Staff report to the National Commission on Water Quality

[From the U.S. Government Printing Office, www.gpo.gov]

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VICE PRESIDENT NELSON A. ROCKEFELLER FREDERICK J. LARKE
CHAIRMAN EXECUTIVE DIRECTOR
SENATOR EDMUND S. MUSKIE TELEPHONE
REPRESENTATIVE ROBERT E. JONES 202 254-7806
VICE CHAIRMEN
PUBLIC MEMBERS
EDWIN A. GEE National Commission on Water Quality
WILLIAM R. GIANELLI
RAYMOND KUDUKIS 1111 18TH STREET. N. W.
R. LADD DAVIES P. 0. Box 19266
U. S. SENATORS
JENNINGS RANDOLPH WASHINGTON, D. C. 20036
LLOYD M. BENTSEN
HOWARD H. BAKER, JR.
JAMES L. BUCKLEY

U. S. REPRESENTATIVES
JAMES C. WRIGHT, JR. April 30, 1976
HAROLD T. JOHNSON
WILLIAM H. HARSHA CENTER'
JAMES C. CLEVELAND

MEMORANDUM TO: Chairman

SUBJECT: Staff Report

I am pleased to transmit the Report of the Staff to the

National Commission on Water Quality.

F. J. CLARKE
Executive Director

CHAPTER I.
I

f. INTRMUCTION

and

SUMKARY OF FINDINGS

I. INTRODUCTION AND SUMMARY OF FINDINGS

Table of Contents
Page

INTRODUCTION

Objectives, Goals and Policies . . . . . . . . . . . . . . . . . I-1
Requirements and Deadlines . . . . . . . . . . . . . . . . . . . 1-2
Commission Charge . . . . . . . . . . . . . . . . . . . . . . . . 1-3

SUMMARY OF FINDINGS . . . . . . . . . ... . . . . . . . . . . . . . . 1-7

I. Progress Under the 1977 Requirements . . . . . . . . . . . . . . 1-7

A. Technological Aspects -- 1977 . . . . . . . . . . . . . . . . 1-8
Publicly Owned Treatment Works -- 1977 . . . . . . . . . 1-8
Industries -- 1977 . . . . . . . . . . . . . . . . . . . 1-14
B. Sociai Effects and Benefits -- 1977 . . . . . . . . . . . . . 1-19
C. Environmental Effects -- 1977 . . . . . . . . . . . . . . . . 1-20

II. Effects of Achieving or Not Achieving the Effluent
Limitations and Goals Set Forth for 1983 . . . . . . . . . . . . 1-25

A. Technological Aspects -- 1983 . . . . . . . . . . . . . . . . 1-25
Publicly Owned Treatment Works -- 1983 . . . . . . . . . 1-25
Industries -- 1983 . . . . . . . . . . . . . . . . . . . 1-27
B. Economic Effects -- 1983 . . . . . . . . ... . . . . . . . . 1-29
Industrial Impacts . . . . . . . . . . . . . . . . . . . . 1-29
General Effects on the Economy, 1975-1985 . . . . . . . . 1-35
Supply Constraints . . . . . . . . . . . . . . . . . . .. 1-37
C. Social Effects and Benefits -- 1977 and 1983 . . . . . . . . 1-37
D. Environmental Effects -- 1983 . . . . . . . . . . . . . . . . 1-43

III. Technologica 1 Aspects pmd Economic Effects of 1977
and 1983 Requirements Applied to Agriculture . . . . . . . . . . 1-46

A. Feedlots . . . . . . . . . . . . . . . . . . . . . . . . . . 1-47
B. Irrigation Return Flows . . . . . . . . . . . ... . . . . . . 1-47
C. The Colorado -- A Special Case 1-51
D. Agricultural Nonpoint Sources 1-52

Page

IV. Institutional Factdrs Influencing "Achieving or Not Achieving,
the Effluent Limitations and Goals Set Forth for 1983 1-53

A. Regulation 1-55
B. Financing . . . . . . . . . . . . . . . 1-60
C. Planning . . . . . . . . . . . . . . . . . . . . . . . . . . 1-64
D. Public Participation . . . . . . . . . . : * , * . . . . . . 1-66
E. Participants and Practitioners -- Adversaries or Foes 1-68

V. "What Will Remain to Be Done after 1983" 1-70

A. Elimination of the Discharge of Pollutants The 1985 Goal 1-70
Selected Nonpoint Sources Other than Agriculture . . . . . . 1-73
Silviculture and Timber Harvesting . . . . . . . . . . . 1-74
Construction . . . ... . . . . . . . . . . . . . . . . . 1-74
Inactive Mines . . . . . . . . . . . . . . . . . . . . . 1-74
subsurface Disposal . . . . . . . . . . . . . . . . . . . 1-75
Salt Water Intrusion . . . . ... . . . . . . . . . 1-75
C. The "Objective" of the Act . . . . . . . . . . . . . . . . . 1-76

INTRODUCTION

The Federal Water Pollution Control Act Amendments of 1972, Public Law
92-500, expanded the Federal role in water pollution control. It raised
the level of Federal funding for construction of publicly owned waste
treatment works, elevated planning to a new level of significance, empha-
sized public participation, and created a regulatory mechanism requiring
uniform technology-based effluent limitations or more'stringent limita-
ticns if required to meet water quality standards. As a mean-s of
enforcement, it instituted a national permit system for all point source
dischargers.

OBJECTIVES, GOALS AND POLICIES-

Congress specified requirements, goals and objectives to be achieved
within stated time frames. The objective of the Act is to "restore and
maintain the,chemical, physical, and biological integrity of the Nation's
waters." In addition, there are two goals and eight policies.

The goals are:

o To reach, "wherever attainable," a water quality that
11 provides for the protection and propagation of fish,
shellfish, and wildlife" and @'for recreation in and on
the water" by July 1, 1983.

0 To eliminate the discharge of.pollutant8 into navigable
waters by 1985.

-The policies arei

0 To prohibit the discharge of toxic pollutants in toxic
amounts.

0 To provide Federal financial assistance for-construction
of publicly owned treatment works.

0 To develop and implement areawide waste treatment manage-
ment planning.,,

0 To mount a major research and.demonstration. effort in
wastewater control and-treatment technology.

To recognize,Ipreserve and protect the primary responsi-
bilities and roles of the states to prevent, reduce and
eliminate pollution.

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0- To insure, where possible, that foreign natio'ns act to
prevent, reduce and eliminate pollution in international
waters.

� To provide for, encourage and assist public participation
in executing the Act.

� To pursue procedures that drastically diminish paperwork
and interagency decision procedures and prevent needless
duplication and unnecessary delays at all levels of
government.

REQUIREMENTS AND DEADLINES

-The Act calls for reaching these ends in phases, with accompanying
requirements and deadlines.

iridustry is required to install "best practicable control technolo4y
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currently availableill and publicly owned treatment works to achieve secon-
dary treatment by July 1, 1977. Both must also install "more stringent
limitations, to meet (state or Federal) water quality standards.

The 1983 requirements are intended to be more rigorous and innovative.
Industries are to install "best available technology economically achiev-
able . . . which will result in reasonable further progress toward the
national goal of eliminating the discharge of all pollutants." Publicly
owned treatment works are to achieve "best practicable waste treatment
technology . . . including reclaiming and recycling of water, and confined
disposal of pollutants." Each must met those requirements, as well as.
any water quality related effluent limitation, by July 1, 1983.

Ultimately, all point source controls are directed toward achieving
the national goal of elimination of discharge of pollutants by 1985.

The Act embodied a new approach to the use of water resources. Some
mechanisms are found in Title I, the broad policy title. others are woven
throughout the Act in the grants and planning sections, in standards and
enforcement and in permits.

The Act requires comprehensive programs to prevent, reduce and elimi
nate pollution. It further calls.for research and development to reduce
unnecessary water use. The statute directs the designation of areawide
institutions to plan and to identi -fy institutions within the area to con-
trol and maintain water quality and.reduce pollution from all sources by
land use or other methods.

Construction grants for publicly owned treatment works are made avail-
able to encourage full waste treatment managemento including:

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"M the recycling of potential sewage pollutants through
the production of agriculture, silviculture, and aquaculture
products, or any,combination thereof;

"(2) the confined and contained disposal of pollutants
not recycled;

"(3) the reclamation of wastewater; and

I'M the ultimate disposal of sludge in a manner that
will not result in environmental hazards.11

Grantees are urged to join with other facilities, to encourage indus-
trial use of publicly owned facilities, and to-raise revenues through its
operation.

These provisions outline a long-term programto reduce water usel curb
the generation of wastes, and establish financially self-sustaining publicly
owned treatment and pollution control facilities.

Congress recognized it was placing demands on people, technology, the
economy.and public and private institutions which, ultimately, would deter-
mine the success of the program. It was uncertain whether the required
technologies, existed; how the new law's implementation might affect society,
the economy and the environment; and how.well the institutional system
would or could respond to this demanding new law. To provide guidance in
these areas of uncertainty in time for the next Congressional examination
of the Nation's water pollution control program, the Congress established
a'National Commission on Water Quality.

COMMISSION CHARGE

The Commission was established by Section 315 of the Law. Its mandate
is to determine if a mid-course correction is needed, and to report its
findings, conclusions and recommendations to the Congress within three
years.

The Commission's charge is to:

make a full and complete investigation and study of
all of the technological 'Aspects of achieving, and all
aspects of the total economic, social,@..and environmental
ef f ectsi of achieving or not, achieving, the ef f luent limi-,
tations and goals set forth for 1983 in,secti6n 301(b)(2)
of this Art.

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The Commission agreed "that a comprehensive study of.the goals and-
requirements for 1983 cannot be properly undertaken without attention to
the progress made toward clean water by industries and municipalities
under the 1977 re quirements." It stated that it would "examine progress
toward the 'elimination of.the discharge of pollutants' as an indicator
.of what will remain to be done after 1983."

The Commission focussed pr 'imarily on the goal and effluent limitations
for 1983, and the effects of applying those limitations. No study could
assess all the far-reaching implication of.each of the Act's provisions.
Limitations of data, time and resources, and evolving knowledge and issues
restrict what could be accomplished.

.Among issues orquestiong which the Commission did not study, or.d.id
not study in sufficient detail for definitive conclusions, are:

0 Alternatives to the strategy of Public Law 92-500 to
control discharges through regulation based on permits;

0 Additional Federal financial incentives; C)

9 Control of nonpoint sources and impacts of applying controls;

Relationship of pollutants to public health; and

Impacts on ground water.

Nevertheless, the results of the Commission's analysis constitute a
major undertaking and provide new and useful information on a broad range
of inportant issues to be found in the@follbwing components of this report:

Chapter II -- An analysis of the capabilities and costs of
technology for achieving the effluent limitations
required by 1977 and 1983, as well as a look at what
xemains to be done after 1983;

Chapter iI -- An assessment of the capability of the public and
private sectors to &pply the defined effluent limitations
for 1977 and 1983, as well as those more stringent to
protect water.qualityl

Chapter III -- An analysis of the economic effect of the cost of
applying the necessary technolo les on both a macro-
s 91
economic and mi6roecon"oihic scale -- as well as the social
effects of these changes;

Chapter IV A desckiption of present water quality and environ-,..
mental (water-based and related terrestrial) conditions,
and projections of anticipAted change which may result
from implementation of the Act.

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Chapter V An assessment of the public and private response as
the institutional segments finance, implement, manage
and enforce the nation's water pollution control program.

Chapter VI -- Identification of the effects in several selected
regions of the nation.

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C A V E A T

The Commission staff particularly wishes to emphasize that:

1. Commission studies performed by contractors often provide a range
of costs and benefits for differing technologies, conditions or assumptions.
Complete and reliable data were not always available covering all questions
the Commission and contractors have analyzed; every effort is made to
explain methodologies.and to qualify estimates in the full text of the
Commission staff report. In the following summary, reflecting this vari-
ability has been sacrificed for the sake of brevity. Therefore, all cost
and expenditure estimates and quantified statements of effects should be
regarded as staff best professional judgment, rather than as exact measures
of these items. The staff recognizes that others might have chosen other
figures for different reasons.

2. Many of the.source documents -- EPA.prescribed effluent limitations,
standards, regul ations, guidance documents and supporting reports -- ha-@e
been, and manystill are, undergoing repeated revision by EPA during the
course of the Commission's studies. Since analysds had to begin on fixed
dates and proceed to completion on short time schedules., documentation
avdilable at the time of initiating contractor studies is the basis for
the results. Where later EPA publications are likely significantly to
affect the results, the staff has attempted to note that fact.

3. Numerical data contained in the report represent the best estimates
of the Commission staff or the Commission's contractors.

4. Estimates are often presented using excessively significant fi gures,
even though the staff recognizes that*a particular value may, at best,
reflect an approximate point falling withfn a range. such a range may be
large or small, depending upon the quality of.i:he data base from which the
,value is derived. The fact that a range exists is implicit in all data.

5. Any projection or estimate of future consequences cited in numerical
terms constitutes the best judgment by the staff, assuming an implicit set
of conditions. Any interpretation to the contrary is unwarranted.

6. The summary which follows represents the condensation of six.
chapters. Those who wish to pursue some subject discussed in the summary
in more detail should examine the full report.

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CHAPTER I.

SUMMARY OF FINDINGS*'

Public law 92-500 requires the application of progressively stringent
uniform pollution control and treatment requirements'to both.publicly
owned systems, industrial and agricultural dischargers by July 1, 1977
and July 1, 1983. The questions of technological availability, the adapt-
ability and uniformity ofits application to both the public and privately-
owned systems, the costs and associated projected economic impacts, and
the predicted environmental improvements are the primary focus of this
chapter.

The most salient questions that must be addressed by those who wish
to examine the Act, its progress, its problems and its potentials, are
here: Does the technology exist for BPT and BAT, can it be applied, at
what costs and economic impacts, with what expectation for environmental
improvement and, perhaps most important, with what alacrity of purpose
are the various governmental institutions pursuing the Act's implementa-
tion?

What follows attempts to examine these questions in the light of the
findings of the Commission's studies. TI-& framework applied is essentially
the incremental one of the Act, itself, dealing -- first -- with the appli-
.cation of the 1977 requirements; next, with the 1983 requirements; and,
beyond that, the prospects for achieving the goal@of elimination of the
discharge of pollutants and the objectives of restoring and maintaining
the "chemical, physical, and biological integrity of the Nation's waters."

I. PROGRESS UNDER THE 1977 RE2UIREMENTS

Analysis of the prospects of achievement of the goals and objectives
of the Act must necessarily begin with the implementation of the first
phase. Looking at the progress under the 1977 requirements has proven an*
essential prerequisite to the Commission's primary charge to examine
effects of achieving or not achieving the 1983 effluent limitations and
goals. Thus, recognizing now, over three years after enactment, that
achievement of the 1977 requirements is severely delayed at least in
the public sector -- it is legitimate to ask:

*All dollar figures stated herein are in June, .1975, dollars.

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QUESTION: What will be the effects of the delay in achievement of
the 1977@requirements on the timetable for "achieving or
,not achieving the effluent limitations and goals set
forth for 1983?"

ANSWER: Slow progress.toward achieving secondary treatment by
publicly owned treatment works by July 1, 1977, will
delay achievement of "best practicable waste treatment
technology over the life of the works" by 1983. Simi-
larly, buit.to a lesser degree, industries and agriculture
not achieving "best practicable control technology cur- . I
rentZy available" by July 1, 1977, will delay achievement
of "best available technology economically achievable" by
July 1, 1983.

Not achieving the- 1977 requirements by the statutory deadlines will,
as Commission studies indicate, delay achievement of the 1983 interim
water quality goal "wherever attainable" and may, in some geographic areas,
result in further water quality degradation before restoration begins. The
longer the delay., the more uncertain the prediction of future change.

Extended delay in achieving both 1977 and 1983 requirements will
preclude water quality improve ment in some areas, and may even allow degra-
dation to occur in certain instances. For other areas, contributions from
nonpoint sources may negate the positive effects of achieving both the 1977
and 1983 requirements, regardless of the pace of progress toward their
achievement.

A. technological Aspects 1977

Publicly Owned Treatment Woiks 1977

OuEsTlm Is se'conda--y treatment for publicly owned treatment works,
as defined by the Administrator of the Environmental Pro-
tection Agency, technoZogicalZy achievable?

ANSWER: Yes.

As interpreted by EPA, the 1977 requirement for secondary treatment and
the 1983 requirement fok."best practicable waste treatment technology over
the life of the works (13PWTT)" are virtually synonymous. EPA has inter-
preted BPWTT as requiring secondary treatment. Only where water quality

1-9

standards necessitate it is a level of treatment beyond secondary required,
and this is applicable to the 1977 requirement, as well as the 1983.

Thus, the real issue As to technological-achievability in relation to
publicly owned treatment works involves consideration of reg@ilatory inter-
pretation and administrative flexibility, rather than technological
feasibility,

Rigid interpretation by EPA of the statutory directive in P.L.92-500
to'define secondary treatment has raised significant issues. Among them
are: (1) Should there be,separate "effluent limitations based upon secon-
dary treatment" for different technologies such as activated sludge, trick-
ling filters, waste stabilization lagoons and physical-chemical treatment?
(2) Is disinfection (chlorination) A -legitimate part of a secondary
treatment definition? and (3) Should the same secondary treatment definition
be required for all ocean dis6harges?

Moreover, there is evidence of a rigidity on the part of both Federal
and state officials toward affecting the application of the statutory
directive to "encourage the recycling of potential sewage pollutants
through the production of agriculture, silviculture, or aquaculture pro-
ducts." Many of the states rigidly adhere to the requirement for secondary
treatment as a prerequisite to land application of wastewater from publicly
owned treatment works. Land application may not be the universal panacea
that its proponents contend, but it has unquestionable adaptability to many
smaller publicly owned systems where it can provide both efficient and
least-cost options. Far broader application, however, can be made of land
for the disposal of-municipal sludges for either crop production or land-
filling. major deterrents to the use of treated sewage or sludge,are
health concerns over the effects on humans from the consumption of the
food crop, and institutional problems.

The latter can be severe. Large metropolitan areas must invariably
seek disposal sites in neighboring, less settled or rural areas since
suitable quantities @f land are not available within most municipal bound-
aries. Such disposal is often unacceptable to the receiving jurisdiction,
and the costs of transport and energy expenditure can push costs beyond
the level of practicality.

in any event, sludge production and the problem of its eventual dispo-
.sition present maJor by-products of the technological treatment process,
especially as treatment becomes more advanced. The estimated 1972 raw
sludge production from publicly owned treatment works was 4.7 million tons
(dry weight)i with an expected increase to about 16 million tons (dry
weight) by 1990, exclusive of separate stormwater sewer control (category
VI). Processes which convert sludge to gases (portions of which are usable
as fuel) can reduce the 1990 amount to about 12 million tons (dry weight).
.Control of separate stormwater systems could add 4 million tons of raw

1-10

sludge (dry weight) in 1990, but this type sludge is.not easily converted
to gases. Dewatering sludge is difficult, and will be even more difficult
as higher levels of treatment become operable; large quantities of water
will accompany the sludge to disposal sites or will require evaporation.

The Commission's assessment of the technologies of publicly owned
treatment works placed operation and maintenance costs for categories I
through V (all except control and treatment of stormwaters in separate
sewers) at more than $2.0 billion per year by 1990 in excess of that
required for 1973. In the same analysis, annual operating manpower is
projected to increase from an estimated 107,000 people to adequately
cperate existing facilities in 1973, to 185,000 people by 1990, when the
facilities reach their design capacity, exclusive of separate stormwater
sewer control (category VI). Control of separate stormwater systems could
require an additional 24,000 people in 1990.

Electric energy demands are estimated to increase from 7.6 to 21.0
billion kilowatt-hours per year; fossil fuels from 72,000 to 87,000 billion
BTUs per year, both exclusive of separate storm sewer control (category VI),
Converting the two types of energy.to a common base, an increase of 106
percent over 1973 energy demand for publicly owned treatment works is pro-
jected, equivalent to 27.0 million barrels of oil per year (74,000 barrels
per day). The increase amounts to 0.20 percent of-the 1973 national
energy use, while the total energy requirement equals 0.41 percent. Con-
trol of separate stormwater systems could add 16,000 barrels per day to
the 1990 requirement.

QUESTION: What are the estimated capital costs for installing the
needed treatment technologies and improvements to comply
with the requirements of the Act?

ANSWER: The Commission's best estimate of the capital costs by
categories for plants reporting a need for secondary
treatment only (category 1), $10.8 billion; for plants
reporting a need for treatment more stringent than secon-
dary (category 11), $24.8 billion; infiZtrationlinflow
correction (category III-A), $6.9 billion; major sewer
system rehabilitation (category III-B), $9.5 billion;
new collectors (category IV-A), $13.0 billion; and new
interceptors (category 1-V-B), $13.5-bilZion; is $78.5
billion.

Estimated costs to meet the 1977 requirements include capacity to ac-
commodate the projected 1990 United States sewered population (210 million,
or 82 percent of 256 million). Costs also include the collection and treat-
ment of industrial wastes discharged into publicly owned treatment works.

The cost estimates for categories I and II include both secondary
treatment and more advanced treatment where necessary to achieve water
quality standards. Of the $35.6 billion total in these two categories,
$27.3 billion is for secondary and $8.3 billion is for advanced treat-
rent to meet water quality standards. These cost estimates for treatment
works are predicated upon their providing an effluent adequate to meet
the 1983 interim water quality goalstated in P.L. 92-500.

EPA has not thus far included combined sewer overflows and separate
stormwater sewers within "publicly owned treatment works" that must
comply with their definition of secondary treatment. Therefore,
Commission cost estimates for correction of combined sewer overflows
(category V) depend upon the treatment or control technology selected,
ranging from $17.0 billion for disinfection only, to $89.0 billion for
secondary treatment. The estimated cost of primary treatment for all
systems discharging to effluent limited waters and secondary treatment
for discharges to water quality limited waters is $79.6 billion of
which $63.7 billion is for storage facilities. While $79.6 billion has
been included in all Commission cost estimates to maintain the tech-
nology based effluent limitations, technologies designed on a site-by-
site basis might prove adequate to'meet water quality standards even
though they would not achieve the same degree of effluent reduction
as those priced here./' Some of.these site specific options are discussed
in Chapter II.

Commission cost estimates for control or treatment of stormwaters in
urbanized areas of the nation's 243 Standard Metropolitan Statistical
Areas (category VI) depend upon treatment or control technology chosen,
ranging from $160 billion for removal of debris, to $430 billion for
physical-chemical treatment. The estimated cost for removal of suspended
solids and disinfection to destroy bacteria is $199 billion, of which $92.3
billion is for collection and storage. Adding these last two costs (cate-
gory V, $79.6 billion; and category VI, $199 billion) to those for cate-
gories I through IV produces a total publicly owned treatment works cost
of $357.1 billion. EPA believes that capital construction is not the most
cost effective solution to'storm sewer pollution and is concentrating on
non-capital intensive management practices. The estimated costs of only
those categories (categories I, II and IV-B) for which the vast majority
of Federal funds is currently being spent, are $49.1 billion.

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QUESTION: Will all publicly owned treatment works achieve
required treatment by July 1, 1977?

ANSWER: No. Achievement iis dependent primarily on Federal
funding. universal secondary treatment by publicly
owned treatment works cannot be achieved by July 1,
1977. Achievement requires sufficient money, manpower
and material assured at an annual rate to meet whatever
deadline date is chosen. When this requirement can be
achieved depends on Congressional authorization and
appropriation, and Presidential approval of adequate
sums to fund the Federal share, as well as on the rate
at which local, state and Federal agencies can formulate,
finance and approve projects within the funded categories.
Engineering design and construction manpower must be
available to,!complete the approved and funded projects.
There must be no shortage of construction materials,
supplies and treatment equipment.

The rate of construction of publicly owned treatment works is deter-
mined principally by the level of Federal funding. A schedule of estimated
expenditures., including funding of all publicly owned treatment works cate-
gories under P.L.92-500 by 1985 (except control and treatment of separate
storm sewer flows), could be structured as follows:

Amount - Calendar Year
(Billions, 1975 $) Achieved

I Secondary treatment $ 10.8 1980
Ii Treatment more stringent .1
than secondary 24.8 1980
III-A Correction (infiltration/inflow) '6.9 1985
III-B Sewer rehabilitation 9.5 1985
IV-A Collector sewers 13.0 .1985
IV-B Interceptor sewers 13.5 1980
Minimum Maximum
V Combined sewers $.:17.-0 79.6 $ 89.0 1985
Subtotal $ 95.5 $158.1 $167,5
VI Control of stormwaters 158.0 199.0 427.0

Total [email protected] $357.1- $594.5

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A condition for achieving this schedule is that secondary treatment,
treatment more stringent than secondary and interceptor sewer expendi-
tures would be gi,@en priority over other categories,* and would be met
by 1980, while all other categories,,except control and treatment of
separate storm sewer flows, would be met by 1985. -'@he 1973 expenditures
for all categories eligible for Federal funding were shared 75 percent
Federal, and an average of-7 percent state and 18 percent local. Fund-
ing of selected categories would vary these percentage shares of total
expenditures; changing the target year for achievement of the various
categories would alter the distribution and the impact. Full or partial
funding of the Federal share of estimated expenditures for controlling
or treating separate storm sewer flows could add as much as $199.0 billion
and considerably alter the impact. Without increments for inflation,
to achieve the above pattern for categories I through V in eleven years
would requireTederal appropriations and commitment ranging from
$2.6 billion in the first year to $15.6 billion in the last two years.
Future inflation could require increasing any pattern of Federal expendi-
tures selected now; the total for,the eleven-year example here could
be increased to $184.4 billion.

Costs to individual communities will vary both with the magnitude
of the need and by the size"of the community, with highest costs to
the'small communities that gain no economies'of'scale, Thus, while
some communities will have no costs becau.�e'.they have no needs, a
small community with population less than 5,000 could incur per capita
costs of more than $200 if it--had to provide treatment beyond secondary.
The crucial determinant of the local share of total expenditures is the
degree to which Federal and state governments subsidize local costs to
install sewers, correct combined sewer overflows'and control or treat
separate stormwater sewer flows.

More than two-thirds of-publicly owned treatment works capital
expenditures are usually financed with bonded.debt. 'Prop6rty taxes
are used by a significant numberof communities especially to repay
capittal borrowing. Sewer service charge use has grown from 20 percent
of all municipalities in 1945-to 61 percent in@1960 and 85 percent
in 1969.

While future financial prospects are.not encouraging for many
state and local governments, bearing,their proportionate.share of
expenditures for construction of publicly owned treatment works
rIequired by P.fL. 92-500 will not gei@erally constitute a major demand
on expected revenues. Rather,@the financial condition of state and
local governments.might'affect their' capacities to.,respond to projected
required operation and maintenance bxpenditures for these plants.. If
state and local revenues and expenditures were to c6fitinue to.increase
according-to historical trends, 21.-states.ana 21 "local aggregates"'

1-14

could face fiscal problems in the period 1975-1980 and 44 states and 40
"local aggregates" would have!difficulty in the 1980-1985 period, assuming
the 11-year program outlined here.

optimum operating performance of publicly owned treatment plants is
essential to achievement of the intended water quality improvement. A
1974 survey revealed that only some 67-70 percent of treatment plants for
which adequate data were available were meeting operating design criteria,
while 56 percent of the.plants surveyed did not have adequate data avail-
able to evaluate performance. Monitoring requirements to comply with
current grant and permit procedures will enable a much more accurate
evaluation of future performance. Operator training is inadequate to
supply current needs, and accelerated completion of publicly owned treat-
ment works will require more trained operatorsand higher technical levels
of training to assure optimum operation of more so@histicated plants.

Industries 1977

QUESTION: Is "best practicable control technology curr 'ently avail-
able," as defined for industrial dischargers, technolo-
gicaZZy achievable?

ANSWER: Generally, yes. Exceptions are some short-term limits
and water constituents or mixed wastewater streams.

"Best practicable control technology currently available" for control-
ling, reducing or treating industrial wastewaters adequately to conform
with the 1977 requirements is available. Generally, these technologies
are "end-of-pipel." as opposed to prodess change. In defining BPT for
industrial discharges, the Environmental Protection Agency apparently
expects a higher reliability from the technology than is likely to be
realisitc in actual performance. Thus, some technologies intended to meet
1977 requirements, even if they exactly duplicate the technology suggested
by'EPA,. are likely to operate so as to cause an industrial discharger to.
violate his permit, or a more sophisticated technology or "fail safe"
system must be installed at added expense to assure constant compliance.
Subcategories used by EPA are generally suitablefor application of uniform
effluent limitations, but difficulty is expected in some industries with
multiple waste streams where the limitations and suggest .ed technologies
for.specific products or processes do not take into account the actual
mix of wastes treated in a common facility.

1-15

There is disagreement whether EPA.has given adequate attention in the
formulation of effluent limitations to such factors (enumerated in Section
304(l)(B) as cost and bene@its,..age of equipment and facil@ties, the
process employed, etc. There is some evidence that actual permit condi-
tions may vary from the effluent limitations, depending upon when the
permits were issued. Variances probably extend both in the direction of
being more stringent and less,stringent. Since the ..Commission's analysis
is based on the limitations rather. than the permits,@ actual achievement
of the requirements,may differ somewhat from what is.indicated in the
results of this analysis. Overall, however, it is the judgment of the
staff that this variation between actual permits and limitations is not
so substantial as to place the results of the analysis in question.

Pretreatment standards,require industries discharging to municipal
systems to reduce or eliminate "Pollutants which are . . . not . . .
susceptible to treatment.by [publicly owned] treatment works" or any
I'pollutant,[whic'hj interfekes.with, passes through, or.otherwise is
incompatible with such works." [sec. 307(b)(1)] Standards are not
yet promulgated for all industries, and EPA has stated in the latest
proposal (July 9, 1975, and subsequent internal redraft dated
September 16, 1975) that its objective is to approach as nearly,as
possible to "best pradticable control technology currently available"
as the pre@r@eatmdnt standard for 1977 for major contributing industries
with incompatible pollutants. Several of the pollutants designated as
"incompatible" are actually substantially removed in a publicly owned
treatment works (approximately the same as the pollutants BOD and
suspended solids which@are included in the EPA definition of secondary
treatmentl. Raising or lowering the minimum discharge volume-subject
to pretreatment standards, or changing the pollutants to which they
apply, can change radically the cost of meeting such standards. Thus
h
variations in bot the quantity limits and the numerical parameters
can alter the effects on industries discharging to public systems and
could determine whether individual plants close or continue in operation.

QUESTIm. For industry to achieve the 1977 requirements, what will
be the capital costs?

ANSWER:, Ae Commission did two estimates of the capital costs of
me.etihg the 1977 requirements: one, a product of the
technology studies, represented the cost of the necessary
hardware and its installation; the other, an economic
3
assessment reflecting certain considerations of the
economic dynamics of the several categories of industry
studied and their likeLy.response to the treatment require-
ments. The two separate cost estimates are as follows:

1-16

Capital Costs for 1977
(in billions of 1975 dollars)

industry Technology Economics

iron and steel $ 2.91 $ 2.08
organic and Mis.cellane@us Chemicals 4.29 4.29*
Inorganic Chemicals 0.52 0.81
Petroleum Refining 1.05 0.83
Pulp and Paper 2.64 2.19
Metal Finishing 14.14 9.13
Fruits and Vegetables 0.44 0.17
Plastics and Synthetics 0.16 0.21
Textiles 0.54 0.46
Steam Electric Power 3.74* 3.74
Feedlots 0.71** 0.43
All Other Industry*** 10.94 11.66

TOTALS 42.08 $ 36.60

'-@Includes growth to 1977.
**Includes growth to 1977 and assumes coverage of all feedlots
whose runoff would reach watercourses.
***See Table 11-30, page 11-82, for listing of other industries.

Assuming the installation of technologies for all industrial produc-
tion facilities in place as of June, 1973, i.e., no closures and no growth
(except for stealh electric power and feedlots), the total.capital cost to
achieve BPT and pretreatment to the BP!t level and residuals disposal is
estimated to be $42.1 billion.

For discharges.to water quality limited waters, costs for individual
industrial plants are difficult to derive and are not included in Commis-
sion industrial cost estimates; in those cases where data were available,
An assessment of required technology indicates installation of technolo-
gies more stringent than BPT, but generally less stringent than BAT, is
now required[Sec.301(b)(1)(C)I. No cost estimates for control of toxic
pollutants are included except where control may be a part of the BPT
limitation. Also, neither the cost to industry for capital cost recovery
for repayment of their share of @he construction costs of publicly owned
treatment works which can be attributable to treatment of industrial
wastes, nor the costs to the industry for the use of the public system
are included here.

1-17

Steam.electric power includes costs t;o,-cpMply'.' with chemical "require-
men.ts for both existing plants and,those'.which-will come,on line prior to
July 1, 1977, but thermal compliance -costs' include only those for new
plants.. Thermalrequirements for.existincj plants take effect July 1, 1981,
and costs are included in the 1983 BAT totals,

converting all,eneigy requirements to:achieve BPT to one type fuel
oil, 169,000 barrels daily would be required for all industrial plants
in place in June, 1973, which equals 0.48 percent@of the 1973 national
energy use.

Op@ration and maintenance costs, excl@ciing depreciation and
interest on capital,-for wastewater control or treatment facilities
for industrial plants in place in June 1973 to achieve' BPT for
industry over and above, June 1973 expenditures is $1.7 billion yearly
($7.3 billion assuming control of fewer feedlots As proposed by EPA
in November 1975). Costs for plants that may close have not been
deducted nor have costs,for new plants been added, except for growth
in feedlots and steam electric power.

QUESTION: When might all industrial dischargers achieve best
practicable control technology currently available?

ANSWER.: Perhaps by 1980; industries.appear to be movin'g to
achieve the 1977 requirement at a rate that will
assure achievement earlier than publicly owned treat-
ment works will achieve their 1977 requirement.

According to published historical@data'., about one-fifth of total esti-
mated required-industrial investment to reach 9PT was made by January 1,
1978. If these data accurately reflect the yearly rate of industrial
expenditures, four-fifths of the amount to rea7ch,BPT,rema3'-ns to be spent
after January 1, 1975, if industry is-to ifistall BPT by July 1, 1577.
Expenditures should rise rapidly as the deadline approaches and-costs of
construction are reflected in reported datd.@ Whether all.industrial dis-
chargers will achieve this requirement on s'chedule i.s currently being
debated, but complete achievement.by the deadline _now appears,unlikely,.
EPA is still issuing effiuent limitations for some industries,, others are
not yet issued. Some industries will be,delayed 'because of pendihg@admin-
istrative hearings on permit conditions or liti4ation involving challenges
to the effluent 'limitations or permit.conditions. These procedures cannot
be completed, in some cases, before the deadline. A large number of
agricultural and small dischargers do not yet have permits.

.Estimated capital requirements for industries -- metal finishing,
chemicals (organic,' inorganic and miscellaneous), pulp and paper, and
steam electric power -- to meet the 1977 water pollution control require-
mehts, account for some 55 percent of the total for BPT. For industries
to achieve BPT by July 1, 1977, using published historical trends to
January 1, 1975, pollution abatement expenditures as a percent of total
capital spending for iron and steel would have to increase from 4 percent
in 1974, to 27 percent in 1976; chemicals from 4 percent in 1974, to
26 percent in 1976; chemicals from 4 percent in 1974, to 33 percent in
1976; and textiles from 2 percent in 1974, to 12 percent in 1976. (All
based on assumed BPT compliance in 1977.)

Small segments of existing capacity in several major water using
industries will experience disproportionately high capital requirements
5-10 percent for textiles, pulp and paper and metal finishing, and
1-2 percent for petroleum refining and iron and steel (Figures III.D.4
and III.D.5). These are primarily small, older, less efficient facil-
ities with higher production costs,that may close because of competitive.
disadvantage s resulting from pollution control expenditures.

supply constraints can affect achieving 1977 requirements. Capital
expenditures to meet BPT will probably reduce capital investment for
productive capacity in some industry segments, particularly if the
apparent required acceleration of expenditures from 1975 to 1977
occurs. Skilled manpower could also be in short supply. These capital,
materials or manpower shortages will not, of course, materialize if
industry has Actually been spending at a higher aggregated rate than
is reflected in historical data or if the ultimate achievement of
BPT extends beyond July 1, 1977. Supply and productive capacity
shortages in supplying industries do not seem probable.

Projected plant closures are significant in six industries:
pulp and paper, metal finishing,. textiles, fruits and vegetables,
feedlots*(including dairies) and meat packing. Concentrated in a
small, hi4h-cost segment of each'of these industries (usually 5-10 per-
cent of capacity), closures are generally the old, small, single-plant
firms that, in many cases, might not remain economically viable over
the next decade in the absence of required expenditures for water
pollution control. The majority of plant closures are plants that
discharge to municipal systems apd have been described by EPA as
having incompatible pollutants s ,ubject to pretreatment standards.
(Analysis was based on proposed pretreatment standards as of June 30,
1975; very different proposed standards that might substantially
alter this result are now being considered by EPA.) Because of es-
timated plant closures, productive capacity of these industries will

The predicted closures are based upon a limited number of covered
feedlots in each category; the prediction may still remain valid
under the latest EPA proposal (November 1975).

1-19

become more concentrated. Except for metal finishing, however, in no
other case is this result attributable solely to water pollution control
expenditures; it'is rather a reflection of existing trends in the
industry which P.L. 92-500 tends to accelerate. Except for those
segments of industries that would probably close because of depressed
profits, the profit level for remaining industry is not substantially
impacted.

Regional negative impacts Are concentrated in the Northeast, and
to a lesser extent in the Middle Atlantic and North Central regions,
principally because of concentrations of metal finishing facilities,
small pulp and paper mills, old textiles mills, small feedlots
(particularly dairies) and old fruit and vegetable canning plants. The
Northeast seems the least able to reemploy the resources dislocated as
a result of the Act.

By 1985, the average price increase due to implementing BPT (including
interest and O@M) is predicted to be 6.2 percent. This is equivalent to a
*i flation. The greatest price increase is a 40
.60 percent annual rate of in
percent price increase for metal finishing services which leads to price
increases of over 7 percent for fabricated metal products and instruments
which extensively use metal finishing services. mining is the only other
major industry with price increases in excess of 7 percent due to BPT.

B. Social Effects and Benefits 1977

The Commission's "Study Plan," February, 1974, stated "Achieving
or not achieving the Act's requirements and goals c'an have social
costs and benefits" and cost and benefit figures associated with
the achievement of the 1983 requirements for industry and municipal-
ities will be used to evaluate the effects on the economy
Consistent with this commitment, the Commission also examined
. . . available leisure and recreational opportunities . . . and the
general quality of life resulting from achieving or not achievingIthe
goalsof the Act." Increases in individual satisfaction associated
with improved waterquality are not always reflected in the use of
marketable water-related goods or services. These unquantifiable,
intangible benefits are acknowledged but their magnitude would largely
be an accumulation of individual perceptions or subjective responses.

Thus the studies of social effects and benefits were structured
to reflect the results of achieving the requirements and goals
'within statutory timeframes. Generally, measurable benefits from the
Act were assumed to be zero in 1912 and to increase yearly thereafter
as the several requirements of the Act are achieved, culminating with
realization of BPWTT and BAT in 1983,-with maximum annual benefits

1-20

occurring two years later. Increased annual benefits thereafter reflect
only population and economic growth. Delays in implementing the Act's
requirements would shift this 1985 maximum annual benefit level to a later
year by whatever number of years the implementation was delayed.

Because of the structure of Commission studies, attempts now to sepa-
rate the 1977 and 1983 social effects and benefits would be largely
arbitrary. Therefore, the full discussion is presented under the 1983
date. Some of the separate effects for 1977 are presented there where
the data are separable.

C. Environmental Effects 1977

QUESTION: How far will the uniform application of BPT to indus-
trial dischargers and secondary treatment to publicly
owned treatment worksgo toward achievement of the
interim goal, a water quality "wherever attainable"
"which provides for the protection and propagation of
fish_, shellfish, and wildlife and provides for recrea-
tion in and on the water by July 1, 1983"9

ANSWER: Based on the analysis-of the Commission's 41 environ-
mental sites, application of the Z977 requirements will
restore a large portion of the Nation's presently pol-
Zuted waters to a level of physical and chemical quality
sufficient to provide for achievement of the interim
goal. The chief exceptions are caused by toxics,-,,,,pulse
loads discharged from point and nonpoint sources auring
and following storms and delays in actual.achievement of
the 1977 requirements. Maintaining that level of quality
with continued growth will depend upon timely and effec-
tive compliance with outstanding permits and the effective
application of more stringent limitations that may become
necessary following adoption of water quality standards
where the volume of pollutant discharges begins to produce
lower water quality.

The interim goal provides a pragmatic measure of progress toward achieve-
ment of the stated objective of the Act -- the restoration and maintenance
of the chemical, physical and biological integrity of the Nation 's waters.
The most quantifiable indicator8 of biological health in an aquatic system
are the physical and chemical parameters assessed at each of the study
sites. Individually and together, they provide a broad picture of existing

1-21

water quality and projected, progress toward a quality that will support
the purposes listed in the interim goal. As minimum criteria to determine
whether a body of water meets the interim water quality goal, the Commis-
sion selected the following: (1) a dissolved oxygen level of at least
four mg/l.during seasonal low-flow-condit-i-ons; (2) toxic'materials limited
to those levels proposed and recommended in Water Quality Criteria;* and
(3) total.coliform of not more than 1,000 p6ri 100 milliliters, or fecal
t-oliform bacterial densities not exceeding 200 per 100 milliliters.*

Applying these criteria to the 41 sites and extrapolating from the
results,Ia generalized statement can be made about the projected condi-
tions of the waters of the entire nation. Obviously, because of natural
,conditions or as a result of waterpollution control efforts prior to
implementation of P.L. 92-500, much of.the nation's waters are already
of sufficient quality to meet the interim goal.. In many of these areas,
the application of 1977 requirements will serve to maintain that quality
into the future. In other areas with large concentrations of industry
or population, more stringent limitations are already being specifically
required under the water quality standards provisions of P.L. 92-500.
A few of these portions are of such deteriorated quality that it is
highly improbable the interim goal will ever be "attainable." Progress
toward the interim goal in these waters can only be adequately evaluated
after 1977 requirements are met and recovery has begun. Even so,.the
appli6ation'o'f BPT to industrial discharges and secondary treatment to
publicly owned wastewater treatment works will substantially improve
the quality of much more of the nation's waters during most flow
conditions.

Controlling pollution from publicly owned treatment works by
installation of secondary treatment as defined by EPA or higher levels
of treatment to meet iwater quality standards, including chlorination,
will result in a.marked reduction in coliform bacterial contamination.
Approximately three-fourths of the nation's waters will.attain accept-
able total and fecal coliform bacterial levels du ring seasonal low-flow
conditions., Similarly, dissolved oxygen will improve to the point
where nearly half of the waters now showing levels of dissolved
oxygen below four mg/l will meet that minimum dissolved oxygen standard.
(See Figure 1-1) Turbidity and suspended solids will also show improve-
ment, especially in regions of the country such as New England, where
there is naturally clear water. EPA has estimated that its present
permit program for industries alone will reduce BOD approximately
12 million pounds p4r day and suspended solids an estimated 28 million
pounds per day.

