunded mandate? Do you feel it's not an unfunded mandate?
    Ms. Nichols. I am convinced that setting air quality 
standards is not an unfunded mandate. If the question is, is 
there a validity to the statement that controls on power plants 
are the strategy we will be pursuing, it seems to me that you 
have the best assurance that you can get in the form of the 
directive that the President sent to the Administrator, the 
implementation strategy that was published in the Federal 
Register, and the reality that from a cost-effectiveness 
standpoint it is the place that we should go. I think you would 
want us to turn to the most cost-effective strategies first, in 
order to attain----
    Senator Inhofe. Well, politically speaking, it's more 
convenient to go after the big, bad guys, and that's what they 
always do. We're experiencing that over there with a lot of 
issues. But, you know, I'm trying not to use disrespectful 
language, but I think the most moderate I can be to 
characterize what you guys have been doing to the American 
people, I think you have been blatantly dishonest with the 
American people. To try to make people believe that they don't 
have to have any new inconveniences out there in terms of when 
they harvest their crop, when they run their diesel engines, 
and all these things and say it's just going to be found in a 
few smokestacks. It's just not honest.
    Ms. Nichols. Well, Senator. You alluded earlier to the fact 
that I was planning to return to California and back to the 
private sector again, and so perhaps I could be indulged just 
for a moment in reminding people that being from the place in 
the country that has the worst air pollution in the Nation, and 
that has done the most and achieved the most to achieve those 
standards, perhaps I have a certain amount of confidence that 
it is possible to make huge progress and at the same time have 
a very successful economy as well.
    I just have to say to you that I don't know how we could be 
more forthright in terms of our commitment to pursuing the most 
cost-effective strategies first when it comes to these new 
standards. We realize that we are setting an ambitious target. 
That's why we have tried to provide the time, and the road map, 
if you will, as to how we would hope to get there. We realize 
there is time involved and we want to work with you to make 
sure----
    Senator Inhofe. Ms. Nichols, we are rapidly running out of 
time. We only have 7 more minutes, and I--there were some 
things I wanted to get to and briefly I'm just going to touch 
on this. An Oklahoma company, it was Citgo out there, are you 
familiar with the work that they have done in placing the 
PM2.5 monitors in different locations in Texas, 
Oklahoma, and Louisiana in order to see what the results would 
be, and they found the following areas in violation of the new 
standards: a parking garage, a festival grounds, a tall grass 
prairie, outside a house, a beach, and the highest level was 
inside a building in the Tulsa Zoo. Does this surprise you?
    Ms. Nichols. Yes it does, especially considering that the 
standard is an annual average standard, I'd find that somewhat 
surprising. I'd be happy to take a look at the report and----
    Senator Inhofe. Well, I think it would probably be a good 
idea because you know it's not always government that is out 
there trying to analyze the effects.
    Senator Inhofe. When you're looking at something as huge as 
this, it's important that we rely on, not our absence of 
knowledge, but knowledge that might be there. It might be 
produced by someone besides government. I have such a hard time 
accepting the fact that we are giving serious consideration to 
setting standards, not implementing them, telling the American 
people that this is going to save lives. I've kind of tracked 
the early deaths, the premature deaths that this Administration 
and that the EPA have cited, starting out with some 40,000 and 
edging down. The same as I have watched the costs that you have 
said and anticipated would be out there, and yet in the private 
sector we find the cost would be so much greater.
    I'm disturbed because--yes, I'm from an agricultural State, 
we have other industries, too, but I don't have any doubt in my 
mind after looking at this that this is going to be a huge 
thing. I mean, how can you say that it's not going to affect 
small business if their electric rates go up somewhere between 
8 and 11 percent? It does have an effect. I was going to pursue 
a couple of things that came out in the Agriculture Committee, 
but it doesn't look like we're going to have time to do that.
    Let me just mention this one thing, though. I have a copy 
of a letter that was sent to Congressman Kucinich. I don't know 
Congressman Kucinich. I may not be pronouncing his name right. 
It was dated May 16, 1997, explaining to him that two 
facilities in his district would not be impacted by these 
standards. In that letter, and was this from the Administrator 
Browner? It's from Ms. Nichols. It's from you. ``These counties 
likely would not have met the proposed new ozone or PM 
standards had these standards been in place during 1993-95. The 
most recent 3-year period for which we have complete data. 