Improvements as a result of the application of the 1977 require-
ments will vary, however, depending upon site specific characteristics
of the receiving waters and the pollutant loads from point and nonpoint

Water Quality Criteria, 1972; NAS-NAE, 1972...

1-22

Figure'l -1
DISSOLVED OXYGEN IMPROVEMENT
UNDER'4 LEVELS OF. POLLUTION CONTROL ABATEMENT

,00 Level
Milligrams per liter
10

E00 . .. . ..........................

b"
4 Minimum criterion during
seasonal low flow

1= anaerobic.
0 10% 20% 30% 40% 50%
Percent of area with 00 equal to or less than level shown
J.
0 500 1000 1500 2000 2300
River miles with Do equal to or less than level shown

Odased on projected improvements at 21 sites covering KEY ABATEMEN .T LEVELS
a total of 4600 river miles during seasonal low flow EOD See Table IV-3-
co@nditions. 1983 for explanation
Source: Nati. Commission on Water Quality compiled 1977 T ................. of abatement
from environmental contractor reports. 1977 A levels
February 1976 Present

1-23

sources. Uncontrolled nonpoint sources, especially as a result of storm-
related pulse loadings in urban areas, will periodically deplete dis-
solved oxygen and raise total and fecal coliform qounts, as well as
increase turbidity and suspended-solids. The frequency and relative
impact of this phenomenon, however, will depend as much on the hydrology
and -meteorological conditions of the area as the quantity of pollutants
cmtained in the stormwater.

As of October 1, 1975, separate effluent limits for any toxic pollu-
tant have yet to be promulgated by EPA other than those that are part of
BPT limits. Control of sane toxic substances will result from the appli-
cation of the 1977 requirements and water quality standards, but, in
many areas,,.th6 effective reduction or elimination of toxics may be a
critical fActor, delaying achievement of the 1983 goal. The failure to
adequately control toxics also bears seriousimplications for public .
health and the long-term impacts of toxics and heavy metals on the aquatic
system, which should not be lightly dismissed.

Another deterrent to achievement will be delays in implementation,
part'icularly control of discharges from publicly owned treatment works.
As illustrated in Figure I-1, the predicted water quality improvement
most nearly corresponding with-full achievement of the 1977 requirements
(BPTT) shows a significant improvement in DO levels at 21 of the Com-
mission's assessment sites over what is likely to be achieved by
1977 (BPTA).

Probable pcpulation growth in an area, new commerce and industry,
associated land-use changes, increased runoff from expanding urban
-Teas and other nonpoint sources.may significantlylower the DO con-
centration unless checked by adoption of increasingly stringent water
quality standards and control of nonpoint sources. Project .ed long-
term water quality deterioration is demonstrated in the examination of
growth impacts on water quality in several regions studied. In some of
these areas, if effluent limitations or the stringency of abatement
measures were to remain unchanged, increases in industrial production
and total population will increase total pollutant concentrations in
receiving waters, even with application of the 1977 requirements. For
such areas, to restore -- and especially, to maintain -- the physical,
chemical and biological integrity of the water, further pollutant
reductions probably will be required. More stringent effluent limita-
tions may be necessary for point sources; control of combined storm
and sanitary sewers, separate storm sewers and nonpoint sources. may be
required. -In still other areas, especially those with heavy agricultural
activities, sediment, pesticides, nutrients and salinity will have to
be controlled if water quality goals are.to be reached and sustained.

1-24

Thus, there are indications of significant progress toward achievement
of the interim goal in much of the nation's water through the application
of the 1977 requirements. How quickly recovery of heavily polluted areas
will occur, however, is difficult to predict. Adequate control will pro-
vide the potential for restoration of a desirable sport fishery to 20-25
percent of the areas where it is now non-existent. For shellfish, secon-
dary treatment of municipal wastewater and, in some cases, combined sewer
overflows, would provide improvement in most areas where beds are now
closed as a result of bacterial contamination. Depending on the degree
and frequency of coliform contamination from-storm runoff, many of these
beds can be opened to harvesting once point source control takes effect.
The same will be true of many beaches now closed to public use as a result
of untreated or inadequately treated discharges from publicly owned treat-
ment works.

More critical to the questi on of achievability will be how well the
first phase (1977) point source controls will serve to preserve the
quality of the water from future deterioration or from seasonal or climatic
episodes that produce large loads of unc6ntrolled and untreated stormwater.
The effect of achieving cannot be accurately evaluated, however, without
reference to the date of achievement since growth occurs during delay and
further adds to the total load even with constant levels of abatement.
The extent to which application of the 1983 requirements serve to alle-
viate this circumstance is treated in Section II.D.

1-25

II. EFFECTS OF ACHIEVING OR NOT ACHIEVING THE EFFLUENT LIMITATIONS@-
AND GOALS SET FORTH FOR 1983.

A. Technological Aspects 1983

Publi cly Owned Treatment Works 1"K

QUESTION:- Does technology adequate to achieve "best practicable
waste treatment technology over the life of the works-,
for publicly owned treatment works exist?

ANSWER: Yes, since -- as defined by EPA -- this technology is.,-
virtually the same as that described by EPA for 1977..,,

For,publicly owned treatment works*for which a construction grant is.
made "from funds authorized for any fiscal year beginning after June 30,
1974," [Seb.201(g)(2)1., the requirement is "the application of tbp,best
practicable waste treatment technology over the life'of the worksi;
[Sec.201(g)(2)(A)I. Additionally, however, effluent limitations.for in-
dividual treatment plants must be set at a level that would not interfere
pp. . . with attainment or maintenance of water quality" to "assure protec-
tion of,public water supplies, agricultural and industrial uses, and the
protection and propagation of a balanced population of shellfish, fish
and wildlife, and allow recreation activities in and on the water"
[Sec. 320 (a) I.

In short,-each,publicly owned treatment works must be designed to meet
the 1983 "interim" water quality goal of the Act.@

QUESTION WiZZ all publicly owned-t:ieatment works achieve the
"best practicable waste treatment technology over the
life of the works" by July, 1983?

ANSWER: The primar
No 'y reasons for not achieving this require-
ment by the scheduked date is an inadequate rate of
Federal fz@nding_, slow obligations of existing funds and
@'@:it takes for construction of treatment works.
the tim

Rather than attempt to separate the costs for various categories of
treatment between 1977 and 1983 requirements, the Commission has examined
all of them within the section on progress under the 1977 requirements.

1-26

one of the indeterminants, however, is how much of the costs of connection
of combined storm and sanitary sewer overflow must be accounted for in
order to realistically achieve the 1983 water quality goal.

EPA's position on this is ambivalent. The 1975 Water Quality Strategy
Paper suggests that the secondary treatment requirement for 1977 does not
apply to combined storm and sanitary sewer overflows and storm sewer dis-
charges which are characterized as "wet weather overflows."* After con-:.1
cluding P.L.92-500 does not "specify a technological level of control or a
date for control," the statement is made that, "States, therefore, are at
liberty to handle acute overflow problems on a case-by-case basis after
thorough study but will not be expected to provide correction of most
problems by 1977."

Subsequent discussion mentions swimming, "drinking water supply and
support of fish and other aquatic life," as beneficial uses for the protec-
tion of which construction grant funds might be used "only where marginal
benefits in terms of pollution control are relatively large compared to
the marginal costs." This rationale suggests that correction of "wet
weather flows" would be part of 1983 requirements. Dividing the require-
ments in this manner may provide a means for segregating the 1977 and 1983
costs. If this interpretation of P.L.92-500 were accepted, the costs of
BPWTT could include the $79.6 billion for control and treatment of com-
bined sewer overflows and the $199.2 billion for separate storm sewer
flows already discussed - in connection with the 1977 requirements for
publicly owned,treatment works.

QUESTION: When might all publicly owned treatment works achieve
best practicable waste treatment technology over the
life of the works?

ANSWER: Depends, primarily, on,level of Federal funding. Could
be achieved in 11 years with adequate funding.

Because the level of treatment beyond secondary that may be required
is to be determined on a case-by-case basis as necessary to meet water
quality standards, actual technologies cannot be described.now for stan-
dards that may be in effect on July 1, 1983. Further, since the achieve-
ment of both 1977 and 1983 requirements for publicly owned treatment
works is lak46ly determined by Federal appropriations, the effects can be
controlled to some degree by Federal decisions. The Federal share of the'

*This discussion is based on the "Water Quality Strategy Paper," draft
third edition, June 30, 1975, pp.C-1 to C-11.

1-27

cost of whatever remain Is to be done to provide secondary treatment after
1977, or more stringent limitations for discharges to water quality
limited waters will probably exceed actual Federal dollar amounts spent
prior to that date; total expenditures will be determined by funding
levels chosen for categories eligible for Federal support.. Full Federal
funding adequate to support the $158 billion total estimated expenditures
for all eligible categories, except separate storm sewer flows, seems
highly unlikely. Achieving full funding of secondary and a higher level
of.treatment to meet more stringent effluent limitations, as well as some
interceptor sewer costs, seems more probable. Therefore, the effects of
achieving whatever-level of treatment (and expenditure) that is selected
can be influenced by the Congress and the President as Federal funds are
authorized and appropriated. If progress is to be made toward a definite,
chosen goal, the level of expenditure must exceed that necessary to over-
come annual inflation rates, plus whatever additional capacity is necessary
to treat wastes from growth in-total sewered population. A low level of
Federal support could preclude ever fulfilling existing needs for secondary
treatment; an unrealistically high level of support could require radical
adjustments, both at its initiation and at its termination. If reasonable
progress is to be made toward achieving treatment requirements in an
orderly manner, choic'es and priorities are essential. The sooner made,
the less confusion and dissipation of resources. Some certainty as a
basis for short-range, five- to ten-year planning is needed; a fixed term,
with a pre-announced termination date and gradual elimination for the
publicly owned treatment works Federal construction grant program, could
,encourage fixing of priorities and concentrating funds on more significant
water pollution-problems. Possible adverse economic effects could also
more easily be minimized with advance planning.

Industr ies 1983

QUESTION: Is defined "best avaiZabZe technology economically.
achievabZell for industrial dischargers technoZogic-
ally attainable?

ANSWER: Generally, yes,- with the exception of short-term (24-
hour) limitations in some cases, and those instances.
where application of technologies must be transferred
from one industry to another or.have not.been ade-
quately demonstrated.

1-28

-The 1983 technologies incorporate suggested process changes to reduce
or eliminate pollutants, but, in most cases, also include end-of-pipe
treatment. As with BPT, however, while the long-term average (monthly or
yearly) BAT effluent limitations can be achieved, inherent technological
'limitations will sometimes preclude achieving the short-term (24-hour)
limits. Either technologies more advanced or complex than those contem-
plated by EPA will have to be installed or the effluent limitations
reconsidered for short-term variations. Examples are abatement technolo-
gies for petroleum refining and pulp and paper. In addition, the statis-
tical method employed by EPA for determining short-term, contrasted with
long-term, effluent limitations was not consistent f-6r,,.all industries.
Considering the lack of background data, it might have been-appropriate
to prescribe only long-term effluent limitations for BAT until an adequate
data base is developed., Some of the suggested technologies are not now
being used for the specific, designated application within a given
industry. In other cases, the indicated technology must be'transferred
from some other industry. While, strictly speaking, the technology.is
tiavailable," it has not heretofore been used for the purpose intended in
the limitation. Some examples are metal finishing, organic chemicals and,
iron and steel. As with some BPT limitations, problems can arise where
suggested technologies for a given production process waste stream must be
applied to combined waste streams from several production *lines, for some
of which there may be individual limitations, and for some of which there
are not yet -- and may never be -- promulgated effluent limitations.

Several technological solutions for both 1977 and 1983 limitations are
founded upon reduction in water use or by-product recovery. These options
are likely to have wider application for BAT than for BPT. The full
potential of such approaches is undeveloped, but will probably become more
prevalent as limitations become more stringent and technologies for treat-
ing large wastewater volumes become more expensive.

New source performance standards are required for "any source, the
construction of which is commenced after the publication of proposed
regulations prescribing a standard of performance, . . . . if such
standard is thereafter promulgated." [Sec. 306(a)(2)] The "standard
of,performance" is to be that for "control of the discharge of pollut-
ants which reflects the greatest degree of effluent reduction which the
Administrator determines to be achievable through application of the
best available demonstrated control technology, processes, operating
methods, or other alternatives, including, where practicable, a
standard permitting no discharge of pollutants." [Sec. 306(a)(1)]
Those point sources which comply with these standards "shall not be
subject to any more stringent standard . . '. . during a ten-year period"
from the date construction is completed or during the depreciation or
amortization period whichever ends first. [Sec. 306(d)] Technologies
considered necessary to meet these standards are often similar to BAT.

1-29

Some difficulty may be encountered where technology transfer is required.
However, more pollutant reduction options are available to the designer
of new facilities than in retrofitting-existing facilities, and this capa-
bility should mitigate transfer difficulties.

The process of identifying "any toxic pollutant or combination
of such pollutants" and establishing effluent standards, which can
include "a prohibition of the discharge," has not been completed by
EPA. (Sec. 307(a)(1)], Based upon preliminary proposed regulations
naming@benzidine, cyanide, cadmium, mercury, polychlorinated biphenyls
and the pesticides aldrin dieldrin, DDT, DDD, DDE, endrin and toxaphene,
several industries will b; impacted by toxic pollutant controls. Among
them are iron and steel (cadmium, cyanide and mercury), petroleum re-
fining (cadmium and cyanide), metal finishing (cadmium and cyanide),
inorganic chemicals (cadmium and mercury), textiles (benzidine) and pulp
and paper (mercury). Adequate evaluation of available technologies and
costs were not possible, although techniques to reduce toxics were explored
,and technologies for some industries are available.

B. Economic Effects 1983

QUESTION: What are the relative industrial costs and economsc
impacts of achieving the 1983 requirements?

ANSWER: Relative to the capital cost requirements for the
installation of BPT, the 1983 requirements for BAT
are estimated to be somewhat reduced. Demands on
three industries -- chemicals, metal finishing and
machinery and mechanical products -- will account
for 75 percent of the total capital outlay.

Industrial Impacts

Expenditures for those plants in place as of June, 1973, that will
incur costs to achieve BAT are estimated at $23.2 billion. Predicting
national industrial growth from 1973 through 1983, and applyine new source
performance standards (NSPS) to new or expanded plants, the Commission
estimated an additional expenditure of $19.9 billion. Together, the cost
to industry for meeting BAT and NSPS between now and 1983 could reach over
$43 billion.

X-30

Added Expenditures for 1983 Requirements

New Sources
Existing Plants 1973 to 1983
Economic Impact Amount Amount
Expenditures (Billions 1975 $) (Billions 1975 $)

Iron and steel $ .56 $ .65
Organic and miscellaneous chemicals 3.64 2.25
Inorganic chemicals .26 .35
Petroleum refining 1.18 .29
Pulp and paper .44 .73
Metal finishing 8.21 3.97*'
Fruits and vegetables .10 .05
Plastics and synthetics .29 .09
Textiles .20 .28
Steam electric power 2.03 .90
Feedlots .14 .23
All other industry 6.18 10.11

Total $23.23 $19.90

*Excludes captive shops included in machinery and mechanical products
($8.30 billion, under all other industry).

No costs are included for any technology more sophisticated than, BAT
for discharges into water quality limited waters, nor is there inclusion
of cost estimates for control of toxic pollutants except where control may
be a result of the application of BAT limitations. While the exactness of
these estimates is subject to question, they dd indicate an order of magni-
tude of needed expenditure. Greater opportunities to reduce the generation
of pollutants exist in the design of new production processes and f.acili-
ties than can be identified in the retrofitting of existing plants. Also,
as the price of water and costs of wastewater treatment and residuals
increase, there will be definite economic incentives for industrial pro-.
ducers to reduce the quantities of water used and the wastes generated.

Costs of operation and maintenance of the treatment technologies
installed as a result of the BAT requirements will be high -- $5.8 billion
annually. operation and maintenance costs for new sources will be spread
throughout the period from now to 1983, and will be' relatively small in
any one year.

1-31

Based on estimated energy requirements from the Commission's technology
studies, a conversion of all energy required to meet BAT to one type of
fuel -- oil -- 211,000 barrels would be required daily in excess of the
amount to achieve BPT for just those industries.in place in June, 1973.
This is equal to a 0.6 percent of the 1973 national energy use. The energy
penalty resulting from installation of cooling towers at steam electric
power plants projected to be in place in 1983 included in the above require-
ment could add from 0.06 percent to 0.4 percent, depending on the assumed
number of 316(a) exemptions.

Industrial users of publicly owned systems ordinarily enjoy a subsidy
of about 45 percent.of capital costs, even with industrial capital cost
recovery, since the industrial user avoids interest payments on his pro-
portion of the Federal share of capital investment. Industries with
compatible waste thus gain the advantage of both economies of scale (which
may account for a saving of up to 80 percent for small users) and a sub-
stantial subsidy. This advantage will exist only so long as pretreatment
standards areapplied to actually incompatible wastes; if these standards
are so applied as to equalize costs between direct dischargers and those
using public systems, the advantage is eliminated. A direct discharger
able to take full advantage of accelerated depreciation for pollution abate-
ment expenditures, state.and local tax relief and the interest differential
of industrial revenue bonds for financing, may realize a total subsidy
almost as large as that available to industries connected to public systems.

At the time Commission analyses were being completed, .2retreatment
standards were generally the same for 1983 as for 1977, i.e., BPT for
industries discharging incompatible wastes to publicly owned treatment '
works. The latest EPA proposal (July 9, 1975, and subsequent internal
redraft dated September 10, 1975) indicates that these standards may
be changed to require BAT as a prerequisite for industries discharging
incompatible wastes to publicly owned systems after July 1, 1983. As
the capital costs of pretreatment plus recovery of the industries'
proportionate share of the capital cost of treatment works approach or
exceed the capital cost of installing BAT, the-remaining incentive for
industries to discharge into these systems is any savings on the capital
expenditure represented by the interest differential between municipal
and private borrowing -- which can be very attractive. Some industries
within urban areas where land or space is limited are preclude 'd from
the option of constructing separate BAT facilities. Neither capital
cost recovery nor costs for use of publicly owned treatment works are
included in the industrial costs stated here.

The majority of plant closures are predicted for plants discharging
to municipal systems defined by EPA as having incompatible pollutants.
Since pretreatment standards remain in a state of flux, the exact
number of plant closings of this type must remain an estimate based upon
pretreatment guidelines suggested at the time Commission studies were

1-32

I N D U S T R Y

Economic Impact Expenditure Estimate
(Millions of 1975 Dollars)
BPT (1977) BAT (1983)
a Annual Annual 1975-83
Indepth Capital O&M Capital O&M NSPS
K
Fruits & Vegetables 167 15 96 10 47
Inorganic 805 178 261 104 351
Organic 3325 487 2990 2242 1873
Misc. Chemicals 965 163 650 228 380
Iron and Steel 2080 322 556 202 647
Metal Finishing-Job b 1715 328 780 168 3967
Captive b 7418 2275 7428 1365 f
Petroleum Refining 829 142 1184 429 294
Plastics & Synthetics b 209 33 286 429 91
Pulp and Paper b 2194 1ll 437 20 734
Steam Electric c 4089 989 1275 16 900
Textiles 458 58 203 61 275
24254 5101 16146 4874 9559

Other
Ore Mining and Dressing d 610 25 0 0 146
Coal Mining 1700 95 0 0 0
d
Petroleum & Gas Ext. d 234 1070 61 266
Mineral Mining & Proc. 730 72 0 0 496
bleat Products & Rendering 148 20 181 10 64
Dairy Products 188 13 73 5 0
Grain Mills 33 2 8 1 0
Cane Sugar Processing 153 17 170 13 8
Beet Sugar 90 17 69 5 2
Canned & Preserved Seafood 41 12 120 12 38
Misc. Food & Beverages 5 1 5 1 4
Timber Products 14 1 25 8 33
Furniture and Fixtures 8 3 0 0 2
Bldg. Paper & Board. 120 12 0 0 13
Paint and Ink 23 22 0 2 2
Soap and Detergent 10 1 2 1 2
Phosphate Mfg. 73 9 14 1 46
Fertilizer Mfg. 77 50 64 23 50
Paving and Roofing 6 6 4 1 1
Rubber Processing 220 18 48 12 299
Leather Tanning 77 20 47 7 13

1-33

BPT BAT
Annual Annual 1975-83
Capital 0&M Capital O&M NSPS
Glass Mfg. 42 5 16 3 K
Cement Mfg. 34 4 9 1 26
Concrete, Gypsum, Plaster 100 26 0 0 12
Asbestos 4 1 9 4 36
Insult. Fiber 14 6 0 0 3
Ferroalloy Mfg. 48 16 13 3 11
Nonferrous Metals b,e 40 21 31 7 39
Machinery & Mechanical Prod.f 3900 390 3900 390 8295
Transportation Industry 1200 130 140 39 137
Water Supply 1200 160 100 3 28
Auto & Other Laundries 25 4 21 1 8
Foundries 180 26 0 0 0

Fish Hatcheries 50 10 47 31 --
Structural Clay 5 1 0 0 2
Pottery 3 1 4 3 1
Steam Supply 0 0 0 0 --
Nonferrous Mills 260 25 0 0 33
Feedlots
Beef 100 8 30 0 225g
Hog 178 9 59 0 --
Dairy 152 10 46 0 --

All Other Industries 12095 1287 6325 647 10344
In-depth Industries 24254 5101 16146 4874 9559
Total 36349 6388 22471 5521 19903

(a) Cost estimates for all Indepth industries (except Iron and Steel) and seven of
the Other Industries (Meat Products and Rendering, Dairy Products, Grain Mills,
Leather Tanning, Nonferrous Metals, Fertilizer and Feedlots) represent costs
only for thos plants which are projected to remain open.
(b) Municipal user charges included.
(c) Some growth included in BPT and BAT estimates
(d) These cost estimates were based upon a preliminary contractor report. The Commission believes
the cost estimates presented in Table II-30 are more accurate; the cost estimates presented here
are included because they were used in the impact analysis.
(e) These cost estimates were based upon a preliminary contractor report. The differences in these
estimates and those presented in Table II-30 are principally due to two factors: (1) the estimates in
Table II-30 include $83 million for two bauxite refineries on the Mississippi River to meet BAT
requirements not included in the cost estimates above; and (2) the Nonferrous Metals estimates in
Table II-30 do not attempt to take account of treatment facilities in place as of January, 1973, for
primary aluminum smelting and refining, a subsector of Nonferrous Metals.
(f) Metal Finishing BPT and BAT costs are excluded from Machinery and Mechanical Products BPT and BAT
costs, but Metal Finishing Captive NSPS costs are included in Machinery and Mechanical Products NSPS
costs.
(g) Includes all Feedlots.

SOURCE: National Commission on Water Quality.

1-34

CAPITAL COSTS TO INDUSTRY
(Billions 1975 dollars)

1977 1983
Industry Technology(lT-Economic(4) Technology(TT7.Econ6mic(4)

Iron and steel $ 2.91 $ 2.08 $ 0.95 $ 0.56
Organic & Misc. Chemicals 4.29 4.29 3.64 3.64
Inorganic Chemicals 0.52 0.81 0.25 0.26
Petroleum Refining 1.05 0.83 1.18 1.18(5)
Pulp and Paper 2.64 2.19 0.80 0.44
Metal Finishing 14.14 9.13 14.09 8.21
Fruits & Vegetables 0.44 0.17 0.16 0.10
Plastics & Synthetics 0.16 0.21 0.29 0.29
Textiles 0.54 0.46 0.30 0.20@
Steam Electric Power 3.74(2) 3.74 2.03(6) .2.03(6)
Feedlots 0.71(3) 0.43 0.170) 0.14(7)
All Other Industry 10.94 11.66 7.64 6.18

TOTALS $ 42.08 $ 36.00- $ 31.50 $ 23.23

(1) Does not include growth or plant closures (except as noted otherwise).
(2) Includes growth-to 1977.
(3) Includes growth and.as 'sumes coverage of,all feedlots; assuming EPA pro-
posed regulations of November 1975, 1977 + $0.11 billion; 1983 + $0104
billion.
(4) Includes closures, but not growth (except as noted otherwise).
(5) Closures are negligible.
(6) Includes growth to 1983. Costs range from $2.03 billion to $7.96
billion, depending on assumed exceptions.
(7) Includes all categories of feedlots'with a limited number covered in
each category; 1983 figure includes growth to that year.

RECAP OF ABOVE

Technology Economic Impact
1977 $ 44.@31 $ 36.00
1983 30.56 23.23
TOTAL $ 74.87 $ 59.23

OPERATION AND MAINTENANCE -- Annual Costs

Technology: $ 7.7 billion 1977 requirements"
6.2 billion 1983.requirements*
$ 13.9-billion annually

Economic: $ 6.8 billion 1977 requirements
5.8 billion 1983 requirements**
$ 12.6 billion annually
*Range from $6.2 to $6.9 billion deperfding on assumed exemptions for
steam electric power.
**Range from $5.8 to $6.5 billion depending on assumed exemptions for
steam electric power.

1-35

completed (June 1975). Changes in the level of stringency do not change
which plants in an industry are most adversely affected. The segment of
industry with disproportionately higher costs for BPT requirements is
the same segment with disproportionately higher costs for 'the BAT re-
quirements. Few plants could justify the expenditures required to reach
BPT requirements if they were going to close rather than met the BAT
requirements.

Plant closures are significant in six industries: pulp and paper,
metal finishing, textilesi fruits and vegetables, feedlots* (including
dairies) and meat packing. They are concentrated in a small high-cost
segment of the industry (usually 5-10 percent of capacity). They are
generally the old, small, single-plant firms, that in many cases could
not remain economically viable over the next decade in the absence of
water pollution controls.

Beyond those plants that would close due to depressed profits, the
profit level for remaining industry is not substantially impacted. The
steam-electric power industry is an exception, with a .3-.7 percent
absolute decline in the present rates of return on a rate base in an
industry where profits are already depressed.

BAT results in smaller price increases than do the BPT effluent limi-
tations. By 1985, the average price increase for all industries due to
BAT (including interest and O&M) is 2.8 percent. This is equivalent to
a .27 percent annual rate of inflation. The highest price increases are
from 3.0-4.6 percent for industries which make extensive use of metal
finishinj services such as fabricated metal products, inst rum6nts, non-
auto transportation equipment, non-electrical machinery and chemicals.
The price of metal finishing services increases 20 percent. By 1985, the
total price increases due to BPT and BAT effluent limitations are pre-
dicted to be 9.0 percent.

General Effects on the Economy, 1975-1985 In an attempt to evaluate
economic effects of P.L.92-500 upon general economic activity, 13 alter-
native sets of variables (scenarios) were analyzed to estimate a range of
possible results. In all cases, impacts on GNP (Gross National Product),
prices, employment and investment were predicted to be smaller than normal
fluctuations in these variables.

Inflation is 9 percent above baseline projections in 1985, indicating
an inflation rate that is .9 percentage points higher, due to the imposi-
tion of pollution abatement standards. It should be noted, however, that
in these calculations, no value is assigned to such "free goods" as water
and air. As a result, improved water quality is not given an in Icreasing
value in assessing the average price of goods and services.

The predicted closures are based upon a.limited.number of covered
feedlots in each category; the prediction may still remain valid
under the latest EPA proposal (November 1975).

1-36

GNP and employment are stimulated in the remainder of the 1970s and
depressed in the 1980s. The maximum addition to unemployment is .9 per--!
cent of the work force; unemployment has ranged from 3.5 percent to more
than 9:.)percent in the last decade.

Impacts on plant and equipment investment and"housing are negative.
The stimulative-effects of.the abatement expenditures tend to offset the
depressive effects via increased costs and prices. The most negative
effects are projected to.be in the latter years when both residential and
.non-rbsidential investments are projected to be as much as 7.3 percent
below baseline projections.

Productivity is positively affected by the requirements of the Act in
years of high unemployment and unused capacity since an increase in output
is often possible without proportional increases in overhead costs. The
increased costs of production because of water pollution abatement tend
to offset the positive effects so that, in most years, productivity
declines slightly -- that is, total employment increases more (or decreases
less) than total output.

Results of analyses of the several sets of assumptions or variables
(scenarios) reflect that:

A smooth pattern of total industrial expenditures through
1983 yields smaller impacts in the 1976-1978 prices.

High levels of public expenditures would add to stimulative
impacts and less to inflationary impacts.

The additional economic impacts assoc@iated with BAT (over
BPT and NSPS) represent about one-third-of the total impact
after 1980, and less than one-fifth of the negative impacts
on GNP and employment.

If actual industrial expenditures are one-half of Commission
estimates, general economic impacts will also be approximately
one-half of those forecast.

If high unemployment rates continue into the 1980s, the eco-
nomic impacts will be little different from those forecast.
Stimulative effects would last slightly longer and inflationary
impacts would be somewhat smaller.

If 25-50 percent of the abatement investments are in produc-
tive equipment (product and process changes), inflationary
and stimulative effects are significantly less than other-
wise. Stimulative impacts would also last two-three years
longer and the depressive effects in the later years would
be much smaller.

1-37

The addition of air pollution abatement expenditures
(approximately one-third the size of the water pollution
abatement expenditures) tends to increase all impacts
prcprotionately. The depressive effects outweigh the
stimulative a year earlier (1981 vs. 1982) than in the
comparable case without air expenditures.

Supply Constraints Strict industrial and municipal compliance with
the 1977 and 1983 deadlines for P.L.92-500 would cause severe shortages of
sanitary engineers needed to design and construct water pollution abatement
facilities. Enrollment of both undergraduate and graduate college students
in the requisite engineer fields is declining. Current unemployment levels
in the construction industry indicate that construction labor will not be
an impediment to achieving the requirements of P.L.92-500.

Chances of shortages of materials, especially pipes, valves and fit-
tings; structural clay products; service industry machinery; industrial
controls; and cement and gypsum, increase if the 1977 and 1983 deadlines
are strictly enforced. Current over-capacity in the water j2ollution -! - -
control equipment industry should provide adequat e.supply of specialty
equipment.

Spreading expenditures for water pollution control over a longer
period can substantially eliminate shortages. A reasonably "smooth"
pattern of pollution abatement expenditures should cause relatively-low
.price increases.

Tight supplies of chlorine, caustic soda, lime and soda ash can occur
in the future, but primarily from demands for other uses. Even major
changes in wastewater treatment demand will not add significantly to the
total demand. Municipalities' recent experiences with chemical shortages
may stimulate better methods of insuring adequate supplies in the future.

C. Social Effects and Benefits 1977 and 1983

QUESTION: Who is likely to bear the adverse social impacts from the
achievement of the water quality requirements and goals?

ANSWER: Adverse impacts wiU-falZ most h .eaviZy on the employees
and 'owners.(either individual or corporate) of those
industrial pZants closed as a result of the i?T-Zementa-
tion of the 1977 and 1@83 effluent Limitations. Generally,
small older businesses will be adversely affected. Employ-
ment Losses from plant closures, both direct and indirect,

1-38

could amount to over one-quarter million jobs with full
implementation of BPT and BAT limitations. other cate-
gories adversely impacted will be the moderate-income
f=ily seeking to enter the housing market for the first
time, and the tow-income resident who.wiZZ bear a higher
relative cost of the Local share of financing pollution
control facilities relative to his income as a result of
the shift from property taxes to user fees.

Heaviest job losses are indicated for the industrial categories of
textile manufacturing, electroplating, pulp and paper, and meat and dairy
processing. The majority of lost employment is expected to occur in the
Northeast and North Central states, and a consequence may be a shift in
jobs favoring the South. Women and white males will be most affected.
Women are 50 percent of the labor force in the textile industry, while
white males dominate the labor force in those portions of the electro-
plating and pulp and paper industries that would be most likely to close.
Minorities do not appear to bear a disproportionate share of job losses.
Thus, while benefits may be fairly evenly distributed geographically and
demographically, the unfavorable impacts of the Act's implementation are
not.

The average cost per family for treatment plant and interceptor sewer
needs and for BPT will be $306 yearly, while the-!costs per family for both
BPT and BAT and all municipal categories except urban runoff, assuming
achievement in 1985, will be $522 yearly. Each case is based upon the
families actually to be serviced by these projects. Excluding industrial
cost recovery and cost of secondary or indirect price increases, the
Federal income tax and user charges are the twomost important revenue
sources for the financing of the publicly owned treatment works program.
User charges weigh particularly heavily on low-income groups, while the
Federal income tax is more progressive. One important consequence of
Federal funding is to shift burdens from lower income groups and from
regions like the South with low incomes relative to the rest of the nation.
The price increases caused by the Act weigh most heavily on the lowest
income families, and next upon the middle income families.

1-39

QUESTION: How many jobs will be created by the implementation of
P.L.92-500? What kind of jobs will they be and how well
.distributed geographically and demographically?

ANSWER: New jobs, due to construction activities, reach a peak
in 1977.of 472,000, and remain over 100,000 per year
through 1983.* Overall, between 1975 and 1985, impZe-
mentation of the Act will create a total of 11.5 million
new Jobs, a majority of which will be associated,with
publicly owned treatment facilities.

One characteristic of treatment plant construction is its higher.@
requirement for non@-professional and unskilled labor, unlike.requiremehts
for other types of pollution control which tend to require relatively
.more professional and technical.sk.ill. The increased demand for con-.:
struction labor could be significant at a time when construction trades
are experiencing 20 percent unemployment. Also, because the treatment
facility requirement is geographically distributed throughout the.nation,
the impacts would be widesp read, providing new opportunities for employ-
ment in construction work in towns and cities all over the nation.

Other categories of employment directly benefit from the Act's
implementation such as the professional fields of sanitary engineering,
civil engineering and planning and environmental consultants.

QUESTION: Who benefits? Are there identifiable publics that
receive the benefits derived from improved water quality?

ANSWER: Sports fishermen, commercial fishermen, seafood canners
and processors and those commercially associated with
water-based recreational pursuits -- especially recrea-
tionaZ boating -- Will be major beneficiaries of the
Act., Property owners, too, of riverside and shoreline
properties will enjoy not only the benefits of improved
water quality adjacent to their property, but also the
increased value of the property, as well.

*Assumes BPT met by 1977 with expenditures over three years, and BAT met by
1983 with expenditures spread over six years; and $60.9 billion for publicly
owned treatment works spread over 11 years..

1-40

Water-based recreational pursuits are so pop ular and prevalent
in the United States that, with the exception of portions of the arid
Southwest, most Americans are within reasonable distance of water bodies,
many of which could provide increased recreation with improvements in
water quality. The public, in general, will also benefit from a larger
abundance of marketable fish and shellfish which should reduce prices
to the consumer.

one major positive social impact of achieving the Act's interim
goal will be to open recreational opportunities to low and middle
income urban residents where they have been, heretofore, limited or
nonexistent. For reasons of historic, commercial and cultural signif-
icance, most of the major cities in the U.S. are located next to the
water -- on major lakes, rivers or doastal sites. Cleaning up adjacent
heavily polluted waters would provide recreational opportunities near
urban dwellers. Increased water-oriented recreation would be possible,
however, only if the public had access to the water. The Commiss,ion
study of beach closings and openings identified this possibleresult as
an especially significant factor -- opening beaches in the heavily
settled regions of the Northeast, the Great Lakes and the Central-
Atlantic regions.

Conversely, increased benefits to property owners may not be widely
distributed, possibly indicating the need to secure or provide access to
the waters of improved quality so that the citizens who have borne the
cost of the clean-up can also enjoy the benefits of the endeavor.

QUESTION: Are thq benefits from the achievement of the 1983
interim water quality goal quantifiable, and what
will they amount to?
ANSWER: improved water quality Witt provide the American public
with greatly expanded opportunities for water-based ,
recreation., sports fishing and the commercial harvesting
of fish and shellfish. Each of these activities Witt
result in -directly.measurabte benefits to individuals,
segments of society and to the economy in general. Trans-
tated into dollar gains, the quantifiable benefits for
these activities, measured by the Commission studies,
could range from an annualized $3.2 to $4.2 billion by
1980, to between $4.8 and $6.2 billion by 1985. There
Witt be additional unquantifiabte benefits resulting from
aesthetic changes in water bodies and water-reZated acti-
vities, as we 41 as' indeterminate dimensions of benefits
to the public health and Welfare that wilt undoubtedly
result from the removal of toxics, heavy metals and other
pollutants from the nation's waters.

1-41

Marine fishing resources may be affected in two ways: (1) The reopen-
ing of many shellfish areas now closed to harvesting mainly as a result of
the discharge of raw or insufficiently treated sewage; and (2) the increase
in productivity of existing fisheries through improved water quality.
Assuming the timely implementation of the Act to achieve the interim goal'
by 1983, estimates of the aggregate measure of benefits associated with
commercial marine fisheries rises to more the $575 million per year by 1985.

Projections of sport fishing in marine waters suggest an increase of
around 76 percent over 1974 participation, or almost 237 million additional
days of sport fishing that may be available yearly beginning in 1985.
Again, assuming the Act's implementation proceeds on schedule, the economic
Value of these additional fishing days may approach $3.2 billion per year
by 1985. Freshwater fishing is expected to increase by 1985 with resulting
benefits approximating $220-$559 million per year. Projected increases in
boating activities appear to be even more substantial as a result of the
water quality improvements, since boating activities do not depend on the
resource availability in'the way that satisfactory fishing experiences
depend,on availability of fish. As a result, boating is estimated to
produce benefits'reaching $498 million to $1.15 billion per year by 1985,
excluding water-Tskiing, canoeing, sailing and other water-based and water-
related activities dependent, at least in part, on the quality of the
.water for a satisfactory experience. No attempt was made to quantify
benefits related to these latter activities because of inadequate historic
data to establish clearly the relationship between water quality and the
particular aciivity. These activities are likely to increase in propor-
tion to perceived improvements in water quality and, together, represent
a large sector of unquantifie:d benefits.

Swimming activities are correlated with the availability of beaches
meeting public health criteria. Nationally, if all public beaches now
closed to.swimming as a result of water pollution were to be opened, an
estimated 1,128 miles of'shoreline and 7,165 acres of public beach area
would be'affected during the swimming season. opening these beaches, could
pxovide up to $129 million in annual benefits from new activities and an
additional $392 million annually in diverted activities by 1985. Benefits
from beach openings are, projected to be concentrated in the'New England,
mid-Atlantic and Great Lakes@ regionst where the combination of population
Poncentration�@and large beach areas now closed to use offer a potential
for expanded public recreation.

1-42

QUESTION: Are these short-term benefits?

ANSWER: No. Assuming the maintenance of the water quality.,
these gains will continue to accrue far.into the future.
By the year 2000, an estimate for the recreational
benefits from marine fishing could climb as high as-
$4.4 billion per year, and annual quantifiable benefits
for all activities could range from $6.3 to $8.5
billion by 2060.

Land values of shore and riverfront property are expected to increase
as the water quality improves. The generally higher price of shorefront
property places a premium on these areas adjoining water of satisfactory
quality for recreation. As the public recognizes quality improvements in
deteriorated reaches along rivers and beaches, the value of nearby property
will rise as a measure of the buyer's willingness to pay more for the per-
ceived quality improvement available at the shorefront location. Commis-
sion studies estimated these increased property values reaching a level of k
almost $93 million per year after assumed achievement of the water quality
goals by 1985. Since property values have shifted.upward in a permanent
trend,i the:estimated benefit level can be assumed to continue indefinitely
into the future.

QUESTION: Are there unquantifiable benefits associated with the
achievement of the 1983 interim water quality goal?

ANSWER: Yes, two important kinds: (1) Those not fully identi-
fied yet,.such as health effects, where quantification
now is impossible; and (2) Those associated with
non-contact related experiences.

Empirical information for the nation establishing the exact association
between long-term exposure to low concentrations of carcinogenic chemicals
in drinking water and human health is woefully lacking. Recent studies
purporting to connect high incidence of cancer with persistent chemical
concentrations in drinking water suggest profound implications for the
health of the American public and the need to launch a full-scale detailed
analysis to identify possible direct association with trace chemical con-
centrations in drinking waters and human health. The implementation of
the Act, with its emphasis on removal of toxic or potentially toxic
materials, could provide immeasurable benefit to present and future popula-
tioris.of Americans. While the:.-reduction in upstream discharges of pol-@@
lutants will have some effect on the quality of water withdrawn downstream,

1-43

any reduction in municipal or industrial water supply treatment costs is
expected to be minimal and may be offset by the.costs of sludge disposal
of substances removed in water supply treatment,which can no longer be
returned to the source of supply.

Many people perceive a real benefit to clean water.,,.even tho 'ugh they
do not participate in water-related recreational activities.. Although
not subject to exact measurement, indiViduals and the public 'generally
take satisfaction,in the knowledge that the quality of thewater of a
particular stream or lake or of the waters of the nation, in general
-- are improving. measurement of public attitudes toward water pollution
control programs give.ample support for this contention.

D. Environmental Effects 1983

QUESTION.: Do incremental improvements in water quality charac-
teristics associated with achievement of the 1983
effluent limitations contribute significantly to the
realization of the 19,83 goat?

ANSWER: In most cases, the gains are projected to be less
than those indicated for achievement of the 1977
requirements.

Measurin g the incremental enviro nmental effect beyond achievement
of Phase 1.(1977) to the next level of effluent limitations (1983)
that of BAT for industrial and agricultural dischargers and BPWTT
.for municipal sources -- becomes highly conjectural. The capacity
to predict within reasonable accuracy the future disposition of a
dynamic ecosystem under constantly changing stresses-is limited,
at best., Recognizing these very real limitations, the environmental
effects of theapplication of the next more.stringent level of treat-
ment to point source. discharges (1983 requirements) would appear to
provide less improvement.in thephysical and chemical indicators
than achieving the 1917 requirements. Additional portions of rivers
and other water bodi es do,reAch the minimum quality standards
reflecting the interim goal of a quality.-tha.t "wherever.attainable"
"provides.for the protection and propagation of fish,.shellfish, and
wildlife and provides for recreation in and on the water." Potentially,
the resulting improvements from the 1983 requirements could provide an
estimated additional 10 to 15 percent increase in-suitable areas for
game fish habitat resulting, primarily, from improvements in the DO
level, control or elimination of toxic substan.ces and nutrient removal.
More shellfish areas and beaches could be opened if flows from combined

1-44

storm and sanitary sewers were brought effectively under control in
some places. Depending upon the level and effectiveness of control
of toxic substances, wildlife and waterfowl would be less endangered.
These are significant Advances, but improvements will,not be so wide-
spread nor so large as from the application of 1977 requirements.

Many areas, including some large urban industrial centers
located on'fresh waters, are'already@requiring control or treatment
measures more stringent than the technology-based effluent limitations
for 1977, based generally on the allocation of pollutant discharge
loads so as to assure the maintenance'of desired water quality.
Major municipal dischargers in these areas are generally required to
reduce@effluent Bob and suspended@solids' concentrations by one-third
to one-half the levels, achievable with secondary treatment. Major
industrial dischargers are generally required to meet limitations more
stringent than BPT, but less than BAT requirements. Where these
measures are being implemented, the achievement of standards or the
attainment of improved'water,quality. is deemed to require and justify
a degree of pollution control beyond that of the 1977 technology-based
limi@at_ions.

Even after achievement of the 1983 requirements, a number of
potential residual dissolved oxygen problems may persist, resulting
from urban runoff and combined gewer overflows. For portions of
15 of 39 sites (36 percent), projections indicate that more stringent
treatment than that for 1983 will be required to achieve adequate
DO levels. Little improvement in fecal and total coliform bacterial
levels can be expected since the major remaining sources of coliform
bacterial loading is attributable to uncontrolled nonpoint sources
which may be unaffected by implementation of the 1983 point source
requirements.

Progress toward identification and elimination of toxic substances
will be a more critical indicator of achievement of the 1983 interim
goal, since toxic substances are present now at all sites for which
data are available. 'In the absence of effluent limitations for toxics
control, the extent to which concentrations of heavy metals from
industrial discharge's will be'controlled by the application of BAT to
industrial dischargers is unknown. Also, by 1983, it is conceivable
that additiona1mateiials will be identified as toxic in certain
concentrationsand subject to effluent limitations and control.
Which substances or in,what concentrations, however, is inpDssible
to predict. Aside from municipal and industrial wastes, toxics from
other sources, such as heavy metals contained in urban storm runoff
and-mine.drainage@and pesticides concentrated in runoff from agri-
.cultural lands or forested areas, are recognized as having potential
for catastrophiceffects an plahts?'fish, wildlife or humans.

1@ 45

Unfortunately, limited knowledge of what concentrations of a
potentially toxic.material constitute a danger in the environmental
system precludes complete identification of all toxics. A sophisticated
knowledge of long-range biological effects of small concentrations
is lacking. Although tolerance ranges-have been established in the
laboratory for a number of substances under rigidly controlled,
simulated environmental conditions, adequately defining a toxic
substance under natural environmental conditions is difficult.
Information is also lacking on the pathways and movements of toxic
materials in the environment, including recycling from sediments and
chronic and sublethal effects and impacts.

'Accumulated residues of historical pollutant discharges may
continue to pose a threat even after their sources have been controlled
or eliminated. For example, pollutants attached to sediment particles
concentrate where sediments are deposited and remain there.until
disturbed or dissipated. Sludge blankets or benthic deposits,from
uncontrolled discharges in the past continue to affect ambient water
qualities.

Delay in.achieving control or treatment measures al lows these
depositions of materials to continue and may eliminate some of those
already depleted aquatic food chain species before corrective measures
provide an opportunity for their restoration. Additional growth during
the period of delay, either industrial or populationt even with appli-
cation of wastewater control or treatment, contributes to the total
pollutant load and may produce further water quality degradation.
Ultimate installation of the required technologies may notalways
be able to overcome the consequences of the delay.

Even achievement of the 1977 requirements, secondary treatment
for publicly owned treatment works, may pose environmental problems.
Required chlorination of municipal effluents to reduce fecal and coli-
form bacteria counts can adversely affect aquatic@'organisms. While
this disinfection is usually justified as a measure for protection
of public health, other methods of disinfection that do not have
this adverse environmental effect, such as ozonation, are practiced
elsewhere.

For 70 percent of the environmental site.-�, the high coliform counts
result either from urban runoff or agricultural and other nonpoint
sources. These sources are not affected by the 1977 and 1983 point
.source control or treatment requirements.

1-46

III. TECHNOLOGICAL ASPECTS AND ECONOMIC EFFECTS OF 1977 AND 1983
REQUIRENENTS APPLIED TO AGRICULTURE

QUESTION Are agricultural point sources of pollutants omenabZe to
the technological concepts of BPT and BAT?

ANSWER: Some are, such as feedlots. Others, such as-irrigation
return flows, present unique and widely variable problems
when attempting to apply universal uniform effluent
limitations requirements of P.L.92-500.

QUESTION: What is being done to implement BFT for irrigation return
flows?

ANSWER: Since EPA has defined the 1977 requirement as monitoring
the quantity and quality of intake water supply and irri-
gation return flows, BPT @- as so far defined -- is tech-
noZogically achievable. Complex and widely varying
systems by which excess water applied for irrigation
reaches surface and ground waters in the vicinity Of its
application, do present,even monitoring problems, however.
Known control technologies currently available are not so
well developed az to,as8ure their universal practicable
application with predictable results.

QUESTION: Is "best available technology economically achievable"
to control pollutants in irrigation return flows techno-
logically attainable by July 1, 1983?

ANSWER: No_, simply because no universally applicable or effective
technology has been developed which can be applied with
reasonable predictable results for all geographic areas.

QUESTICN: Should statutory provisions, intended to controZ.poUution
from irrigation return flows, remain a part of P.L.92-500?
ANSWER: Yes, if they should be so formulated and designed as to
recognize the variety of pollutant effec 'ts, the unique
institutional structure of irrigated agriculture, the wide
geographic.differences in irrigation objectives and prac-
tices, and the state-of-the-art for control practices and
measures for reducing pollutants from irrigated agriculture.

1-47

A. ..:-Feedlots

Technology costs and economic effects of applying BPT and
BAT to.beef cattle, dairy, hog and turkey feedlots have been included
in analyfses already discussed; those for layers, broilers and horses
were not examined because there is generally little liquid discharge;
and those for catfish* and@ducks** were given cursory examination but
not reported because of their localized importance. ' The cost of con-
trolling point source discharges from feedlots to 'the BPT level is
very high for small operations of all types in wet and cold regions
of the country. Investment costs range up to $160 per head of capacity
for small dairies in the upper tier of midwestern and eastern states
and in the southeast. Costs are much lower for large operations of all
animal types in milder, drier climates, ranging down to $48 per head
of capacity for an 800-head dairy, $14 per head of capacity for a
20,000-head beef feedlot, and $5 per head capacity for a 1,500-head
hog feedlot. Comparable ranges for costs for installing BAT and $231
for small dairies to $57 for 800-head; $35 for 20,000-head beef feed-
lots and $10 per head for a 1,500-head hog feedlot. Price increases,
decreased profits and feedlot closures because of pollution control
expenditures, other than dairies for which the distribution is general
nationally, reflect the same geographic pattern of higher costs that
occur for small operations in wet, cold,regions. one of the major
problems with feedlots has been limiting application of P.L. 92-500
to the significant discharges. After a judicial ruling that EPA's
classification was inappropriate, the Agency has now issued new,'
proposed regulations (November 20, 1975).

B. irrigation Return Flows

Difficulty with applying the "best practicable control
technology currently available" (the 1977 requirement) and "best
available technology economically achievable" (the 1983 requirement) to
irrigation return flows results'from the wide variation in irrigation
practices, selective underdraining of irrigated lands and historical
appropriative surface water rights dependent upon available quantity
flowing in watercourses. There is little doubt that Congress intended
to include irrigation return flows as a point source subject to
effluent limitations and NPDES permits, but the BPT and BAT limita-
,tions concepts, even with all the problems their application has
encountered, are more simply and:easily applied to industrial than to
irrigation discharges. Some irrigated land is underdrained; some not.

*Reliable, comprehensive, national data were not available.
..**Available data show 63 duck farms with about one-third on
Long Island, New York and most of the others in Indiana.

I-48

Drainage systems have been installed on about 55 million acres on non-irrigated land and about 5 million acres
of irrigated land. The underdrains and runoff collected in them are point sources, while excess irrigation water
that may enter surface watercourses by sheet runoff or by prcolation through the soil is not. The concentrations
of all pollutants except dissolved mineral salts can be expected to be similar in drainage from irrigated and non
irrigated land. Some underdrainage irrigated land accumulates percolating irrigation water applied to its upslope
neighbors; the discharge is a point source accumulated from several irrigators. Even where there is a discernible,
confined and discrete conveyance "such as "pipe, ditch, channel,tunnel, conduit, well,[or] discrete fissure,"
irrigation return flows from many fams may be indiscriinately commingled before they can be adequately monitored or
treated, if treatment becomes necessary. Sometimes efficient application of irrigation water may decrease pollutants,
but it can also reduce the quantity of water stored in the soil that later percolates into surface watercourse or
groundwater aquifers to provide a sustained supply to downstream or downslope users. Reducing water withdrawels during
high flow periods may result in lower and more polluted flows during dry seasons.

As with feedlots, EPA attempts to fix a size or numerical limit for irrigation return flow point sources
below BPT or BAT limitations would not apply have been unsuccessful. Thus far, EPA has accepted monitoring the
intake supply and discharge quantity and quality as compliance with the 1977 requirement; parameters to be measured
include flow, suspended solids, total dissolved solids jor specific conductance, turbidity and sometimes nitrates
and other variables as conditions at the site may dictate.

More than 90 percent of all irrigated acres (39 million) and all irrigated farms (257 thousand) are in twenty
states, California (with 18.5 percent of irrigated acres, 7.2 million, and 19.9 percent of irrigated farms, 51
thousand) and Texas (with 17.6 percent, 7.0 million acres, and 11.9 percent of irrigated farms, 29 thousand)
account for 35 percent to 40 percent of the national total. About 41 percent of all irrigation water is supplied
from groundwater, 15 percent by direct diversion of surface water, and 44 percent by irrigation organizations, including
around 20 percent from Bureau of Reclamation projects. The pollutant of most concern, dissolved salts, is perhaps
more critical in California and thos states entitled to use water from Colorado River. Sediments contained in
return flows represent a generalized contribution while nutrients (nitrates) and toxic pesticides are of more
localized concern.

Four primary methods are used for applying water to land; about 54 percent is irrigated by furrows or ditches
30 percent by flooding,

1-49

1.5 percent by sprinklers an d 1 percent by subirrigation, which is
important in a very few regions. Well-managed sprinkler systems are
generally among the most efficient methods of applying irrigation water.
Since all water applied in excess of that which can be stored in the
root zone either evaporates or becomes return flow in the form of
either tailwat'er, drainage or deep percolation, increasing the
efficiency of irrigation will reduce the-quantity of return flow.
Irrigated land with installed subsurface drains is concentrated in the
South Pacific (1.55 million acres), Great Basiri (.23 million acres),
Pacific Northwest (.63 million acres), Colorado (.21 million acres)
and Rio Grande and Western Gulf (.24 million acres) drainage basins,
with the exception of Florida (,91 million acres).

The cost and effectiveness of three levels of control of irrigation
return flow were investigated: "low", "medium", and "high".

The low level of control would reduce the mass emission of pollu-
tants in return flow by increasing the efficiency of water use through
"irrigation,management service" (IMS), but it would increase the
concentration in the volume of water retained. In many cases, in-
creasing efficiency'reduces mass discharge of dissolved salts simply
by reducing the mass of salt applied to the land in the water. In areas
with highly saline soils, incr .eased'efficiency'will decrease the rate
of salt leaching and the total salt load carried in the water body.
The cost of a typical IMS averages about $5.00 per acre per year and,
since this system does not eliminate return flow,the cost of
monitoring return flows, estimated at $2.00 per acre per year, must also
be considered. However, IMS has been estimated to save about $2.00
per acre per ye.ar in fertilizer costs, and this is estimated to
balance the cost of monitoring. Therefore, IMS is estimated to result
in a net cost of about $5.00 per acre per year.

The medium level of control as defined in this study would improve
irrigation efficiency to the maximum extent feasible by initiating
IMS, lining unlined laterals and canals, and installing sprinkler
systems on all land that is now surface irrigated.' Sprinkler irriga-
tion may not always be economical because of the length of the
growing season,crop adaptability or other*factors. These controls
would be applied only to surface irrigated land with installed drains.
The medium level of control for land that is not artificially drained
and that is surface irrigated would be IMS, plus sedimentation basins
to treat all tailwater. In both cases, monitoring of return flows
would still be required.

The high level of control investigated would add desalting of
return flows from lands with installed drains to the medium level of
control, and would prohibit the discharge of,tailwater by requiring

1-50

installation of tailwater recovery systems for capturing and punping
back to the irrigation system any water that collects at the lower end
of the field.

Where conditions are favorable, irrigation management service can
improve irrigation efficiency by approximately 20 percent, while in-
creasing crop yields by about 15 percent. The use of the service can
reduce the discharge of pesticides, phosphorus, sediments, and organic
matter by 20 or 40 percent. The degree of control of nitrogen dis-
charges which can be achieved is highly variable and is dependent on
local conditions. The cost, where major structural improvements in
the delivery system are not required, averages about $5 per acre per year.

Increasing irrigation efficiency by 20 percent could reduce irriga-
tion water diversion by about 20 percent and reduce return flow
volume from 40 to 50 percent but would increase the dissolved salts
concentration in the return flow by 30 to 60 percent. It would
generally have no effect on consumptive use of water by plants. It
would decrease the mass emission of salt in the return flow by about
20 percent, and would alter the temporal distribution of downstream
flow. The water quality impacts of these alterations may be beneficial
or detrimental, depending on local conditions.

Major structural changes in water conveyance, distribution and
application systems (canal lining, installing sprinklers, etc.) to
improve efficiency are much more expensive, and have about the same
average degree of effectiveness in reducing water use and return flow
as IMS. The effectiveness of such structural changes in improving
efficiency is highly dependent on local soil types, being very
effective in coarse grained soils and only marginally effective in
soils with high clay content. Costs range upward to $78 per acre per
year, depending upon local circumstances.

Desalting all the drainage.water from one acre of irrigated land
costs up to $130 per year, assuming a plant for return flows from each
10,000 acres of land*and evaporation ponds for the resultant brines.
Cost of collection and transport of return flows is not included, nor
is the cost of disposal of residue from the ponds. The effectiveness
of desalting is limited by the fact that most irrigation return flows
reach receiving waters as nonpoint sources.' Only 12 percent of irriga-
ted land is drained, although 25 to 50 percent probably contributes some
return flow to the drains. However, installed on-farm and master
drains are normally provided only to supplement the natural drainage
system provided by subsurface porosity, and they intercept only a
portion of the percolating water under drained land. Drains may be
installed to advantage only where there are certain subsoil conditions.

1-51

C. The Colorado Rivet -'A Special Case

The overriding water quality problem in the Colorado River is
salinity. The salt loads in the river stem mainly from the weathering
of the basin's saline soils. Man's affect on the salt concentrations
arises from-activities which both change the total amount of salt and
*decrease the river's flow. Under present conditions the net increment
to the salt load from irrigated agriculture or other uses is probably
less than half that from natural sources. However, consdmptive use
or out-of-basin transfers decrease dilution and further increase salt
coocentrations. The increment in salinity concentration attributable
to reduced flow is at least as large as that from the increased salt
load. Future water depletions have a greater potential for degrading
water quality than new sources of salt.

Increased salt concentrations in the Colorado River tend to be more
harmful to man-than they are to the natural environment. The biological
communities of the lower Colorado are tolerant of salt concentrations
historically associated with low flow conditions. In contrast, man's
use of the river, including irrigated agriculture and municipal and
industrial use, are affected by the.present salt concentrations. Some
varieties of crops cannot be grown.' Salt tolerant crops require in-
creased quantities of irrigation water if salinity concentrations.are
high. Municipal or industrial users of water from the lower Colorado
must meet costs for water softening or for controlling salt deposits.

The apportionment of the wa ter resources of the.Colorado River is
governed by a complex set of treaties, compacts, Federal and state
laws and court decisions. The present upper basin use amounts to
about 3.7 million acre-feet each year. Consumptive use will increase
in the future as the upstream states commit to use the quantities to
which they are entitled. The Bureau of Reclamation has estimated that
this demand could grow to be 5.9 million acre feet per year by the
year 2000. When development occurs remedial actions to control down-
stream salinity concentrations will be required. Without such actions
salinity at Imperial Dam could increase from the present 850 mg/l to
as much as 1,250 mg/l.

The program to*control salinity in the Colorado may include'a
variety of measures. Title II of P.L. 93-320,.the Colorado River Basin
Salinity Control Act,-authorizes the Secretary of the Interior, acting
through the Bureau of Reclamation;, to construct three projects to
isolate and remove highly saline inflows and undertake improvements to
decrease the seepage of irrigation water from the delivery and
drainage canals in the Gran4 Valley area of Colorado. P.L. 93-320 also
directs the Secretary of the Interior to complete planning reports on
12 additional salinity control projects. Of these.projects, four

1-52

would control salt loads from irrigation sources, three from natural
springs, and five from natural diffuse sources.

The initial four projects are to be funded on a cost-sharcing
basis. 75 percent of the cost is Federal and 25 percent is derived
from the Upper and Lower Colorado River Basin Development Funds. Over
$125 million was authorized,'but there have been no appropriations
to date.

The seven basin states have developed and are in the process of
adopting salinity standards, including both numerical criteria for
salt concentrations and measures to assure their achievement and
maintenance. The core of the program is the 16 Federal projects of
P.L. 93-320. In addition, the implementation plan includes a "no salt
return" policy for industrial uses and a reformulation of certain
future agriculture development projects to minimize their salt discharges.
The industrial policy requires that wherever possible, new water uses
for energy or other industrial developm!@
,pt not return the salts removed
by water diversions. At the present time this policy means that
"blowdown water" from cooling towers at steam electric generating plants
is contained in evaporation ponds. The third feature of the states'
implementation plan is an on-going research program mainly focused on
lessening the salt load cont ributed by irrigated agriculture.

The Commission's findings confirm the potential for reducing the
salt load in the river by increasing the efficiency of irrigation
practices. Based upon general assumptions, a program to increase irri-
gation efficiency throughout the basin could potentially reduce the
salt load in the river by 2.0 million tons per year from the current
9.0 million tons per year. Projects designed to decrease salinity
through increased irrigation efficiency, however, should never be
initiated without careful evaluation on a site"-by-site basis.

D. Agricultural Nonpoint Sources

Certain nonpoint sources may contribute large quantities of
pollutants to the nation's waters on a temporary or intermittent basis.
Runoff from agricultural cropland may deliver sediment, fertilizer,
pesticides and organic materials to surface water. Non-irrigated
cropland in the United States was estimated to total about 380 million
.acres in 1967, roughly 90 percent of the total cropland. The only
measures evaluated for reducing pollutant contributions such as '
sediment, fertilizer, pesticides and organic materi@i to streams were
those recommended by the Soil Conservation service in its 1967
Conservation Needs Inventory. This Inventory indicates that about
158 million acres -- 40 percent -- of non-irrigated cropland needs
better soil conservation practices applied. Implementation of these
practices is estimated to require a capital investment of $2.6 billion.
No mechanism now exists that could dictate implementation of all the land
needing these measures, even if all investment cos@ts were borne by the
Government.

1-53

IV. INSTITUTIONAL FACTORS INFLUENCING "ACHIEVING OR Nar ACHIEVING, THE
EFFLUENT LIMITATIONS AND GOALS SET FORTH FQI@ 1983

Institutional Factors -- 1977 and 1983

QUESTION: How has the response of persons in the institution 'al
s.tructure for water pollution control -- Federal, state,
7.nterstate, regional and local governments, industrial
and agricultural dischargers, and all interested groups
-- affected achieving or'not achieving, by the stated
deadlines, all that is required.'to meet the requirements
and goals of P.L.92-500?

IndividualLy and collectively, their response has con-
tributed to the time required to' achieve-resuZts under
P.L.92-500. Unfortunately, the Iinterrelationship's have
too often been adversary, rather @tha,n cooperative in
nature.

The task has been larger than any of the initial participants recog-
iized. Probably none of those involved in the formulation of P.L.92-500
n
fully appreciated the magnitude of the task;assigned t6,j and the response
expected from, persons in the various government levels,and among indus-
trial and agricultural point source dischaigers,and the many,"publics" in
implementing the Act. Congress seriously underestimated the'EPA manpower
requirements,the time required and the compl.exity,of establishing effluent
limitations and issuing permits to-every disch Iarger %, while,Iat the'samm'e
time, rapidly accelerating a publicly owned treatment@works construc .tion
grants program with several,major.new requirements. To the extent that
EPA acquiesced in'the.sev6ral statutory deadlines and encouraged-the
various program expansions, it, too overestimated its,own capacity'to
respond to the Act.

The breadth and detail of the delegations to the EPA Administrator for
definitive explanatory or implementing regulations are enormous.; States
initially had serious reservations about the new direction of the national
program and the joint capability to implement it.@ Local governments were
ill prepared to reformulate pending and developing construction grant
applications under the new requirements. State pollution control agencies
p
were inadequately manned to perform the review, permit and enforcement
functions expected of them. :States and local governments were'thkust into
much Sharper conflicting roles as@both regulator and regulated. The tradi-
tional and normaltension between levels of government b6ca more strained
'ivate dischargers-who generall
than ever. Pr an approach utilizing
uniform national reqi4irements,.:wexe unhappy -with the initial effluent

1-54

limitations issued by EPA. Agricultural dischargers were hardly aware of
the full import of the Act until long after-its passage. All affected and
intereste6groups differed widely and strongly as to the best course
toward implementation. EPA became the-focus of the contending viewpoints,
with individual Members of Congress who had been intimately involved in
shaping the legislation often expressing different interpretations of the
intent-of'the'Act@. EPA's anxiety to do a good job with the new statute
.often cause it to regard all its critics as its adversaries, only in the
last year or so have the relationships become more relaxed.

QUESTION: What are the implications of the resultant delays in
meeting deadlines or implementing various statutory
directives?

,ANSWER: The obvious implication is that the time schedule for
accomplishment of some requirements and goals of the
Act is out-of-phase. The first major'deadline __
installation by dischargers of Phase I wastewater treat-
ment technologies by JuZy 1, 1977 -- will not be met by
all dischargers, and the series of delays which have
occurred within the institutional structure and the slow
flow of grant funds share major responsibility. This
fact requires consideration of alteration in the present
time schedule for accomplishment to coincide more closely
-with the realities of current circumstances and available
funding, as well as the limitations inherent in the
intergovernmental process and the interactions between
these governments and the various affected and partici-
pating "publics."

QUESTION:. Where, in the program structure, are the delays most
seriously manifested, and what do they reveal,.tabout the
fundamental,implementation strategy of the Act?

ANSWER: The strategy of the Act is predicated.on the proposition
that 75 percent Federal construction grant assistance
for publicly owned treatment works, coupled with strong
centraZized national initiatives for regulation and en-
forcement structured within a framework of comprehensive
state and local pZanning., will produce the@most expedi-
tious, effective and sensitive application Of resources
and manpower to the accomplishment of national water
quality objectives.. In the first three years, a dis-
parity has developed between the proposition and its
reatization.

1-55

Delays in issuance of guidelines,-effluent limitations and regulations;
delays in the obligation and outlay.of Federal funds for*construction
grants; delays and variances in theissuance of the NPDES permits for muni-
cipal, industrial and agricultural dischargers; and the fact.that mandated
planning requirements are seiiously out-of-synchronization with the con-
struction grants and permit phases,.all'contribute to uncertaint@ as to
the validity of the essential proposition. Experience with implementation
to date can neither effectively discredit nor irrefutably sustain the.
proposition.- Experience can, howeverj1dentify the points in the implemen-
tation process where the delays have'been most-pronounced and made some
observations, based on-performance thus far, about the basic structure of
institutional cooperation vital to the Act's fair and effective implementa-
tion.

A. Regulation

QUESTION: Has implementation progressed sufficiently-to identify
any basic problems with the reguZdtory.strateg'y contem-
plated in P.L.92-500?

ANSWER:. AiZe there am still a number of uncertainties about
the implementation of the regulatory scheme,-the con-
duct of two activities'in the regulatory strategy can
jeopardize the ef@ective implementation of the Act.
one is the development and protnutgation of effluent
limitations which are being aggressively contested by
-industry in over 250 legal challenges.- The other is
Ithe capability of the Federal -state and local reguZa-.
tory and a&ninistrative agencies to develop useful
information systems for monitoring and reporting com-
ptiance with the Act's various program components.

Development of effluent limitations presented EPA with one of the
.most complex, perplexing and controversial activities essential to the
Act's implementation. The Pasis for the entire regulatory strategy,
the setting of effluent limitations, presumes an understanding by
EPA personnel of every segment and subcategory of industry, their
various production processes, the waterborne wastes th6y'generate and
the technologies for treating those wastes. Such detailed expertise
may be more than the Agency can reasohably be expected to posse ss
about complex, ever-changing industrial operations.

Problems with the development and perfection of effluent limita-
tions have slowed the entire regulatory process. Due one year after
enactment (()ctober 18, 1973), the first EPA effluent limitations were,

1-56

not issued until January 31.-1 1914,and the process of identification of
industrial subcategories and the issuance of limitations still continues.
In particulari promulgation of pretreatment and toxic substances standards
pose major uncertainties for the regulated dischargers.

The methodology EPA selected to define the effluent limitations (bakd
on model plant performance), as well as the statutory interpretation of,
Sections 301 and 304, have been criticized by industry and independent
advisory groups and 'challenged in court. The methodology, it is charged,
results in indiscriminate and inflexible application of fixed numerical
limitations to industrial categories and subcategories without adequate
recognition of products and production technologies of a particular plant
or sensitivit@ to such considerations as size, age of plant, location,
y
lice, however, Commission studies found evidence of a degree
etc., In pract
of variability in the permits which are the end product of the actual
application of effluent limitations.

Many of the EPA effluent limitations are being legally contested.
More than 250 lawsuits have been initiated by industries chall6nging the
promulgated "effluent limitation guidelines," on (1) the fundamental
nature of the regu@atory scheme, and (2) the substance of the regulations.
These challenges have been consolidated in U.S. Courts of Appeals to 21
proceedings. Issues in these legal controversies are detailed in the
11P.p.92-500 Litigation" section of.Chapter V of this report.

To date, only one case has been,decided on its merits; all others
are still pending. Thus the final outcome cannot be predicted. What
has been demonstrated, however, is the perhaps inherent difficulty
experienced in attempting the detailed specification and universal
application of regulations to industrial categories and subcategories
and numerous, complex and changing production processes.

The Commission's studies of the application of treatment or control
technologies by industries indicate that the EPA effluent limitation
_@trategy, based on allowable pollutants per unit of production for an.
entire subcategory, in effect sometimes causes a "force fit" of a
simplistic set of numbers to wastesfrom industrial production processes.
The more-complex the industry and the more variable its production
processes,-the more difficulty EPA has encountered in applying this
regulatory strategy, As the trend in most industries is toward more
sophistication, variationj change and complexity in production,
problems for the regulator are not likely to decrease, but rather
increase. As new source performance standards and Phase 11 (1983)
requirements for application of BAT become effective and are incor-
porated into individual permit conditions under the NPDES, the process
will require of the regulator even more knowledge and technical sophistica-
tion.

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it is within the,,p6rmit system that the controversy over effluent
limitations is most significant. Permits issued under the National
Pollutant Discharge Elimination System provide the legally enforceable
application of the Act's requirements.. In some instances, constituents
from.a particular discharge will precisely match the constituent para-
.meters of the applicable effluent limitations. -But, in many cases,
they do,not.
In more @epresentative situations involving complex industrial
processes, the discharge will not precisely correspond to the effluent
limitation.on a donstituent-by-constituent basis because of the variety
of products produced. Thus, permits that follow effluent limitations
exactly may not include all pollutants. Conversely, when permits do
include poilutants not enumerated in effluent limitations, they must
be negotiated on a plant-by-plant basis rather than in strict conformity
with the promulgated limitations. While the overall impact on water
pollution control.,may be insignificanti it does pinpoint a divergence in
application of the Act's strategy of transforming universal uniform
effluent limitations into permits.

The permitting process has been gubject to other divergence from
strict compliance with the Act -- chiefly as a consequence of delay.
Initiating the issuance of industriAl'and municipal permits was .'
postponed pending development of-effliient.limitations, review and up-
grading of state water quality *Standards and completion of waste load
allocations pursuant to the Sec. 303(e) state basin planning process.
Consideration of agricultural permits awaited a determination of how
best to proceed. By the December 1974 deadline, EPA and the NPDES
states had issued.only a little more than half of the estimated 47,000
required permits. Included were permits for 94 percent of the major
industrial dischargers, and 91 percent of the major municipal dischargers.*

There cire differences, too,.betWeen the application of the NPDES to
the industrial and municipal dischargers. EPA placed major emphasis on
issuing industrial permits. Industrial permittees are now operating
under prescribed construction schedules, although, as Commission studies_@
show, many may not actually hav.e the required facilities in place in time
to meet the July 1, 19'77, deadline'. Some share doubts, however, that the
installed technologies will, under all circumstances, strictly.meet permit
conditions.

*Major dischargers represent approximately 12 percent of total permittees
and account for 60 to 80 percent of.total point s.ource pollutant dis@,...
charges. EPA regions identified them on a subjective basis -- taking into
account discharge volume, receiving water quality, discharge, severity and
discharger compliance history.

1-58

Progress with the NPDES in the public sector has not been so
promising. Recognizing the inextricable relationship between Federal
construction grants and permit compliance as well as the legal and
political difficulties of enforcing permits issued to publicly owned
treatment works, EPA made what was probably the only realistic decision
and is writing permits to reflect the availability of funds and the
eligibility of the permit applicant. Consequently, only about
50 percent of the publicly owned treatment works permits prescribe
compliance with required effluent limitations (secondary treatment or
a higher level of treatment to meet water quality standards by July 1,
1977).

Where public facilities are to 'be funded, use of permit conditions
to 'assure the application of strict compliance schedules for constructi)on
and'optimum performance of the facility.when completed, varies from
EPA region to EPA region and from state to state. Smaller cities and
communities (with population under 25,000), which make up over 25 per-
cent of all municipal dischargers, apparently have had difficulty
understanding and applying the complex requirements of the law and
regulations or do not-always possess the technical and legal staff
capabilities to decipher the Act's requirements and the detailed
requlations. Such communities must rely upon consulting engineers
and engineering firms who may not always examine the cost-effective
control options. For example, most communities elect traditional
treatment.works without investigating potential cost savings and
efficiencies in such alternatives as land treatment. Currently, EPA
and the states rarely provide field technical advisory services to
assist small communities in the development of water pollution control
strategies. Wider use of such a service might be both helpful and
efficient. Limited in-house capabilities and reliance upon consulting
engineers are probably equally applicable to many industries, and
certain small plants might be well served by a similar type of service.

Application of-the NPDES,beyond the 1977 requirements is uncertain.
Industry appears generally reluctant to accept the 1983 requirements
(RAT),*claiming that they are being treated inequitably when compared
with municipal dischargers; that the environmental improvements asso-
ciated with the application of BAT to point source dischargers are,
in most cases, marginally beneficial when compared with e-ffects of
nonpoint sources; that capital costs, energy expenditures and residual
disposal problems associated with BAT are excessive contrasted with
benefits realized; and that current economic conditions intensify
competition for investment capital. Also, delay in the issuance of
toxic and pretreatment standards extends the uncertainty about the
future application of these provisions of.the Act and their economic
and environmental inpacts. An indeterminate number of discharges

1-59

(EPA estimates between 50,000 to 100,000) remain to be permitted, such as
small feedlots, stormwater sewers., irrigation return flows, etc., present-
ing an enormous policy and management problem for.the Agency.

As for designation of the NPDES authority to the states, EPA initially
emphasized the states"assuming the program, perhaps at the expense of
developing consistent, unequivocal guidelines for NPDES implementation.
As of October 29, 1975, EPA had designated 26 states for NPDES authority,
with indication that eventually as many as 39 states, Puerto Rico and the
Virgin Islands w6uld be certified. Remaining states and territories may
never apply to undertake the program. The Federal framework established
by P.L.92-500 can be sustained even after designation through the pre-
scribed mechanisms -- effluent guidelines, permit reviews, Sec. 106 grants
and Sec. 303(e) planning. According to Commission survey results from
several state and EPA regions, neither the EPA personnel nor those from
the states believe that, once designated, EPA will ever reassume NPDES
authority from a state.

There presently appears to be no direct correlation between delegation
and degree of Federal involvement at the state level. In Texas, for
example, which is not certified for permit authority, the state, in effect,
is performing most of the permit functions. In some other states desig-
nated for permitting authority, EPA continues to maintain a dominant role.

Evaluation of progress under the Act's regulatory strategy must
include recognition that the law specifies a cyclical patternfor its
critical components. Effluent limitations issued under Sec.301(b)(2) for
1983 "shall be reviewed at least every five years and, if appropriate,
revised . . .". [Sec.301(d)]; water quality standards are subject to peri-
odic revision under Sec.303; the Administrator's definition of secondary
treatment and other actions are subject to change "from time to time"
under Sec.304; new source performance standards are also subject to change
"from time to time" under Sec.306(b)(1)(B), as are toxic standards under
Sec.307; and the Administrator "shall ... . review at least annually" pre-
treatment standards under Sec.304(f)(1). Regular NPDES permits are issued
for terms up to five years, and new source permits are not to exceed ten-
year periods. Thus, most significant administrative actions relating to
the principal instrument for enforcement -- each point source discharge:,
permit -- are automatically reviewable in prescribed cycles. Opportunities
for change and refinement are not just suggested; in some instances., they
are mandated by the Act. Thus, whatever the delays, confusion and errors
to date, early opportunities are available for improvement. Experience
to date provides guidance to the Congress and to EPA for actions to be
taken in the next cycle of effluent limitations and permits.

1,60

Compliance monitoring is the mechanism intended to alert EPA and
NPDES states to permit violations, thus triggering compliance or enforce-
ment action. As such, coverage and performance of the system will be
critically dependent upon the collection, review and assessment of
information from permittees. Moreover, situated at the sensitive
juncture between Federal and state enforcement programs, its utility
as a management tool requires effective cooperation between EPA and
the states for regular, systematic, selective, on-site inspection of
permittees, premises and monitoring records and instruments. Without
an effective information collection and retrieval system and clear
delineation of Federal-state respofisibility for report review and
spot-checking, much of the intended improvement through installation of
control facilities could be lost, in effect, to poor operation or
deliberate by-passing of wastes by the*discharger. Unfortunately,
perfecting a strategy for using compliance monitoring as an enforcement,
tool has had a low priority; the responsibilities among the Federal
government, the states and the dischargers remain ambiguous; and an
organized, systematic, uniform information management system is only
now being devised.

Status of present compliance monitoring efforts has most relevance
to the Act's strategy for enforcement. one of the recognized shortcomings
of the water pollution control program prior-to enactment of P.L.92-500,
was the difficulty regulators had identifying the discharger or dis-
chargers responsible for violating water quality standards, and then
prosecuting the violator through extended and intricate enforcement pro-
ceedings. Although one of the Act's major objectives was to clarify and
expedite the process toward enforcement against violators, the prospect
of detecting permit violations under existing circumstances is quite
tenuous. Without tmcontestable data showing violation of permit condi-
tions, the entire strategy fails.

An adequate compliance monitoring, reporting and detection system
is essential now as issuance of major permits is concluded. Perhaps,
as the states move increasingly toward acceptance of the NPDES program,
an appropriate and potentially effective role for EPA would be to
allocate manpower and resources to monitoring permittees and assuri.ng,
compliance with construction schedules. EPA is committed to giving more
attention to this function but the actual scheme'for monitoring permits,
the requisite manpower allocations, and the appropriate assignment of
Federal and state roles remain to be perfected. Recognizing the enormity
of the task of maintaining up-to-date information in a central location
on all permittees, an effective monitoring information system based
upon a carefully selected sample of dischargers might be designed.

Citizens also need such a system. Effective public participation
depends on availability of and accessibility to couprehensible informa-
tion about progress toward achievement of water quality goals. Clearly,
a part of the strategy envisioned within the regulatory process of

1-61

P.L.92-500 was the presence of an interested and informed public that would
press pollution control officials at every level of responsibility to ad-
minister the program with vigilance. Public pontkibution to the regulatory
scheme, however, will be severely hampered without a system to provide the
informed, but not technically trained, citizen with information on permit
issuance, compliance and overall progress in the reduction of pollutant
discharges.

B. Financing

QUESTIcN: .Has the fZow-of Federal construction grant funds to the
states for publicly owned treatment works impacted the
timely achievement of the 1983 requirements and the
interim goals?

ANSWER: Yes.:

The obligation of Federal construction grant funds has not progressed
with.either the facility or the efficiency the Congress intended. Now,
three years-after enactment of P.L.92-500, only about 40 percent of the
authorized $1$ billion of'Federal-funds has been obligated for construc-
tion of publicly owned wastewater treatment works, and only about $1.4
billion of.the appropriated amount has been actually expended. This
means that the accelerated pace envisioned by the Congress for public
treatment works construction has not occurred. Only now are obligations
beginning to-,reach a level (approximately,@6.8 billion in.FY 1976, based
on a 15 month fiscalyear) commensurate with the scope and pace indicated
in the Act. Indeed; even at present,obl'igation levels, the bulk of the
$18 billion will not be-.spent,@until five or more.years after July 1, 1977.
Thus, a major porti6n,@of-the nation-s'Ipublicly.owned wastewatertreatment
systems will not meet,secondary tr@atmentorhigher tieatment levels where
required for water,.,quality standat6s'by t@e statutory'deadline.

There are 'some legitimate. reasons for the lag in the obligation of
funds. The formulatio;n@'arid application of implementing'r6gulations and
procedures were difficult-.@ Delay at the-local and state level,in:pre-
paring and-submitting acceptable Step 1 facility plans is another major
reason. Finally,;..Presidential roefusal to allot one-half of the $18
billion in authorized Federal. fun'"dshad at least a psychological effect
in slowing construction gra-ult processing-

1-62

Undeniably, the approval process is layered with a debilitating
maze of regulations for satisfying planning, management and operating
requirements. Some are prescribed by the Act (i.e., reduction of
excessive infiltration and inflow and.determining the proportionate
share of volume and strength of wastes from various classes of users).
Some are required to comply with Federal legislation and Executive
orders to achieve programs other than control of pollution. Some are
designed to minimize adverse environmental effects. Some result from
EPA's legitimate concern for review and audit procedures to prevent
fraudulent or illegal use of public funds. Together, these require-
ments total 27 discrete decision points fulfilling numerous EPA regula-
tions interpreting P.L. 92-500 and coordinating its implementation with
the 27 other Federal laws and Executive Orders that must be satisfied
for each grant. Many of these requirements would still remain, even
if the Act were amended to provide for state assumption of some con-
struction grant review and certification functions.*

Nevertheless, the Commission st udy of construction grants concludes
that:

0 There is an excessive burden of red tape in the approval
procedure.

0 much time-consuming duplication exists between Federal,
regional and state review processes.

0 Lack of uniform procedures and evaluation criteria interferes
with efficient administration.

0 Staffing is inadequate at both the EPA and state levels to
adequately cope with post-award project review.

0 Heavy dependence on consulting engineering firms-for the
development of local plansand design of facilities has
placed a heavy load on the capacity of these firms, adding
to the time necessary to complete each project.

Most significant, perhaps, is the finding that the net inpact of
these various impediments is to discourage innovation of design of
public treatment systems. Those who observe the construction grants
process believe that "standard specifications get through the approval
system faster," and thus most designs are of traditional or conventional
treatment methods.

*H.R.9560 proposed amendment of P.L.92-500 to provide for increased state
responsibility for the construction grant process.

1-63

Whatever the explanation, delay has occ.urre@d and its Implications
are manifold. Not only is achievement of the 1977 requirement for
uniform application of secondary treatment.to all publicly owned
wastewater treatment systems affected but also achievement' of the
1983 "interim" water quality goal of the Act may be delayed,as well.
Delay has made the program vulnerable to.inflationaky impacts on the
cost.of laborand materials for-construction.

As estimated costs to prov'ide required publicly owheia.wastewater
treatment facilities increase, the needs surv2X must be,evaluated tQ
ascertain its validity for measuring progress and,allo6a"ting Federal
grants 'and its-utility for fixing priorities among ndeded.,treatm6nt
pategories and facilities. The Commission'.s own . assessmeiht-,o-f- the
'IEPA 1974 needs survey concluded*that, in many cases, the survey
was not an accurate assessment of actual need�.' Some states and munici-
palities manipulated their population estimates or water quality desig-
nations to inflate their needs, hoping to maintain or improve their.
relative share of annual Federal grant allocations,

Commission studies-also determined that the needs-survey and the
priority lists - because they are treated as separate,functions -- are
not being used as a management device to make decisions that will con-
tribute to achievement of water quality goals,or for-making,effective
resource allocations. Continued use of the present allocation formula
based solely.on state or local estimated needs can be fair and effective
if the reported needs are independently verified, Most states, in fact,
have little confidence in using the results of the survey as the basis.
for allocation. Change, however, to some other formula, such as a
combination of needs and population, must be approached cautiously
to avoid creating other disparities such as funding deficiencies in
some states and regions of the nation, while virtually over-funding
facilities in other states. Congress is'faced with choosing between
allocating construction funds where real needs exist to-achieve environ-
mental goals or treating the program as one of traditional public works.

Efficient utilization-of manpowerand resources remains a critical
management problem. The.present inability of a state or local agency
,to develop long-range projections of needed facilities based on a
reliable continuing level of Federal funds, creates management problems,
leads to an imbalance between large and small projects, and limits
optimum@distribution of projects-among Steps 1, 2 and 3 so as to
maintain a fairly constant flow of funds and p3pojects. Although the
Commission finds evidence of improvement, a cbherent manpower strategy
supported with an even and dependable flow of funds, with full local,
state and Federal commitment to stabilize the construction grants process
could be A major contribution to achievement of the Act's municipal treat-
ment objectives.

1-64

Research and development into water pollution control, for example
innovative technologies for the treatment and utilization of wastewaters,
has actually declined. A comparison of the FY 1975 appropriation for
purpose shows a-14.5 percent decrease over what was being spent in
1969. Impacts of inflation have reduced the purchasing power of the
research dollar. -As a percentage of construction grants for water
pollution control, research and development for municipal technology
has decreased from 17.5 percent in FY 1967, to 0.3 percent in FY 1973.
One very clear implication of this decline is that Federal construction
grant expenditures are almost exclusively for the installation of tried
and tested traditional/technologies. The framers of P.L. 92-500 hoped
for something more imaginative.

C. Planning

QUESTION: Has implementation of the planning provisions of the
Act progressed commensurate with the planning policy
objectives articulated in Sec-101(a)(5) -- "that area-
wide waste treatment management planning processes be
developed and implemented to azeure adequate control
of sources of pollutants in each state'19

ANSWER: No. The.pUmning process is already out of sequence
with the implementation strategy.

The strategy of P.L. 92-500 relies on planning as the essential
device for integrating NPDES perm@tsf construction grants, control of
n6npoint sources, projected growth and predicted land use changes into
a reasonable formula for local pollution control, attuned to both state
and local needs, solutions and priorities. That planning has not
functioned that way so far can be attributed to two factors: (1) the
diffuse and uncoordinated planning requirements of the Act and (2) the
delay, by EPA, in implementing Sec. 208, the areawide planning provision.

As a consequence, the discernible planning patterns emerging from
state and Federal interpretations of the Act are characterized by
dis j ointed and of ten l@. unre I atel activitie s, The key e lemen ts of the
planning process -- facility planning and areawide waste treatment
planning -- are seriously out of synchronization. The 1974 Water 2uality
Strategy Paper indicated,that construction grants, permits and nonpoint
source controls should be consistent with, And serve the purposes of,
the relevant plans. Instead, relevant plans are dictated by grants and
permits. This process may.be reversed in time for the next series of
five-year permits, but that is by no means assured.

I-65

Under the Acts's timetable, initial state basin plans were to have
benn completed, and initial areawide plans near completion, by mid-1975.
To date, only one-third of the 635 state river basin plans [Sec. 303 (e)]
have been completed and no areawide (Sec. 208) plans will be completed
for at least another year. As a result, for five to six years following
enactment of P.L. 92-500, construction grant and NPDES activites
will have porceeded without having to comply with prescribed state,
regional and local plans. Instead of constructed and permitted treatment
facilities located and controlled according to local plans for future
growth, te facilities will, to a considerable extent, dictate the
pattern of the area's long-range development. Clearly, this wa not the
intent of the congress. While it may be too late to restrore the planning
porcess to its apporpriate swquence in phase with the on-going construc-
tion grants and permitting processes, it is not too late to critically
examine planning's role within the context of the Acts's present imple-
mentation, and determine what legislative or administrative changes
might improve the effectiveness and utility of the planning program.