However, based on current data, it is likely that nothing other 
than continued implementation of the 1990 Clean Air Act, plus 
the application of a regional control strategy''--I guess you 
are talking about OTAG there--``in the Eastern United States 
which will focus on power plants, large industry sources, and 
new autos will be necessary in order to meet the new ozone 
standards.'' And you end by saying, ``It is not likely that 
either county''--two counties, this is in Ohio, I believe; is 
it Ohio?--``would require additional local controls in order to 
meet the new ozone standards.'' So here we are in Ohio, and 
they are pointed at as the one who is creating the problem for 
other States, and you're saying in these two areas that these 
two industries are not going to have to make any changes. They 
are not going to be involved in this.
    Ms. Nichols. Again, Senator Inhofe, the letter refers to 
the OTAG modeling work as the basis for that assessment about 
what those counties would be doing, or what would be expected 
about their air, and the reason for that is that what the 
modeling shows is that the benefit of the NOX 
controls are greater, the closer to the source that you are. 
So, since Ohio does have a number of the large, NOX 
generating utilities that we're referring to, they will 
actually be getting the greatest benefit in terms of being able 
to reach the ozone standard in the counties in Ohio, and that 
was the point of the letter.
    Senator Inhofe. So here's two counties in Ohio that have 
both an automobile manufacturing plant and an auto casting 
plant, and you say that they're not going to have any 
additional controls in those areas?
    Ms. Nichols. These are counties, I believe, I am not 
certain I am reflecting this, but my recollection is that they 
are counties that have been in nonattainment in the past and 
have already implemented a number of new source review and 
other kinds of requirements that are in place. We're not saying 
those controls would go away. What we are saying is that the 
benefits of the control strategy for the utilities are such 
that we believe that that would alone bring them into 
attainment under the new standard as well.
    I think the chemistry of this pollutant is perhaps a little 
counter-intuitive and one of the things that we've learned over 
the many years that we've been controlling ozone is that this 
issue about how NOX affects air quality over long 
distances is one that has become clearer over a period of time. 
But it does appear to be quite well agreed to now by all the 
scientists----
    Senator Inhofe. Ms. Nichols, we're out of time here. I 
would only observe that I believe the American people are 
smarter, and are not going to buy into the idea that each 
individual is going to be exempt. It's just going to be that 
guy behind the tree, and I haven't heard anything else that has 
come from this meeting that has convinced me otherwise.
    We are out of time. I appreciate very much your being here 
and I wish you the best of luck in your career as it goes west.
    Ms. Nichols. Thank you.
    Senator Inhofe. Thank you.
    [Whereupon, at 11:54 a.m., the subcommittee was adjourned, 
to reconvene at the call of the chair.]
 Statement of Hon. Joseph I. Lieberman, U.S. Senator from the State of 
                              Connecticut
    Thank you Mr. Chairman for holding this important hearing on 
implementation issues. This is a critical area and requires careful 
attention from Congress.
    I have been very supportive of setting standards on a health-basis 
using the most recent scientific evidence. EPA has weighed a large 
amount of data and developed the revised standards to protect public 
health.
    I have continued to express concern about ensuring that the 
standards are implemented in a sensible, equitable and cost-effective 
manner, with full consideration of costs, and adequate time for 
attaining the standards. The President has committed that these 
standards will be implemented in a way that does not cause economic 
dislocations, and it is critical that regulatory agencies pay close 
attention to the process. The burden must be equitable. Downwind states 
must not bear unfair costs because pollution sources in upwind states 
have not been controlled adequately.
    First, and most importantly, it is critical that EPA implement on 
an expedited basis the strategy for controlling emissions of pollutants 
from areas upwind of the Northeast. Downwind states are in a grossly 
inequitable position. Without prompt and strong followup on this 
commitment, EPA's promise of cleaner air in a cost-effective, equitable 
and effective manner will not be fulfilled. EPA's attention to the 
transport problem must not stop there. Its policies under both the old 
and new standard must recognize the transport phenomenon and ensure 
that areas are not unfairly penalized for being downwind of communities 
with massive air quality problems.
    Second, I'm concerned that EPA's plan raises some equity issues 
between current and new nonattainment areas. These need to be addressed 
promptly. We also need to ensure that EPA has not unduly loosened 
requirements in areas that contribute to downwind pollution.
    Third, we need to pay close attention to ensure that the timeframe 
for implementation is adequate.
    Fourth, we need to examine how EPA has applied some of the 
requirements of the old standard in the context of the new standard and 
whether that approach makes sense.
    These are just some of the issues that need to be addressed during 
the implementation process. There is considerable dispute about costs 
of implementation which ultimately will be determined during the 
implementation process. Concern about costs underscores the need for 
paying close attention to implementation.
                                 ______
                                 
  Statement of Hon. Max Baucus, U.S. Senator from the State of Montana
    Senator Inhofe, I'd like to start by thanking you for convening 
this hearing. And I'd also like to thank Assistant Administrator Mary 
Nichols for her testimony today.
    Since EPA released its proposal for new ozone and PM2.5 
standards, we have heard from just about everyone interested in this 
issue. Scientists, industry, farmers and ranchers, environmentalists, 
health professionals and State and local governments. And EPA has also 
received over 50,000 comments both pro and con.
    Those comments have shown that while clean air is neither easy nor 
inexpensive, the importance of protecting public health cannot be shown 
on a balance sheet. The fact remains that air pollution has costly 
impacts on our workforce, health care system, environment, and our 
quality of life.
    Exposure to ozone makes breathing difficult for the young and the 
old. Furthermore, particulate emissions are causing people to die 
prematurely. And, although we don't have all the answers, we need to 
take action now to improve the quality of our nation's air.
    But despite the great importance of this issue or maybe because of 
it we have had difficulty talking calmly and thoughtfully about how to 
get the clean air our citizens want in a way that makes sense for our 
local economies. For instance, this Spring there was great hysteria 
among folks who were told that the EPA was preparing to snuff out their 
barbecues. This summer farmers in my State of Montana were told that 
the EPA was going to force them to change the way they do their jobs. 
But Administrator Browner has assured us on the record that neither of 
these things are true.
    In addition, the Administrator responded to our concerns about 
implementing these new standards. EPA's strategy will give areas more 
time to meet the new standards. It creates a program to deal with the 
ozone transport problem helping many downwind areas meet the new 
standard without having to adopt any new controls. And it sets up a 
monitoring system that will help scientists answer some of the 
questions about fine particles that have generated so much debate.
    EPA predicts that by achieving the new PM2.5 standard, 
premature deaths will be reduced by 38 percent each year. That is an 
impressive statistic. But no lives will be saved if states can't meet 
the new standards. It's time to put the last several months behind us 
and get on with the job at hand. Namely, helping EPA and the states 
identify the most sensible, cost-effective ways to implement these new 
standards.
    So, Mr. Chairman, I look forward to Ms. Nichols' testimony and 
today's discussion about how we will proceed in implementing these new 
standards. I believe that EPA is headed in the right direction. It is 
this Committee's responsibility to ensure that happens, and I look 
forward to working with the Administration to be sure it does. We must 
implement these standards in a way that makes sense for our economy and 
provides cleaner air for all Americans.
    Thank you Mr. Chairman.
                                 ______
                                 
Prepared Statement of Mary D. Nichols, Assistant Administrator for Air 
             and Radiation, Environmental Protection Agency
    Mr. Chairman, Members of the Subcommittee, thank you for inviting 
me to discuss implementation plans for the Environmental Protection 
Agency's (EPA's) revisions to the national ambient air quality 
standards for ground-level ozone and particulate matter.
    As you know, the Clean Air Act directs EPA to set national 
standards for certain air pollutants to protect public health and the 
environment. For each of these pollutants, Congress directed EPA to set 
what are known as ``primary'' standards to protect public health 
without consideration of cost and ``secondary'' standards to protect 
public welfare, including the environment, crops, vegetation, and so 
forth for which costs may be considered. Under the Act, Congress 
directs EPA to review these standards every 5 years to determine 
whether the latest scientific research indicates a need to revise them.
    Last week, EPA set new standards for ozone and particulate matter 
that will be a major step forward in public health and welfare 
protection. Each year, these updated standards have the potential to 
prevent as many as 15,000 premature deaths; as many as 350,000 cases of 
aggravated asthma; and as many as one million cases of significantly 
decreased lung function in children.
    Numerous other public health and welfare benefits will result from 
implementation of the new standards. Additional public health benefits 
would include: reduced respiratory illnesses, reduced acute health 
effects, reduced cancer from air toxics reductions, and the avoidance 
of various other air pollution-related illnesses and health effects. 