Even though slow in getting started, a great deal of energy,
manpower ad resources are now being expended in the implementation of
the planning provision. EPA has allocated $163.5 million in total
support grants to 149 designated areawide planning agencies. Most of
the recipients are Councils of Gobernment, representing the mulit-
gobernmental structure of the majore metropoliatan areas of the nation.
Moreover, elaborate processes are underway in most of these areas to
develop te cooperative participation of local governmental entities,
interested groups and appropiate arganizations in the plan's development.

Efforts should be intensified to fund more planning agencies.
Future success for adequate pollution control may depend upon the
utility and viability of these plans. Guidance and assistance is
needed if tha plans that evolve are are to be physically and politically
realistic and environmentally sound and capable of engendering the
necessary public support to be followed. Any effective strategy for
control of nonpoint sources wihtin the framework of the Act can only
be a product of the areawide planning process.

Other cirtical elements that must be produced by areawide waste
management planning are future priorities for construction of publicly
owned treatment works; the next series of NPDES permits for point
source dischargers; the necessary actions to restore and maintain
water quality in areas experiencing rapid growth and heavy industrial
development; questions of public access to, and utilization of, improved
waters for recreation; and th integration of the water pollution
control plan with air and solid waste control strategies.

11-66

Because these elements are critical to the future success of water
pollution control efforts in localities and within the states, a streng-
thened role for public participation should be incorporated into the
areawide waste treatment planning process and its eventual implementation.
Without participation and support of the affected publics, the chancres
are slim for design and execution of a plan acceptable to a wide, diveise
constituency with varied private, public and political interests.

D. Public_Participation

QUESTION: Has the experience with public participation in water
pollution control programs differed significantt.y under
P.L.92-500 from prior experience?

ANSWER: No. Even though the Act mandated an unprecedented
public roZe, there is no empirical evidence to suggest
that the actual influence of the citizen on the decision-
making process has effectively increased.

The Act contains the most comprehensive provisions for public.
participation ever written into Federal law. Sec. 101(e) requires public
participation in the development, revision and enforcement 'of any
standard, effluent limitation, plan or program pertaining to the im-
plemen@tation of the statute'. Not only is public participaiion to be
provided for, but also it is to be encouraged and assisted by the EPA
Administrator and by the states. Prior to enactment of P.L. 92-500,
there was only one mandated requirement for participation of the public
in the administrative processes of water pollution control. The 1965
Federal Water Pollution Control Act required hearings prior to the
adoption of state water quality standards, and provided for public.
hearings (if deemed necessary) following water pollution enforcement
conf erences.

Ironically, despite expanded opportunities provided in the 1972
Act for public involvement, actual citizen participation may have
declined. Some reasons can be identified, For one thing, rather than
causing citizen influence to focus at strategic points for maximum
irnpact on decisionmaking, the statute and EPA's regulatory interpreta-
tion have proliferated opportunities for citizen exposure throughout the
entire administration and regulatory process, dissipating the limited
energies and resources of the relatively small community of actively
involved individuals. For example, many persons with long experience in
.the water pollution@contrdl program, feel that procedures of the prior
Federal law, even with its recognized limitations, did, in the standard-
setting hearings and periodic enforcement conferences, provide the
citizen with a more effective forum in which to express his views.

1-67

Such "benchmark" episodes are absent from the present implementa-
tion process. Instead, interested citizens complain they are deluged
with an indiscriminate flaw of notices of trivial public hearings,
tedious regulations, complex permit applications, etc., with little
or no effort by the Agency or the states.to identify for the recipient
what has critical importance for future water quality and what is
merely procedural or pro-forma. In other words, while EPA,and the states
have accepted and perhaps fulfilled their statutory responsibilities
to provide for an opportunity for the public to participate through
notices of hearings, rule-making and permit application, they have done
little to fulfill the other directive in the Act: To encourage and assist
those who wish.to participate so their participation is meaningful.
Also, there is-some'indication that the intensity of active citizen
interest in water pollution control as a public issue is subsiding, and
that many organized groups have-turned their efforts to other objectives.

On the other hand, EPA and 'state emphasis on the public hearing -
as the principal device for-public expression,and influence, tends to
discourage many citizens. These hearings -- occurring, as@they frequently
do, late;in the decisionmaking process -- frequently appear to be pro-
forma exercises. Matters discussed are often.highly technical, not
easily understood without some non-technic*al explanation, and that is
rarely offered. Generally, Agency and state personnel and public inter-
est groups agree that hearings are of limited.utility and oftenwaste-
ful of everyone's time and resources.

There has also been a tendency to create.and maintain a discrete
separation between program development and opportunities for public
involvement. Most EPA personnel in Washington and the regions appear
to expect their public affairs offices to be the proper unit for citizen
assistance'and'support programs. Although this arrangement may have
some administrative logic, there is also an undeniable tendency -- not
unique to EPA -- to isolate publir- affairs activities from substantive.'
program activities. Also, placing the function here may give it a
public relations flavor'of image making for the Agency. Indeed, nation-
wide interviews with Federal and state pollution control officials
revealed strong inclina'tion to treat the participatory process as
chiefly affording citizens an opportuni ty to vent their emotions.
The opinion survey also indicated there is'strong sentiment among the
majority of state and local officials that the-achievement of water
pollution control is essentially a technical activity best left to
the professionals.

As a result, efforts seeming to@promote public participation can
project a patronizing superficiality which veteran participants are
quick to discern. EPA has no specific budget for developing and
assisting public participation opportunities although considerable

1.-68

amounts of both money and manpower have been spent-on publication and
distribution of regulations, petinit applications and notices as well
as public hearings, all with minimal effect.

The largest potential for public.impact is probably in@the design
and eventual implementation of Sec. 208 Areawide plans. There are
requirements for creation of citizen advisory groups associated with
each of the designated 208 autorities. There is some question as to
how effectively this is working in actual application, but it is gate
to hazard that chances for implementation of eventual areawide plans
will be slim indeed, if they are developed in a vacuum without the
contribution and involvement of a broad range of interested groups.

E.- Participants and Practitioners Adversaries or Partners

Contention among all interested parties about how the Act is to
be interpreted and applied has probably been the activity which has
consumed the most energy during the three years P.L. 92-500 has been
in effect. Beginning with the admonition, "It is the national policy
that to the maximum extent possible the procedures utilized for imple-
menting this Act shall encourage the drastic minimization of paperwork
and interagency decision procedures, and the best.use of availa 'ble
manpower and funds, so as to prevent needless duplication and unneces-,
sary delays at all levels of government",[@ec. 101(f)], the statute
continues for some 90 pages with detailed specifications and directions.
many of these provisions delegate additional explanatory and rule-
making duties to the Administrator. A positive, ringing declaration
that, "It.is the policy of the Congress to recogni ze, preserve, and
protect the primary responsibilities and tights of States to prevent,
reduce, and eliminate pollution, to plan the development and use
(including restoration, preservation, and enhancement) and land and
water resources, and to consult with the Administrator in the exer-
cise of his authority under this Act [Sec. 101(b)] is followed
by section after section retaining final administrative discretion
with the Federal Administrator in most instances. Delegations to
the Administrator are often qualified by directing action only "after
consultation with appropriate Federal and state agencies and other
interested persons." There is corisiderable evidence that only lip
service is given to these pronouncements.

In fact, progress and achievement of results have been slowed by
the time and energy consumed in disagreements -- among the levels
of government, between the dischargers and the Federal and state
regulatory personnel, between all affected persons and groups and the
regulation writers as to how'the regulations should be written, between
the environmental and public interest groups and state, Federal and

1@69

local officials, and even between Congress and EPA personnel as to the
proper meaning of the Act. Time spent in administrative hearings or
preparing and defending court cases may not be the most effective use
of manpower.

consultation requires not only listening but also hearing.
Ultimate personnel needs to make the Act fu lly op erative, though not
precisely known, are probably immense. Man-hours spent in bickering
between Federal and state officials may be unproductive man-hours in
terms'of-water quality. Dischargers probably know more about their
production processes and their wastewater constituents than anyone
else; while,they should not be allowed to subvert the statute's
implementation, they.contribute little if their stance is that of
antagonistic adversaries; and not all knowledge is concentrated.in the
bureaucratic regulatory agenc@es, The resources of all interested or
affected groups are needed -- cooperating at least in an atmosphere of
11constructive tension" -- to make the Act work for its intended
benefits'to, all the people.

1-70

V. "WHAT WILL REMAIN TO BE DONE AFTER 1983"

A. Elimination of the Discharg6 of Pollutants The 1985 Goal

QUESTION: Asswing achievement of the 1977 and 1983 requirements
for publicly owned treatment works and agricultural and
industrial dischargers at some date later than Z983., as
well as the control of toxics, what major poZlutant
sources will continue to-prevent realization of the
interim and ultimate goals?

ANSWER: Any point source (such as urban runoff in separate storm
sewers) not adequately controlled with the 1977 and 1983
requirements or any nonpoint source(such as urban run-
off from other than combined sanitary and storm and
separate storm sewers and agricultural or general land
-runoff) contributing pollutants to the nation's waters
can prevent achievement of the water quality goals of
the Act. The effect of these source contributions in some
site specific areas of the country will prevent achieve-
ment of the water quality goats of the Act.and may, in
some cases, overwhelm improvements from point source
control. To.the extent that publicly owned treatment
works, industrial and agricultural dischargers have not'
achieved elimination of the discharge of pollutants, they.,
too, would be major contributors.

QU29TION: Are there technologies available now, or that might reason-
ably be expected to become available within the next ten
years, that could achieve the elimination of "the discharge
of pollutants into the navigable waters'19
AN914@ft: Yes. However., in most cases, the costs of these technoZo-
gies are such that applied to point source discharges, their
installation would be prohibitively expensive, and the
economic and social effect would be too -severe to be ab-
sorbed within the foreseeable future; further, predictable
environmental effects, using present anaZyticat techniques
and methodologies, would appear to be minimal., particularly
in the absence of adequate control of nonpoint sources of
pollutants in some places.

1-71

QUESTION: Does the goal of the elimination of 'It-he discharge of
pollutants into the navigable waters" have value as a
guide to poZicymakers?

ANSWER.: Yes. Wastes generated by projected population increases
and continued economic growth, if discharged to the
nation's waters, can soon minimize the effect of improve-
ments in receiving water quality realized through achieve-
ment of the,1977 and 1983 requirements of the Act applied
to point source discharges. If new sources of pollutants
new industrial plants-, agricultural activities and
increased discharges from publicly owned treatment works
install "the best available demonstrated control tech-
nology., processes, operating methods or other alternatives,
including, where practicable, a standard permitting no
discharge of pollutants" [sec.306(a)(1)], and if existing
water quality standards are regularly reviewed and appro
priate waste load allocations timely made, this action
may assure that growth does not negate the improvements
achieved by point source effluent limitations as the
prograw envisioned by P.L.92-500 is implemented.

Considering the time it will take municipal, industrial and agri-
cultural point source dischargers to achieve the 1977 and 1983 require-
ments, the 1985 goal of the elimination of the discharge of pollutants
(EOD) into navigable waters cannot possibly be achieved by ail point
source discharges by 1985. For approximately 20 industries, however,
the 1985 goal will be achieved by some subcategories if they comply
with the effluent limitations for 1977 (BPT) and 1983 (BAT). Only one
industry, metal finishing, is required to achieve EOD for all sub-
categories, the proposed 1983 BAT effluent limitation.

Since the Act does not define EOD, various interpretations have been
proposed. The chosen interpretation is important in assessing possible
technologies and costs. The Commission has defined EOD as follows:

"The elimination of the discharge of pollutants shall apply
to removal of those constituents which are added during use
of the water. The resultant discharge must be of equal or
lower concentration than that of the original supply."

The EOD goal is stated in the Act only in relation to point source dis-
charges; it does not apply to@nonpoint sources..

Most industrial dischargers will not be required to achieve EOD as
part of the BPT and BAT effluent limitations, nor will publicly owned
treatment works achieve EOD as part of the treatment required to meet

IT-72

secondary treatment in 1977, "best practicable waste treatment technology
over the life of the works" in 1983 or even more' stringent effluent
limitations to meet water quality standards. Where an industry or a
publicly owned treatment works does achieve EOD, it will usually be
achieved by eliminating'the discharge of water, not by treatment and dis-
charge of treated wastewater to navigable waters. This method of EOD
requires complete reuse of plant effluent. Complete reuse appears to
be viable for only a very limited number of plants.

While technologies are available, or will become available in the
foreseeable future, to achieve or closely approach EOD, they are generally
considerably more costly and more energy intensive per unit of flow
treated than those required to satisfy the 1977 and 1983 requirements.
The dominant technological consideration for achieving EOD relates to
the capability to remove soluble salts normally not covered by 1977 or
1983 effluent limitations. Removal of these salts creates large quanti-
ties of brines, which must then be disposed of in an environmentally
and otherwise acceptable manner, generally at very high costs.

If EOD were a requirement rather than a goal, it is probable that
more wastewater reuse or less water consumption (or both) would result,
particularly by industry.

Land application is often regarded as a technological solution for
achieving EOD. While some land application systems can usually accomplish
slightly more effective removal of BOD, suspended solids and nutrients from
untreated wastewater than more conventional secondary treatment processes,
these systems along will not achieve EOD. Additional technologies to
remove dissolved salts and other contaminants would be required, just as
would be required following other treatment processes. In effect, land
application is similar to secondary treatment, but can serve as a more
efficient "pretreatment" system for the add-on innovative technologies which
mustalso be employed for achieving EOD. While land application shows pro-
mise, it cannot be considered a panacea, not only because of ' technological
limitations but also because of institutional problems'of acquiring.or
leasing large land areas.

To accelerate the achievement of the EOD goal, research and develop-
ment efforts over the next decade should be directed to dissolved salt
reduction by membrane separation processes (reverse osmosis, electro-
dialysis, ultrafiltration, and related technologies).; dissolved organic
reduction by adsorption processes (ion exchange,.activated carbon,
synthetic polymers) and land treatment technologies. With adequate
financial support for research and development, several of the innovative
EOD technologies could become available as viable full-scale treatment
systems within five to ten years.

X-73

only minor incremental improvements in water quality charac teristics
are.predicted to occur (at the Commission's study sites) in moving from
achieving the .1983 requirements to EOD of point source effluents. For
example,, on the basis of these studies, the differences in projected DO
for 21 of tlie Commission's study sites may not be significant -- when
comparing anticipated changes under 1983 requirements and those ex-
pected.for the EOD level. The existing coliform bacterial contamination
would not be significantly reduced, since the major source nationwide
is,from nonpoint sources. -on a regional and local basis, much of the
pi6blem'will be, eliminated by achieving the 1977 point source require-
ments. Potential or existing eutrophicatioh.problems will continue at
EOD for point sources, since ponpoint sources contribute approximately
80 percent of the total nitrogen and 50 percent of the total phosphorus
to our rivers, streams and standing waters. Suspended solids are also
contributed primarily from nonpoint sources. Achievement of EOD for
point sources wili.leave approxiamtely 90 percent of the load (after.
achieving the 1977 requirements) entering the nation's navigable waters.

Removal;.of the BOD-load which represents,the difference between
that remaining after achievement of the'1983 requirements and achieve-
ment of E06 from point source discharges may be of minor significance
when.coapared with that.'being contributed presently from urban storm
runoff, agricultural runoff, etc.

Nonpoint sources area major contributor to toxic substances, based
on the.Commission's environmental studies. EoD from point sources will
not eliminate toxic substances,[email protected] if they are uniformly restricted` in
all municipal and industrial permits. Furthermore, EOD of toxic.sub-,
stances'in view of probable-nationwide costs, would require additional
s tudy.

In-terms of biological impacts, approximately 5-10 percent of the.
.nation' s waters presently unsuitable for game fish habitat will become
suitable upon achieving EOD from point'source discharges, based only,on
the,Commission's study sites. In reality, conditions are better nat-ion-
wide and'the actual aggregate improvement might be less than this-,.--,-.

B. Selected Nonpoint Sources Other Than Agriculture

Construction and timber harvesting may cause larae temporary increases
in the ttansport ofsediments and other pollutants to receiving waters.
inactive mines, subsurface waste disposal and salt water intrusion may
contribute pollutants either continuously or intermittently, depending
on local circums*tances.'.'These.nonpoint pollutant sources are significant
to the'Commission's study because they may in some instances overwhelm
and negate the reductions achieved through point source effluent limil--
tations. Point.sources are.of primary concern during low-flow conditions

1-74

of streams when nonpoint sources (except for sources such as acid mine
drainage from inactive mines) make little or no contribution and nonpoint
pollutants are contributed principally during periods when point sources
may have little or no impact on water quality.

Silviculture and Timber Harvestinr-About 500 million of the 2.3
billion acres of land in the 50 states are in commercial forests. About
1.7 and 1.5 million acres were harvested in 1965 and 1970, respectively.
Logging operations are the major cause of increased sediment yield in
the Northeast and Pacific Northwest, while site preparation for re-
forestation of upland forests predominates in the Southeast. A change
in logging practice -- from skidding felled logs to a loading point by
use of tractors to non-tractor yarding (high lead, skyline, balloon)
-- is estimated to decrease sediment yield on the order of one-half ton
per acre, and to increase logging costs by $39 to $130'per acre. A
change in site preparation method for upland forests from bulldozing
and burning to chopping with a drum chopper for the Southeast is esti-
mated to reduce sediment yield by as much as 70 percent (14 tons/acre,
average) and to reduce the cost of site preparation by $26 to $39 per
acre. A disadvantage of the method is that it requires more frequent
.burning of the growing forest to control scrub hardwood size, thereby
increasing air pollution to some degree.

Construction--About 1.6 million acres of land are disturbed annually
by construction activities, 90 percent for highways and roads, and
5 percent each for urban residential and urban non-residential con-
struction. The annual sediment yield from uncontrolled construction sites
is estigiAted to average 200 million tons, an average of 124 tons per acre
of disturbed land and 11 percent of the yield from the 380 million acres
of non-irrigated cropland. Controls such as sedimentation basins,
diversion ditches, dodded ditches, grade stabilization, and other effective
practices can be used to control sediment production. In addition to
reducing the sediment contribution to surface waters, such controls may
yield benefits in the form of reduced quantities of fill dirt that must
be hauled to the construction site. Costs are estimated to range from
about $910 to about $1,482 per acre (average $1,170 per acre) for a
reasonable mix of the above measures. This would total $1.8 billion per
year. The proposedsediment controls are predicted to reduce sediment
yield by about 70 percent, or 140 million tons per year.

Inactive Mines--The primary water quality problems associated with
inactive mines are sediment production from denuded areas and acid pro-
duction from exposed reactive areas. Sediment production@.,problems may
occur in all areas where mining has been practiced, but acid mine drainage
is confined primarily to the Appalachian coal fields. Vegetative buffer
strips along affected strdams have been demonstrated as effective in
abating sediment delivery. The width required is a function of land

1-75

slope, with 145 feet estimated to be 'required for a 30 percent slope.
The cost of establishing such vegetative buffers is estimated to average
$520 per acre, or about $9-,000 per mile of affected stream ($18,000 per
mile if sediments are:delivered from both sides). About 5,000 miles of
stream are reported to be affected by sediment in Appalachia. Acid pro-
auction from surface mined lands can be controlled most economically by
reclaiming'the affected land at a cost ranging from $130 to $5,200 per
acre, and averaging $2,100 per-acre. About one-third of all acres of
inactive surface coal mines in Appalachia are estimated to need such
reclamation. More than half of all acid mine drainage is discharged from
inactive underground mines. The cost of neutralization with limestone
was reported in 1969 to range from $0.20 to $0.50 per thousand'gallons,
depending,upon the strength and quantity of the acid. About 5,700 stream
miles in Appalachia are affected by acid mine drainage.

Subsurface Disposal -The deliberate use of subsurface excavations
.for waste disposal is a growing practice that poses a continuing threat to
the nation's groundwater quality. Presently, the wastewater derived from
about 32 million tons of municipal and inaustrial solid waste are buried
in landfills each year, and around 300 industrial wastewater injection
wells are in operation in the country. 'The subsurface is also used
inadvertently for disposal of liquids spilled on the surface and leaked
from pipelines, pits, lagoons and storage tanks. The threat to ground-
waterquality -- and ultimately to surface water quality -- by subsurface
disposal can never be entirely eliminated. In most cases, it can be
minimized by judicious site selection, utilization-of sound and proved
design procedures, and careful management and operation of the facility.
In rare cases, it must simply be recognized that groundwater quality
deterioration will be an inevitable consequence of development, and
appropriate plans must be made to deal witih the resulting problem.

Salt Water Intrusion--Forty-two of the fifty states report salt
water intrusion problems. Seawater intrusion into coastal aquifers as a
result of overpumping fresh groundwater is a ubiquitous problem in most
coastal states. Upstream encroachment of seawater as a result of
deepening of channels for navigation and of reduction of streamflow
because of.increasing consumptive uses upstream presents problems to
municipalities, industries and agriculture.

More than two-thirds of the nation is estimated,to be underlain by
saline water. Frequently, saline water and fresh water are in direct
contact in an aquifer. In other cases, fresh and saline water aquifers
that were originally separated by irqpermeable strata have been connected
inadvertantly by improperly completed or sealed, water, oil and gas wells
or by other disruptions of the earth's surface. Salt water intrusion
into bays and estuaries can be controlled.(conceptually at least) by in-
creasing freshwater inflows, construction of navigation locks, or allowing
navigatio4 channels to silt up. Seawater intrusion into coastal aquifers

1-76

can be controlled by decreasing withdrawal, increasing freshwater recharge,
or construction of hydraulic or mechanical barriers between the fresh and
saline parts of the aquifer. Intrusion of underlying brine into fresh-
water aquifers through improperly completed or abandoned wells can be
controlled by finding and sealing the offending wells. one or more of
the above solutions is likely to be effective in solving the problem in
any particular area, but the cost of implementation cannot be generalized
because of the extreme dependency of the optimum solution on site specific
conditions.

C. The "Objective" of the Act

QUESTION: Is progress being made toward the "objective of this
act . . . to restore and maintain the chemical, physical-,
and biological integrity of the Nation's waters'19

ANSWER: Yes, although progress to date attributable to P.L.92-500
is minimal., since results from its implementation are
only now beginning to be realized.

QUESTION: Can this "objective" serve as a guide to policy-makers
for their actions?

ANSWER: Not with much certainty or specificity. Even the experts
cannot agree upon a full statement of the objective's
meaning. "Restore" obviously means returning to some
prior condition; restoring "physical" integrity could
mean eliminating man-made changes in the nation's water-
ways so that sediment loads and temperatures would be as
they were before man's perturbations of the land; restoring
Irchemical" and "bioZogicaZ" integrity would require knowing
these conditilons of the nation's waters at some historical
point in time with a degree of accuracy not possible from
existing historical data. Man has consistently adjusted.,
or attempted to alter-, the "biology" of the nation's waters
to suit his perceived needs. These acZjustments or aZtera-
tions would have to be eliminated in any literal appZica-
tion of the objective -- often to man's discomfort, if not
to the detriment of his general well-being or health.

1-77

A major objective of P.L. 92-500, as stated in Section 101(a), is
"to restore and maintain the-chemical, physical, and biological integrity
of the nation's waters." Hence, the new.concept of "chemical, physical,
and biological integrity" of water requires understa@ding by the Commission
in its various studies.

Of key importance to.understanding this objective, howF@vdr, is a
precise interpretationof the word "integrity." While the House Committee
on Public Works did not explicitly define the word in its report, it
stated that "the word integrity as used is intended to convey a concept
that refers to a condition to which the natural structure and function of
ecosystems is maintained." The report further said that "natural is
generally defined as that condition in existence before the activities
of man invoked perturbations which prevented the system from returning
.to its original state of equilibrium." The Senate Committee made
reference to sources which could be used to come to a definition of
integrity for specific waters. They said, "The 'natural . . . integrity'
of the waters may be determined partially by consultation of historical
records on species composition; partially from ecological studies of
the area or comparable habitats; partially from modelling studies
which make estimations of the balanced natural ecosystems based on the
information available."

Even with this,quidance, the integrity concept is still difficult.
to define,, primarily because few professional ecologists or environ-
mentalists agree to a.precise definition. The Commission, with assist-
ance from The.Instituto of Ecology's Advisory Committee Qn Water Ec6-
systems, has 'examined differing opinions and philosophical approaches
to defining the phrase, but is 'uncertain which viewpoint or philosophi-
cal approach most closely reflects the intent of Congress, as stated
in the Act.

Although it has physical,'biologicai and chemical components,
ecosystem integrity as a single concept is preferable to dissection
into "component integrities" for purposes of definition. The concept
of ecosystem integrity relates to regulation of the structure and func-
tion of all components. -To understand this concept requires under-
standing of several basic characteristics of ecosystems:

1. Interrelationships among species and their physical-chemical
environments are results of long-term continuing evolutionary
processes.

2. Due to interactions among species and with the environment,
ecosystems tend toward short-term stability of biomass, and
maintain characteristic rates of energy flow.

1-78

3_ Ecosystems evolve toward a steady-state condition th .rough
species succession following short-term environmental
disturbance.

4. occasional natural disturbances (e.g., floods) are essential
to maintenance of diversity of ecosystems.

5. Maintenance of life on earth is dependent 'upon the con-
tinued functioning of evolutionary ecosystem processes.

However, others believe using the environment and maintaining
environmental quality at.a level no higher than is required for current
use is philosophically acceptable, They feel that it is impossible,
and in fact undesirable, to achieve an environmental quality that
existed prior to human technological impact and that man has been,
and should continue to b6, an integral component of the ecosystem in.
which he lives. Upgrading general environmental quality above a level
necessary.for survival is ari unnecessary expense which society can ill
afford.

Contractors performing 41 site-specific water quality and environ-
mental studies, the primary focus of the Commission's national environ-
mental impact assessment, were instructed to compare existing conditions
and projected changes within the site to physical, chemical, biological
and ecological characteristics of an "undisturbed setting" within or
adjacent to each of the study sites. However, in a number of site-
specific studies, environmental contractors found it impossible to
document these characteristics for the "undisturbed setting." Often,
there was insufficient data, historical or present, and, in some

1-79

instances, contractors were Only able to @se a "hypothesized" set of
environmental conditions representing some "undisturbed" level for
comparison. For nearly all study sites, except in extreme headwater
regions, there have been important changes in physical, chemical and
biological characteristics.over time. Even where an "undisturbed
setting" is described, then there are pollutant discharges from up-
stream that prevent accurate characterization of such a setting.

Thus, the Commission cannot claim that its studies, even in a
limited sense, have identified a "chemical, physical, and biological
integrity" at these locations to which the water there should be re-
stored. They do, however, utilize information for the respective sites
to analyze progress toward a water quality better than today and one
that will provide "for the protection and propagation of fish, shellfish
and wi ldlif e.

II. TECHNOLOGY ASSESSMENT

II.' TECHNOLOGY ASSESSMENT

Table of Contents

Page

A. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . .

B. PUBLICLY OWNED TREATMENT WORKS . . . . . . . . . . . . . . 11-4

1. Introduction . . . . . . . . . . . . . . . . :@ . . . 11-4
2. Regulations . . . . . . . . . . . . . . . . . . .. . . 11-5
a. Wastewater . . . . . . . . . . . . . . . . . . . 11-5
b. Combined Sewer Overflows and Storm Sewer
Discharges . . . . . .. . . . . . . . . . . . . 11-8
C. Residuals Disposal . . . . . . . ... . . . . . . 11-9
3. Characteristics of Wastewater, Combined Sewer
Overflows and Storm Sewer Discharges . . . . . . . II-10
4. 1973 Baseline Conditions . . . . . . . . . . . . . . 11-14
5. State of the Art of Technology 11-18
a. Wastewater Collection 11-18
b. Wastewater Treatment . . . . . . . . . . . . . . 11-19
C. Combined Sewer Overflow.Control . . . . . . . . 11-21
d. Storm Sewer Discharges . . . . . . . . . . . . . 11-22
6. Sources of Data . . . . . ... . . . . . . . . 11-24
a . Inventory of Needed Facilities . . o . . : '. .' *. 11-24
b. Population Projections . . . . . . . . . . . . . 11-25
C. Technologies and Costs . . . . . . . . . . . . . 11-26
7. National Assessment . . . . . . . . . . . ... . . . . 11-27
a. Costs . . . . . o . . . . . . . . . . . . . . . 11-27
b. Resources . . . . . . . . . . . . . . . . . . . 11-41
C. Residuals . . . . . . . . . . . . . . . . . . . 11-43

C. INDUSTRY . . . . . . . . . . . . . . . . . . . . . . . . 11-45

1. Study Definition . . . . . . . . . . .. . . . . . . . 11-45
2. The, Industrial Setting 11-52
a. Water Use . . . . . . . . . . . . . . . . . . . 11-52
b. Waterborne Pollutants . . . . . . . . . . . . . 11-54
C. Abatement Measures in Place . . . . . . . . . . 11-56
d.. Subcategorization . . . . . . . 11-57
3. Capabilities and Costs@of Industrial Technology . . . 11-61
a. Industrial Effluent Limitations . . . . . . . . 11-61
b. Best Practicable Control Technology
Currefttly Available (BPT) . . . . . . ... . . 11-63

Page

C. Discharges to Publicly Owned Treatment Works 11-68
d. Best Available Technology Economically
Achievable (BAT) . . . . . . . . . . . I . . . . 11-74
e. Costs and Resources . . . . . . . . . ... . . . 11-79
(1) Technologies to Comply with EPA's BPT and
BAT Effluent Limitations . . . . . . . . 11-79
(2) Alternative Levels of Abatement 11-92
(3) Non-Financial Resources . . . . .. . . . . . 11-99
f. Best Available Demonstrated Control Technology 11-106
Special Issues . . . . . . . . . . . . . . . . . . . 11-108
a. Discharge to Water Quality Limited Waters . . . 11-108
b. Toxic Effluent Standards . . . . . . . . . . . . II-110
C. Thermal Limitations . . . . . . . . . . . . . . 11-112
d. Residuals to Land and Air . . . . . . . . . . . 11-124
e. Uniformity . . . . . . . . . . . . . . . . . . . 11-126

D
-'INNOVATIVE TECHNOLOGY . . . . . . . . . . . . . . . . . 11-137
. .1
J.

Introduction . . . . . . . . . . . . ... . . .. . . .. 11-137
-2. Discharges from Industry . . . . I. . . . . . . . . . 11-139
a. Scope . . . . . . . . . . . . . . . . . ... . . 11-139
b. Costs . . . . . . . . . . . ... . . . . . . . . 11-144
C. Energy . . . . . . . . . . . . . . . . . . ... . 11-145
d. Residuals and Their Disposal . . . . . . . . . . 11-146
3. Discharges to Publicly owned Treatment Works: 11-148
a. Scope 11-148
b. Costs . . . . . 11-152
C. Energy . . . . . . . . . . . . . . . . . . . . . 11-154
d. Residuals and Their Disposal . . . . . . . . . . 11-156
4. Recommendations for Research, Development and
Engineering . . . . . . . . . . . . . . . . . . . . 11-158

E. AGRICULTURE ... . ... . . . . . . . . . . . . . . . . . . 11-161

.1. Introduction . . . . *. . . . . . . . . . . . . . . .. 11-161
2. Feedlots . . . . . . . . . . . . . . . . . . . . . . 11-161
a. Numbers and Types of Feedlots . . . . . . . ... 11-161
b. Cost and Effectiveness of Pollution Control
Measures 11-162
C. Materials. and Energy Requirements . . ... . . . 11-165
d. Residuals . . . . . ... . . .. . . . . . . . . . 11-165
3. Irrigation Return Flows . . . o . . . . . . . . . . . 11-169

Page

a. Introduction . . . . . . . . . . . . . . . . . .. 11-169
(1)., Salinity . . . . . . . . . . . . . . . . . 11-169
(2) Suspended Sediment . . . . . . . . . . . . . 11-170
(3) Fertilizer .. . . . . . . . . .. . . . . . . 11-171
(4) Pesticides . . . . . . . . . . . . . . . . 11-171
(5) Hydrology . . . . . . . . . . . . . . . . . 11-172
b. Location and Distribution of Point Source
Irrigation Return Flows . . . . . . . . . . . 11-173
C. Cost and Effectiveness of Control Options . . . 11-175
d. Energy and Manpower Requirements . . . . . . . . 11-181
4. Nonpoint Agricultural Sources . . . . . . . . . . . . 11-182

F. SELECTED NONPOINt SOURCES . . . . . . . . . . . . . . . . 11-185

1. Introduction . . . I. . . . . . . . . . . . . . . . . 11-185
2. Silviculture and Timber Harvesting . . . . . . . . . 11-185
3. Construction . . . . . . . . . . . . . . . . . . . . 11-186
4. Inactive and Abandoned Coal Mines . . . . . . . . . . 11-186
5. Subsurface Disposal . . . . . . . . . . . . . . . . . 11-187
6. Salt Water Intrusion . . . . . . . . . . . . . . . . 11-188

G. OBSERVATIONS AND FINDINGS . . . . . . . . . . . . . . . . 11-189

REFERENCES . . . . . . . . . . . . . . . . . . . . . . . 11-200

II. TECHNOLOGY ASSESSMENT

A. INTRODUCTION

The Act requires achievement of t echnology-based effluent limitations
by specified dates to control point-source discharges, Application of
the technologies capable'of achieving these minimum limitations must be
augmented where required to achieve water quality requirements and
goals.

@Technology assessments have.been conducted for point-source dis-
charges from publicly owned treatment works, industry and agriculture.
The current'and potential technological capabilities and the corre-
sponding costs have been identified and evaluated for each type of
discharge to meet the.various effluent limitations.

Generally, technologies are available to achieve the 1971 and 1983
effluent limitations for publicly owned treatment works and industry.
For certain industrial categories, technologies which serve as the basis
of EPA regulations actually may.not achieve the promulgated effluent
limitations, particularly the short-term (24 hour) limits. In these
cases, strict compliance will necessitate more elaborate and expensive
technologies. On@ occasion, thetechnology has not been employed in the
particular applications that.are suggested. Instead, the technology
must-be "transferred" from another industry,.or segment of the same
industry.

Agricultural assessments are constrained by lack of regulations.
While technologies are available to control runoff from feedlots, the
regulations with respect to-the size of feedlots to be covered are un-.
settled. Control of runoff from'feedlots is achieved by merely storing
and spreading, a technology readily available.

For irrigation return flows, nothing more than monitoring is
.presently required in permits and no regulations have been promulgated.
Technological measures to reduce pollutants from irrigation return flows
are available but which pollutants will be controlled and to what degree
must be established before costs can be assessed realistically.

-Although not subject to specific effluent limitations, nonpoint
sources undoubtedly will@play a key role in achieving the goals of the
Act in some locations. Technologies capable of minimizing or reducing
pollutants from nonpoint sourceq have been explored, although an analysis
as detailed as that for the 1977 and 1983 point source requirements
co uld not be undertaken. The more promising control strategies are
usually accomplished by modifying,operating procedures, rather than by
treatment. For example, agricultural nonpoint sources are best controlled
by applying soil conservation measures.

11-2

While not a requirement of the Act, elimination of the discharge of
pollutants into the navigable waters by 1985 is a national goal [Sec.
101(a)(1)]. The Administrator may require elimination of the discharge
of pollutants for BPT or BAT where there is a technology that can
achieve it. An overview of what remains to be done toward the elimination
of the discharge of pollutants into navigable waters after the 1983
requirements are achieved and what technologies are applicable is in-
cluded in a section on "Innovative Technology."

Innovative technologies to achieve elimination of discharge of pol-
lutants are coming into use on a limited basis. In some cases, usually
low water-use industries, the goal will be achieved by compliance with
BPT or BAT effluent limitations. Eliminating the discharge of pollutants
from other point sources is technologically feasible, but far more
.costly than achieving 1983 requirements, if technologies, available now
or within the foreseeable future are to be employed.

The technology analysis was sometimes constrained by the absence of
promulgated regulations. As mentioned above, this was the case with
agriculture. In several cases, with toxics and pretreatment too, the
regulations are in a state of uncertainty, and the Commission's technology
assessment is highly speculative. Where effluent'limitations had not
been promulgated (or even drafted, in some cases) at the time the Commission
contracts were under way, Cormiiission'contractors postulated effluent
limitations. To the extent that the bases for Commission analyses
differ from those eventually promulgated by EPA, the assessments will be
different from the effects that are likely to occur.

Some other analytical limitations are worth noting too. All
technology assessments undoubtedly lack specificity when considering
exactly what approach may be available on a plant-by-plant basis to meet
effluent limitations. Analysis of "qnd-of-pipe" alternatives is much
easier than identifying internal."process changes", since plant-specific
opportunities eventually must be determined case-by-case. This general-
ization is not as significant for publicly owned treatment works as it
is for industries, where plant-by-plant options may be virtually un-
bounded. overall, the need,to generaiize probably results in a con-
servative assessment of applic4ble'technologies since optimized technolog-
tcal solutions could not be ag@;essed. Nevertheless,. many in-plant
changes are an integral part oi the technological solutions Commission
contractors have utilized to meet the effluent limitations.

While optimized technologies may result in lower costs, a counter-
vailing consideration is the omission of technologies '(and corresponding
costs) to achieve effluent limitations for toxic pollutants and water
quality-limited waters by industrial point sources. On balance, aggregates
for publicly owned treatment works, industry and agriculture are thought

11-3

to be within expected limits of engineering estimates. Costs for specific
cases, and even for some individual categories of point-source discharges,
undoubtedly are subject to considerable variability because of the
necessary simplifying assumptions and lack of definitive regulations.

In spite of the numerous limitations, the Commission was able to
obtain a comprehensive in@ight into the more technologically viable
techniques for achieving the requirements of the Act. The details of
this examination follow.

11-4

B. PUBLICLY OWNED TREATMENT WORKS

1. Introduction

The Commission's studies of Publicly Owned Treatment Works (POTW)
were designed to provide 1) a determination of what technologies capable
of meeting the requirements of the Act are available or likely
to become available in the foreseeable future; 2) estimate the capital,
operating and maintenance costs of applying these technologies; 3)
estimate the associated requirements for non-financial resources such as
manpower, materials, energy, land and chemicals; and 4) analyze the
quantities, characteristics and methods for disposal of residual wastes
remaining after treatment.

The definition of "treatment works" contained in Section 212 of the
Act is extremely broad:

The term "treatment works" means any devices and
systems used in the storage, treatment, recycling,
and reclamation of municipal sewage or industrial
wastes of a liquid nature to implement Section 201
of this Act, or necessary to recycle or reuse water
at the most economical cost over the estimated life
of the works, including intercepting sewers, outfall
sewers, sewage collection systems, pumping, power,
and other equipment, and their appurtenances; exten-
sions, improvements, remodeling, additions, and
alterations thereof; elements essential to provide
a reliable recycled supply such as standby treat-
ment units and,clear well facilities; and any
works, including site acquisition of the land
that will be an integral part of the treatment
process or is used for ultimate disposal of
residues resulting from such treatment.
[Sec. 212 (2) (A) I

In addition to the definition contained in subpara-
graph (A).of this paragraph, "treatment works" means
any other method or system for preventing, abating,
reducing, storing, treating, separating, or disposing
of municipal waste, including storm water runoff, or
industrial waste, including waste in combined storm
water and sanitary sewer systems. [Sec. 212(2)(B)l

These types of facilities generally serve one of four functions:
wastewater collection, wastewater treatment, control of combined sewer
overflows, and urban runoff control.

11-5

2. Regulations

Publicly owned treatment works are subject to Federal, state and
local laws and regulations which establish limits on effluent-quality
and on air emissions, and place restrictions on methods of sludge dis-
posal.

a. Wastewater

By July 1, 1977, publicly owned treatment works must achieve
secondary treatment [Sec. 301-(b)(1)(B)) as defined by EPA and compliance
with'applicable state laws or regulations which demand higher levels of
treatment (Sec. 301(b)(1)(C)I. A second set of effluent limitations to
-be met by July 1, 1983 is to be achieved through the application of best
practicable waste,treatment technology over the life of the works (BPWTT)
[Sec.' 301(b)(2)(B)I, or more stririgent effluent limitations where neces-
sary to contribute to the attainment or*maintenance of required water
quality (Sec. 302(a)]. The more stringent effluent limitation's may be
adjusted where there is no reasonable relationship between the economic
and s6cial costs and the benefits to be obtained [Sec. 302(b)].

Table II-1 shows-the limitations on biochemical oxygen demand
(BOD), suspended solids, pH and fecal coliform. bacteria that constitute
EPA's definition of the effluent quality attainable through secondary
treatment. Somewhat higher concentrations of BOD and suspended'solids
are permissable in those cases where a publicly owned treatment works
receives more than 10 percent of its design flow from industrial waste
discharged by categories for which less stringent effluent limitations
have been promulgated. Case-by-case exceptions may'be granted for
treatment works served by combined storm and sanitary sewer systems
where increased flows during wet weather may prevent the attainment of
the level of secondary treatment defined by EPA(l).

TABLE II-1: Definition of Secondary Treatment

maximum Average Concentration
Characteristic Unit-of 30 Consecutive 7 Consecutive
of discharge measurement Days Days.

Biochemical oxygen 3ora,b) 45 rb)
demand-(5-day)
Suspended solids mg/l 3ora,b) 45rb)
Fecal Coliform No. per 100 ml 200(c) 4()Orc)
pH pH units between 6.0 and 9.0 at all times

TOr, in no case more than 15 percent of influent value.
(b)Arithmetic mean.
rc) Geometric mean.
Source: 40 CFR 133. "Secondary Treatment Informationt" Federal Register
Vol. 38, No. 159, pp. 2298-229�, August 17, 1973.

11-6

The limitation on fecal coliform bacteria normally cannot be met
without chlorination or some other form, of disinfection. Although EPA
is now reconsidering the need for such a provision, the analysis that
follows is @ased on .the present definition of secondary treatment.

EPA ha s not promulgated regulations defining the effluent quality
associated with BPWTT; however, proposed "Alternative Waste Management
'able Waste Treatment has been published for
Techniqui@p for Best Practic
public comment(2). This document essentially sets the 1983 requirements
fo'r'POTW's equ4l to the 1977 requirements*, and lists'three options'for
achieving BPWTT: treatment and discharge, land application and reuse.
Although the choice is left to the@municipality, applicants for grants
must demonstrate that'the--6ption seldcted-is cost-effective.

Facilities using treatment and discharge must provide secondary
treatment as a minimum, or a higher level of treatment consistent with
maintaining receiving7water quality. (In tfiis'regard, EPA's proposed
definition of BPWTT is somewhat redundant with respect to the require-
ments of Section 302.) Land-application systems are governed by criteria
designed to proteft groundwater for use'as a public water supply.r Reuse
is an acceptable alternative provided that it dges not result in greater
pollution of ground and,surfaq@- waters@than would result from treatment
and-discharge, or land application-. .