Public welfare benefits will include: reduced adverse effects on 
vegetation, forests, and natural ecosystems, improved visibility, and 
protection of sensitive waterways and estuaries from deposition of 
airborne nitrogen that can cause algal blooms, fish kills, and loss of 
aquatic vegetation. Estimated total monetized health and public welfare 
benefits associated with the new standards are enormous, ranging in the 
tens of billions of dollars annually. Many additional potentially large 
benefit categories, such as reduced chronic respiratory damage, infant 
mortality, and other health and welfare benefit categories, cannot be 
monetized.
    The new ozone and particulate matter standards are based on an 
extensive scientific and public review process. Congress directs EPA to 
consult with an independent scientific advisory board, the Clean Air 
Scientific Advisory Committee (CASAC). In conducting these reviews, EPA 
analyzed thousands of peer-reviewed scientific studies that had been 
published in well-respected scientific journals. These studies were 
then synthesized, along with a recommendation on whether the existing 
standards were adequately protective, and presented to CASAC. After 
3\1/2\ years of work, 11 CASAC meetings totaling more than 125 hours of 
public discussion, and based on 250 of the most relevant studies, the 
CASAC panel concluded that EPA's air quality standards for ozone and 
particulate matter should be revised. CASAC sup- 
ported changing the ozone standards from a 1-hour averaging period to 
an 8-hour average to reflect increasing concern over prolonged exposure 
to ozone, particularly in children. CASAC also supported adding a fine 
particle standard. Fine particles are inhaled more deeply into the 
lungs.
    EPA then proposed updated standards and conducted an extensive 
public comment process, receiving approximately 57,000 comments at 
public hearings across the country and through written, telephone and 
E-mail message communications.
    As a result of this extensive process, the final standard for ozone 
will be updated from 0.12 parts per million (ppm) of ozone measured 
over 1 hour to a standard of 0.08 ppm measured over 8 hours, with the 
3-year average of the annual fourth highest concentrations determining 
whether an area is out of compliance. The new standard also reduces 
``flip-flopping'' in and out of attainment by changing it from an 
``expected exceedance'' to a ``concentration-based'' form. For 
particulate matter, EPA is adding new standards for particles smaller 
than 2.5 micrometers in diameter (known as PM2.5 or fine 
particles). The fine particle standard will have two components: an 
annual standard, set at 15 micrograms per cubic meter and a 24-hour 
standard, set at 65 micrograms per cubic meter. EPA has also changed 
the form of the current 24-hour PM10 standard; this will 
provide some additional stability and flexibility to states in meeting 
that standard.
    We believe it is critical to move forward with these standards now. 
The American public deserves to know whether its air is healthy or not. 
The standards we have set serve as an essential benchmark for people to 
use in understanding whether the air they are breathing is safe. In 
addition, the standards will encourage early action to help reduce 
adverse health effects as soon as possible. By setting the standards 
now, states will be able to proceed with the monitoring and planning 
requirements needed for implementing them over the next several years. 
For PM2.5, areas can begin to develop inventories and 
characterize the nature of their PM2.5 problem. As I will 
now discuss, we have developed an implementation strategy through an 
extensive interagency consultative process to assure that concerns of 
State and local governments and affected industries, such as 
transportation and agriculture, are addressed. This strategy will allow 
states and local areas the time they need to implement these standards 
in a cost-effective and reasonable way.
              implementation of the revised air standards
    In the interagency process leading up to the issuance of these 
standards, EPA worked with other Federal agencies to develop an 
implementation strategy for implementing the standards. In a memorandum 
signed July 16, 1997, President Clinton set forth several general 
principles for implementing the standards, and directed EPA to follow 
the interagency implementation strategy. I would like to summarize the 
principal features of that strategy for you today.
    Achieving the air quality benefits of the updated standards 
requires a flexible, common sense, cost-effective means for communities 
and businesses to meet the standards. The President's implementation 
package has four basic features, all of which can be carried out under 
existing legal authority:
    1. Implementation of the air quality standards is to be carried out 
to maximize common sense, flexibility, and cost effectiveness;
    2. Implementation shall ensure that the Nation continues its 
progress toward cleaner air by respecting the agreements already made 
by States, communities, and businesses to clean up the air, and by 
avoiding additional burdens with respect to the beneficial measures 
already underway in many areas. Implementation also shall be structured 
to reward State and local governments that take early action to provide 
clean air to their residents; and to respond to the fact that pollution 
travels hundreds of miles and crosses many State lines;
    3. Implementation shall ensure that the Environmental Protection 
Agency (`Agency') completes its next periodic review of particulate 
matter, including review by the Clean Air Scientific Advisory 
Committee, within 5 years of issuance of the new standards, as 
contemplated by the Clean Air Act. Thus, by July 2002, the Agency will 
have determined, based on data available from its review, whether to 
revise or maintain the standards. This determination will have been 
made before any areas have been designated as `nonattainment' under the 
PM2.5 standards and before imposition of any new controls 
related to the PM2.5 standards; and
    4. Implementation is to be accomplished with the minimum amount of 
paperwork and shall seek to reduce current paperwork requirements 
wherever possible.''
            strategy for meeting the revised ozone standard
    Ozone is a pollutant that travels great distances and it is 
increasingly important to address it as a regional problem. For the 
past 2 years, EPA has been working with the 37 most eastern states 
through the Ozone Transport Assessment Group (OTAG) in the belief that 
reducing interstate pollution will help all areas in the OTAG region 
attain the NAAQS. A regional approach can reduce compliance costs and 
allow areas to avoid most traditional nonattainment planning 
requirements. The OTAG was an effort sponsored by the Environmental 
Council of States, with the objective of assessing ozone transport and 
recommending strategies for mitigating interstate pollution.
    The OTAG completed its work in June 1997 and forwarded 
recommendations to EPA. Based on these recommendations, in September 
1997, EPA will propose a rule requiring states in the OTAG region that 
are significantly contributing to nonattainment, or interfering with 
maintenance of attainment, in downwind states to submit State 
implementation plans (SIPs) to reduce their interstate pollution. EPA 
will issue the final rule by September 1998.
    If the states choose to establish a voluntary regional emission cap 
and trade system, similar to the current acid rain program, reductions 
can be at a lower cost. EPA will encourage and assist the states to 
develop and implement a NOX cap and trade program. Most 
important, based on EPA's review of the latest modeling, a regional 
approach, coupled with the implementation of other already existing 
State and Federal Clean Air Act requirements, will allow the vast 
majority of areas that currently meet the 1-hour standard but would not 
otherwise meet the new 8-hour standard to achieve healthful air quality 
without additional local controls.
    Areas in the OTAG region that would still exceed the new standard 
after the regional strategy, including areas that do not meet the 
current 1-hour standard, will benefit as well, because the regional 
NOX program will reduce the extent of additional local 
measures needed to achieve the 8-hour standard. In many cases these 
regional reductions may be adequate to meet CAA progress requirements 
for a number of years, allowing areas to defer additional local 
controls.
                  phase-out of 1-hour ozone standards
    EPA's revised ozone standard will replace the current 1-hour 
standard with an 8-hour standard. However, the 1-hour standard will 
continue to apply to areas not attaining it for an interim period to 
ensure an effective transition to the new 8-hour standard.
    As you know, the Clean Air Act includes provisions (Subpart 2 of 
part D of Title I) that address requirements for different 
nonattainment areas that do not meet the 1-hour standard (i.e., those 
classified as marginal, moderate, serious, severe and extreme). These 
requirements include such items as mandatory control measures, annual 
rate of progress requirements for emission reductions and emission 
offset requirements. All of these requirements have contributed 
significantly to the improvements in air quality since 1990. Although 
EPA initially proposed an interpretation of the Clean Air Act that 
would have been more flexible in how these provisions applied to 
existing ozone nonattainment areas after promulgation of a new ozone 
standard, based on comments received, EPA has reconsidered its 
interpretation and EPA has concluded that these provisions should 
continue to apply as a matter of law for the purpose of achieving 
attainment of the 1-hour standard. Once an area attains the 1-hour 
standard, those provisions and the 1-hour standard will no longer apply 
to that area. An area's implementation of the new 8-hour standard would 
then be governed only by the provisions of Subpart 1 of Part D of Title 
I.
    The purpose of retaining the current standard is to ensure a smooth 
legal and practical transition to the new standard. It is important not 
to disrupt the controls that are currently in place as well as those 
that are underway to meet the current ozone standard. These controls 
will continue to be important to reach the new 8-hour standard.
            general time line for meeting the ozone standard
    Following promulgation of a revised NAAQS, the Clean Air Act 
provides up to 3 years for State Governors to recommend and EPA to 
designate areas according to their most recent air quality. In 
addition, states will have up to 3 years from designation to develop 
and submit SIPs to provide for attainment of the new standard. Under 
this approach, areas would be designated as nonattainment for the 8-
hour standard by 2000 and would submit their nonattainment SIP by 2003. 