A fewstates have established secondary treatment standards similar
to EPA's, but somewhat more stringent. For example, one state places an
upper limit of'25 mg/l on BOD and suspended solids in contrast to EPA's
30 mg/l. Other sta@e se6on'dary treatment standards Iinclude specifications
for constituents, such as disso'l,@r4,id"oxygen andIchlorine residual, not
included in EPA's definition.*

Effluent limitations more stringent than secondary treatment also
may be imposed. The.states have designated their'surface waters as
either effluent limited or water quality @imited. An effluent limited
receiving water is one in,which.water quality standards can-be achieved
through permits based on the uniform, technology-based effluent limita-
.tions promulgated-by-EPA.' water quality limited receiving waters require
effluent limitations more stringent than these., A facility discharging
to an effluent limited receiving water'would not need to go beyond
secondary treatment. Effluent limitations for municipali-Eies discharging
to w@ter quality limited receiving waters are determined by waste load
allocations which con@sider,all discharges to a'pa'rticular receiving,
water and which are,:part of the'pontinuing planning*piocess under Section
303 of the Act(3).

A few states have designated all of their waters water quality
limited, while a few others have designated all waters effluent limited.
In general, a large portion of the more string'ent,effluent limitations
are aimed at maintaining,dissolved oxygen in receiving waters and limit

11-7

effluent BOD to between 10 and 20 mg/l. A few also control nitrogenous
oxygen demand by limiting ammonia nitrogen to between 2 and 5 mg/1(3).

Limits on nutrients are generally applicable to plants discharging
to lakes or to streams tributary to lakes. The permissible concentration
of phosphorus in the effluent is usually between O.s and 2.0 mg/l. Re-
strictions 'on total nitrogen are uncomon(3).

The use of land application as a method of wastewater treatment is'
subject to various state regulations and policies. Few states specifi-
cally allow irrigation of any land with-wastewater unless it has been
subjected to some form of treatment, usually a level proximate to
secondary. Table 11-2 presents the results of a recent survey of state
restrictions on land application.

TABLE 11- 2. Summary of State Restrictions on Land.
-Application by Irrigationra)

Number of Statesral Reporting
Treatment
Required Prior to Non-Food Food Parks and
Land Application Crops Crops Golf Courses

Land Application Prohibited 2 5 3
Primary 1 0 0
Secondaryrb) 9 2 3
Secondaryrb) and Disinfection 12 10 16
Not Specified 13 20 is
No Response 19 19 19
Total 56 56 56
-ra-rIn6ludes District of Columbia, American Samoa, Guam, Puerto Rico,
Trust Territories and Virgin Islands.
rb)Includes Laqoons.'

Source: National-Commission on Water Quality. From Metcalf and Eddy,
Inc., Water Pollution Abatement Technology: Capabilities and
Costs. Publicly owned Treatment Works. 1976.

11-8

b. Combined Sewer Overflows and Storm Sewe r pischarges*

Combined sewer overflows and storm sewer discharges are not now
included in regulations defining the level of effluent quality attain-
able through secondary treatme nt(l) or in proposed regulations on best
practicable waste treatment technology over the life of the works(2).

Effluent limitations for overflows from combined sewer systems will
be established on a case-by-case basis where control of overflows is
necessary to meet water quality standards. The EPA Water Quality
Strategy Paper indicates that permits from the National PollUtaini DiS-
charge Elimination System will "require municipalities to operate existing.
treatment facilities to minimize discharges of pollutants from combined
sewer overflows and bypasses to the extent possible with available
funding and planning"(4). Municipal permits also-will contain provisions
for monitoring overflows and for planning corrective act-ion.

A survey of state pollution control agencies conducted by a Commission
contractor(5) revealed.that the states are just beginning to approach
combined sewer overflow problems. Only five states have established
criteria,for the quality of combined sewer overflows,* and only a handful
of enforcement actions"have been taken.

Under P.L. 92-500, storm sewer discharges are subject to regulation
as point sources but not the minor amount of runoff.which is not carried
in any pipe, ditch or other "discernible, confined and discrete con-
veyance" (Sec. 504(14)). A recent court decision (7 ERC 1881) obligates
EPA to issue permits for storm sewer discharges. This decision also
states that EPA has the latitude to rank categories and subcategories of
point sources of different importance and to treat them differently
within its permit program. No effluent limitations for storm sewer
discharges have been promulgated to date.

The EPA Water Quality Strategy Paper states that facility plans and
areawide waste treatment management plans should include consideration
of methods to control pollution from storm sewer discharges. Presumably,
these plans will identify locations where these discharges are a problem,
and indicate the level of control needed to meet water quality standards.

*As used in this report, "runoff" pertains to water flowing over the
land surface. Except in sparsely populated areas, runof f is normally
collected in storm sewers (pipes or ditches) that convey it to some
point of discharge. If the collection system also handles wastewater"
it is termed a "combined sewer" system. Such systems contain often
numerous points where combined sewage is allowed to overflow to surface
waters during storms, since sewage treatment plants generally have not
been design ed to treat the volu me of combined sewage that results from
all but very minor storms. "Storm sewer discharges" is also taken to
include runoff from areas in need of storm sewers.

11-9

C. Residuals Disposal

Treatment of municipal wastewater generates considerable quantities
of sludge, and lesser amounts of grit, screenings and Scum. Disposal of
these materials normally is accomplished through ocean dumping, landfilling,
land application or incineration.

ocean dumping of sewage sludge is regulated under both P.L. 92-500
and the Marine Protection, Research, and Sanctuaries Act of 1972 (P.L.
�2-532). Public Law 92-532 requires permits from EPA for all dumping of
materials other than dredge spoil in U.S. waters, the contiguous zone
and the territorial sea, and for dumping of materials transported from
the U.S. anywhere in the oceans. Criteria for the evaluation.of permit
applications define EPA's policy "to regulate the dumping of all types
of materials into ocean waters and,to prevent or to regulate strictly
the dumping or other discharge into ocean waters of any material in
quantities which would adversely affect human health, welfare, or
amenities, or the marine environment, ecological systems, or economic
potentialities, or plankton, fish, shellfish, wildlife, shorelines, or
beaches"(6). EPA considers ocean dumping of sludge to be only an interim
measure since sludges tested to date fail to meet the criteria for
special permits. Interim permits require the permittee to "seek means
of meeting the criteria or to find alternative means of disposal"(4).

Land application of sewage sludge is addressed in an EPA draft
technical bulletin entitled Municipal Sludge Management: Environmental
Factors(7). This document states that land application of treated
sludges for agriculture, enhancement of parks and forests, and reclamation
of poor or damaged terrain is an acceptable method for the utilization
of sludges. A key point is that sludge must be stabilized prior to land
application; i.e., treated to reduce public health hazards and to prevent
nuisance odors. Proper site selection, design, operation and monitoring
are essential elements of a satisfactory land utilization system.

Disposal of sludge in sanitary landfills is discussed in EPA's
Guidelines for the Land Disposal of Solid Wastes(8). These guidelines
list digested and heat-treated sludges and incinerator ash as materials
compatible with normal sanitary landfill methods, provided these materials
contain no free moisture. Raw sewage sludge and beptic tank pumpings
are'considered special wastes for which precaut.,ons are needed to prevent
ground and surface water contamination, nuisance odors, and possible
spread of pathogens. The guidelines do not mention grit, screenings and
Scum, all of which are commonly disposed of in landfills. These guide-
lines are mandatory for Federal agencies and are recommended for use by
state and local agencies.

II-10

Air emissions from sludge incinerators-must meet Federal, state and
local air pollution requirements. The Air Quality Act of 1967 resulted
in the establishment of ambient air stanaards as well as standards of'
performance for various classes of sources including sewage treatment
plants. The Federal standards of performance for sewage treatment
plants limit opacity to 20 percent and particulates to 1.3 pounds per
ton of dry sludge input. Some local @ir quality requirements are so
strict as to preclude the use of-slud4e incinerators(3).

3. Characteristics of Wastewater, Combined Sewer Overflows and Storm
Sewer Discharges

Wastewater receiiie&by publicly owned treatment works (municipal
wastewater) consists of sewage flg"ws generated in housiehi'olds, commercial
and industrial establishments, and-public buildings and'varying amounts
of groundwater and-stormwater. I .ts volume and 6omposition depend upon
the pattern of.domestic water use, the quality of-the water.supply used
in a given--area,, industrial wastes,,and infiltration of groundwater into
the collection system through cracks'aind defective joints in sewer
systems. Separate sanitary sewer systems also,,may receive considerable
amounts of stormwater inflow from.submerged manhole covers and from
normally illegal connections of.ioo'f leaders, foundation.drains and area
drains.

The principal contaminants in municiiDal.wastewater.incltide oxygen
demanding materials, suspended solids,*dissolved,solids, nutrients,
toxic substances and 'pathogenic organisms- Typicai concentrations of
biochemical oxygen demand, suspended solids, dissolved solids, phosphorus
and nitrogen characteristic of. strong, .medium' and weak municipal waste-
water are shown in Table 11-3.

TABLE 11-3: Municipal Wastewater Characteristics

ConcentrAtion.Amg/l)
Constituent Strong Medium Weak

Biochemical Oxygen Demand (5-day) .335 200 100
Suspended Solids 360 260 100
Total Dissolved Solids 860 515 270
Phosphorus.(as P) 20 10 6
Nitrogen (as.N) 80 .40. .18
Source: National Commission on Water Quality. From Metcalf and
Eddy, Inc., Water Pollution Abatement Technology:
Capabilities and Costs. Publicly Owned Treatment Works.*
1976.

Metals such as chromium, copper and zinc are of concern because
they may interfere with biological treatment processes (see Table 11-4),
they are normally not as amenable to removal by conventional treatment
as are organic substances, they may render sludge unsuitable for land

TABLE 11-4. Concentrations@ of Metals which Interfere with Biological
Treatment Processes

Concentration (mg/1)

Aerobic Anaerobic
Metal processes digestion Nitrification
Copper 1.0 1A 0.5
Zinc 5.0 5.0 0.5
Chromium (Hexavalent) 2.0 5.0 2.0
Nickel 1.0 2..0 0.51
,Lead 0.1 0.5

Source: -National Commission on Water Quality. From Metcalf and Eddy, Inc.,
Water Pollution Abatement Technology: Capabilities and Costs.
Publicly owned Treatment Works. 1976.

'application, a4d they may adversely affect water quality. Some of the
metals come from industrial discharges into municipal systems, but
studies of New York City sewage treatment facilities indicate that
appreciable quantities also come from residential and other nonindustrial
sourcds, as shown in Table 11-5.

TABLE 11- 5. Sources of Heavy Metals in New York City Wastewater

Percentage of Total Load
Source Copper Chromium Nickel Zinc Cadmium

Water Supply 20 0 0 7 0
Industrial 19 52 65 20 39
Residential 47 28 25 42 49
.Runoff 14 9 10 31 12
Unknown 0 11 0 0 0
Source@ L.A. Klein, M. Lang, N. Nash and S. L. Kirschner, "Sources
of metals in New York City wastewater," Journal Water
Pollution Control Federation, Vol. 46, No. 12, D6cember
1974, pp. 2653-2662.

11-12

Combined sewer systems exhibit wide variations in flow between wet
and dry weather. Wet weather flow associated with a rainfall intensity
of 0.1 inch per hour may exceed the dry weather flow by a factor of five
to 10, while a one-inch-per-hour rainfall may produce flows 50 to 100
times the dry weather f low (9).

Overflows from combined sewer systems include a portion or all of
the domestic and industrial wastewater discharged during the storm, to-
gether with the pollutants washed from streets and other surfaces. In
addition, solidst oil and grease accumulate within combined sewers
during periods of dry wea ther and are flushed out during the early
stages of a storm. During this "first flush" the concentratipns of
pollutants in the overflow often exceed those characteristic of un-
treated wastewater in dry weather. This condition may last for only a
few minutes or it may continue for several hours, particularly in large
sewer system (9). After the'first flush passes, the overflow normally
becomes diluted to the point where its BOD concentration, averaged over
the entire storm, is less than that of the untreated dry weather flow.

Storm sewer discharges can be considered sIgnificant sources of
pollution with regard to the total quantities of pollutants released.
As shown in Table 11-6, the 1971 suspended solids load attributable to
storm sewer discharges was almost four timesthat of wastewater treatment
plant effluents and combined sewer overflows. This suspended solids
load will become relatively more important as other sources achieve
compliance with the requirements of the Act.

TABLE 11-6. 1973 Average Daily Pollutant Load of Storm-Sewer Discharges Compared
with those of other Municipal Discharges.

Effluent of
Storm Sewer Wastewater Combined Sewer
Discharges(alb) Treatment Plants(c) Overflows(c)

5-day Biochemical 2,600 7,900 .1,600.
oxygen Demand (tons/day)
Suspended Solids (tons/day) 47,000 7,100 6,200
Nitrogen (tons/day) 190 3,000 150
phosphorus (tons/4ay) 94 880 60
Flow.(million gallons/day) 22,500 24,000 3,600

(a)For the Urbanized Area portion-of Starfdard Metropolitan Statistica@ Areas.
(b)source: National Commi Ission on Water Quality. From Black, Crow and Eidsness,
Inc. and,Jordan,_, Jones and Goulding, Inc., Water Pollution Abatement
Technology:_ capabilities and Costs. Urban Runoff. December 1975.
(c)Source: National Commission on Rater Quality. From Metcalf and Eddy, Inc.,
Wafer Pollution Abatement Technology: Capabilities and Costs.
Publicly@Owned Treatment Works,., 197,6...

11-13

In terms of gross quantities of pollutants contained in storm sewer
discharges, BOD, nitrogen and phosphorus appear to be lesser problems
than suspended solids.when other municipal discharges are used as a
point of reference; however, they can have pronounced short-term effects
on water quality since storm sewers like combined sewer overflows,
release pollutants in a number of separate, and often intense,. dis-
charges.

Storm sewer discharges constitute a highly significant source of
bacterial contamination as indicated by the coliform content. Observed
fecal coliform densities vary from a few hundred to millions of organisms
per 100 milliliters, while sewage treatment plants are not allowed to
discharge more than an average of 200 per 100 milliliters under EPA's
current regulations on secondary treatment. Appreciable.quantities of
heavy metals and other toxic substances have been found in urban runoff.
Most of these materials are associated with very fine particles (smaller
than 250 microns). The principal sources of pollutants in urban runoff
are listed in Table 11-7.

TABLE 11-7: Sources of Pollutants in Urban Runoff'

Source Pollutants

Dustfall and rainfall Suspended solids (particulates),
nitrogen, sulfur, acid, pesticides

Vegetation oxygen-demanding substances, nutrients

Animal droppings Bacteria, oxygen-demanding substances

Fertilizer usage Nutrients

Pesticide usage Pesticides

Erosion at construction-sites and
other pervious areas, and in Suspended solids
drainage channels

motor Vehicles Suspended solids, lead, oil and grease

Snow and ice removal Dissolved solids, chloride:, suspended
solids, toxic compounds (e.g., sodium
ferrocyanide).

Weathering of paving,materials Suspended.solids

Source: National Commission on Water Quality. From Black, Crow and Eidsness,
Inc. and Jordan, Jones and Goulding, Inc., Water Pollution Abatement
Technology: Capabilities and Costs. Urban Runoff. December 1975.

11-14

Wide variations in the quality of storm sewer discharges have been
reported for different locations, and for different storms at the same
location. Some investigators have reported a "first flush" effect while
others have not found such a phenomenon. It appears that the existence
and intensity of any "first flush" depends upon such factors as the
extent of paved surfaces, rainfall intensity, size-of watershed, the
frequency with which catch basins and sewers are.cleaned, and the elapsed
time since the last rainstoria. Table 11-8 shows the'ranges in the,con-
centration of several pollutants in urban runoff at 10'sites across the
country.

4. 1973 Baseline Conditions

At the time of the 1970 census, 144 million persons, or 71 percent
of the U.S. population of 204 million, were connected to municipal sewer
systems. About 93 percent of the population served resided in regions
designated by the Census Bureau as urbanized areas.*

Data collected in the 1974 EPA Needs Survey" indicates that approx-
imately 25 percent of the nation's sewered population is served by
combined sewer systems. These systems are most numerous in the northeastern
quarter of the continental United states. Some overflow occurrences re-
sult from bypassing of dry weather flows because of overloaded sewers
and treatment plants, and cannot be considered combined sewer overflows
,in the strict sense. The number of overflows associated solely with
storm events cannot be'estimated from the available data.

The extent of wastewater treatment provided by publicly owned
treatment works in 1973 is difficult to assess because of the lack of
adequate data. The trend since 1940 is shown in Figure II-1. Since the
data upon which this figure is based include some privately owned treat-
ment plants, less importance 'should be placed on the absolute numbers of
facilities shown than on the relative 1@vel of treatment provided. In
1940, only about half of the nation's'municipal treatment plants provided
more than primary treatment. By 1974, however, 81 percent of the facilities
were providing some form of treatment beyond primary (but not necessarily
that level of secondary treatment.required for 1977), and five percent
had tertiary treatment. Figure II-1 does not show the number of plants

Generally, urbanized areas include central cities of at least 50,000
population, the surrounding closely settled territory, incorporated
places of 2,500 or more inhabitants@ incorporated places of fewer than
21-500 inhabitants provided each has a closely settled territory of
100 housing units or more. (For a complete definition 'see p. xiii
1970 Census of Population(10)).

**See p. 11-24 for explanation of 1974 Needs Survey.

TABLE 11 8 RUN-OFF QUALITY

Suspended BOD COD Total-Nitrogen Total Phosphorus - Fecal Caliform Lead Chloride Total Dissolved Qil and
Site @Solids (mg/1) (mg/1) (mg/1) (mg/1) (mg/1) (organisms/100 ml) (mg/1) (mg/1) solids (mg/) Grease 1mg/1)

Cincinnati, OH 4-1200 1-173 20-610 0. 3-7 .5 0.02-7.3 3-428 -
(mean) (227) (17) (Ili) (3.1) (1.1) - (12) -

Atlanta, GA 6-800 1-10 5@64 0-01-1.28 90-104,000 0.05-0.15 - - 6.2-26.3
.(mean) (215) (6) (26) J0.94) (0.33) A11,000)l (0.08) - - (11.7)
Durham, NC 27-7340 - 20-1042 '0.1-11.6 b 0.2-16 100-200 000 0.1-2.86
(170) (0.'96) b (0.82) (23,000 1
(mean) (L223 ) (0.46)
.Tulsa, OK 112-864 2-26 64-215 0.13-2.24 0.6-2.1 d 0-290,000 - 56-396
Amean) (401) _(14) (121) (0,.82 )c (1.16)d (720)1 - (174)
Lubbock,TX 144-670 110-461 0-5.28 e 0.36-3.53 f
f -166-1150
(mean) (296) (215) (1.94)e (0.64) (307)

-Moines, -3170 14-166 - -4.69 e h
..-Des IA 14 0 0-1.76 18-27-24
(mean) (578) (63) (1-.47)e (0.93) (681)h -
Ln
New York,..NY k -20-1653 .0-131 0.65-19.3 0.05-1.,46 d <31000@4,600,000 - -3.7-2370 - 0.4-76 i
(mean) (184) (30) (46) (3.64) A0.48 )d (283,000)l - (452) - 17) i

Washington, D.C. 130-11,280 3-90 29-1514 0.5-6.5 0.2-4.5 9 40,000-1,300,000 -
lmeaa) (L69,7 (19) (335) (2.1) (1.3)9 A310,000)l -

Castro Valley, CA [email protected]
2@90 13-340 0.3-2 1 100-47,000 0-01-1.0 5-110 0-91
(mean) - - - - - - -

-West Lafayette., IN 90_95 a f4-232 a - 900,000@2,900,000 a -
Amean) (38) (37) - -(1,800,000)1 -

a-Average.values.for separate storms. g Total phosphate. Source: National Commission on Water Quality. From
b.Kjeldahl nitrogen. h Snowmelt only. Black, Crow and Eidsness,-Inc. and Jordan, Jones
-c organic nitrogen. i.-Hexane extractable,zaterials. and Goulding, Inc., Water.Pollution Abatement
d Soluble-orthophosphate. j Runoff.@quality affected by discharge of
e Nitrate as N. industrial wastewater to btorm,sewer. Tech@ology: Capabilities and Costs.- Urban Runoff.
,f.Drthophosphate. k.-Runoff quality may be affected by illicit December 1975.
connections.
1-Geometric mean

Figure 11.1
TRENDS IN MUNICIPAL WASTEWATER TREATMENT
1940-1974

Number of Plants

21,011
C-4
With Tertiary C"
20,000
Treatment

15,000

00
at
10,000

5568
With Secondar 1 Treatment
5,000 S

11N

With Primary Treatment Oni CD

1940 1950 1960 1970 1974

Source: U.S. Dept. of Interior, Fed. Water Quality Admin., "Municipal Waste Facilities in the U.S.; Statistical
Summary, 1968 Inventory", Publication No. CWT-6,1970.
1974 date from EPA STORET Municipal Waste Facilities Inventory. Some privately owned treatment
works included in 1974 date.
Natl. Commission on Water Quality
February 1976

11-17

that discharge w ithout treatment. This number is estimated to be about
3,500 on the basis of the data generated in the 1974 EPA Needs Survey.

Although the distribution of treatment plants by size, shown in
Table 11-9, is for facilities reported in the Needs Survey, it is con-
sidered representative of all existing plants. Although 78 percent of
the plants are smaller than one million gallons per day (MGD), they
treat only 7 percent of the nation's wastewater flow. Plants larger
than 20 MGD constitute only 2 percent of the number of plants, but they
treat 61 percent of the flow.

TABLE 11-9: Size Distribution of Treatment Plants

Treatment Percent of
C
apac*t Number of
1 y Percent of
(MGD)ral Plants (b)- F low (b)

Less than 1 78 7
1-5 15 14
5-20 5 18
More than 20 2 61
Total 100 100

(al0ne Million gallons per day (MGD) is
approximately equivalent to the flow of-
a population of 10,000 in the absence of...
industrial flow.
(b)For facilities reporting needs in 1974 EPA
Needs Survey.

Source: National Commission on Water Quality. From
Metcalf and Eddy, Inc., Water Pollution Abate-
ment Technology: Capabilities and Costs.
Publicly Owned Treatment Works. 1976.

The present method of effluent disposal reported in the 1974 Needs
Survey is shown in Table II-10. Surface water outfalls are used in 84
percent of the plants. Some form of disposal on land is used by 13
percent of the facilities and 2 percent use ocean outfalls. In terms of
total flow, 89 percent goes to surface waters; 8 percent to the oceans;
and 3 percent to land. It can be concluded from these data that plants
discharging to the oceans are typically larger than those discharging to
surface waters.

11-18

TABLE II-10. Present Method of Disposal of Treatment
Plant Effluents.

Percent of Percent of
Disposal Method Plants Total Flow

Surf@ce Water Oiitfalls 84 89.4
Ocean.Outfalls 2 7.8
Holdin4 Ponds 5 1.3
Deep Wells < 1 negligible
Groundwater Recharge 1 0.9
Other Land Disposal 3 0.6
Wciter Supply Recycling 1 negligible
Septic Tank Fields 4 negligible
100 100.0

Source.: National Commission 'on Water Quality. From Metcalf
and Eddy, Inc., Water Pollution Abatement Technology:
Capabilities and Costs. Publicly Owned Treatment
,eorks. 1976.

.5. State of the Art of Technology

In general, adequate technology exists to meet municipal needs for
wastewater collection and tieAtfiient systems.

Storage and treatment techniques for controlling combined sewer
overflows have been demonstrated, and can be considered currently avail-
able but costly.

Although techniques which appear capable of preventing the con-
tamination of urban runoff ate becoming available, these techniques have
not,been' proved to date. Technology for treating storm sewer discharges
is now at a. relatively early stage of development; however, theie has
been discussion of adapting technology for wastewater treatment and
combined sewer overflow control for possible application to this source
of pollution.

a.. Wastewater Collection

Existing wastewater collection systems normally have been reliable
in the performance of their primary fujhcti6n, the protection of public
health through the timely conveyance of wastewater from its sour"ce to
the point of disposal; nevertheless-, the efficiency of many of these
systems -suffers because 'of their age and the limitations of technology
available at the time they were installed.

11-19

Public Law 92-500 requires an applicant for a construction grant to
demonstrate that the collection system serving a proposed treatment
works is not subject to excessive amounts of infiltration and inflow.
Techniques are available for sealing leaky sewers and for eliminating
inflow from such sources as roof and area drains.

it is anticipated that the conventional practice of collecting and
tranporting wastewater predominantly by gravity will continue during the
foreseeable future. Alternatives to conventional collection systems are
available in the form of vacuum and pressure sewer systems, but the cost
of these systems limits their applicability to a relatively small number
of cases where gravity collection or individual septic tank systems are
not feasible because of adverse terrain or unsuitable soil conditions.

b. Wastewater Treatment

Several opportunities exist for reducing the cost of wastewater
treatment by controlling the volume and strength of wastewater generated
in the home. Water-saving plumbing fixtures become more economical with
increases in the.costs of water'and wastewater services, particularly
for new installations and for the replacementof worn-out fixtures.
Widespread use of dual cycle toilets arid,flow-limiting shower heads
would reduce domestic wastewater flow by about 40 percent(3) but the
potential savings in treatment costs would be significantly less than 40
percent since 'wastewaterstrength would increase in proportion to the
reduction in flow.

Garbage disposa ls increase household water consumption by about 4
percent. City-wide use of these appliances can increase wastewater
total.suspended solids by 55 percent, BOD-by 30 percent and grit by 40
percent(ll). Automatic dishwashing uses about twice the water needed
for manual dishwashing and can increase per capita flow by about 3
percent(3).

Banning the use of phosphate detergents can reduce the phosphorus
content of domestic wastewater by about 50 percent; howeveri greater re-
ductions in phosphorus normally are necessary where eutrophication is a
problem. Thus, the only savings in treatment costs that would result
from such a ban would be about $0.90 per capita per year associated with
reduced consumption of chemicals at treatment plants designed to remove
phosphorus(3).

Since the-above measures for flow and load reduction are not likely
to be implemented soon on a wide scale without the imposition of legal
restrictions, and since the historical trend toward increased domestic
water usage appears to have leveled'off, the analysis that follows
assumes that there will not be major'changes in household wastewater
generation in the immediate future.'

11-20

The principal constituents of concern in the design of wastewater
treatment facilities are BOD, suspended solids, ammonia nitrogen, total
nitrogen, phosphorus and pathogens. A large number of different treat-
ment systems can be assembled from available unit processes; they can be
grouped under five basic options:

1) suspended growth (e.g., activated sludge)
2) fixed film (e.g., trickling filter)
3) lagoon and pond
4) physical-chemical, and
5) land application.

There are variations of suspended growth and fixed film processes
that can control nitrogen and all flow ranges can be accommodated.

Some lagoon processes also are capable of removing nitrogen when*
facilities'for algae removal are provided. Without algae removal, most
I
lagoon systems are not capable of achieving the level of suspended
solids removal required by EPA for secondary treatment. Some techniques
.for upgrading lagoon performance are available while others are under
development. Because of their substantial land requirements, lagoons
.generally are not applicable to plants over 1 MGD, although there are
more than 200 lagoons now in use that are larger than this.

Physical-chemical systems are capable of producing high quality
effluents. Although they can be designed to handle any flow range,
their complexity and cost often preclude their application in small
plants.

Many treatment facilities that have been termed "secondary" in the
past do not comply with EPA's definition of secondary treatment, but
their performance normally can be upgraded through modifications of
existing processes or through the addition of processes for effluent
polishing.

Effluent limitations more stringent than secondary treatment fre-
quently are required to meet water quality standards. Extensive research
over last decade has produced a number.of applicable advanced waste
treatment techniques that have been proven in pilot plant studies, and
often in full-scale demo nstration projects. Advanced technology is
expensive, but it can be considered available.

Achieving the effluent limitations required by the Act will require
closer attention to operation and maintenance than has been provided in
the past. Without it, there may be a considerable difference between
the level of treatment for which a facility is designed and the level
actually achieved.

11-21

Secondary treatment and best practicable waste trdatment technology
can be achieved through land.application and wastewater reuse also.
Irrigation of crops and other vegetation is the predominant land appli-
cation technique in present use. Infiltration-percolation is a.high-
rate process suitable for well drained, sandy soils. For impervious
soils, land application may be accomplished by allowing wastewater to
flow across a vegetated surface into runoff collection ditches. The
principal use of this overland flow technique has been for treating food
processing wastes, rather than municipal wastewaters.

Opportunities exist for reusing treated effluent for a number of
municipal, industrial, agricultural and recreational purposes. Although
.there are many public health questions that need to be answered before
direct recycling for public water supply can be practiced on an extensive
scale, groundwater recharge through land application or recharge wells
is an example of indirect reuse which has been practiced successfully.
Municipal water supplies can be augmented by substituting reclaimed
water for potable water in such applications as-watering of golf courses,
if separate transmission facilities are provided. Treated effluents
have been used in industrial applications, primarily for cooling.
Irrigation of cropland is an example of agricultural reuse. Reclaimed
wastewater also has been used for aesthetic enhancement through ornamental
lakes, and for the creation of reservoirs suitable for boating, fishing
and swimming.

Numerous options for sludge treatment and disposal are available.
The objectives of sludge treatment are to reduce the sludge volume and
to eliminate its noxious properties so that it may be disposed of eco-
nomically and in an environmentally acceptable manner. The.principal
difference among sludge handling systems lies in the methods of.stabilization
and ultimate disposal. Lime stabilization and aerobic digestion are
normally employed in small trickling filter and activated sludge plants
while anaerobic digestion is common in larger plants. No stabilization
is necessary or desirable prior to sludge incineration. Methods of
ultimate sludge disposal include: landfill, land application, ocean
disposal, reclamation (e.g., marketing of processed sludge as a fertilizer),
conversion to innocuous gases (e.g., incineration), and reuse (e.g.,
recovery of lime and chemical sludges).

Since sludge handling and ultimate disposal are often the most
costly elements of waste water treatment systems, constraints on sludge
disposal may influence the choice among sludge-producing wastewater
treatment options.

C. Combined Sewer Overflow Control

Methods available for reducing pollution from combined sewer over-
flows include.source control, collection system control, storage and

11-22

treatment. Source control, which includes measures taken in the urban
drainage basin to improve the quality of runoff and to reduce peak and
total flow entering the sewer system, is discussed in the next section
dealing with storm sewer discharges.

Collection system controls include sewer separation, catchbasin
cleaning, control of infiltration and inflow, line flushing, improvement
of overflow regulators, and remote monitoring and control for flow
routing and in-line storage. Separation of combined sewer systems has
come to be viewed not As a panacea but as a poor alternative because of
the cost and disruption associated with large-scale replacement of.sewer
lines, and because of the pollution potential of storm sewer discharges.
Periodic removal of solid.s*that accumulate in the collection system
during dry weather would prevent these materials from being flushed out
during a storm, and restore sewer capacity needed during wet weather.
Improved overflow regulators capable of reducing the suspended solids
concentration of th e overflow are becoming available.

Some form of storage normally is essential in a scheme of combined
sewer,overflow control since it is not feasible to treat combined sewage
at the rate it is generated during a storm, especially if substantial
reduction of pollutants is necessary. Most collection systems can be.
altered to provide a limited amount of storage through the use of in-
flatable dams or other regulators within trunk and interceptor sewers,
but substantial off-line storage in holding basins or tunnels would be
required for all but the smallest of storms. After a storm, impounded
combined sewage can be released gradually for treatment at dry weather
facilities, or treated separately.

Technology for treating combined sewage is basically similar to
that used for wastewater. Special consideration is needed in process
selection and design to accommodate the wide variations in flow and
strength characteristic of combined sewerage systems, however.

The design of combined sewer overflow control facilities would
differ significantly from that of wastewater treatment plants since
facility size would be determined primarily by rainfall characteristics
rather than the quantities of domestic and industrial wastewater re-
ceived.

d. Storm Sewer Discharges

A number of techniques are emerging for preventing the contamination
of urban runoff by controlling polluta nts at their so urce. Street
sweeping, as it is now pract iced, is relatively ineffective in removing

11-23

the fine particles (under 250 microns) which contain most of the oxygen-
demanding materials, nutrients and toxic substances found of the street
surface. Vacuum street-sweepers' *that-are now available may be capable
of removing-substantial portions of these fine particles. Improved
street cleaning alone would achieve only 4 partial reduction in pollution
because of other sources of contaminants, such as soil erosion(12).

Temporary storage of rainwater on 'rooftops and parking lots by
means of*throttled drain-inletsl@can reduce peak flows and thereby eliminate
part of the Suspended solids'loAd attributable to erosion of drainage
ditches and streambanks, and%.-may reduce the need for separate storage
facilities if treatment is to be provided(12).

Pollution associated with snow'and ice removal can be reduced by
moderation-in the use of salt, by avoiding the use of toxic anti-cakiing
ingredients in road salt,,an'd by substituting.abrasives for salt, where
possible. Although it.is doubtful..thatthe use .of salt can be eliminated,
better management of this source of pollution .can the quality of
surface waters, as well asgroundwater(i2)'.

Control of erosion at construction sites is another method of.im-
proving runoff quality and is'considered in Section II"F, Selected
Nonpoint Sources.

Treatment processes proposed.for controlling storm sewer discharges
may be grouped under the headings of solids-separation, biological
treatment, disinfection and physical-chemical treatment. Reported
performance and capital costs vary significantly, e'vdh for similar
systems. Data for.operation and-maintenance requikements are almost
nonexistent. Nevertheles@i,!some:generalizationsi can@be made using basic
studie's'reported in.the literature.

.Some form of storage normally is included in proposed treatment
systems. The benefits of storage are that it can be designed to.in-
corporate sedimentation for achieving substantial reductions in suspended
solids and associated,pollutants (toxic substances,;oxygen demand,
nutrients),@especially if chemicals are added, And,that it eliminates
the need todesign downstream processes large enough to handle peak
flows.,

Biological treatment is not particularly we 11-suited to controlling
urban runoff pollution." Treatment at sewage treatment plants would"be
difficult because biological processes do not respond well to sudden
chang6s-':in,flow and load, especially if toxic substances are present.
Treatment in.,separate facilities would require some means"of maintaining
the necessary population of microorganisms during periods of dry weather.

11-24

Physical-chemical treatment offers distinct advantages over . bio-
logical treatment in that it can accommodate I'shock" loadings and is not
affected by toxic substances. It is more expensive, however, and pro-
duces large quantities of sludge. Disinfection would be required to
reduce bacterial counts to acceptable levels.

6. Sources of Data

The approach taken in estimati 'ng the cost to the nation of achieving
the requirements of P.L. 92-500 for publicly owned treatment works in-
volved four basic steps: 1) an identification of needed facilities,
together with enough information to define the types of technologies
that might be applicable; 2) a determination of available technologies
most likely to be used to meet the needs identified, and for each
technology, the costs; and 3) an assignment of available technologies to
individual needs, followed by 4) addition of costs. A similar approach'
was taken in estimating quantities of residual wastes generated and
requirements for manpower, energy, materials and land.

a. Inventory of Needed Facilities

For wastewater treatment plants and combined sewer overflow control
facilities, the 1974 U.S. EPA Needs Survey was used as the primary in-
ventory of facilities needed to meet the requirements of the Act. This
survey was conducted in response to P.L. 92-243, an amendment to Sec.
516 of P.L.,92-500. P.L. 93-243 directed EPA, in cooperation with the
states, to conduct a state-by-state survey of costs of new facilities
required by publicly owned treatment works as of June 1974, to be used
as a basis for allocating construction grant funds among the states.
Costs were reported in the following categories:

1. Secondary treatment and BPWTT
II. Treatment to meet more stringent effluent limitations
III.A. Infiltration/inflow correction
III.B. Major sewer system rehabilitation
W.A. New collector sewers
IV.B. New interceptor sewers
V. Control of combined sewer overflows
V1. Treatment and/or control of storm sewer discharges.

The Needs Survey was used as a data base in the Commission's in-
vestigation because it represented the most recent inventory of existing
facilities and because it presumably identified, either directly or
through representative sampling, all publicly owned treatment works that
,needed additional facilities to meet the requirements of the Act. In
addition,.the survey requested from the states a wealth of technical.
information that would permit the'.Cotmission to estimate costs independently.

11-25

A considerable amount of care had to be exercised in interpreting
the Needs Survey data. Since the results were to be used as a,basis for
allocating federal funds, the states had an incentive to overstate their
needs. It is difficult to determine how-extensively costs may have been
inflated, but the opportunity existed for reporting unnecessarily high
population estimates, high estimates of population connected to the
sewers, and high per capita flow and industrial flow,.and for reporting
effluent limitations mbre stringent than those actually required to meet
water quality standards. The c6sit.of facilities is quite sensitive to
all of these factors. Furthermdke.,.at-the time the,survey was conducted"
the states had only limited information to guide them in forecasting the
extent of industrial use of municipal facilities,rand in predicting the
level of pollution abatement,tequired for facilities discharging to
water quality-limited receiving waters(S).

The Needs Survey data also.suffers from lack of completeness.. Al-
though each needed facility seems to be reasonably accounted for in the
data base, records for individual facilities often were missing part of
the technical information needed by the Commission. Usually it was
possible to overcome this deficiency through the judicious use of
assumptions and other sources of information compiled by the Commission
contractors.

The need,for new collection systems was determined on the basis of
the population expected to be served by municipal treatment facilities
by 1990. Although the Needs Survey did obtain detailed information on
the length and diameter of needed collector sewers, interceptor sewers
and appurtenances, these data were not available in a form for convenient
analysis.

The Needs Survey does not contain a uniform data base which could
be-used for*estimating the cost of controlling pollution from storm
sewer discharges. The varying depth of study.by' individual states is
reflected in their needs reports.which range fiom single-page cost
statements to voluminous documents supplementedby computer analysis.
In the absence of a more suitable data base, Commission contractors made
varying assumptions about the extent of land area in the country for
which storm sewer discharges might need to be controlled and estimated
the cost of treating the runoff from these areas.

b. Population Projections

Because of the dominant influence of p6pulation on the cost of
n6eded.collectioh and treatment facilitiesp it was deemed necessary to
make an independent projo-ction of the population that would be served by
publicly owned treatment.works in the year 1990. This date was selected
so that the Commission's cost estimates could be compared with those of
the 1914 EPA Needs Survey.

11-26

The starting point in this analysis was information developed by
the 1970 Census which contains data.on the urban, rural-nonfarm and
rural-farm populations served by sewers in 1970., The estimate of the
1990 total population was taken from the Department of Commerce Series'
1-E projection with some blight modifications.-

It was assumed that the entire population growth between 1970 and
1990 would occur in urbanized areas, and,that the rural-nonfarm and
rural-farm, populations would remain unchanged. Assumptions were made
that the percentage of the urban populati on not now.connected to sewers
would decrease by a factor of 50 percent between 1970 and 1990, and that
there also would be corresponding decreases of 30 percent and 10 percent
in the unsewered rural-nonfarm and-rural-farm population segments
respectively. These assumptions result in the projection, shown in
Table II-11, of the 1990 population served by sewers.

TABLE II-11. Projection of U.S. Population Served by
Publicly Owned Treatment Works

Percent
Total Population Served Served by
Population by Sewers Sewers
Year (millions) tmillions) M

1970ral 203.9 143.7 70.5
199orb) 256.0 210.2 82.1

(@ElIncludes the 50 states and the District of Columbia.
rb)Includes the 50 states, the District of-C61umbia, American
Samoa, Guam, the Trust Territories of the Pacific Islands,
Puerto Rido and the Virgin Islands.
Source: National Commission on Water Quality. From Metoalf and Eddy, Inc.,
Water Pollution Abatement Technology: CRabilities and Costs.
Publicly-;Owned Treatment Works. 1976.

C. Technologies and Costs

Information on the costs and capabilities of available and emerging
water pollution control technologies was drawn from numerous sources,
incl.udi'ng searches of the technical literature, mail surveys, and.personal
contact with researchers, government officials and wastewater treatment
personnel.

For the category of new collector and interceptor sewers, 97
recent.sewer construction projects were reveiwed to determine the typical

11-27

per capita..requirements for sewers and,pumping stations of various,
sizes. Total costs were estimated from th ita kequiJikements,
I ., I ese per cap
the projected increase in.populatiomconnected tomunicipal sewer
systems, and published data on the cost of collection system components'.

An effort to,develop an independent estimate of the cost of
correcting infiltration.and inflow conditions, and of major sewer system
rehabilitation did not prove productive. The 1974 Needs Survey estimates
were used for these projects.

All'airailable information on wastewater treatment and sludge dis-
posil processes was reviewed to determine applicability, reliability and
capabilities of different technologies.
Infor'matiIon on available technology for controlling combined-sewer
overflows and urban@runoff ivas drawn from..thd technical literature.
Master plains p;epared,for seveial large.-cities and the results of de-
monstation projects were reviewed and proved Ito be valuable sources 6f
additional informatidn'on methods of controlling combined sewer over-
flows. Adequate meteorological data, essential to the design of facilities
for controlling wet weather pollution, were available from publications
of the National Weather Service.

7. National Assessment

a. Costs

The Commission's' estimates of the capital and operation and main-
tenance costs for meeting the 1983 r4@quiienients of the Abt for,publicly
owned treatment works with facillities.designed to meet the needs of the
1990 population are shown in Table 11-12. The costs are presented using
the same categories as the 1974 Needs Survey.

TO estimate the cost of wastew@ter treatment plants, the'15,089
plants smaller than 20 MGD reported in,the 1914 E]@A Needs Survey were-
divided into 54 classes.: The facilitiet,in a given class were similar
with respect to their 1990 design flow, extent of existing facilities,
and effluent limitations on BOD, suspended solids and nitrogen. Technol-
ogies and costs were assigned to each class after.a consideration of
influent strength, existing capacityj required capacity, in-place pro-
cesses, climate and required effluent quality. The results of this
assignment of technologies are summ ariized.,in Table 11-13., It was
assumed that expansions of plants that now provide secondary treatment
would be accomplished through the.use of technology similar to that
already installed.

11-28

TABLE 11-12: Capital and operation and Maintenance Costs
for Publicly Owned Treatment Works (a)

Incremental
Capital Costs(b) Annual O&M Costs(b)
Category ($.Billions) ($ Billions/yr)

I Secondary Treatment and
BPWTT 10.8 0..36
II Treatment to Meet More Strin-
gent Effluent Limitations 24.8 0.83
IIIA Infiltration/Inflow Control 6.9 0
IIIB Major Sewer Rehabilitation 9.5 0
IVA New Collectors 13.0(c) 0.16
IVB New Interceptors 13.5(d) 0.16
V Correction of Combined
Sewer overflows(e) 79.6 [17-891 (f) 0.50 [0.12-:0.521(g)

SUBTOTAL 158 [95.5-1681 2.0 (1.6-2.01
VI Treatment and/or Control rh) (i) (j)
f Storm Sewer Discharges 199 [158-4271. 1.3 [0.31-3.21
TOTAL 357 [254-5951 3.3 [1.9-5.21
la'For meeting 1983 requirements for,19190,population for projects not funded
as of June 1974.
l(b)Not including interest, amortization or depreciation. Capital costs
include interest during construction. Incremental O&M cost is the
difference between 1990 and 1973 O&M cost.
rc)Revised capital cost estimate is $14 billion.
(d)Revised capital cost estimate is $14 billion.
(e)Based on primary treatment plus disinfection on effluent limited receiving
waters and secondary treatment plus disinfection on water quality limited
receiving waters.
(f)Ranges from 17 to 89 depending upon level of control.
rg)Ranges from 0.12 to 0.52 depending upon level of control.
(h)Based on primary treatment plus disinfection for the Urbanized Arta
portion of Standard Metropolitan Statistical Areas.
(i) Rahges from 158 to 427 depending upon level of control.
(j)Ranges from 0.31 to 3.2 depending upon level of control.