The Act allows up to 10 years plus two 1-year extensions from the date 
of designation for areas to attain the revised NAAQS.
                      transitional classification
    For areas that attain the 1-hour standard but not the new 8-hour 
standard, EPA will follow a flexible implementation approach that 
encourages cleaner air sooner, responds to the fact that ozone is a 
regional as well as local problem, and eliminates unnecessary planning 
and regulatory burdens for State and local governments. A primary 
element of the plan will be the establishment under Section 172(a)(1) 
of the CAA of a special ``transitional'' classification for areas that 
participate in a regional strategy and/or that opt to submit early 
plans addressing the new 8-hour standard. Because many areas will need 
little or no additional new local emission reductions to reach 
attainment, beyond those reductions that will be achieved through the 
regional control strategy, and will come into attainment earlier than 
otherwise required, EPA will exercise its discretion under the law to 
eliminate unnecessary local planning requirements for such areas. EPA 
will revise its rules for new source review (NSR) and conformity so 
that states will be able to comply with only minor revisions to their 
existing programs in areas classified as transitional. During this 
rulemaking, EPA will also reexamine the NSR requirements applicable to 
existing nonattainment areas, in order to deal with issues of fairness 
among existing and new nonattainment areas. The transitional 
classification would be available for any area attaining the 1-hour 
standard but not attaining the 8-hour standard as of the time EPA 
promulgates designations for the 8-hour standard. In terms of process, 
areas would follow the approaches described below based on their 
status.
    (1) Areas attaining the 1-hour standard, but not attaining the 8-
hour standard, that would attain the 8-hour standard through the 
implementation of the regional NOX transport strategy for 
the East.
    Based on the OTAG analyses, areas in the OTAG region that would 
reach attainment through implementation of the regional transport 
strategy would not be required to adopt and implement additional local 
measures. When EPA designates these areas under section 107(d), it will 
place them in the new transitional classification if they would attain 
the standard through implementation of the regional transport strategy 
and are in a State that by 2000 submits an implementation plan that 
includes control measures to achieve the emission reductions required 
by EPA's rule for states in the OTAG region. This is 3 years earlier 
than an attainment SIP would otherwise be required. We anticipate that 
we will be able to determine whether such areas will attain the revised 
ozone standard based on the OTAG and other regional modeling and that 
no additional local modeling would be required.
    (2) Areas attaining the 1-hour standard but not attaining the 8-
hour standard for which a regional transport strategy is not sufficient 
for attainment of the 8-hour standard.
    To encourage early planning and attainment for the 8-hour standard, 
EPA will make the transitional classification available to areas not 
attaining the 8-hour standard that will need additional local measures 
beyond the regional transport strategy, as well as to areas that are 
not affected by the regional transport strategy, provided they meet 
certain criteria. To receive the transitional classification, these 
areas must submit an attainment SIP prior to the designation and 
classification process in 2000. The SIP must demonstrate attainment of 
the 8-hour standard and provide for the implementation of the necessary 
emissions reductions on the same time schedule as the regional 
transport reductions.
    (3) Areas not attaining the 1-hour standard and not attaining the 
8-hour standard.
    The majority of areas not attaining the 1-hour standard have made 
substantial progress in evaluating their air quality problems and 
developing plans to reduce emissions of ozone-causing pollutants. These 
areas would be eligible for the transitional classification provided 
that they attain the 1-hour standard by the year 2000 and comply with 
EPA's regional transport rule, as applicable.
         areas not eligible for the transitional classification
    Existing nonattainment areas which cannot attain the 1-hour 
standards by 2000 will not be eligible for the transitional 
classification. However, their work on planning and control programs to 
meet the 1-hour standard by their current attainment date will take 
them a long way toward meeting the 8-hour standard. While areas will 
need to submit an implementation plan for achieving the 8-hour standard 
within 3 years of designation as nonattainment for the new standard, 
such a plan can rely in large part on measures needed to attain the 1-
hour standard. For virtually all of these areas, no additional local 
control measures beyond those needed to meet the requirements of 
Subpart 2 and needed in response to the regional transport strategy 
would be required to be implemented prior to their applicable 
attainment date for the 1-hour standard. This approach allows them to 
make continued progress toward attaining the 8-hour standard throughout 
the entire period without requiring new additional local controls for 
attaining the 8-hour standard until the 1-hour standard is attained.