[Indicates range]

Source: National Commission on Water Quality, February 1976, compiled from
technology contractor reports to the Commission. -

TABLE 11-13: Distrih;ution of Wastewater Treatment-Technologies by Effluent Limitation

Effluent (a) Secondary. 'Number Percent of Plants Using 'Land
Limitation Treatment of Activated F@ixed Aerated oxidation
in Place Pi ants (b) Sludge Film Lagoon Pond Application-

BOD: 15-30 Yes 4156 28 31 9 28 4
SS: 15-30. No 4052 30 32 5 25 8

BOD: 15-30 Yes 393 37 43 6 11 3
SS: 15-30 No 238 48 23 16 8
NH3-N: 0-6

BOD: 15-30 Yes 39 15 41 .5 34 5
SS: J5-30 No 71 40 6 20 .10
Total-N: 0-6

BOD: 0-15 Yes 1724 41 36 6 14 3
SS: 0-15 No 1634 55 14 5 17 9

BOD: 0-15 Yes 843 42 38 4 13 3
SS: 0-15 No 496 55 20 4 14 7
NH3-N: 0-6

BOD: 0-15 Yes 1288 46 22 8 21 3
SS: 0-15 No 517 45 24 .6 17 8
Total-N: 0-6

a
Range in effluent limitations on biochemical oxygen demand (BOD), suspended solids (SS), ammonia nitrogen
(NH3-N) and total nitrogen (Total-N).
bWith needs for new or improved facilities.

Source: National Commission on Water Quality. From Metcalf and Eddy, Inc., Water Pollution Abatement
Technology: Capabilities and Costs. Publicly owned Treatment Works. 1976.-,

11-30

Large plants often are faced with unusual design constraints
(e.g., shortage of land for treatment plant expansion) that are peculiar
to large cities. Consequently, costs for the 365 plants larger than 20
MGD reported in the Needs Survey were considered separately. Reported
capital costs were compared with data collected by Comission.contractors.*
The only major adjustments were deletions where costs for the same
facility appeared more than once in the 1974 Needs Survey, and population
adjustments.

The capital cost estimates for each.of the 54 classes of facilities
under 20 MGD and for facilities over 20 MGD was apportioned to Categories
I and II of Table 11-12 on the basis of the amount of flow that appears
in the Needs Survey record for these categories. This method was
selected because there are some advanced waste treatment plants in
Category I, Secondary Treatment, and some secondary treatment plants in'.
Category II, Treatment to Meet More Stringent Effluent Limitations. The
total capital cost estimate was refined by making adjustments to com-
pensate for facilities which could not be classified because of in-
sufficient Needs Survey data, and to correct for overstated population
estimates.

This procedure resulted in an estimate of $35.6 billion for waste-
water treatment plant capital costs -- $10.8 billion in Category I
(secondary treatment and BPWTT) and $24.8 billion in Category II (more
stri ngent treatment). The need for disinfection accounts for about 4
percent of the capital cost.

About 40 percent of the existing lagoon systems are expected to
need more than secondary treatment to meet water quality standards. The
remaining 60 percent will have to install filtration, or similar processes
for algae removal, at an estimated cost of $0.26 billion, to achieve the
suspended solids removal required under EPA's definition of secondary
treatment.

A separate estimate was made of the capital cost of providing only
secondary treatment for all facilities. This estimate was @27.8 billion.
Thus, $7.8 billion, or 22 percent of the total cost for wastewater
treatment, is associated with the need for advanced waste treatment(3).

*American Public Works Association(5), and written responses to question-
naires from member agencies of the Association of Metropolitan Sewerage
Agencies.

11-31

At one time, EPA was considering, as part of the definition of
BPWTT(13), a requirement for a more stringent minimi= level of treatment
which would have included a specification for an average ultimate oxygen
demand* of less than 50 mg/l in warm weather** and an average ultimate
biochemical oxygen demand*** of less than 30 mg/l at all other times.
Facilities serving a population of fewer than 10,000 and located outside
SMSA's or those discharging to ocean waters were not included. Meeting
this requirement generally would entail biological nitrification or some
other method of ammonia removal, and would add about $1.4 billion to the
capital cost estimate(3).

Costs for infiltr&tion/inflow correction and major sewer system
rehabilitation (Categories IIIA.and IIIB), shown in Table 11-12, were
taken directly from the' Needs Survey since a lack of data prevented in-
dependent estimates for'these,categories of need. The 1974 Needs Survey
estimates that $6-'9 billion is needed for controlling infiltration and
inflow. This amount,ib equal to one-fifth of the $36.8 billion Needs
Survey estimate**** for bonstruction of wastewater treatment facilities.
This estimate may be premature because the Needs Survey was conducted
before most municipalities had completed the evaluation of their sewer
systems. Commission contractors conclude that the estimate is probably
low because of the number of authorities that reported only the cost of
conducting the sewer system evaluation without the projected cost of
correction.(5)

The total cost of new collection systems ($26.5 billion), shown in
Table 11-12, was apportioned to Categories IVA (new collectors) and IVB
(new interceptors) in the same ratio as they were reported in the Needs
Survey. It is not known precisely how much reserve capacity is provided
for in the cost estimate, but since the per capita requirements are
based upon a review of recent projects, it is presumed that they correspond
to current engineering practice.

To be accurate, a national assessment of the cost of abating pol-
lution from combined sewer overflows would involve detailed information
on the characteristics of rainfall and receiving w;ters for each facility
served by combined sewers. Because of the dearth of such information,
Commission studies were structured.to develop a range of costs by altering
assumptions about the level of abatement required.

Ultimate oxygen demand = 1.5(BOD5 + 4.6(NH3-N) (D.O.)

Warm Weather was defined as influent temperature greater than
@:200 C.

Ultimate biochemical oxygen demand 1.5(BOD5) (D.O.)

Costs shown are in 1975 dollars.

11-32

A common design storm, defined in terms of its frequency and duration
as a 2-year, 1-hour storm, was used for all analysesi that is, facilities
were designed to collect, store and treat the runoff from the storm of
one hour duration whose rainfall is equalled or exceeded, on the average,
once in two years. Designs for this storm will reduce the average
annual number of overflows per site from the present 60 to about one to
five.

To simplify the analysis, rainfall was assumed uniform within each
of the five regions shown in Figure 11-2. The size of the 2-year, 1-
hour storm in each of these regions is also shown.

While it appea3es that the Act intends that combined sewer overflows
be subject to effluent limitations for publicly owned treatment works
and presumably would be included in the secondary treatment and BPWTT
effluent limitations, alternative less stringent levels were also explored.
Initially the Commission contractor derived costs for treatment options
1 through 5 as shown in Table 11-14. Commission technology c-uld economic
contra ctors have used Option 5 (primary treatn*nt and disinfection for
effluent limited receiving waters and secondary treatment plus disinfection
for water quality limited receiving waters) as the basis upon which
impact analyses have been conducted. About 80 percent of the $80 billion
capital cost of this option is attributable to storage facilities. The
selection of this option reflects an assumption that this level of
control is the most probable that would be needed to meet receiving
water quality requirements.

In recognition of the high costs for controlling combined sewer
overflows and in anticipation that site-specific alternatives may eventually
be adopted, the Commission contractor was directed to investigate. other
technological alternatives which might provide substantial reduction in
disc.h@rge of pollutants at markedly lower costs. Options 6, 7 and 8
shown,on Table 11-14 are the principal possibilities that might be
employed.

The eight levels of abatement were considered for the rainfall in
each region. Storage volume and treatment rate were varied to determine
the least-cost system capable of containing and treating the design
storm within 24 hours. No storage was necesshry for the option of
disinfection only. Estimates of sludge handling costs were based -upon
the assumption that sludge generated at wet-weather facilities would be
treated at large dry-weather plants.

In Table II-14,,the eight treatment options are compared in terms
of their costs, the degree of pollutant removal attainable, and cost per
pound of pollutant removed. Secondary treatment of all ov6rflows,,
option 3, is the most effective in that it controls 70 percent of the
BOD and 80 percent of the suspended solids, but it is also the most,
expensive. The least expensive solution, in-line storage and treatment

11-33

Figure 11 -2
RAINFALL REGIONS USED FOR ANALYSIS OF
.COMBINED SEWER OVERFLOW CONTROL

.. ........
.. ..........
. ...........

.. ...........
...............

.................
............
......................

.............. ....

......... ........
................ 4
..........
....... ...

................

................
...............

..........

..................
............ ...

..........

RAINFALL CHARACTERISTICS

2 yr., 11-hr-Rainfall (inches) Average Annual Rainfall (inches)
Region (a) Range Average (b) Range Average (b)
1 1.30-2.55 1.64 39.1 -57.6 46.2
2 1.00-1.70 1.36 24.8-50.0 34.6
3 0.40-2.45 .1.23 7.7-59.2 25.4
4 0.80-1.80 1.20 30.7-55.5 41.9
1 5 0.35-0.80 0.49 6.3-86.4 36. 7
18) As shown on map above '
(b) Weighted average based upon the distribution of facilities needed for control of combined
sewer overflows.

Source: Nati. Commission on Water Quality, from Metcalf and Eddy, Inc., "Water Pollution Abatement Technology:
Capabilities and Costs, Publicly Owned Treatment Works", 1976
February 1976

TABLE 11-14: Comparison of Abatement Levels for Combined Sewer overflow Control

System Efficiency Cost per Pound of
Treatment Annual Operation Annual -(percent removal) Pollutant Reno-ved(c)
Treatment Effluent limited Water quality limited Capital Cost and Maintenance Cost(b) Suspended Suspended
option receiving water(a) receiving water(a) Storage ($ Billions) Cost ($ Billions) Billions) BOD solids BOD Solids
I Disinfection only None 17 0.06 1.6 0 0 n.d.(d) n. d. rd)

2 Primary and disinfection In-line and 70 0.47 7.1 30 55 is 2.9
off-line

3 Secondary(e) and disinfection in-line and 89 0.52 8.9 70 80 9.6 2.5
off-line

4 Disinfection Primary and In-line and 45 0.26 4.5 14 27 24 3.7
only disinfection off-line
5 Primary and Secondary(e) and In-line and 80 0.50 6.0 49 67 12 2.6
disinfection disinfection off-line
H
6 Swirl concentration with disinfection off-line 33 0.09 3.2 13 45 18 1.6 11.
of overflow and treatment of under- storage of 0.
flow at existing dry-weather plant(s) underflow

7 Treatment of stored runoff at existing In-line 1.5 0.15 0.30 45 45 0.'50 0.15
dry-weather plant(s) only

8 Treatment of stored runoff at existing Off-line 6.7 0.12 0.75 54 54 1.0 0.31
dry-weather plant(s) storage of
"first
flush,, rf)

1-WICities reporting needs only in Category I of the 1974 Needs Survey are considered to be located on effluent limited receiving waters; those reporting
Category 11 needs are assumed to be located on water quality limited receiving waters.
(b)Capital Cost, annualized at 7 percent for 20 years, plus annual Operation and Maintenance Cost.
iclAnnual Cost divided by pounds of pollutant removed annually.
(d) Not defined.
(e)In the traditional sense, not as defined by' EPA.
Source: National Commission on Water Quality. Data from Metcalf and Eddv, Inc. , Water Pollution Abatement Technology: Capabilities and Costs. Publicly
Owned Treatment Works. 1976.

11-35

at dry-weather plants (Option 7), removes 45 percent.of the BOD and
suspended solids.

Comparison of the options in terms of cost per pound of pollutant
removed is difficult because all the options are not designed to remove
the same pollutant. option 1, disinfection of all overflows, is not
designed to remove either BOD or suspended solids. Primary treatment is
oriented toward suspended solids removal, but it would remove that
portion of the BO'D load associated with settleable suspended solids.
Consequently, it is not surprising that it costs more,to remove a pound
of BOD using primary,treatment than using secondary treatment, which is
designed to remove BOD. In spite of the limitations of this kind of
comparison,,-two options emerge as extremely attractive: option 7, which
uses in-line storage followed by treatment at dry-weather plants, and
option 8, which uses off-line' storage of the "first flush" followed by
treatment at dry-weather plants. Despite the somewhat limited effective-
ness of-these options, they constitute a relatively inexpensive first
step toward controlling overflows from combined sewers. (For the sake
of comparison, large secondary treatment plants provide 85 percent
removal of.BOD from sewage at a cost of.about $0.25 per pound of BOD
removed.)

The costs for Options 6, 7 and 8.do not include disinfection of
those overflows which will not reach dry-weather.plants for treatment.
Therefore, total costs for options 6, 7 and 8 should be increased to
account for the probable necessity of chlorinating untreated overflows.
An allowance almost as great as required for option 1 should be included.
Nevertheless, the total costs for site-specific solutions employing
these options plus chlorination could be substantially less than uniform
application of option 5. It is difficult to assess national costs when
all solutions for controlling combined sewer overflows are so dependent
upon yet to be finalized regulations,,. site by site specifics regarding
rainfall and receiving water characteristics and the vagaries of each
pystem.

In estimating the cost of controlling pollution from storm sewer
discharges, critical assumptions were necessary with regard to extent of
land area in need of runoff control, level of abatement required, and
design storm. Three land areas were considered:

0 All 243 Standard metropolitan Statistical Areas (SMSA's),
which generally include all cities of 50,000 inhabitants or more and the
entire area of each contiguous county. These areas account for 11
percent of the land area of the U.S. and 69 percent of the population.

0 The urbanized areas within these SMSA's. These include 1 per-
cent of the nation's land area and 58 percent of its population.

11-36

0 The central cities of all urbanized areas. These account for
0.4 percent of the nation's land. area and 32 percent of the population.

The five abatement levels for which costs were estimated and the
associated design storms are shown in Table 11-15.

The methodology for estimating costs is as.follows:

1) Conceptual designs for treatment systems were prepared for
each abatement level for each of the 10 sites listed earlier
in Table 11-8. The estimated costs for these facilities
formed the basis of cost curves (cost per unit of treatment
capacity vs. population density) used in estimating national
costs.

2) Information from the technical literature was used to establish
the cost of stormwater collection as a function of population
density.

3) The cost of collection and treatment'for each SMSA, urbanized
area and central city was calculated by means of a computer
program which used these cost relationships and the following
information specific to each geographical unit: land area,
population, design storm, annual rainfall, area served by com-
bined sewers, area without storm sewers, and a factor to
incorporate regional differences in construction costs.

This methodology produced the capital and operation-and maintenance
costs shown in Table 11-16.

As indicated previously, the most significant contaminants in urban
,runoff appear to be pathogens and suspended solids. Abatement level 3
would control these constituents, together with those toxic substances,
nutrients and oxygen-demanding materials associated with the suspended
solids. Areas within SMSA's but outside the urbanized areas are so
sparsely settled that storm sewer discharges are less likely to be
significant sources of pollution in these regions than in the urbanized
areas. Consequently, the cost of achieving abatement level 3 in the
urbanized areas, $199 billion, was selected by the Commission as being
indicative of the national total capital cost of abating pollution from
storm sewer discharges. A large portion of this cost, $84 billion, is
attributable to stormwater collection.

TABLE 11-15. Hypothetical Abatement Levels Considered in Analysis of Storm Sewer
Discharges.

Avg. No.
of Storms
Exceeding
Storage and Estimated Percent Pollutant Reduction
Treatment
Design Capacity Per Suspend"td
Level Description Technology Storm- Year Solids BOD Nitrogen Phosphorus Bacteria

1 Removal of unaesthetic. Bar screen 1-year,' more than 3 3 1 0 0 0
debris 1-hour @A

2 Removal of sediment and Sedimentation 2-year, 2 60 35 15 35 0 11
associated pollutants 1-hour

3 Removal of sediment, Sedimentation-plus 2-year,, 2 60 35 15 35 99
bacteria and associ- chlorination 1-hour
ated pollutants

4 Removal of sediment, Aerated lagoon plus 1-year, 1 90 60 15 40 99
oxygen demand, and sedimentation 6-hour
associated pollutants

5 Treatment higher than Physical7chemical 1-year; less than 1 97 90 70 70 99
secondary treatment plus 24-hour
chlorination

Source,; National Commission on Water Quality. From Black, Crow and Eidsness, Inc. and Jordan, Jones and-Goulding, Inc.,
Water Pollution Abatement Technology: Capabilities and Costs. urban Runoff. December 1975.

11-38

TABLE.II-16. National Capital and Operation and Maintenance Costs for
Controlling Stormwaters
Abatement Level (a) 1 2 3 -4 5

Capital Cost ($ billions)

.Central City 60 81 85 100. 190
Urbanized*Area 158 189 199 225 427
SMSA. 174 200 212 235 454'

Operation & Maintenance
Cost ($ billions/year)

Central City 0.12 0.@32 0.53 0.50 1.2
Urbanized Area 0.31 0.84 1.4 1.3 .3.2
SMSA 0.36 0.96 i.6 1.5 .3.7

a See Table 11-15 for d.ef inition.
Source: National Commission on Water Nality. From Black, Crow and
Eidspess, Inc. and Jordan, Jones and Goulding, Inc., Water
Pollution Abatement Technology: Capabilities and Costs.' Urban
Runoff. December 1975.

The methodology used for,estimating oper ation and maintenance costs
for each category of need shown in Table 11-12 was basically similar to
that used in estimating capital costs. Costs associated with wastewater
collection were based upon surveys conducted by the Commisgion's con-
tractors(3). Costs for operation and maintenance of wastewater treat-
ment plants were estimated from information on the requirem hts of
various unit processes"for manpower, energy, chemicals and materials.
Costs for controlling combined sewer overflows were based upon the
results of demonstration and pilot plant projects., Informition on the
operation and maintenance of'urban runoff control facilities is almost
nonexistent; however, it was'possible to make,some. generalizations from
studies reported in the literature.

It was recognized that the present design and operation of waste-
water treatment plants often do not provide the level of reliability
required by EPA. The need for standby units was not addressed specifically,
but where differences in the reported cost-for a given process were
attributable to differences in reliability, the cost for the more reliable
design was used in the Commission's analysis. Estimated operation and
maintenance costs provide for a higher than customary level of manpower
that is consistent with dependable operation.

The 1974 Needs Survey was assumed to be a complete inventory of
needs for wastewater treatment and combined sewer overflow control. Any

11-39

publicly owned treatment works not reporting needs for these kinds of
facilities was not specifically included i n the analysis. The method-
ology used by the Commission contractor for estimating needs for new
collector and int6rcep@or sewers resulted in the inclusion of some costs
(minor) for new collectors to serve communities not in existence on
66tober 18, 1972,,which are not eligible for construction grants, The
N(ieds,.Survey theoretically include d eligible projects only. Neels for
infiltration and inflow correction for major sewer system rehabilitiation
were taken directly from Category III reported in 1974 Needs Survey.

The Needs'8urvey:data on effluent limitations, industrial flow, and
per capita domestic flow used in this analysis are imperfect. The Needs
Survey provided little infnrmation upon which an estimate of the cost of
controlling combined sewer overflows and urban runoff could be based;
ther.efore, it was' necessary to make major assumptions for many factors
to which the cost estimates were quite sensitive.

The cost functions used in estimating costs are representative of
national average conditions (e.g., influent composition, climate and
chemical costs). Consid6ration was given to abnormal circumstances,
such as unusual site probelms, only to the extent that these circumstances
Are reflected in the-Needs Survey for the.larger facilities.

Many,of the cost functions used were based upon numerous installations
reported in the literature and can be considered reliable; however, cost
fuhctions.for many.unique wastewater treatment processes and for technol-
ogy to control combined sewer overflows and urban runoff are based on
very little data And must be considered approximate.

Table 11-17 compares the 1974 Needs Survey cost estimates with
those developed by the Commission. The two compare favorably for waste-
water treatment facilities even though the Commission's estimate is
based upon lower population estimates and stricter effluent limitations
than the Needs Survey. The Needs Survey estimates for new collector and
interceptor sewers are substantially higher than those estimated by the
Commission. The Commission's estimated cost of combined sewer overflow
control is almost double that reported in the Needs Survey, but its
estimate of the cost of controlling urban runoff is substantially less.
Nevertheless, the Needs Survey estimates for these kinds of facilities
do fall within.the extremely wide range of the Commission's estimates.

Differences in the estimates of wastewater collection (Category IV)
are attributable partially to the Needs Survey's higher estimate of the
1990 population served by publicly owned treatment works. The differences
in Categories V and VIAre due largely to uncertainty because of the
newness of technology for controlling wet-weather pollution, and un-
certainty as.to..the level of control needed to meet water quality
standards.

TABLE 11-17: Comparison of NCWQ Cost Estimates with EPA 1974 Needs Survey

Capital Costs ($ Billions)
Category NCWQra) EPA Needs Survey

I. Secondary Treatment 10.8 16.4

II. Treatment to Meet More Stringent
Effluent Limitations 24.8 20.4
IIIA.- Infiltration/Inflow Correction 6.9(b) 6.9
IIIB. Major Sewer System Rehabilitation 9.5rb) 9.5.

IVA. New Collectors 13.0 22.8

IVB. New Interceptors 13.5 23.1
V. Correction of Combined Sewer Overflows 79.6 (17-891 rc) 40.4
0

Subtotal 158 [95.5-1681 139

vI. Treatment and/or Control of Stormwaters 199 [158-4271 (d) 305

Total 357 (254-5951 444

(a)Projects not funded as of June 1974. Costs do not include interest, amortization, depreciation
or land for expansion.
(b)Needs Survey estimates.
(c)Ranges from .,',17 .to 89, depending on level of control.
(d) Ranges from 158 to 427 depending on level of control.
(Indicates range]
Source: National Commission on Water Quality, February 1976, compiled from technology contractor
reports to the Commission.*

11-41

Of all the estimates developed by the Commission for publicly owned
treatment works, those for wastewater treatment facilities (Categories I
and II) are considered the most reliable; however , it must be remembered
that these are for the 1990 population served by sewers. The use of
1990 as a basis for facility design in the present analysis produces an
underestimate of'costs because new facilities normally would be designed
with adequate capacity to accommodate growth farther into the future
than 1990.

b. Resources

Estimates of the manpower and land required for the construction of
publicly owned treatment works are shown in Table 11-18.

TABLE 11-18: Manpower and Land Requirements for Construction
of Publicly owned Treatment Works

Manpower Land (thousand
Category (thousand man-years) acres)

Wastewater Treatment 280 32
New Collection Systems 300 3.4
Combined Sew r Overflow 660 39
Control(V
SUBTOTAL 1,200 74
Storm Sewer-Discharge ControlIP! 2,100 140
TOTAL 3,300 214

(alBased on primary treatment plus disinfection on effluent
limited receiving waters and secondary treatment plus
disinfection on water quality limited receiving waters.
(b)
Based on primary treatment plus disinfection for the
Urban ized Area portion of Standard metropolitan Statistical
Areas.
Source:. National Commi ssion on Water Quality, February 1976, compiled
from technology contractor reports to the Commission.

Table 11-19 shows the manpower, energy and chlorine required for
operation and maintenance. The energy requirements shown are those in
excess of those likely to be supplied by methane produced by sludge
digestion.

TABLE 11-19. Manpower, Energy and Chlorine Requirements for operation and
Maintenance of Publicly Owned Treatment Works
(1) (2) (3) (4) (5) (6)
storm Sewer
Wastewater Wastewater Combined Sewer Subtotal Discharge(c, Total
Category Treatment(a) Collection Overflow Control(b) (1) + (2) + (3) Control (4)+(5)

Manpower (thousand
man-years/yr.)
1973 47 60 Negligible 107 0 107
1990 85 82 18 185 24 209
change 38 22 18 78 24 102,
Oil Equivalen@h) of
Energy (thousand
bl./day)(d)
1973 65 5 Neqliqible 70(e) 0 70
1990 127 7 12 146(f) 16 162
change 62 2 12 76rg) 16 92

Chlorine (thousand
tons/yr.)
1973 250 Negligible Negligible 250 0 250
1990 440 Negligible 110 550 865.0 1,410
change 190 Negligible 110 300 860 1,160

(a)Includes facilities with and without needs.
(b) Based on -primary treatment plus disinf ection on ef f luent limited receiving waters- and secondary treatment (in the
traditional sense not as defined by EPA) plus disinfection on water quality limited receiving waters.
(c)Based on primary treatment plus-disinfection for the urbanized area portion of,.Standard Metrol5olitan Statistical'
Areas
,,(d,)Based.on 33 percent efficiency in generation and-,transmission of electrical energy
(e)Equals 0.20 percent of 1973 U.S.:total.energy consumption
MEquals 0.41 percent of 1973 U.S. total energy consumption
(9)An-,increase of 106 percent above 1973value.
(h) Includes-electrical and fuel oil requirements.

.Source: ..National Commission.on Water Quality,,February,.19-76, compiled-from technology contractor reports to the
commission.

11-43

C. 'Residuals

The total annual sludge production will increase significantly when
all needed publicly owned treatment works are constructed. The 1972 raw
sludge production has been estimated at 4.7 million tons per year (dry
solids basis)(14). By 1990, this figure is expected to increase to 24
million tons per year. Seven percent of this is attributable to con-
trolling combined sewer,overflows* and 43 percent to controlling storm
.sewer discharges.** Sludge processing reduces.the total to about 20
million tons per year on a dry solids basis through processes, such as
digestion and incineration, which convert some of the sludge to gaseous
products. The actual quantity of material going to ultimate disposal
will be more than double this 20 million togs because of the high water
content of treated sludge.

The quantities of pollutants that would be discharged from publicly
owned treatment works in 1990 if all needs are met are compared with
1973 quantities in Table 11-20. The BOD load would be about half the
1973 load, and suspended solids and total phosphorus would be reduced by
60 percent and 17 perc ent respectively. Total nitrogen would remain
virtually unchanged because the total volume of wastewater treated
annually will increase, but not all treatment plants will be'required to
remove nitrogen. No conclusions about environmental impacts can be
drawn from this information because@such an evaluation would require an
assessment of effects at specific disposal sites.

Based on primary treatment plus disinfection on effluent limited
receiving waters, and secondary treatment (in the traditional sense,
not as defined by EPA) plus disinfection on water quality limited
receiving waters.

Based on primary treatment plus disinfection for the urbanized area
portion of Standard Metropolitan Statistical Areas.

11-44

TABLE 11-20. Projected Flow and Pollutant Load Discharged from Publicly
Owned Treatment Works

Wastewater Combined::Sewer.: Storm Sewer
Treatment Plants(a) Overflow Control Discharge5
1973 1990 1973 1990"01 1973 19901c'

Flow (MGD) 24,000 36,000 3,600 3,600 22,000 22,000
Biochemical Oxygen
Demand (tons/day) 7,900 3,200 1,800 920 2,600 1,800
Suspended Solids
(tons/day) 7,100 3,200 6,200 2,000 47,000 19,000
Total Nitrogen
(tons/day) 3,000 3,200 150 100 190 160
Total Phosphorus-
(tons/day) 880 780 60 26 61-

ra"Includes facilities with and without needs
rb) Based on .primary treatment plus disinfection on effluent limited receiving
waters and secondary treatment plus disinfection on water quality limited
receiving waters.
(C)Based on primary treatment plus disinfection for the Urbanized Ai:ea portion
of Standard Metropolitan Statistical Areas.
.Source: National Commission on Water Quality, February, 1976, compiled from
technology contractor reports to the Commission.

11-45

C. INDUSTRY

1. Study Definition

Primary emphasis was placed upon technologies required to achieve
the effluent limitations promulgated, proposed, or under consideration
by the EPA for 1977 and 1983, corresponding to "best practicable control
technology currently available" (BPT) and "best available technology
economically achievable" (BAT). Alternatives to EPA's BPT and BAT limi-
tations were considered, and special attention was given to technologies
now available or likely to become available in the foreseeable future to
approach or achieve the 1985 goal of the elimination of the discharge of
pollutants into navigable waters.*

Abatement costs were estimated for both construction and operation
and maintenance, and associated non-financial resources including energy,
chemicals, labor and land. Costs for pretreating wastes before dis-
charging to municipal sewer systems were also estimated, assuming the
approach to pretreatment promulgated by EPA in November 1973(15).
(Specific pretreatment limitations are yet to be finalized for most in-
dustrial categories - see Section 3.c.) Finally, the technological
problems associated with the ultimate disposal of materials removed from
wastewaters, commonly referred to as "sludges," were explored, and the
quantities of sludges and the costs of their disposal were calculated.

I The broad spectrum of activities existing among water-using industries
makes this study complex, and dictates use of a standard methodology and
set of simplifying assumptions. Industries discharging significant
quantitites of waterborne pollutants were divided into two groups.
Separate studies of 10 industries were conducted "in depth." (An eleventh
industry, animal feedlots, was also studied in-depth: see Section E.)
These are either very large water users or illustrate important techno-
logical, economic or environmental issues. An additional 38 industrial
categories were investigated in a "general industry" study. They were
chosen because they were identified explicitly in the Act, or had been
identified by EPA as categories for which effluent limitations would
eventually be promulgated. Of the 38 general industry categories, four
were subdivided into two sectors, giving a total of 42 categories studied
as separate entities. Of these, it was determined that 20 should receive
the most attention because of the relative significance of their water
pollution abatement problems. one study covered all the industries
within the "general" group.

*These are discussed in Section D. - Innovative Technology

11-46

Table 11-21 ranks the major manufacturing categories by total water
intake in 1973, and shows those sectors studied in depth. (A tenth,
non-manufacturing category, steam electric power, was also studied in
depth.)

Table 11-22 lists the industrial categories included in the general
industry study. Those designated as group "A" received the least amount
of study. The 20 deemed most significant were divided among groups "Bul
and "C". The "C" categories were given the most attention because they
are major dischargers or because little prior information existed.

The standard approach and assumptions used throughout all the
industry studies were:

0 Each industrial category was divided into subcategories and
with a few exceptions - uniform effluent limitations were postulated for
each subcategory. The utility of using subcategories in addition to
those used by EPA was examined in the in-depth studies.

0 A series of increasingly stringent effluent limitations was
postulated, and in many cases more than one technological option for
achieving each was assess 'ed. For the categories studied in-depth,
limitations in addition to those promulgated or under consideration by
EPA were studied to provide possible alternatives should it be concluded
that the published limitations either were not technically feasible or
economically achievable, or because the final limitations were not yet
known in many cases, and because All are subject to possible revision.

0 Where possible, in-plant changes aimed at reducing the amount
and strength of wastewaters received as much attention as external
("end-of-pipe") treatment that removes the wastes after generation.
This approach was followed because a combination of in-plant and external
control strategies will often be the least-cost abatement strategy, and
many in-plant changes are expected to be used by industry to meet the
1983 and "new source" requirements.

0 Abatement-needs were based upon one or more representative
plant "models" for each subcategory. This approach facilitates analysis
of plant-level economics, and variations in plant costs due to different
production processes, size, etc., can be taken into account by using
more than one representative plant per subcategory. Deriving plant-
level expenditures also facilitates aggregating to total expenditures
for each industry.

0 Costs were calculated incrementally, starting from the abate-
ment measures that were in place in each industry as of January 1973.
A "baseline" is necessary in any calculation of expenditures, and the
industrial studies used January 1973 to represent in-place abatement
"before the Act."

Table IJ- 21: Ranking of Major Industrial (Manufacturing) Categories by Total Water Intake in 1973 (1)

Sectors Covered by Total Intake by Sectors
Total Intake In-Depth Studies No. of Plants 'in Sectors Covered In Depth
Category SIC. No. (billions of.gallons) (SIC Nos.) Covered In Depth (billions of gallons)

Primary Metals 33 4,941 Iron & Steel (SIC 331) 416 4,250

Chemicals and 28 -4,176 Inorganic Chemicals, 3,700 4,048
Allied Products Organic Chemicals,
Plastics and SyniEhetics
(SIC 281;2865,2869;282 less 2822)

Paper and Allied
Products 26 2,415 Pulp, Paper, and Paper- 598 2,305
board Mills (SIC 2611,
2621,2631)

Petroleum and Coal
Products 29 1,283 Petroleum Refining. 250. 1,278
(SIC 2911)

Food and, Kindred
Products 20 804 Canned and Preserved 2,123 123
Fruits & Vegetables
(SIC 2032-2035,2037)

Transportation
Equipment 37* 242 none none none

Stone, Clay, and
Glass Products 32 219 none none none

Textile Mill
Products 22 178 All 1,926(2) 178

Machinery, Except
Electrical 35 171 none none none

Lumber and Wood
Products 24 160 none none none

Table li,21: (Continued)

Rubber and Misc.
Plastic Products 30 154 none none none

Fabricated Metal
Products 34 107 Metal Finishing (3)
(SIC 3471) 70,000 12

Electrical and
Electronic Equipment 36 104 none none none

Instruments and
Related Products 38 37 none none none

Miscellaneous
Manufacturing 39 12 none none none

Total water intake for all manufacturing industries in 1973 =15,024 billion gallons. (4)

(1) Includes brackish and saline, as well as fresh waters.

(2) There are approximately 3,440 additional mills which use insignificant amounts of water.

(3) Only a rough estimate. The number of "Job shops", business establishments doing metal finishing only, is approximately
4,000. The remainder ("captive shops") are parts of larger manufacturing operations (including many in categories other
than SIC 34). .

(4) This figure excludes the steam electric power category, which was also studied in depth.

Source: 1973 Census of Manufacturers: Water Use in Manufacturing, Bureau of the Census, 1975. Table 3A

Table 11-22: Categories within General Industry study

Group "A" SIC Nos. Group "B" SIC Nose Group "C" SIC Nos.

Glass Manufacturing 321, 322, 323 @Fertilizer Manufacturing 2873@, 2874 Ore mining and Dressing 10
Iron, Copper, Lead, Zinc,
Uranium, Radium, Vanadium
Cement Manufacturing 3241 Ferroalloy Manufacturing 3313, 2819 Canned and Preserved Seafood 2091, 2092
Processing

Structural Clay Products 325 Nonferr ous Metals Manufacturing 3331, 3332,' 3333, Miscellaneous Food and 2082
Copper,.Lead, Zinc, and 3334, 3341 Beverages -- Brewing
'Aluminum

Pottery and*Related Products 326 Builder',s Paper and Board Mills 2661 Water Supply 4941

Concrete, Gypsum and Plaster 327 Meat Products Processing and 2011-, 2013, 2016, Machinery and Mechanical 3079, 34, 35, 36,
Products Rendering 2017, 2077 Products Manufacturing 37, 38, 39

Asbestos 3292, 3293, 2661 Dairy Products Processing 2021 , 2022, 2023, Leather Tanning and Finishing 31
2024, 2025

Insulation Fiberglass 3296 Grain Mills 2041, 2043, 2046 Coal Mining 11, 12
Manufacturing Wet Milling, Wheat Starch and
Gluten, and Cereal

Auto and Other Laundries 721, 7542 Cane Sugar Processing 2061, 2062 Petroleum and Gas Extraction 13

Foundries 3321, 3322, 3325, Beet Sugar Processing 2063 Mineral Mining and Processing 14
3361, 3362, 3369

Table 11-22: (Continued)
Group "A" SIC Nos. Group "B" SIC Nos. Group "C" SIC Nos.
Nonferrous Mill Products 335 Transportation Industries 40, 41, 42, 43, 44,
45, 46, 47
Timber Products Processing 24 Rubber Processing 3011 3021, 3031,
3041, 3069, 3293,
2822
Furniture and Fixtures 25

Miscellaneous Food & Beverages 205, 206, 207,
Grain Mills -- Dry Milling, 208, 209, 514 , 541
Wheat and Rice Feeds 2041, 2044, 2048
Paving and Roofing Materials 2951, 1611o 2952,
(Tar, Asphalt) 3996
Paint and Ink Formulation and 27, 2851, 2893
Printing

.Soap and Detergent Manufacturing 2841

,Phosphate Manufacturing 2819, 2874

Steam Supply 4961

'Ore Mining and Dressing 10
Gold, Silver, Bauxite,
Ferro-ally Ores, Tungsten
Molybdenum, Mercury, Other
Nonferrous Metals Manufacturing 2819
Bauxite Refining
Fish Hatcheries and Farms 0921, 0279
Source: National Commission on Water Quality, October 1975.

11-51

0 Costs were expressed in mid-year 1973 dollars in the contractors'
reports and reflect relative price levels at that time. These figures
have been converted to approximate 1975 dollars by the Commission staff,
using a uniform multiplier of 1.3. All costs in this reportreflect 1975
dollars unless otherwise noted.. only capital and direct operation and
maintenance expenditures were caluclated. Adjustments for such factors
as inflation rates, depreciation and financing costs were considered in
the economic impact studies.

0 Costs of abatement technologies aggregated to subcategory and
industry level do not incorporate plant closures or industrial growth
after-January, 1973. These factors were also addressed in the economic
impact studies.

0 Where available, EPA's promulgated effluent limitations, and
supporting data given in the Agency's "Development Document for Effluent
Limitations Guidelines and New Source Performance Standards" were used
to define the effluent limitations associated with BPT and BAT. When
limitations,had been proposed but not promulgated, Development Documents
supporting the@proposed limitations were used. In cases where the
limitations had not yet reached the proposal stage, the limitations
suggested by EPA's'contractors and under consideration by EPA were used.
In a few' cases, particularly within the general industry study, none of
these'sources were available and Commission contractors were forced to
hypothesize what the limitations would be. Of the 10 industries studied
in depth, promulgated limitations were available for all subcategories
of the petroleum refining, steam Ielectric power, and textile categories.
Promulgated limitations were available only for portions of the other
seven: -limitations suggested by EPA contractors and under consideration
at the time of the Commission's studies were used for the remaining
subcategories.

Alternatives to the abatement levels promulgated, proposed or under
consideration by EPA were not analyzed for most of the 42 categories in
the general industry study. For about 12 of these, no limitations had
.been proposed by EPA by the inception of the studies. Approximately
the same number of categories within the general industry study had
limitations that were only proposed or under consideration. In the
latter situation, Commission contractors used EPA's contractor reports,
and assumed that the suggested limitations would be promulgated.

There were other differences between the general and the in-depth
studies. EPA studies served as the primary data base for most of the
general industry studies,, and the contractor assumed the viability of
EPA's suggested BPT and BAT-technologies for all but the nine group C
industries. However, costs were developed independently in all cases.
Areas such as toxic materials limitations and state water quality standards

11-52

were considered to some degree in the in-depth studies, but were, give n
little or no attention in the general industry study.

None of the aggregate cost data include costs of meeting water
quality standards or toxic pollutant standards which might require more
sophisticated technologies than required to meet the BPT and BAT effluent
limitations.

2. The Industrial Setting

a. Water Use

.Across the spectrum of individual activities, the following uses of
water are most prevalent:

1) Cooling and heating
2) Steam generation
3) As a chemical solvent or reactant
4) Washing
5) Materials transport
6) Air pollution abatement.

Cooling is the largest volume usage, and the steam electric power
category is, by far, the major user of cooling water. Cooling water is
often physically separated from water required in the manufa cturing pro-
cess ("Process water"), often does not come into contact with the
product and, except for the addition of heat, may remain relatively un-
contaminated. This is particularly true for electric power generation
where, although some chemicals may be added to the "once-through"
condenser cooling water before it is discharged, the main addition is
simply heat. Steam electric power is the industry most impacted by
thermal effluent limitations.

Water used for steam may become con@taminated after contact with.
chemicals or intermediate products, and the pollutants absorbed must be
Hs@ripped" from the condensed steam before it is reused or discharged.
The petroleum refining industry provides a major example -- "sour water
strippers" are used to remove sulfur and other polluting compounds from
condensed steam that has been used to heat crude oil during the dis-
tillation process.

Water is known as the "universal solvent," meaning that it dissolves
a large number of chemical compounds. Thousands of industrial processes
depe nd on this property, and some o! the dissolved materials usually end
up in wastewaters. Water is also.used in many chemical reactions, and a
fraction may be combined into otheir'chemical compounds. When this
occurs, that fraction is truly consiumed., and does not appear in the
plant's discharge. (The quantities of.-water lost in this way are minor:
more wate@ is 'lost through 6vaporat-ion.)

11-53

The canned and preserved fruits and vegetables industry offers ex-
amples of water used for materials transport Commodities such as
potatoes are often transported between processing stages by flumes
filled with rapidly moving water. Water fluming can also serve the
purpose of washing and cooling, as well as the primary purpose of mini-
mizing product damage during transport. Fluming water leaches soluble
materials from the product, and may contribute significantly to the
plant's wastewater discharge.

The greatest source of wastewater in producing steel ingots is from
the "scrubbing" (washing) of pollutants from gases. All of the major
production processes produce large volumes of these gases, laden with
suspended solids and a variety of chemicals. Controlling these potential
air pollutants results in a complex water pollution problem. Some of
the effluent from the scrubbing process can be recovered,treated and
recycled. ' The balance must be treated before it can be safely dis-
charged to land or surface waters.

The volume of intake water used per unit of product has been de-..
creasing in recent years in many industries. This trend results from
several factors,.including increases in the cost of the water, water
pollution control costs, and the adoption of economic process changes
which are less water intensive. (An example of the last case is the
shift from "sulfite" to "kraft" chemical pulping in the pulp and paper
industry: the'kraft process discharges only half the water per ton as
the older calcium sulfite process.)

A low flow, concentrated wastewater stream normally is easier and
less costly to control and treat than a high volume, more dilute stream
and hence water conservation can play an important role in water pol-
lution abatement. "Conservation" refers to reductions in the net intake
water requirements per unit of product. This is different from "gross
water applied," a quantity determined by the details of the manufacturing
.process. The difference between these is the amount,of water recycled
and reused within the process: increased recycle and reuse decreases
the intake water requirement and the discharge flow. Table 11-23
summarizes information published by the Department of Commerce on histor-
ical water use by the manufacturing sector. The trend toward increased
recycli@lg and reuse is most dramatic between 1968 and 103, when gross
use increased by 32 percent, while net intake actually dropped slightly.

11-54

Table 11-23: Historical.Gross and Intake Water
Usage by all Manufacturin Industries
;g

Gross Water Used Net Water Intake
Year (billions of gallons) (billions of gallons)

1959 26,257 12,131

1964 29,857 14,007

1968 35,7pl 15,467

1973 46,965 15,024

Source: Census of Manufacturers: Water Use in Manufacturingr Bureau of the'
Census, 1961, 1966, 1971, 1975..

b. Waterborne Pollutants

The wide variety of uses for water is reflected in the numb6r of
industrialmastewater constituents which are considered pollutants. The
most common pollutants controlled are:

� Biochemical Oxygen Demand, Five-day (BOD)
� Chemical Oxygen-Demand (COD)
� Suspended Solids (SS), or Total Suspended Solids (TSS)
� pH (a measure of acidity-or alkalinity)@
� Oil and Grease (O&G)

Examples of other pollutants controlled in several industries'are
ammonia, sulfides, p@henols and color. Table 11-24 shows the complete
list of pollutants controlled by'EPA's effluent limitations for the 10
industries studied in depth.'