           implementing the new particulate matter standards
    Implementing the new particulate matter standards will require a 
different path from the one I just discussed for ozone. As required 
under the Act, within the next 5 years EPA will complete the next 
periodic review of the particulate matter criteria and standards, 
including review by the CASAC. As with all NAAQS reviews, the purpose 
is to update the pertinent scientific and technical information and to 
determine whether it is appropriate to revise the standards in order to 
protect the public health with an adequate margin of safety or to 
protect the public welfare. EPA has concluded that the current 
scientific knowledge provides a strong basis for the revised 
PM10 and new PM2.5 standards. We, along with the 
Departments of Transportation, Health and Human Services, Labor, and 
others, will continue to sponsor research to better understand the 
causes and mechanisms, as well as the effects of fine particles on 
human health, and the species and sources of PM2.5. EPA will 
also promptly initiate a new review of the scientific criteria on the 
effects of airborne particles on human health and the environment. By 
July 2002, we will have determined, based on data available from its 
review, whether to revise or maintain the standards. This determination 
will have been made before any areas have been designated nonattainment 
under the PM2.5 standards and before imposition of any new 
controls related to the PM2.5 standards.
              implementation of new pm2.5 naaqs
    The first priority for implementing the new PM2.5 
standard is establishing a comprehensive monitoring network to 
determine ambient fine particle concentrations across the country. The 
monitoring network will help EPA and the states determine which areas 
do not meet the new air quality standards, what the major sources of 
PM2.5 in various regions are, and what action is needed to 
clean up the air. EPA and the states will consult with affected 
stakeholders on the design of the network and will then establish the 
network, which will consist of approximately 1,500 monitors. All 
monitors will provide for limited ``speciation,'' or analysis of the 
chemical composition, of the particles measured. At least 50 of the 
monitors will provide for a more comprehensive speciation of the 
particles. EPA will work with states to deploy the PM2.5 
monitoring network. Based on the ambient monitoring data we have seen 
to date, these would generally not include agricultural areas. The EPA 
will fund the cost of purchasing the monitors, as well as the cost of 
analyzing particles collected at the monitors to determine their 
chemical composition.
    Because we are establishing standards for a new indicator for 
particulate matter (i.e., PM2.5), it is critical to develop 
the best information possible before attainment and nonattainment 
designation decisions are made. Three calendar years of monitoring data 
that complies with EPA's monitoring requirements will be used to 
determine whether areas meet or do not meet the PM2.5 
standards. Three years of data will be available from the earliest 
monitors in the spring of 2001, and 3 years of data will be available 
from all monitors in 2004. Following this monitoring schedule and 
allowing time for data analysis, Governors and EPA will not be able to 
make the first determinations as to which areas should be designated 
nonattainment until at least 2002, 5 years from now. The Clean Air Act, 
however, requires that EPA make designation determinations (i.e., 
attainment, nonattainment, or unclassifiable) within 2 to 3 years of 
revising a NAAQS. To fulfill this requirement, in 1999 EPA will issue 
``unclassifiable'' designations for PM2.5. These 
designations will not trigger the nonattainment planning or control 
requirements of Title I of the Act.
    When EPA designates nonattainment areas for PM2.5 
pursuant to the Governors' recommendations beginning in 2002, areas 
will be allowed 3 years to develop and submit to EPA pollution control 
plans showing how they will meet the new standards. As for ozone, areas 
will have up to 10 years from the date of being redesignated as 
nonattainment until they will have to attain the PM2.5 
standards. In addition, two 1-year extensions are possible.
    In developing strategies for attaining the PM2.5 
standards, it will be important to focus on measures that decrease 
emissions that contribute to regional pollution. Available information 
indicates that nearly one-third of the areas projected to not meet the 
new PM2.5 standards, primarily in the Eastern United States, 
could come into compliance as a result of the regional SO2 
emission reductions already mandated under the Clean Air Act's acid 
rain program, which will be fully implemented between 2000 and 2010. 