In addition to the pollutants listed in Table 11-24, EPA's proposed
Toxic Pollutant Effluent Standards would limit the discharge of the
pesticides aldrin, dieldrin, MT (and DDD, DDE), endrin and toxaphene,
the compounds PCB, benzidin'e and cyahide, and the heavy metals cadmium
and mercury(16). Promulgation of these proposed toxic standards would
impose additional limitations on the pulp and paper, iron and steelf
metal finishing, ore mining, ferroalloys, nonferrous metals, transpor-
tation, petroleum, and'sectors of the-chemicals industries, among others.

TABLE 11-24: industrial Pollutants Controlled by Effluent Limitations Either Promulgated or Under Consideration by EPA

Category Pollutants Controlled by BPT (1977) Additional Pollutents Controlled by BAT (1983)

Canned and Preserved Fruits and BOD, SS, fecal coliform, PH,, O&G None
Vegetables
Inorganic Chemicals SS and pH for all subcategories; plus for specified EOD(11
products. ammonia, COD, BOD, fluoride, sulfite, (for some product/processes)
sulfide, O&G, total organic carbon, cyanide, free
bromine (molecular), arsenic, barium, cadmium
chromium, copper, iron, lead, manganese, mercury,
nickel, selenium, silver, zinc
Iron and Steel SS, O&G, PH, cyanide, phenol, ammonia, iron, zinc(21, Sulfide, fluoride, nitrate, manganese
lead(2), chromium, tin
Metal Finishing SS, pH, cyanide, fluoride, phosphorus, copper, EODW
nickel, chromium, zinc, cadmium, lead, iron, tin,
silver, gold, iridium, osmium, palladium, platinum,
rhodium, ruthenium

Organic Chemicals BOD_SS, PH, for all subcategories; plus for specified COD
products- phenol, cyanide, chromium, copper

-Petroleum Refining BOD, COD, SS, O&G, pH, phenol, ammonia, sulfide, None
chromium

Plastics and Synthetics BOD, COD, SS, PH for-all subcategories; plus for None
specified products: O&G, fluoride, phenol, chromium,
copper, zinc

Pulp and Paper BOD, SS, PH color

Steam Electric Power SS, O&G, pH, polychlorinated biphenyls, chlorine, Heat, zinc, chromate, phosphorus
copper, iron

Textiles BOD, COD, SS, fecal coliform, pH, phenol, sulfide, color
chromium

The .1983 limitations correspond to elimination of the discharge of process wastewater pollutants.
(2). For Primary Steelmaking, only controlled by BAT.

'Source: National Commission [email protected] Qualityi February 1976.

11-56

(EPA's proposed toxic standards are discussed further in Section 4.b.)

Another parameter defined as a pollutant in the Act is heat. Many
industrial processes generate wastewaters with a higher temperature than
that of the intake water and, in some cases, the wastewater must be
cooled, even before biological treatment. The steam electric power in-
dustry is unique in this regard because the discharge of large quantities
of heat energy, from the plant is fundamental to the electric generating
process. Control of heat discharged to surface waters is cormtonly
accomplished with evaporative cooling devices. The requirement that
some classes ofelectric generating plants install these devices has
been one of the more,controversial regulations issued under the Act.
(Thermal pollution controls for this industry are discussed in Section
4. c-.

Generally, this Act and previous laws require a higher degree of
treatment if the discharge is to surface waters than to municipal sewers.
In the latter case, treatment may consist only of screening large solids
(rags, woodchips, leaves, etc.), but sometimes involves more sophisticated
treatment before discharge, called "pretreatment," anticipating that the
municipal system will treat the wastewater again before final discharge.

Treatment of wastewaters to remove pollutants is commonly referred
to as end-of-pipe abatement -- the strategy usually being to combine all
waste flows into a few streams which converge upon a central facility .
where they are treated before being discharged. In addition, pollutants
can often be reduced at the source by various in-plant changes, ranging
from simple better "housekeeping" procedures.to reduce spills and leaks,
to fundamental changes in the manufacturing processes themselves. Other
measures are aimed Primarily at flow reduction (water conservation).
The least-cost abatement strategy will often be some combination of
these in-plant changes and end-of-pipe treatment. The optimal combination
depends upon the degree of abatement required, costs of candidate in-
.plant changes, treatment costs, and other site-specific factors which
are difficult to generalize.

C. Abatement Measures in Place

Considerable effort in the in-depth industry'studies, and to a
lesser extent in the general industry study, was devoted to assessing
water pollution abatement technology in place in the 1973 base year.
Although industry wide, plant-by-plant surveys covering abatement measures
in place were not available for most categories,* Commission contractors

*An exception is petroleum refining, where there are only 250 j ?lants,
and where a very detailed industry survey carried out in 1972 was
utilized. Surveys complete in most other respects were available for
non-ferrous metals, iron and steel, and pulp and paper.

11-57

were.able to make reasonably accurate estimates of end-of-pipe treatment
in place for most of the in-depth categories, and rough estimates for
some of those covered by the general study. Information on in-plant
measures undertaken partially or wholly for purposes of water pollution
abatement was much more difficult to obtain and, in most cases, only
a
rough estimates of the presence of such measures were possible. In
fact, many of the representative plant "models" assumed none of the in-
plant measures considered for 1983 in the studies were in place in the
base year -- a realistic assumption for the majority of cases.

Conventional wastewater treatment systems can be separated into two
different types: biological and physical-chemical. The basic principle
of biological treatment is simply to accelerate the natural processes
that would occur if the wastes were to be introduced into the natural
water environment. Dissolved organic materials are converted into
carbon dioxide and "biomass" by cultivating bacteria that feed on the
waste constituents. The sludge from these processes is composed primarily
o bacterial cellular matter. The most common biological systems have
as their essential component either activated sludge basins, or aerobic
or anaerobic lagoons.*

Physical-chemical treatment is normally used on either inorganic
wastes or organic wastes,which are slow to degrade biologically.** (The
i.atter are sometimes referred to as "refractory organics.") Physical-
chemical treatment normally requires less space than biological treat-
ment, and may be preferred for treating biodegradable wastes for facilities
with space constraints, a particular problem for plants located within
cities. Examples of water-using industrial plants often found within
cities are textile mills, metal finishing shops, some types of paper
mills, and fruit and vegetable canneries. Many of those plants discharge
to municipal sewers, and some form of physical-chemical and/or biological
pretreatment may be required.

Table 11-25 summarizes the information from the Commission's in-
depth industry studies on the end-of-pipe wastewater treatment in place
as of January 1973. No attempt was made in the technology assessment
studies to quantify the financial investment this represents.

d. Subcategorization

The subcategorization of each industrial category has been used by
EPA to expedite the development of effluent limitations and to help

Aerobic bacteria require dissolved oxygen; anaerobic do not.

**Materials classed as "organic" always contain carbonj and normally
..originate from naturally occurring raw materials of plant or animal
origin, including fossil fuels, especially petroleum and'its
derivatives.

TABLE 11-25: Summary-of Wastewater Treatment Practices as of January 1973",
Fraction )f Industry Dis-@ Fraction of Surface Water Disch:ryers,
charging to Publicly Owned Fraction of Industry Dis- Fraction of Industry Dis- Fraction of Surface Water Dischargers with Technology in Place Basic I y
Treatment Works. charging to Land , charging to Surface Waters with "Secondary" Treatment(21 Equivalent to BPT-M
By Number of By Production By Number of By Production By Number of By Production By Number of By Production ByNumber of By Production
Industrial Categories No. of Plants Plants Capacity Plants Capacity Plants Capacity Plants Capacity Plants Capacity
Canned and Preserved 2,123 40% (50%) 40% (35%) 20% (15%) (63%) (78%) unknown, but unknown
Fruits and Vegetables very small
Inorganic Chemicalsi See footnote 4. Small negligible negligible negligible (100%) (100%) (45n 45% (less than 45%) (less than 45%)
Iron and Steel- 416 unknown negligible negligible negligible unknown (100%) unknown (30%) unknown but unkno I but
small(5f smal I In
Metal-Fini-shing 70.000 70% unknown negligible negligible 30% un known 81% unknown 29% unknown
(85% job, 65% (15% job , 35%
captive) captive)
Organic Chemicals See footnote 4. unkhown-, (10% negligible negligible (90%) (90%) (20%) 25% negligible negligible
Petroleum Refining 250 14% 12% 15% 4% 71% 84% 42% 65% 1%(9)
Plastics and Synthetics 'See footnote.4. (40%) (20%) negligible negligible (60%) (80%) (30%). (30%) unknown unknown
Pulp and Paperf6l' 598 30% 10% negligible negligible 70% 90% (29%) (51%)
37% 60%
Steam Electric Power, 1,037 negligible negligible negligible negligible 100% .100%. Chemical: unknown, but Chemical: unknown, but
small very small
Thermal : not relevant Thermal : 42% 18%f7')
Textiles 1,926(8) 76% unknown very small negligible 24% unknown (28%) (53%) (28%) (53%)
(1) All figures shown are estimates, the degre3 of accuracy varying with the industry. Numbers in parentheses-are little more than educated guesse @Only
industries covered in the in@depth study are listed here. Little or no information is available for most of the i ndustri es, covered by the "genes@al study.)
Source; National Commission on Water
(2) For the purpose of tbis.ttable, "secondary" treatment is considered'-to be anything beyond gravity separation. Quality. Compiled from
technology contractor reports
(3) Plants with the same basic typeof technology as recommended by the EPA for 1977: many of these are not currently.meeting the 1977 limitations. to the Commission. February,197F.
(4) The Organic and Inorganic Chemicals and Plastics and Synthetics categories are normally found together in-various combinations, so a discrete number of
plants cannot be assigned to each. The total number of plants producing any products of these three types is approximately 3,700
(5) For complete facilities. Technology equivalent to BPT may be in place for certain processes within the facility.-
(6) For mills producing both pulp and paper, production is measured in terms,of pulp.. (9) Includes only those with sand filtration. If long detention
time polishing ponds are assumed to be equivalent technology,
(7) Cooling towers and/or cooling lakes or ponds. these numbers would increase to approximately 10%.
(8) An additional 3,400 mills use insignificant amounts of water.

11-59

achieve economic equity among different types of plants. This' procedure
is also useful in an overview assessment of abatement technologies.
There are inherent shortcomings in any practical subcategorization
scheme, however. No two manufacturing facilities, no matter how outwardly
similar in terms of products, raw materials and processes used, will
have identical pollution abatement problems. Imposing a uniform effluent
limitation (per unit of raw material processed or product produced) on
all plants within even the most carefully defined-subcategories involves
potential inequities, some of which might be eliminated if the limitations
were applied on a plant-by-plant basis. The proper degree of generaliza-
tion requires tradeoffs between minimizing potential inequities and
keeping the regulatory program manageable.

As a compromise, Commission coniractors.were instructed to assess
the degree to which EPA's subcategories reflect genuine and reasonable.
differences in production processesf abatement problems and costs. The
basic factors EPA attempted to take into account in the subcategorization
process were types of raw materials and production processes, products,
size and age, wastewater characteristics (including treatability), and
geographic location. With very few exceptions, the resulting subcate-
gories are defined primarily in terms of products produced and/or
processes,used. Size and age are'used as criteria for delineating sub-
categories only in the case of meat products, where small renderers are
to be ex@mpted; and steam electric power, where.all units operating,
before 1970 and those under 500 megawatts capacity operating before 1974
are to be exempt from thermal controls. Size is considered in assigning
effluent limitations within subcategories to petroleum refineries, -
dairies, leather tanneries, and metal finishers, but is not used ex-
plicitly in defining the subcategories. Age is implicit in other cases.
For example, effluent limiations promulgated for the iron and steel
industry differentiate between the basic oxygen and open hearth steel
making processes, and nearly all newer plants are of the basic oxygen
type. Of the 52 industries studied, only two -- canned and preserved
seafood and cane sugar processing -- have effluent limitations which
subcategorize explicitly,on the basis of geography. Location can relate
to clima:te, a factor which affects biotreatment effectiveness. As with
age, however, some geographic differentiation is implicit in other cases
where certain types of plants are concentrated in one.area.*

*Most of the effluent limitations promulgated by EPA contain' a clause
which allows for.variation from the promulgated values if the discharger
can show that factors relatincl-to his plant are "fundamentally different
from the factors considered in the establishment of the guidelines."
This clause*is intended to be used'in unusual situations, and in effect,
allows the permitting authority to declare an individual plant to be in
a subcategory by itself, subjec 't to approval by the Administrator. The
legality of-this-clause is currently being.challenged in the courts.

11-60

Alternative subcategorizations which appear to-be manageable and
which might materially improve the subcategorization schemes used by EPA
were not discovered in most of the industry studies. While non-product/
process factors can substantially affect abatement costs, the Commission
was not able, in the time available, to incorporate them to any greater
degree than was done by EPA in establishing its effluent limitations.

For some industries, EPA's effluent limitations are related to
specific internal waste streams, or to particular products or processes,
rather than to the discharge from the entire facility. This approach
expedites writing discharge permits for those industries which combine
different products and processes in a wide variety of combinations.
(The number of "representative plants" needed to characterize the industry
from a technological point of view may be unmanageable from a regulatory
point of view.) of the industries studied in depth, the organic and
inorganic chemicals, plastics and synthetics, iron and steel, and canned
and preserved fruits and vegetables categories have effluent limitations
defined in terms of individual products or processes. Regulated dis-
charges for plants in these categories are derived by summing the
discharges allowed by the promulgated-effluent limitations for each
product or process occurring within the plant. This is sometimes
referred to as a "building block" approach and is one practical way to
expedite the permitting process for these industries.

@ Difficulties may occur in applying this procedure to actual facilities.
Two common problem areas are:

0 For reasons of economy of scale, similarity or compatibility
of wastes, limited space or difficulty of separating sewer
lines, effluents from two or more unit processes are often
treated together in a combined treatment facility. Physical
and chemical interactions occur among the pollutants in the
combined stream which affect the treatability of the waste.

0 There are instances where particular pollutants are emitted by
several processes, but regulated for a lesser number. If
waste streams for these processes are combined, questions
arise as to whether and how "credit" should be given for the
pollutant from the unregulated process in the combined stream.

Commission studies have uncovered problems of this nature in the
iron and steel, chemicals, and steam electric power categories. For
iron and steel and chemicals, modified limitations for related unit
processes whose wastes are normally combined would be beneficial.

Chemical constituents in six different, specific waste streams are
controlled by EPA's effluent limitations for the steam electric power
industry. Potential problems of the second type mentioned above have

11-61

surfaced during the Commission's assessment of these limitations. For
example, copper in waste streams from the boiler (boiler "blowdown") is
limited in the BPT (and BAT) limitations. Some plants treat the condensed
boiler steam before reuse (condensate polishing). For these plants; the
copper limitations for boiler blowdown can be met without further
treatment. However, the polishing process itself generates wastes which
must be discharged periodically. This type of discharge, which may
,contain copper in amounts exceeding the concentrations allowed in the
boiler blowdown stream, is classified as a "low volume waste" and not
subject to limitations on copper.

The canned and preserved fruits and vegetables industry consists of
a large number of diverse plants distributed throughout the nation,
processing many different combinations of commodities and product styles.
EPA's subcategorization is strictly.on a commodity basis. The "building
block" approach is to be used to.define limitations for the typical
situation in which a plant-processes more than one of the 56 commodities
specif'ied in the limitations. To fac'ilitate analysis of the impact of
the Act on this industry, dom'mission,..contractors were.successful in,
defining natural groupings of plants with similar water pollution
abatement problems. The groupings were then used to define 24 subcate-
gories of processors. Subcategorizing the industry in this manner,
rather than strictly by single commodities, was necessary to provide
realistic plant-level estimates of abatement costs, and represented a
significant advancement in the methodology for analyzing the economics.
of.an industry of this nature. Froin.the standpoint of defining effluent
limitations, however, the single commodity approach appears to be the
,only practical alternative.

An identical strategy was adopted for study of the iron and steel,
organic chemicals@, and inorganic chemicals industries.

,A difficulty of the "building blocW' approach is the full coverage
of all products or processes in a specific plant. EPA has yet to develop
effluentlimitations for all products and processes. Commission.contractors
who developed generalized combinations of products or processes for
study mitigated this problem from an analytical standpoint, but difficulties
associated with issuing actual permits are likely to persist.

3. Capabilities and Costs of Industrial Technology

a. Industrial Effluent Limitations

Both the Act and the legislative history must be examined to
analyze which technologies areappropriate when considering EPT and BAT.
The determinations of regulations for "best practicable control technology
currently available" are to be made by the EPA Administrator based on
factors specified in the Act [Sec.' 304(b)(1)(B)I. These factors are

Il-@-62

"the total cost of the application of technology in relation to the
effluent reduction benefits to be achieved," as well as, "the age of
equipment and facilities involved, the process employed, the engineering
aspects of the application of various types of control techniquqs, pro-
cess changes, non-water quality environmental impact (including energy
requirements), and other such factors as the Administrator deems appropriate."

An elaboration of the procedure to be used for identifying "best
practicable technology" comes from the Report of the Senate Public Works
Committee on S.2770 which says "the Administrator should establish the
range of best practicable levels based on the average'of the best existing
performance by plants of various sizes, ages, and unit processes within
each industrial category"(17).

For BAT, determinations of regulationsare also to be made by the
Administrator, and are to take into account "the age of equipment and
facilities involved, the process employed, the engineering aspects of
the application of various types of control techniques, Process changes,
the cost of achieving such effluent reductions, non-watet quality
environmental impact (including energy requirements) and-such other
factors as the Administrator deems appropriate". [Sec. 304(b)(2)(B)I.

The Senate debate of the Conference Report addresses the determina-
tion of BAT. "Rather than establishing the range of levels in reference
to the average of best performers in an industrial category (the procedure
required for best practicable), the range should at a minimum be estab-
lished with reference to the best performers in any industrial category"(18).

In either case, the Administrator is not to require specific types
of control technologies or processes; rather, effluent limitations are
to be established for categories and classes of point sources.'

The vast majority of EPA effluent limitations have taken the form
of a maximum allowable discharge quantity of a specific pollutant per
unit of production. For example, an effluent limitation may @e expressed
as an allowed maximum discharge of two pounds of suspended solids per
1,000 pounds of product. Implicit in this limitation is the volume of
wastewater discharged per pound of product and the concentration of
suspended solids in that volume. Both volume and concentration may vary
from discharge to discharge, but in no case can they combine to produce
more than the maximum allowable pounds of suspended solids per unit of
production.*

*In some cases (for example, petroleum refining), the limitations are
expressed in terms of allowable pounds of pollutant per unit of raw
material (e.g., pounds per barrel of crude oil refined).

II-63

Effluent imitations are usually stated both as averages over 30
consecutive days (long-term) and as a 24-hour maximum (short-term).
Commission technology contractors were instructed to address technologires
capbale of meeting both the 30-day and the 24-hour limits.

The effluent limitations contain restrrictions of different pollutants
for different industries, although the most common pollutants (BOD or
COD and SS) are covered in virtually all cases. The pollutants coverd
by effluent limitations for a specific industry are generally those that
are present in significant quantities in that industry's discharge, are
potentially harmful, or are removed by the technology which will be
employed ( see Table II-24).

Effluent limitations, once pormulgated, form the basis of individual
permits issued under the National Pollutant Discharge Elimination System
(NPDES). The commission's analyses only considered meeting EPA effluent
limitations promulgated, proposed or contained in EPA contrctor reports
or, in the case of several categories within the "general" study, the
Commission contractors' estimates of what they might eventually be.
consistency between the effluent limitations and permits actually issued
was not examined in the technology assessment studeis.

b. Best Practicable Control Technology Currently Available (BPT)

As a general rule, the 1977 limitations corresponding to the appli-
cation of BPT can be achievd through the use of currently available,
proven technologies, However, Commission studies identify several sub-
categories for which the requied technolgy will be more elaborate than
that envisioned by EPA, and some of these cases will require technologies
which have yet to be tested in that particualr industrial subcategory
("technology transfer")

The types of technolgies envisioned by EPA for 1977 are generally
consistent with those suggested by Commission studies. The suggested
additional measures in some cases result from the way the effluent
limitations have been formulated, rather than from disagreements about
long-term average performance capability. Treatment systems are normally
designed on the basis of long-term (annual or perhaps seasonal) average
effluent quality criteria. Effluent limitations are currently being
stated in terms of pollutant discharges (per unit of product produced
or, in some cases, of raw material consumed) that are "maximum for any
one day" and "average of daily values for 30 consecutive days." In some
cases, these numbers were derived from a statistical analysis of date
averaged over longer time spans and, in other, by engineering judgment
or "rules of thumb" applied to long-term disign values. In many industries,
very little operating data are available on short-term (daily and monthly)
fluctuations in effluent qualities and quantities from actual plants,
and the capability of the technologies suggested by EPA to dampen those
inherent variations to the degree required by the limitations is questionable

11-64

This "variability problem" applies to both the BPT and BAT limitations,
and there is considerable controversy about the attainability of the
daily -- and,'to a lesser extent, the 30-day limitations even in
those industries for which the long-term capability of the stipulated
technology is not disputed. In some cases, it is claimed that the
promulgated values are not consistent with the longer-term data from
which they were supposedly derived. In other cases, technology sufficient
to meet the 30-day average requirement may not be sufficient to meet the
daily maximum requirement. This may not be revealed until the system
has been designed, installed and operated. Pulp and paper and petroleum
refining are two industries for which Commission contractors had suffi-
cient data to make quantitative judgments about the degree of variability
control needed to meet the effluent limitations.* In both cases, the
conclusion was that measures beyond those envisioned by EPA will be
required. The following communication from the petroleum refining study
contractor summarizes this problem:

"Based on our analysis of the technological capabilities available
to the petroleum refining industry, the effluent limitations pro-
mulgated by EPA for 1977 can be met on an industry-wide basis.
However, it is our belief, based on our evaluation ofavailable
treatment systems and methods of in-plant control, that the techno-
logical model suggested by EPA for Best Practicable Control Technology
Currently Available will not be sufficient to assure that these
limitations are met industry-wide by the petroleum refining industry.
The problem basically revolves around the capabilities to meet the
short-term (daily and monthly average) limitations for certain
controlled constituents, particularly total suspended solids,
chemical oxygen demand, and oil and grease. We believe that the
long-term attainable effluent concentrations used by EPA in developing
(its) numbers are reasonable for most of the controlled constituents,
with the possible exception of chemical.oxygen demand. However,
the variability limitations are such that a refineryoperating at
the process wastewater flow rate used in estimating the mass dis-
charge limitations would have difficulty meeting the short-term
.requirements. We believe this problem can be circumvented if all
refineries resort to the in-plant controls which EPA has associated
with 1983 technology, including a limited amount of wastewater
reuse. This essentially means that long-term average mass discharge
rates will be lower than those used by EPA for the 1977 limitations
to assure that refineries can actually meet the daily and monthly
maxima allowed by (them)

*Because of a superior data bas e, the petroleum refining study addressed
the variability problem in the greatest depth..
**Citation from letter to Commission staff from Engineering Science, Inc.,
summarizing results found in Chapter V of their report to the Commission,
Water Poll'ution Abatement TechnoloW: Capabilities and Costs, Petroleum
Refining Industry, 1975.

11-65

Despite the fact that detailed data on daily variabilities.from existing
plants were not available for use in Commission studies, enoughinforma-
tion was obtained to suggest the following conclusions:

� Methods used by EPA toderive the daily and 30-day numbers
from available data are not consistent among the industrial
categories.

� The achievability of the daily values 100 percent of the time
by even "exemplary" plants, during normal operation, with the
technology suggested by EPA is highly questionable in several.
cases.

� In many cases, abatement systems are being designed to meet
the 30-day values. A "wait and see" and "hope for the best"
attitude is being taken toward the maximum daily limits.

� Considerable uncertainty about EPA's enforcement posture with
respect to violations of the daily values exists among industrial
dischargers.

A peripheral issue to the variability problem is the applicability
of the promulgated limitations to unusual situations, such asr-plant
start-ups and shut-downs or cases involving accidents or unusual equipment
malfunctions.* Effluent qualities from even a properly designed and
operated treatment system will fluctuate widely during these periods,
and the @Lpplicability of EPA's limitations to,them needs to be clarified.
There seems to be an unwritten assumption among EPA's technical personnel
that the limitations apply only during periods of "normal operation,"
but this is neither stated nor defined an any of the promulgated limita-
tionz or irr any of the discharge permits reviewed by the Comission. A
clear policy statement on this question should be made to clarify the
issue for both EPA and the permittees.

Additional short-term data are now being collected under the monitor-
ing,requirements of the NPDES permits. The Commission studies suggest
that a uniform statistical procedure should be developed for inferring
proper 24-hour and 30-day limits from these data, and that it-be applied
to each industry as its data base becomes adequate in order to verify
the limitations currently in effect for 1977.

Required end-of-pipe treatment systems vary only in design details
among subcategories for some industries, whereas in others, different
types of measures are required. In-plant measures tend to be much more

*Production stops and starts are not really "unusual situations" in
general. Many industries have regular production cycles which involve
routine "down times" for clean up and maintenance.

11-66

subcategory specific. -@or the,petroleum refining, pulp and paper,
-canned and.prfBs6rved fru'i@s and vegetables, textiles, organic chemicals,
and plastics and.synthetics categories, end-of-pipe technology for 1977
is basically,,biological treatment similar to that.used for treating
domestic sewaIge,.with Additional effluent "polishing" and increased
water conservation in some cases. Physical-chemical treatment is required
for the,inorganic chemicals, iron and steel, metal finishing, and steam
electric power industries. most physical-chemical systems,require the
precipitation of dissolved compounds by Adding chemicals, plus the
of-suspended solids. -In the inorganic chemicals category,
substantial opportunities exist for achieving the elimination of discharge
of all process wastewaters by.mieans of recycling. EPA's BPT limitations
dictate.that the processes associated with 28 of the 59 product categories
examined by the Commission contractor achieve this "closed system"
configuration. The contractor found that 19 of the 28 product categories
could achieve this requirement by inprocess or recycle strategies
alone. Eliminating all wastewater discharges to surface water is one
way of achieving the national goal of the elimination of discharge of
pollutants. This is addressed in detail in Section D of this chapter.

Metal finishing operations produce both concentrated and dilute
waste streams containing the metals being finished or plated, plus other
potentially.toxic materials, including cyanide. The abatement needed to
meet the BPT limitations inviolves.precipitating the metals, using lime
or caustic soda additives, neutralization of the acidic wastes, and
conversion of1the cyanide to harmless compounds by chemical reactions
with chlorine. The 1983 limitations require the elimination of discharge
of All.process water pollutants,, including the variety of salts that
result from wastewater neutralization. One way to achieve this is to
.increase the degree of recovery of plating meta-19"'And-,acidsi--,concentrate
the salts by means of advanced treatment technologies, such as reverse
0smosis, and evaporate the remaining water, leaving a concentrated brine
or.solid salt residue. The cost of this procedure would be very high,
and the Commission economic impact studies indicate that its imposition
upon the smaller facilities would accelerate the existing trend toward
fewer, but larger, metal finishers.

Both chemical and thermal limitations apply to the steam electric
power industry. The chemical limitations can be met with standard
physical-6hemical treatment, although the costs of achieving them are a
matter of controversy and there is some uncertainty about the inter-
pretation of the limitations. (See Section 2.d.) The technology
employed for the abatement of heat discharged to the environment.--
normally evaporative cooling towers -- is considerably different from
what is usually thought of as "wastewater treatment technology."
Thermal pollution abatement in this industry is discussed in Section
4.c.

11-67

The following list outlines the differences between EPA's abatement
models and those that the Comission's in-depth industry studies.indic-ate---
will be needed by significant numbers of dischargers to meet the 1977
effluent limitations promulgated or under consideration by EPA. The
increments shown rely exclusively upon end-of-pipe treatment. In-plant
changes not applied generally for 1977 may serve as alternatives in some
situations.

Best Practicable Control Technology Currently Available

industry Category Probable Increment Needed

Pulp a1id Paper* Additional solids removal, using multi-
media filtration for approximately one-
third of the pulping mills.

Metal Finishing* Additional solids removal, using filtra-
tion for most shops, plus steps to reduce
water use for some shops.

Iron and Steel* Additional solids removal via filtration,
plus partial recycling for some subcate-
gories.

organic Chemicals* Additional BOD and SS removal, using
additional stages of bictreatment and
filtration, plus activated carbon ad-
sorption for some segments of subcategories.

Textiles Additional solids and COD removalf using
chemical coagulation, either before or
after biotreatment, for some subcategories.

Petroleum Refining Additional in-plant flow reduction.measures
needed for all subcategories because of
potential effluent variability problems.

*Conclusions based in part upon limitations under consideration, but not
pro posed, by the EPA at the inception of the Commission's technology
studies.

,In most of these 'cases, deficiencies in the BPT systems envisioned
by EPA can be remedied without using unproven technologies, but the cost
will be higher than EPA has estimated. However, two of the remedies do

11-68

rely,upon unproven technology: for pulp and paper, filtration of
-pulping wastes*is still at the experimental stage; and for organic
chemicals and plastics and synthetics, Commission studies indicate that
carbon adsorption will be required for some classes of plants for which
there is little or no experience to date with this form of treatment.

Industries within the Commission's general study for which EPA
acknowledges reliance upon technology undemonstrated within the industry
to meet the 1977 limitations are: off-shore oil and gas extraction,
transportation, nonferrous metals smelting and refining, canned and
preserved seafood, and sugar processing. No cases in which the necessary
technology was clearly impractical have been uncovered, although the
Commission was not able to carry out a detailed assessment. Because of
the uncertainties inherent in the design of these systems, cost data for
them should be considered speculative.

A significant issue is raised by possible inconsistencies between
EWs technology models and the corresponding effluent limitations ..
Commission studies indicate that, in many cases, the abatement which is
actually being installed is equivalent to the suggested technologies,
rather than being designed to meet the limitations per se. This is most
readily apparent in those industries where the additional measures -
needed to guarantee that the limitations are met consistently may involve
unproven technology. However, a potential problem also exists in the
cases where the additional measures do not involve unproven technologies.
The number of engineering' consulting-firms capable of perceiving the
necessary design variations from the.systems suggested by EPA are limited,
and many industries have little "in-house" expertise in the control and
treatment of wastewaters. It appears that,there may be a significant
number of abatement systems installed in these industries that will be
equivalent to EPA's BPT models, but will not meet the BPT limitations.
This failure may not be appreciated until after the systems have been
installed and operated.-- The necessary corrections will not be simple
"add ons" 'in all cases. EPA may then be faced with the dilemma of
enforcing violations against dischargers who installed the suggested
abatement technology in good faith and in accord with the compliance
schedules stipulated in their NPDES permits. The design parameters of
any system must be adjusted to fit the needs of the particular discharger,
and this requires considerable expertize when stringent effluent limita-
tions must be met.

C. Discharges to Publicly Owned Treatment Works

The degree to which the various industrial categories use publicly
owned treatment works (POTWs) for the disposal of wastewaters extends
from negligible to virtually complete dependence. The dischargers most
likely to be connected to POTWs are generally small water users, located

11-69

in or near cities and towns. Some companies, and even entire industrial
categories,.prefer this practice wherever possible.

The industries in which a substantial number of plants or wide
production capacity discharge to POTWs are listed in Table 11-26. Also
tabulated are the industries which utilize POTWs to a small extent (less
than 10 percent), if at all. Smaller plants of several other industries
petroleum refining, chemicals, pulp and paper, builders paper and
board, and rubber processing -- make moderate use of POTWs (on the order
of 10-20 percent of the production capacity).

Wastewaters generated by plants which use POTWs usually contain
suspended solids and oxygen-demanding materials at levels amenable to
conventional municipal wastewater treatment. However, it is often
necessary to use some form of pretreatment before the municipality will
accept the waste. Potential detrimental effects of industrial contri-
butions generally fall into three categories: damage to structures,
impairment of treatment performance, or reduoed effluent quality'from
the POTW because of wastes not susceptible to conventional municipal
treatment. Table 11-27 shows examples of wastewater characteristics,
which can be detrimental and the industries whichare most likely to
discharge the pollutants. The frequency and degree of impairment depend
on the size of the industry's flow relative to that of the POTW, as well
as the technology used by the POTW.

TABLE 11-26: Relative Use of POTWs
by Major industrial Categories

Industries with Substantial Use Industries with Minimal Use
Of POTWSM of POTWs(2)

Meat Processing Mining (all types)
Dairy Processing Petroleum & Gas Extraction
Canned and Preserv9d Fruits and Sugar (except refining)
Vegetables(3) Seafood Processing
Grain Milling Iron and Steel
Brewing Ferroalloys
Textiles Nonferrous Metals
Leather Tanning Water Supply
Metal Finishing Steam Electric Power

(1) Generally more than 70 percent of plants or production capacity to
POTWS.
(2) Generally less than 10 percent of plants or production capacity to
POTWs.
(3) An estimated 40 percent o:E plants discharge to Pd4vs.

Source: National Commission on Water Quality, February 1976.

11-70

Pretreatment technology may be as rudimentary a's screening to re-
move large solids or as complex as that required fo r plants discharging
directly to navigable waters. In general, the technologies used to
date have focused on reduction of constituents which disrupt or impair
POTW performance. Corrosive and explosive materials are usually pro-
hibited, but additional pretreatment requirements to reduce constituents
that impact POTW operation vary considerably among municipalities.

TABLE 11-27: Effects of Industrial Wastes on POTWs

Potential Industrial
Type of Effect Waste Characteristic Discharger

Damage to Structures Acids Chemicals*
Solvents Petroleum Refining
Strong Alkalies Textiles

Large solids Virtually all

Excessive flow Virtually all

Reduce Performance of Excessive variability Food Processing
POTW (seasonal)

Toxics Textiles
Chemicals*
Petroleum Refining
Leather Tanning
metal Finishing

Pollutant Not Amenable Non-degradable organics Pulp and Paper
to Treatment by POTWs Chemicals*
Textiles
Petroleum Refining

Inorganic salts (including Metal Finishing
metals) Chemicals*
iron and Steel
Textiles
Petroleum Refining

*Includes Inorganic and Organic Chemicals and Plastics and Synthetics.

Source: National Commission on Water Quality, February 1976.

II-71

The Act indentifies four basic objectives related to industrial use
of POTWs:

o Encouragement of areawide waste treatment management, often
interpreted as encouraging industrial use of POTWs. [Sec.
208.]

o Recovery of the Federal share of construction costs in propor-
tion to industry's use of the POTW. [Sec. 204 (b)(1).]

o Payment of industry's porportionate share of the POTW's
operation and maintenance expenses. [Sec. 204 (b)(1).]

o Establishment of pretreatment standards for industrial wastes
entering POTWs. [Sec. 307 (b).]

Realization of the first objective will be influenced by the others,
all of which are controversial and/or in state of flux. Many munici-
palities have or are developing systems to recover porportionate shares
of construction and operation and maintenance costs from industry.
Where an option exists, some industrial plants may decide to discontinue
using POTWS. In special cases, usually related to high residential
growth compared to industiral growht, recovery of construction costs
proportionate to industrial use may discourage contines use of POTWs.
where they continue to discharge to POTWs, industry will undoubtedly
reduce the discharge of wastes into POTWs to the extent possible to
minimize porportionate share surcharges.

Establishment of Federal pretreatment standards for industry may
have a more dramatic effect than the cost recovery and porportionate
charge provisions. The Administrator must establish pretreatment standards
to prevent the discharge of any pollutant which interferes with, passes
through or otherwise is incompatible with POTWs. EPA has promulgates a
gerneral approach to pretreatment as te basis for industry specific
standards. (15) Two categories of pollutants were defined: "compatible,"
i.e., those which have historically been associated with the design of
POTWs (BOD, suspended solids, ph, fecal coliform bacteria); and "in-
compatible, " i.e., anything else. The compatible pollutants are limited
to those four which appear in the EPA definition of secondary treatment
for POTWs. Only incompatible pollutants were to be limited, with the
limits being identical to those promulgated by EPA for BPT (1977) for
discharges to navigable waters.

Industry-specific pretreatment standards for a small number of
industrial categories were promulgated in February 1975 (19). With two
exceptions, these standards only verify that pretreatment will not be
required for "compatible" pollutants. The exceptions were COD and
surfactants for the soap and detergent industy, and oil and grease for
the canned and preserved seafood and meat products industries. As of

11-72

October 1975, EPA has not issued any pretreatment regulations which
would not require all other users of POTWs to pretreat pollutants other
than BOD, TSS, pH and fecal coliform to the BPT limitation level.

Recently, EPA has been reconsidering the general provisions. While
various possible changes are being considered, the basic thrust remains
essentially the same. A key new aspect, however, is EPA's indication
that it may later revise the pretreatment standards so that they are
comparable to the BAT effluent limitations by 19.83(20).

Commission contractors assumed that all pollutants other than those,
listed above as "compatible" would have to be reduced to the levels
dictated by EPA's BPT limitations before they could be discharged to
POTWs. Costs incurred by current users of municipal systems for this
pretreatment were included in the costs incurred by 1977. No pretreat-
ment beyond the BPT level was assumed for 1983. No charges levied by
the municipality for use of its system were included id th 'is phase of
the Commission studies. These can be substantial in many cases, and
will be an important factor in determining future use of POTWs by the
industrial sector. (See Chapter III, Section E, for further discussion
of these issues.)

In addition to including BPT-level pretreatment for the incompatible
pollutants, some pretreatment technology was also assumed for those
industries whose wastes are "compatible," but which, in the opinion of
the Commission's contractors, have historically or can now be e:@Pected
to practice some degree of pretreatment in order to reduce proportionate
charges or to comply with local municipal standards. Except in the
canned and preserved fruits and vegetables category, where discharges to
POTWs greatly exceed those to navigable waters, these costs are small
when compared to the industry total for 1977.

of the industries studied in-depth, the pretreatment assumptions
outlined above have a major impact 6n the expenditures rbquired of the
textiles and metal finishing categories because both rely heavily upon
POTWs and because most of the pollutants they discharge are deemed
"incompatible." The portions of the total 1977 estimated capital costs
due to pretreatment are summarized in Table 11-28 for those industries
for which they are significant.*

*The EPA is currently reviewing the entire pretreatment issue and has
proposed, or intends to propose, regulations it says may substantially
effect the impacts on certain industries. However, because of the
uncertainty as to how this will be'resolved, the Commission has followed
the original EPA pretreatment regulations. Data in Table 11-28 are
based on achieving BPT abatement levels for "Incompatible" pollutants
as derived by Commission contractors per discussion in the text above.

Table II-28: Pretreatment Technologies and Costs (1)

Percent of 1977
Capital Costs Due
Industry Category Motivation for Pretreatment Type of Technology Requires to Pretreatment

Canned and Preserved Reduce porportionate share Screening, equalization or 42
Fruits and Vegetables charges, assure compatibi- clarificationk sludge hand-
lity with local require- ling, neutralization in
ments. some cases.

Metal Finishing Removal of "incompatibles." pH control, cyanide and metal 80
removal.

Textiles Removal of "incompatibles." Screening, equalization and 80
chemical treatment.

(1) Capital and O&M costs for 1977, including those for pretreatment as well as for meeting EPA's BPT
limitations, are shown on Table II-30.

Source: National Commission on Water Quality, February 1976. Compiled from data contained in in-depth
industy contractor reports.

11-74

Commission contractors for the technology studies ,4ere unanimous in
suggesting that many pollutants presently classified as being incom-
patible are, in fact, effectively treated by POTWs. The Commission
contractor for the textile industry study concluded:

"Whe*n regulations recognize COD, phenol and sulfides as compatible
pollutants (parameters which can'be effectively treated at activated
sludge plants) economics will normally favor the use of POTWs
When compared on an individual plant basis, total capital cost of a
system meeting pretreatment regulations can be higher than surface
water dischargers for many subcategories. The higher costs of
pretreatment systems are due to the removal of the 'incompatibles'
utilizing chemical.treatment, as opposed to biological treatment.
Chemical treatment is usually selected because it takes less area
and is better suited to mills discharging to municipal systems
located in populated areas. Pretreatment standards as presently
stated offer the mill little economic incentive to discharge into
municipal systems We believe these regulations need careful
review and revision to encourage joint municipal-industrial water
treatment, not discourage it."(21)

Commission studies lend no.support to an approach which forces ex-
tensive pretreatment of all, pollutants other than BOD, TSS, pH and fecal
coliform bacteria. The better approach is to develop pretreatment
limitations on a subcategory-by-subcategory basis, taking into account
the treatability of the wastes by the POTW.*

d. Best Available Technology Economic ally Achievable (BAT)

As in the case of the 1977 limitations, the Commission finds that
the necessary technologies will be available in most cases to.meet the
more stringent effluent limitations prescribed for 1983. Debate focuses
more upon costs in relation to benefits than upon technological capabil-
ities. Howeve*rl.wastewater treatment remains basically an empirical
science, and little or no full-scale operatingdata are available for
many of the advanced techniques envisioned for 1983. As a result,
judgments about technical capabilities are much less secure than in the
case of Bk.. There are a substantial number of cases in which the
feasibility or reliability of the technology suggested by EPA for 1983
is questionable. Examples are metal finishing (elimination of discharge
of process water pollutants by advanced treatment and evaporation);
organic chemicals (required removal efficiencies for activated carbon

*The promulgated regulations(15) do allow for the POTW to grant credit
to the industrial user for any fraction of any "incompatible" pollutant
that the POTW is committed to remove in its NPDES permit.. Many factors,
currently uncertain are involved in determining the effe
of U11s.
provision. Presently, there appear to be few,instances.iri.',@,which.su.ch
credit is being granted. No credits were allowed for in the pretr'eia't,@,
ment costs presented herein.

II-75

adsorption questionable on an industry-wide basis); and iron and steel
(by-product coke treatment involves technology that is unproven; elimina-
tion of dishcarge of pollutants required for other porcesses is also
unproven technology). Even those technologies which appear to be techni-
cally feasible may not be adequate to achieve the 1983 limitations in
several cases. In other cases, less elaborate measures than those
envisioned by EPA may be adequate. differences between technologies
postulated by Commission contractors and those envisioned by EPA for
1983 are summarized in the following table.

Best Available Technology Economically Achievable

Category Differences between NCWQ Contractors and
EPA's Suggested BAT

Organic Chemicals Use of in-plant changes and/or highly
eficient biotreatment may preclude need
for activated carbon suggested by EPA for
a substantial number of plants.* Carbon
in excess of that envisioned be EPA may
be needed in a few cases.

Inorganic Chemicals Evaporation units required because complete
recylcle stipulated by limitation does not
appear feasible in several subcategories.

Textiles Additional solids and COD removal as for
BPT: carbon adsorption also required in
some subcategories.

Fruits and Vegetables Limitations can probably be met using
activated sludge treatment plus in-plant
changes; mulit-media filters envisioned by
EPA may not be necessary in most subcate-
gories.*

Petroleum Regining Attainablility of COD, TSS and O&G limita-
tion even on long-term basis questionable:
effluent desalting and partial recycling
may be necessary.

*In thses cases, postulated technologies are less elaborate than those
envisioned by EPA.

11-76

The effectiveness of the prescribed BAT systems cannot be verified
unequivocably without more operating data. The variability problem
discussed in the context of BPT ap plies also to BAT and ma be even more
.y
acute. The following discussion of the petroleum refining category is
a continuation of that quoted in Section 3.b.