Similarly, the Grand Canyon Visibility Transport Commission, consisting 
of western states and tribes, committed to reductions in regional 
emissions of PM2.5 precursors (sulfates, nitrates, and 
organics) to improve visibility across the Colorado Plateau.
    As detailed PM2.5 air quality data and data on the 
chemical composition of PM2.5 in different areas become 
available, EPA will work with the states to analyze regional strategies 
that could reduce PM2.5 levels. If further cost-effective 
regional reductions help areas meet the new standard, EPA will 
encourage states to work together to use a cap and trade approach 
similar to that used to curb acid rain. The acid rain program delivered 
environmental benefits at a greatly reduced cost.
    Given the regional dimensions of the PM2.5 problem, 
local governments and local businesses should not be required to 
undertake unnecessary planning and local regulatory measures when the 
problem requires action on a regional basis. Therefore, as long as the 
states are doing their part to carry out regional reduction programs, 
the areas that would attain the PM2.5 standards based on 
full implementation of the acid rain program will not face new local 
requirements. Early identification of other regional strategies could 
also assist local areas in completing their programs to attain the 
PM2.5 standards after those areas have been designated 
nonattainment.
    The EPA will also encourage states to coordinate their 
PM2.5 control strategy development and efforts to protect 
regional visibility. Visibility monitoring and data analysis will 
support both PM2.5 implementation and the visibility 
program.
            implementation of revised pm10 naaqs
    In its rule, EPA is revising the current set of PM10 
standards. Given that health effects from coarse particles are still of 
concern, the overall goal during this transition period is to ensure 
that PM10 control measures remain in place to maintain the 
progress that has been achieved toward attainment of the current 
PM10 NAAQS (and which provides benefits for 
PM2.5) and protection of public health. To ensure that this 
goal is met, the existing PM10 NAAQS will continue to apply 
until actions by EPA, and by states and local agencies, are taken to 
sustain the progress already made.
                cost-effective implementation strategies
    Consistent with states' ultimate responsibility to attain the 
standards, EPA will encourage the states to design strategies for 
attaining the particulate matter and ozone standards that focus on 
getting low cost reductions and limiting the cost of control to under 
$10,000 per ton for all sources. Market-based strategies can be used to 
reduce compliance costs. EPA will encourage the use of concepts such as 
a Clean Air Investment Fund, which would allow sources facing control 
costs higher than $10,000 a ton for any of these pollutants to pay a 
set annual amount per ton to fund cost-effective emissions reductions 
from non-traditional and small sources. Compliance strategies like this 
will likely lower the costs of attaining the standards through more 
efficient allocation, minimize the regulatory burden for small and 
large pollution sources, and serve to stimulate technology innovation 
as well.
                           future activities
    In accordance with the President's July 16 directive, to ensure 
that the final details of the implementation strategy are practical, 
incorporate common sense, and provide for appropriate steps toward 
cleaning the air, input is needed from many stakeholders including 
representatives of State and local governments, industry, environmental 
groups, and Federal agencies. EPA will continue seeking advice from a 
range of stakeholders and, after evaluating their input, propose the 
necessary guidance to make these approaches work. In particular, EPA 
will continue working with the Subcommittee on Implementation of Ozone, 
Particulate Matter and Regional Haze Rules which EPA established to 
help develop innovative, flexible and cost-effective implementation 
strategies. Moreover, EPA will continue to work with a number of 
Federal agencies to ensure that those agencies comply with these new 
standards in cost-effective, common sense ways. EPA plans to issue all 
guidance and rules necessary for this implementation strategy by the 
end of 1998.
    EPA will continue to work with the Small Business Administration 
(SBA) because small businesses are particularly concerned about the 
potential impact resulting from future control measures to meet the 
revised PM and ozone standards. EPA, in partnership with SBA, will work 
with the states to include in their SIPs flexible regulatory 
alternatives which minimize the economic impact and paperwork burden on 
small businesses to the greatest possible degree consistent with public 
health protection.
                              conclusions
    In summary, EPA believes that the new ozone and particulate matter 
standards will provide important new health protection and will improve 
the lives of Ameri- 
cans in coming years. Our implementation strategy will ensure that 
these new standards are implemented in a common sense, cost-effective 
and flexible manner. We intend to work closely with State and local 
governments, other Federal agencies and all other interested parties to 
accomplish this goal.
    Mr. Chairman, this concludes my written statement. I will be happy 
to answer any questions that you might have.

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