"We believe that by 1983 technology will be available to permit the
industry to meet the promulgated limitations. However, on the
basis of our analyses, we find'it unlikely that the treatment
technology model defined by EPA as Best Available Technology Econom-
ically Achievable for the petroleum refining industry will be
sufficient to meet these limitations. Based on what is admittedly
a small amount of pilot-plant data and operating data from two
full-scale carbon plants which are not identical to EPA's technolog-
.ical.model, we find it probable that even the long-term achievable
concentrations for several constituents which were used in developing
the 1983 limitations will not.be attainable. Specifically, these
problem constituents are: chemical oxygen demand, oil and grease,
and total suspended solids. we also found that the allowed varia-
bility between long-term average discharges and the maximum monthly
and daily discharges, which are the basis of the published effluent
limitations, are considerably more stringent than those allowed by
EPA for BPT technology and appear to be'unsubstantiated with regard
to the capabilities of the technology to produce these levels of
control. Thus, we believe it is likely that there would be a wide-
scale noncompliance with both the long-term average mass discharge
rates used by EPA to calculate the (limitations) and with the
shdrter-term numbers that are actually published as the 1983 effluent
limitations. For this reason, we added another level of technology
which involves desalting as much as 50 percent of the total waste-w-
water flow so that it can be completely reused within the refinery.
However, it should be remembered that the desalting methods which
we have included as potentially available in 1983 cannot be considered
at this time to be proven technology for this application and thus
the question of compliance with the 1983 effluent limitations on an
industry-wide basis is still conjectural."

Verifying the anticipated effluent variability for suggested BAT
systems is not possible at this time because there are very few systems
equivalent to BAT in place. Until more operating data become available,
it would appear advisable to express the 1983 limitations solely in
terms of long-term average performance criteria.

Color removal is currently required of a few industries for 1983
and by some New Source Performance Standards (NSPS). Two industries
affected are textiles and pulp and paper. Using conventional methods,
color removal at the treatment end is expensive, and may consume large
quantities of chemicals. Little operating data are available, but it

11-77

appears that better internal controls, coupled with process modification's,
may be the best strategy for color reduction in many cases. Changes in
product specifications also may play a role. Development and application
of these changes will take time, and the potential rate of adoption is
uncertain. In the pulp and paper industry, EPA's NSPS for some sub-
categories require color removal to.the same degree-as the BAT limita-
tions. These should be reviewed to verify that reliable and economically
achievable abatement options exist.

In-plant changes play an important role in the abatement strategies
postulated for 1983 for many of the industries studied in-depth. Flow
reduction measures, by means of increased water recycling and reuse, are
common to all of these strategies, as are better housekeeping procedures.
Other measures can reduce the quantities of wastes generated, and most
of these impact water usage as well. Uncertainties inherent in Commission
studies in this area preclude definitive discussions of these changes.
Not only are the 'cost data,'very approximate, but the technological
feasibility of some of the techniques has yet to be proven on a scale
adequate to confirm industry acceptance. The particular measures dis-
.cussed should be considered only as illustrative of what might be done.*

Table 11-29 summarizes some of th e most significant in-plant pol-
lution abatement measures which Commission studies indicated may be
feasible to retrofit or design into a significant number of plants by
1983. Also described are the expected effects in terms of water discharged
and/or changes in pollutant loadings, and the direction of change in
overall industry production costs (including,the cost of end-of-pipe
wastewater treatment). A net decrease in annual O&M expenditures is
indicated for,some categories, primarily due to savings in energy and
chemicals, both within the manufacturing process itself and for end-of-
pipe wastewater treatment. Quantitative estimates of installation costs
and changes in plant O&M costs have been incorporated into Commission
estimates of capital and O&M costs, the latter being net of any estimated
savings.** The fact that some savings opportunities appear to exist is
one reason to expect internal controls to become.an increasingly impprtant
part of water pollution abatement planning in the future.

The Commission did, however, restrict consideration to only those
measures which have been tried at least at the "pilot plant" stage:
no purely theoretical measures were included.

**The savings figures are tenuous. They depend critically upon the
assumed cost of energy and chemicals, as well as site specific factors
which cannot be considered in the aggregate. The assumptions used in
their derivation are detailed in the Commission's industry contractor
reports.

TABLE 11-20: Examples of In Plant 1,batement Measures

Expenditure for
Estimated Effect Assumed Installation as % of Effect on Overall
on Waste Load Implemented Total Capital Expendi- Plant O&M
Industry Category Abatement Measures Needing Treatment by: ture for Abatement Expenditures

Petroleum Refining Separation of storm water sewers. Flow regulation. 1977 50 - 83% Increase
Two-stage sour water stripping. Reduce ammonia & sulfides
Conversion of barometric to surface by 95%
condensers. Reduce oil & grease
Spent caustic neutralization. emulsions.
Segregation of cooling and process Reduce sulfides, COD;_
water. adjust pH.
Various water reuse and conser- Reduce flow being treated
vation measures. by 24-48%

Pulp and Paper Internal spill containment. Eliminate shock loading 1977 17-26% for mills with Increase
pulping, 6-7% for mills
without

Clean cooling and service water Reduce flow being treated 1983 12-24% (including spill Decrease
segregation and reuse, other by 10-50%. containment) (substantial savings
measures for water reuse. Reduce BOD load by in some cases)
More efficient ("countercurrent") 5-30%, TSS by 10-45%.
pulp washing techniques.
Fiber recovery techniques.
00

Canned & Preserved
Fruits & Vegetables Water conservation through use of Reduce flow being treated 1983 Not reported separately. Increase in O&M
"dry cleaning, washing, and by 5-7%. partially offset by
peeling techniques.. Reduce BOD loading by savings in most cases;
Steam blanching. 0-80%, TSS by 0-71%. net decrease in O&M
Dry collection and transport.of. realized in 6 of 24
solid wastes. subcategories.
Reuse of process waters.
Dry product transport.
Miscellaneous-water conservation
and waste management measures
(increased product yield results
in some cases.)

Metal Finishing counter-current rinsing Substantial flow reduction 1977 Some Varies widely depending Decrease
1983 Most upon@many plant-specific
Segregation of..Process Flows Varies - permits optimum 1977 Some factors Increase
effluent control 1983 Most
Segregation of Batch Dumps- Varies - permits optimum 1977 many Increase
and Floor Spills effluent control 1983 Most
Chethical Recovery Systems aubfft-antial flow-and pollutant 1977 Few
reductions 1983 Many Decrease.

Source: National Commission on Water Quality, February 1976. Compiled.from contractor technology studies.

11-79

e. Costs and Resources
(1) Technologies to Comply with EPA's BPT and BPT Efiluent Limitations

Abatement costs cannot be estimated definitively without making
simplifying assumptions.. Actual expenditures will depend upon the mix
of abatement measures eventually employed by each discharg er, and changes
in the numbers, products and production rates of the plants within each
industry over time. A least-cost strategy today may not be a few years
hence, when relative price levels of ab atement components have shifted.
(For example, the recent substantial increase in energy prices favors
low energy systems.)

Cost estimates reflect June 1973 relative price levels, are ex-
pressed in 1975 dollars,* and involve Commission contractor judgments
about which abatement strategies will be used.

Additional land required for in-plant changes and end-of-pipe
treatment facilities are included in the capital costs. Since actual
purchase prices of industrial land vary from a few hundred to several
hundred thousand dollars per acre, gross averages were used for each
industry category and represent the Commission contractor's judgment as
to the appropriate value for thatindustry., In most cases, this item is
not criticalsince land costs are a small part of total capital. Operation
and maintenance (O&M) costs are defined as the change in the total
direct cost of operating a facility after installation of the water
pollution abatement technology. Depreciation and financing costs are
not included in this discussion. Definition of a "baseli ne" level of
expenditure from which costs due to the Act are to be measured, as well
as incorporation of future changes in industry,--growth and plant closures
all fall within the purview of the economic impact analyses. The data
presented here were the starting points for those analyses.

The majo)r qualifications that characterize the aggregate cost
figures derived in the technology assessment studies may be summarized
as follows:

0 While Commission studies endeavored to cover all industry, a
few segments which representan extremely minor portion of,
industry costs were not studied.

*Energy prices as of November 1973 were used. All costs were adjusted
to 1975 dollars using a uniform multiplier of 1.3.

11-80

0 Costs apply to industry as its plants-were configured in 1973,
including 1973 production rates, product mixes and product
specifications.

0 No costs are included for technologies to control toxic
materials beyond those required by EPA's BPT and BAT effluent
limitations.

0 Other costs for wastewater control not directly related to the
-effluent limitations are not considered. Examples are stormwater
monitoring and control (required by the effluent limitations
in only a few categories), sanitary sewage treatment and
control of hazardous wastes.
N 0 No costs are included for meeting water quality standards
where such standards imply abdt ement more stringent than that
associated with EPA's BPT and BAT effluent limitations.

0 No charges for proportionate share of O&M or capital recovery
Assessments are included in costs for dischargers to publicly
owned treatment works.

0 Effluent limitations under consideration, but not yet finalized
by EPA, were used in a large number of.cases. This occurred.
to varying degrees in approximately 40 of the 49 industry
categories studied. Further, 12 categories were examined
without the benefit of any form of effluent limitations or EPA
studies upon which limitations would eventually be based. The
twelve industries are ore mining and dressing, coal mining,
mineral mining and processing, miscellaneous food and bevera4es,
machinery and mechanical products, water supply, structural
clay products, pottery and related products, concrete gypsum
and *plaster products, steam supply, foundries and non-ferrous
mill products. In view of the scarcity of data available in
studying th@se industries, the 'costs provided here reflect, at
best, order of.magnitude estimates.

0 Costs are incremental in the sense that credit has been given
for of January 1973.
pollution abatement measures in.place as
Aggregates therefore measure the additional outlays required
for plants, as they existed in 1973, to comply with the 1977
and 1983 requirements.

0 The figures are only estimates, not "exact" calculations.
Costs for in-plant changes vary greatly with plant configuration.
other uncertainties about engineering feasibility and d esign
details of the technblogies'postulated for 1983 make the BAT
figures'more speculative than those for BPT and pretreatment.

Aggregate capital and O&M costs for achieving the pretreatment, BPT
and BAT requirements for all industrial categories are shown in Table
11-30. The total capital cost for 1977 is about $44 billion, with about
$31 billion additional required to achieve the 1983 limitations.
Pretreatment requirements account for 37 percent of the total capital
cost for 1977, with the metal finishing category alone accounting for 70
percent of the pretreatment total. These figures incorporate judgments
by Commission contractors and Commis%ion staff about which technologies
will be required to achieve the effluent limitations. As explained
previously, these technologies differ from those suggested by EPA in
several cases.

The least-cost abatement strategy for a particular discharger will
often be some combination of in-plant changes and end-of-pipe treatment,
the optimal combination depending upon the degree of abatement required,
costs of candidate in-plant changes, treatment costs, and other site-
specific factors which are difficult to generalize. Time constraints
and the breadth of the Commission's studies precluded detailed optimiza-
tions, and their absence tends to make the Commission's cost estimates
higher than the theoretical "least cost" solutions in many cases. Other
site-specific factors excluded from consideration -- the possibility of
having to excavate through bedrock, for example -- tend to cause the
estimates to be understated.

The volume and strength of wastewater and the required percent
pollutant reduction are the primary determinants of the capital costs of
end-of-pipe treatment systems. Operation and maintenance costs are
composed primarily of labor and treatment-related energy and chemicals,
including the costs of handling and disposing of sludges. Table 11-31
gives cost data for some representative plants. These data apply to
plants with no abatement measures in place, and illustrate the range of
costs for individual plants, both for different industries and within a
given industry.

Results for the petroleum refining category illustrate the effect
of plant configuration, or "complexity" upon abatement costs. All
petroleum refineries are designed from a conceptual base of nine basic
chemical processing steps which are utilized in a variety of combinations
.and sizes and, in general, the more processes, the greater the raw waste
.load per unit of crude oil refined. A type "D" refinery i's more complex
than a type "B" and this accounts for the fact that the' treatment expendi-
tures per barrel of crude oil are greater for the D than the B refinery,
where the "economy of scale" effect would tend to make unit costs less
for the D refinery, all else being equal. Process complexity is therefore
an important variable in determining abatement expenditures for this
industry, as well as'for many sectors of the iron and steel, chemicals,
metal finishing, and plastics and synthetics industries. EPA's limitations

11-82

TABLE 11 -30: Aggregate Capital and Direct Operation and Maintenance Costs
to Achieve EPA's BPT, Pretreatment, and BAT Effluent Limitations(l)

1977 BPT EFFLUENT AND
PRETREATMENT LIMITATIONS(4) 1983 BAT EFFLUENT LIMITATIONS(S)
CAPITAL O&M(6) CAPITAL O&M(6)
INDUSTRY (Million $) <Million $/yr) (Million $) (Million $/yr)

IN-DEPTH STUDIES:

Fruits & Vegetables(2) 443 39 161 16
Inorganic Chemicals(2) 520 156 247 104
.Iron & Steel(2) 2,910 229 949 64
Metal Finishing(2) 14,140 3,170 14,100 2,210
organic Chemicals(2) 4,290 650 3,640 2,470
Petroleum Refining 1,650 179 1,180 395
Plastics & Synthetics(2) 160 32 286 29
Pulp & Paper(2) 2,640 135 798 21
Steam Electric Power(l) 3,740 1,420 2,030(9) 260(9)
Textiles 537 88 300 29
Feedlots (1) 0) 705 43 169 1-

Subtotals (In-Depth 31,140 6,140 23,860 5,600
Industries)

GENERAL INDUSTRY STUDY,
GROUP C:

ore Mining & Dressing(3) 616 25 400 18
Coal Mining(3) 1,000 50 400 26
Petroleum & Gas Extraction(2) 234 18 1,070 61
Minerals Mining & Processing(3) 730 72 500 50
Canned & Preserved Seafoods(2) 41 12 120 12
Misc. Food & Beveraqes(3) 5 1 5 1
Leather Tanning & Finishing 120 27 73 13
Machinery & Mechanical Products(3)(8) 3,900 390 3,900 390
Water Supply(3) 1,200 160 100 3

GROUP B:

Meat Products & Rendering(2) 130 13 240 14
Dairy Products 79 6 51 3
Grain Mills 56 4 13 1
Cane Sugar 153 1@ 170 13
Beet Sugar 90 17 69 5
Builders Pa@er & Board(2) 120 12 0 0
Fertilizer( ) 64 36 60 16
Rubber Processing(2) 220 is 48 12
Ferroalloy 48 16 13 3
Nonferrous Metals(2) 91 30 112 30
Transportation(2) 1,200 130 140 39

GROUP A:

Fish Hatcheries & Farms(2) so 10 47 31
Timber Products Processing(2) 14 1 25 8
Furniture & Fixtures(2) 8 3 0 0
Paint & Ink Formulation(2) 23 22 0 2
Soap &,Detergent(2) 10 1 2 0
Phosphate(2) 73 9 14 1
Paving & Roofing Materials(2) 6 6 4 1
Glass(2) 42 5 16 3
Cement(2) 34 4 9 1
Structural Clay Products(3) 5 1 0 0
Pottery & Related Products(3) 3 1 4 3
Concrete, Gypsum & Plaster(3) 100 26 0 0
Asbestos(2) 4 1 9 - 4
insulation Fiberglass(2) 14 6 0 0
Dlv(3) 0 0 0 0
Steam Supj
Auto & other Laundries(2) 25 4 21 1
Foundries(3) 180 26 0 0
Non-ferrous Mill Products(3) 260 25 0 0

Subtotals (General 10,940 1,200 7,640 760
Industries)

TOTALS 42,080 7,340 31,500 6,360

(1) For industries as structured in January 1973; except steam electric power and feedlots which include growth.
(2.) Final effluent limitations unavailable for part or all of industry at time of study.
(3) Neither effluent limitations nor development documents were available for industry at time of study.
(4) Does not include capital recovery or user charges for use of municipal treatment works.
(5) Costs in addition to those for BPT.
(6) Depreciation and interest on capital not included.
(7) For feedlots which discharge to streams. If only for feedlots greater than 1,000 animal units: BPT capital
- $113 million, BPT O&M = $11 million/year; BAT capital = $35 million, BAT O&M = $<l million/year. (See. Sec. II.E.2.)
(8) Excluding metal finishing operation.
(9) Costs range up to $7.96 billion capital and $0.95 million O&M depending upon assumed number of Sec. 316(a)
exemptions and state enforcement of thermal controls on plants exempt from federal regulations. (See Sec. II.C.4.)

Source: National Commission on Water Quality, February 1976. Compiled from data in contractor reports to the
Commission.

TABLE 11-31: Illustrating Plant-Level Costs

PETROLEUM REFINING

1. Type: Subcategory "B" "Cracking" emphasis on the production@of gasoline and other motor fuels

Capacity: 42,500 barrels of crude oil per day - 347 day/yr

Abatement Option: Installation of in-plant measures to reduce the. strength and flow rate of the waste load, secondary biological wastewater treatment
(aerated lagoon), and effluent filtration (multi-media) for 1977. Further treatment by activated carbon plus 50 percent recycling
of treated effluent for 1983. (Data assume no abatement technology already in place and includes in-plant, end-of-pipe and
solids handling requirements.)

0 & M Chemical Requirements
Capital0l 0 & M(2) Energy(3) Construction O&M Labor Land Installation (tons/yr.) Sludge(6)
Abatement Cost @, Cost (mill. Labor (man Required Time Generation Sulfur
Level _ (mill. $) (mill. $/yr) KWH/yr) (man days) days/yr) (Acres) (Years) Alum Polyelectrolyte Other (tons/yr) (tons/yr)
BPT 3.82 1.16 56.778 6,120 3,246 5,075 2.5 310 6 50(4) 1,995 17,375
BPT to BAT 3.16 1.09 46.4 4,690 3,585 Neg. 2.0 90(5) 1,352 0

Total capital expenditure to meet BAT limitations = $6,974,500
Total (annualized)(7) cost per barrel of crude tQ meet: BPT limitations = T2t/bl. Purchase price of crude oil $11.00/bl (1975).
BAY )imitations = 22@jbl-
(1) Includes cost of land at $52,000 per acre.
(2) Annual values assume production at or near capacity.
(3) Includes energy for steam generation for sour water strippers as well as electrical energy for end-of-pipe treatment.
(4) Precoating chemicals for "vacuum" filters (for sludge).
(5).Activated carbon makeup.
(6) Dry weight basis.
(7) Calculated as: (Capital cost x 16.3% + Land Cost x 10% + O&M Cost)/Annual Production.
Source: Engineering Science, Inc., Water Pollution Abatement Technology: Costs and Capabilities, Petroleum Refining Industry, 1975.

TABLE 11-31: Illustrating Plant-Level Costs (contd.)

2. Type: Subcategory "D" - "Lube" - produces significant quantities of lubricating oils as well as gasoline, the lighter heating oils, and asphalt:

Capacity: 45,200 barrels of crude oil per day.- 347 day/yr

Abatement Option: Same as in the previous case. (Data assume no abatement technology already in place and includes in-plant, end-of-pipe and
solids handling requirements.)

0 & M Chemical Requirements
Capital(l) 0 & M(2) Energy(3) Construction O&M.Labor Land Installation (tons/yr.) Sludge(6)
Abatement Cost Cost (Mill. Labor (man Required Generation Sulfur
Level (Mill. $) (mill. $/yr) KWH/yr) (man days) days r) (Acres) Alum P91yelectrolyte Other (tons/yr) (tons/yr)

(4)
BPT 4.54 1.34 60.952 7,010 3,764 8.05 2.5 590 11.6 55 2,160 16,125

(5)
JBPT to BAT 1 4-.15 1.57 178.15 1 5,900 4,815 1 Neg. 1 2.0 1 165 1 2,382 1 0

Total capital expenditure to me-fit BAT limitations = $8,684,000
Total (annualized) (7) cost per barrel of crude to meet: BPT lim. ,itations = 130/bl. Purchase price of crude oil $11.00/bl (1975).
BAT limitations = 270/bl.

MIncludes cost of land at $52,000 per acre.
MAnnual values assume production at or near capacity.
(3)Includes energy for steam generation for sour water strippers as well as electrical energy for end-or-pipe treatment.
(4)Precoating of chemicals for "vacuum" filters (for sludge).
MActivated carbon makeup.
(6)Dry weight basis.
MCalculated as: (Capital cost x 16.3% + Land Cost x 10% + O&M Cost)/Annual Production.

Source: Engineering Science, Inc., Water Pollution Abatement Technology: Costs and Capabilities, Petroleum Refining Industry, 1975.

TABLE 11-31- Illustrating Plant-Level Costs (contd.)

METAL FINISHING

1. Type: Small Job Shop application of decorative copper-nickel-chrome finish to brass plumbing hardware..

Capacity: 17 square meters/hr - 8 hr/day - 250 day/yr

Abatement Option: Cyanide oxidation, pH adjustment and equalization of waste discharge flows for 1977. For 1983, add chrome. reduction,
clarification filtration, reverse osmosis and evaporation equipment to eliminate pollutant discharge.
(Data assume no abatement technology already in place and includes in-plant, end-of-pipe and solids handling requirements.)

Capital(l) 0 & M(2) 0 & M Chemical Requirements (3) (3)
0 & M (l s./vr.) Sludge Salt
Abatement Cost Cost Labor Sodium Sulfuric Sodium Generation Concentrate
Level (Thou. $) (Thou. $/yr) Energy (man days) Bisulfite Caustic Acid Hypochlorite (tons/yr.) (tons/yr.)

Ln
BPT 61 26 4 (0 200 0 '25F6OO 2,600 1,250 0 0

BPT to BAT 683 72 99 (a) 200 800 1,900 1,000 -600 2.5 53
1.1(b) (savings)

Total (annulized) (4) cost per 100 square meters processed: BPT limitations = $106
BAT limitations = $645

(a)Thousand kwh/yr.
(b)Billion Btu/yr.

MIncludes costs of building and land at $39/sq. foot.
(2)Annual values assume production at or near capacity.
(3)Dry weight basis.
MCalculated as: (Capital costs x 16.3% + O&M Cost)/Annual Production.

:Source: National Commission on Water Quality, February 1976. Compiled from Lancy Laboratories, Water Pollution Abatement Technology:
Capabilities and Costs, Metal Finishing Industry, 1975.

TABLE 11-31: Illustrating Plant-Level Costs (Contd.)

2. Type: Large Captive Shop - Steel, stock for automobile. bumpers is pickled for scale removal, phosphated for lubrication, stamped to shape,
and finally chrome-nickel plated.
Capacity: 1,167 square meters/hr - 24 hrs/day 300 day/yr
Abatement option: Segregated tr 'eatment for nickel and chrome waste streams,. then combined for neutralized general rinses, clarified and
filtered for 1977. For 1983, substitution of caustic soda for lime in neutralizing waste flows.(to avoid scaling problem
in concentrating equipment) and addition of reverse osmosis and evaporation equipment to eliminate pollutant discharge.
(Data assume no abatement technology already in place and includes in-plant, end-of-pipe and solids handling requirements.)

o & m chemical Requirements (tons/yr.)
Capital(') 0 & M (2) o&m Labor Sludge(3) Salt(3)
Abatement Cost Cost (man . Sodium Sulfuric Generation Concentrate
(Mill. $) (mill. $/yr) Energy days/yr) Caustic -Lime Bisulfite Polyelectrolyte Acid (tons/yr.) (tons/yr.)

(a)
'BPT 1.91 0.57 0.90 2,200 183 1,300 176 1.6 91 2,100 0

BPT to BAT 3.64 2.7 2.37(a) 650 702 -482 0 0 0 0 2,850
186 - (b) savings)

(4)
Tbtal (annualized) - cost per 100 per square meters processed: BPT limitations = $10
BAT limitations = $50

(a)Million kwh/yr.
(b)Billion Btu/yr.

(I)Includes cost of building and land at $39/sq. foot.
MAnnual values assume production at or near capacity.
(3)Dry weight basis.
(4)Calculated as: (Capital cost x 16.3% + O&m Cost)/Annual Production.
Source: National Commission on Water Quality, February 1976. Compiled from Lancy Laboratories, Water Pollution Abatement Technology:
Capabilities and Costs, Metal Finishing Industry, 1976.

11-.87

recognize this explicitly for the petroleum refining industry by the
basic subcategorization scheme, and by taking complexity into account in
the allowable pollutant discharge. The difference in expenditures (per
unit of crude refined) for the two refineries shown in the table are
reduced by this flexibility. This approach seems appropriate, and
should be applicable to other industrial categories of this type, including
those listed above.

The second part of the table illustrates two extremes which charac-
terize the metal finishing industry, a small "job shop" and a large
"captive shop". The small shop is not required to achieve the same BPT
effluent limitations as the large facility, but EPA's BAT effluent
limitations require both to achieve complete elimination of the discharge
of process water pollutants by 1983. To afford perspective to the
annualized costs, the approximate selling prices for services are $600
per 100 square meters plated for the small shop and $420 per 100 square
meters plated for the large shop. A major increase in energy .is required
for BAT as compared to BPT, as well as a large change in the quantity of
residuals to be disposed of, since salts must be removed to achieve BAT.

Table 11-32 details the O&M costs shown in Table 11-31. The treat-
ment and disposal of both biological and chemical sludges is a significant
portion of total O&M expenditures.

Economy of-scale has been mentioned-in the context of Table 11-31.
For a fixed level of abatement -- i.e., fraction of raw waste load that
must be removed --.the cost per gallon of wastewater treated in an end-
gf-pipe system decreases with increasing flow rate. The expenditures
per unit@of production for small facilities are usually greater than for
.Comparable larger facilities, assuming the same type of treatment.
Figure II-1 illustrates this "economy of scale", effect for a plant in
the textiles category. Similar curves apply to virtually all conventional
end-of-pipe systems.

The costs of,achieving a specific level of abatement for existing
plants, as opposed to plants still in the design stage, are potentially
quite different. As a general rule, any form of industrial pollution
control costs-less when designed into the plant from conception, compared
to being added on, or "retrofitted" to an existing facility. This is
particularly true for major process changes aimed at waste load re-
duction. Many changes that are desirable from a pollution control point
of view-are technically infeasible, or at least prohibitively costly, to
retro'fit. As a result,,the traditional response to more stringent
abatement requirements by existing dischargers in most industries has
been primarily the addition of more extensive end-of-pipe treatment.
this.trend may be changing, however, since the increasingly stringent
limitations engendered by the Act have focused more attention on in-
plant waste controls.

11-88

TABLE 11-32: Components of O&M Expenditures for Representative
Wastewater Treatment Systems

Petroleum Refining

Type of refinery: "Cracking" subcategory, 42,500 barrels of crude oil
per day capacity. (See first entry in Table 11-31.)

Type of treatment: Advanced oily-solids removal, followed by an aerated
lagoon with settling pond followed by multi-media effluent filtration,
sludge dewatering and landfilling. (The end-of-pipe part of BPT.)

O&M Expenditure $445,900 per yearr" (of which
$200,000 relates to solids handling)

Percent of BPT O&M
O&M Component Costs

Laborr2) 62%
Energy(3) 6%
Chemicalsr4) 12%
.Miscellaneous 20%

100%

rl)Assuming production at or near capacity. Covers end-of-pipe and solids
handling costs only.
r2)Labor rate (including benefits) of $19.50 per hour.
(3)1.94@/KWH.
r4)Polyelectrolytes at $1.76/lb.; alum at $81/ton; filter precoat at
$137/ton.

Source: National Commission on Water Quality, February 1976. Compiled
from Engineering'Science, Inc., Water Pollution Abatement
Technology: Costs and Capabilities, Petroleum Refining
Industry, 1975.

11-89

TABLE 11-32: Components of O&M Expenditures for Representative
Wastewater Treatment Systems
(continued)

Metal Finishing

Type: Small Job Shop application of decorative copper-nickel-chrome
finish to brass plumbing hardware.

Type of treatment: Cyanide oxidation, pH adjustment and equalization,of
waste discharges for BPT. For BAT, addition of chrome reduction,
clarification, filtration, reverse osmosis and evaporation equipment
to eliminate discharge of pollutants.

Total Annual O&M Expenditure* BPT - $26,000
BAT - $98,000

Percent of O&M
O&M Component Expenditures
BPT BAT
Labor 46%
Energy 1% 6%
Chemicals 13%. 4%
Maintenance 3% 7%
Transportation and Disposal of Sludge 0% 35%
and Salt Concentrates
Miscellaneous 1% 2%
100% 100%

*Assuming production at or near capacity. Covers in-plant, end-
of"pipe and solids handling costs.

Source': National Commission on Water Quality, February 1976. Compiled
from Lancy Laboratories, Water Pollution Abatement Technology:
Capabilities and Costs, Metal Finishing Industry, 1975.

11-90

TABLE 11-32: Components of O&M Expenditures for Representative
Wastewater Treatment Systems
(continued)

Type: Large Captive Shop - steel stock for automobile bumpers pickled
for,scale removal, phosphated for lubrication, stamped to shape, and
finally chrome-nickel plated.

Type of treatment: segregated for nickel and chrome waste streams, then
combined with neutralized general rinses, clarified and filtered for
BPT. For BAT, substitution of caustic soda for lime in neutralizing
waste flows (to avoid scaling problems in concentrating equipment to
eliminate pollutant discharge).

Total Annual O&M Expenditure* BPT - $ 570,000
I@AT - $3,270,0 '00

Percent of O&M
O&M Component Expenditures
BPT BAT
Labor 44% 10%
Energy 5% 26%
Chemicals 33% low
Maintenance 2% 1%
Transportation and Disposal of Sludge 7% 1%
Transportation and Disposal of Salt 0% 51%
Concentrates
Miscellaneous 9% 1%
100% 100%

*Assuming production at or near capacity. Covers in-plant, end-
of-pipe and solids handling costs.

Source: National Commission on Water Quality, February 1976. Compiled
from Lancy Laboratories, Water Pollution Abatement Technology:
Capabilities and Costs, Metal Finishing Industry, 1975.

11-91

Figure 11-3

"ECONOMY OF SCALE" EFFECT
FOR A TEXTILE PLANT*
(Effect of production volume on the cost of. building a treatment system)
Annualized cost to build a treatment system
1975 dollars per 1000 lbs. of product
9

8 $8.06

CL $5.53

C*
$4.23
CL
CA
4 $3.77
$3.58
-$3.38

01-
40 100 200 300 400 500
Production rate (1000 lbs/day)

Plant type: Textile finishing plant chemical treatment, dyeing and printing of fabrics made of cotton and
cotton-synthetics blends.
Annualized cost calculated as: (Capital costs x 16.3% + O&M cost/Annual production). Wastewater treatment
qssumed:,Screening, aerated lagoon, clarification, sludge digestion and disposal by spray irrigation.
Source- Natl- Commission on Water Quality,' from Lockwood Greens Engineers, Inc., Water Pollution
Abatement Technology: Capabilities and Costs, Textile Industry", 1975.
February 1976

11-92

The advantages inherent in pre-planning to meet a known effluent
limitation are recognized in the Act. New Source Performance Standards
apply to all industrial point sources whose construction begins after
publication of the proposed standards. In most cases, the NSPS are more
stringent than the BPT effluent limitations. Several are identical to
the BAT limitations and, in a few cases, are more stringent. These
standards are discussed further in Section 3.f.

(2) Alternative Levels of Abatement

The Commission's technology studies were designed.to identify
abatement levels both more and less stringent than those required to
meet EPA's effluent limitations. In each case, alternative levels were
based upon the expected performance of technologies which are either
presently available or which, in the contractor's judgment, can be
expected to be available by 1977, or 1983.* In no cases were arbitrary
11percent removal" targets stipulated. Where Commission'contractors
concluded that the technologies suggested by EPA were not consistent
with the corresponding effluent limitations, the EPA technology model
was used to define an alternative level of abatement perform@nce. Other
levels both more and less stringent than required to meet the BAT effluent
limitations were included where they corresponded to logical increments
in abatement technology. Figure 11-4 shows aggregate industry costs for
each abatement level. The number of levels varies depending upon the
industry, and levels from industry to industry are not directly comparable.
Level I in iron and steel bears no direct relation to Level I in textiles;
they are similar only in that they both correspond to the abatem@nt
measures that EPA associated with BPT limitations.**

Because the levels were based upon discrete increments in technology,.
it is not always possible to precisely equate technology level and
effluent quality. In the petroleum refining and iron and steel categories,
for example, the technologies postulated by Commission contractors for
meeting EPA's,BPT limitations actually "overshoot the mark" in some sub-
categories, meaning that the resulting effluent qualities in many cases
would actually exceed those required by the EPA. A similar result
applies to the fruits and vegetables industry at the BAT level. This
results from the Commission's consideration of abatement measures that
correspond to realistic engineering designs.

*An additional level approaching or achieving the 1985 goal of the
elimination of discharge of waterborne pollutants was assessed for
some industries: See Section D of this chapter.

**See Figure II-4e for a description of each abatement level for the
respective industry categories.

11-93

Figure 11.4a
CAPITAL & DIRECT OPERATING COSTS FOR LEVELS
OF WATER POLLUTION ABATEMENT - IN DEPTH INDUSTRY STUDIES

Billions of do 'liars 3.86
Levels
cumulative 33% increase
to III
CAPITAL COSTS

2.91

900
A increase
2.23
I to 11
14% increase
1.96
...... IV to V

:% ..... ... ......
1.53
87% increase
III to IV

...... 1.05
0.871 21% 11 to III
0.742 ......
-17% to 11

...... ....%
X.-
RON&STE.
ETROLEU

I III Levels of I I I III IV V
1977---/ 1983 Abatement" 1977----/ \--1983---/
Millions of dollars/yr O&M COSTS* 5.74
Levels cumulative 37% increase
IV to V
419

...... .....
...... .......
..... 28% increase 134% increase
229 11 to III III to IV
179
56% increase 162
147 149 10% 11 to III
I to 11 .....
9%
S E L:*.-*- PET 0 U M:'-...%. I to 11
A V ZI
1 11 111 Levels of 1 11 111 IV V
1977 1983 Abatement" 1977 1983---/
11 R

E I
L EIR 0 IN & Sil F11PA R '/ L E
L

Costs in 1975 dollars. For industries as stru ctured in Jan. 1973. Include costs for direct discharges and
pretreatment for discharges to publicly owned works (POTWs). Excludes depreciation, interest on capital
and user charges for discharges to POTWs.
Levels of abatement described in Figure 11.44.
Source- Nati. Commission on Water Quality from technology contractor reports
February 1976

11-94

Figure 11.4b
CAPITAL & DIRECT OPERATING COSTS FOR LEVELS
OF WATER POLLUTION ABATEMENT - IN DEPTH INDUSTRY STUDIES
Billions of dollars 21.44
Levels cumulative
16% increase
...... III to IV
2.96
12% increase
CAPITAL COSTS*
2.64
11 to III
2.44.- 8% increase
I to 11

1.19
42% increase
III to IV
0.837
0.727
15% 11 to III
0.537 -X-:-:V. 35% 1 to 11
X.X'V.
x--N
L A R "-TEXT

1 11 111 IV Levels of I I I III IV
1977 1983 --J Abatement" 1977 1983

Millions of dollars/yr
Levels cumulative 156 O&M COSTS*
129 +5% ... 42% increase 139
...... 19% 111 to IV
III to IV 117
-19% 113
NNN -
...... 4% 11 to I I I
1110'
88 -X: ..... 28% increase
%XXXX. %..,..: .. ....
X..
to

PULP R :TE TIL
X
X ;:*,
X
III I V I V
E

\--1977---J \- 1983 1977 1983
Costs in 1975 dollars. For industries as structured in Jan. 1973. Include costs for direct discharges and
pretreatment for discharges to publicly owned works (POTWs). Excludes depreciation, interest on capital
and user charges for discharges to POTWs.
Levels of abatement described in Figure 11.4e.
Source: Nati. Commission an Water Quality from technology contractor reports
February 1976

11-95

Figure 11.4c
-CAPITAL & DIRECT OPERATINGCOSTS FOR LEVELS
OF WATER POLLUTION ABATEMENT - IN DEPTH INDUSTRY STUDIES

Millions of dollars 767
745
Levels cumulative
23% increase
...... .....
III to IV
X. 48% increase
604 to 11
-re-
9% increase CAPITAL COSIS
...... ..... ......
552 ......
- . - 11 to III
... ..... ...
.... ..... 520
.. ... 25% increase
. .... .... I to 11
443 446

179% increase
... to 11

...... ....
.... ... ....
..... ....

...... 160
x
.4
INORGANIC CS &
RUI '4_VEGETABi.._-E'S'*, CHE - ICALS -SYNTHETICS

11 111 IV Levels of 1 11
1977 1983 Abatement" IM 1983 1977 1983

Millions of dollars/yr 260
Levels cumulative O&M COSTS* 7*,--*,.'
67% increase
I to 11

156

FRUITS&V PLASTICS &
EGETABLES
Increases SYNTHETICS
66
50 55 20% 111 to IV 61
0% 11 11 1 *-'* ..`91% increase
39 1 to I INORGAN C 32
28% 1 to 11 to
CHEMICALS
x
LE
I Ii III IV Levels of
1977 Abatement** 1977 1983 1977 '1983

Costs in 1975 dollars. For industries as structured in Jan. 1973. Include costs for direct discharges and
pretreatment for discharges to publicly owned works IPOTWs). Excludes depreciation, interest on capital
and user charges for discharges to POTWs.
Levels of abatement described in Figure 11.4s.
Source: Nati. Commission on Water Quality from technology contractor re0orts
[PqLAST@
TS

February 1976

11-96

Figure 11.4d
CAPITAL & DIRECT OPERATING COSTS FOR LEVELS
OF WATER POLLUTION ABATEMENT - IN DEPTH INDUSTRY STUDIES

Billions of dollars 28.24
Levels cumulative

CAPITAL COSTS*
100% increase
11 to IV

X.Xv%
14

48% increase
I to 11
..X
9.55 -..XX-*

7.93
X"
...... 85% increase
...... ....
I to 11
4.29

NIC. METAL FINISHIN
M\l L\\@j r-.*1**'--**-1
1 11 IV
1977 1983 Levels of Abatement" 1977 1983

Billions of dollars/yr .5.38
TC*
Levels cumulative O&M Cos 10
70% increase
11 to IV

..X
3.12 3.17
...... 54% increase
ORGANIC 2.06 1 to 11
c
311% in rease
...... ......
CHEMICALS .....
I to 11

0.650
XXX
ETAL FINIS

I V
1977 1983 Levels of Abatement" 1977 1983

Costs in 1975 dollars. For industries as structured in Jan. 1973. Include costs for direct discharges and
-2
0 9 RN
RGA 1C.-

MET,

pretreatment for discharges to publicly owned works IPOTW s). Excludes depreciation, interest on capital
and user charges for discharges to POTW s.
Levels of abatement described in Figure 11 As.
Source: Nati. Commission on Water Quality from technology contractor reports
February 1976

11-97

Figure 11.4e
DESCRPTION OF LEVELS OF ABATEMENT FOR IN-DEPTH INDUSTRIES
SHOWN IN PRECEDING FIGURES 11.4a - 4d

Industry Level Description

IRON & STEEL I Equivalent to EPA's suggested technology for 1977.
!II Achieves EPA's BPT limitations
III Achieves EPA's BAT limitations; using more or less eleborate technology than suggested
by EPA, depending upon subcategory
PETROLEUM I Less than EPA's suggested technology for 1977
I IEquivalent to EPA's suggested technology for 1977
III Achieves EPA's BPT limitations
IV Equivalent to EPA's suggested technology for 1983
V Achieves EPA's BAT limitations
PULP & I Equivalent to EPA's suggested technology for 1977
PAPER 11 Achieves EPA's BPT limitations
III Intermediate technology between BPT and BAT
IV Achieves EPA's BAT limitations and is generally equivalent to EPA's suggested
technology for 1983
,TEXTILE I Achieves EPA's BPT limitations and is equivalent to EPA's suggested technology for 1977.
11 intermediate technology between BPT and BAT
III Achieves EPA's BAT limitations and is generally equivalent to EPA's suggested tech-
nology for 1983
IV A level more stringent that EPA's BAT.
CANNED & I Achieves EPA's BPT limitations and is equivalent to EPS's suggested technology for 1977.
PRESERVED 11 Intermediate technology between BPT and BAT
FRUITS & III Achieves EPA's BAT limitations and is generally equivalent to EPA's suggested technology
VEGETABLES for 1983
IV A level more stringent that EPA's BAT
INORGANIC I '' Achieves EPA's BPT limitations and is generally equivalent to EPA's suggested technology
CHEMICALS f r 1977
To
11 Achieves EPA's BAT limitations and is generally equivalent to EPA's suggested tech-
nology for 1983
PLASTICS'& I Generally equivalent to EPA's suggested technologies for 1977
SYNTHETICS, 11 Generally equivalent to EPA's suggested technologies for 1983
ORGANIC I Achieves BP A's BPT I ,imitations and is equivalent to technologies more or less
CHEMICALS elaborate than those suggested by EPA for 1977
11 Achieves EPA's BAT limitations and is equivalent to technologies more or less elaborate
I than those suggested by EPA for 1983
METAL 1 Equivalent to EPA's suggested technology for 1977
FINISHING 11 Achieves EPA's BPT limitations
III (Not shown) Alternative technology for 1983 which only approaches EDO for
entire industry. The alternative involves can siderable in-process changes for chemi-
cal recovery. (Estimation of aggregated costs was not possible).
IV Achieves EPA's BAT limitations, which correspondto EOD.

Source: Natl. Commission an Water Quality. Compiled from technology contractor reports to
the Commission.
February 1976

11-98

As discussed in Sections 3.b. and 3.d., Commission contractors
determined that technologies more extensive than those suggested by EPA
would be required to meet the assumed BPT limitations for the iron and
steel, pulp and paper, petroleum'refining, and metal finishing categories.
Figure 11-4 contrasts the costs of these higher levels with the costs of
installing EPA's suggested technology. The resulting increases in
capital costs are: iron and steel - 90 percent; pulp and paper - eight
percent; petroleum refining - 21 percent; metal finishing -48 percent.
In all cases but pulp and paper, these increases are major, and again
serve to illustrate the problem that may result if the EPA suggested
technologies are installed and the effluent limitations are not achieved.

Commission contractorsi assessments of the capabilities of technology
to achieve the BAT effluent limitations did not uncover many quantifiable
differences between EPA effluent limitations and suggested technologies
for 1983. Petroleum refining is the one case in which an alternative to
EPA's technology was identified and the costs assessed; Figure 11-4
shows a 14 percent capital increment in this case. Potential shortcomings
have been detected in several categories (c.f. page 11-75) , but lack of
data about the capabilities of BAT-level technologies precluded the
commission's contractors-from making definitive estimates of differences
in costs.

The average increase in capital costs in going from the technologies
suggested by EPA for 1977 to those suggested for 1983 is 102 percent.
This ranges from 36 percent for fruits and vegetables to 195 percent for
metal finishing. If the alternative levels judged necessary by Commision
contractors to actually achieve the assumed BPT and BAT limitations are
considered, the average capital increase is 75 percent, ranging from 30
percent for pulp and paper to 179 percent for plastics and synthetics.
In.the two cases where 1983 effluent limitations more stringent than
EPA's were considered, the capital costs increase is 23 percent for
fruits and vegetables and 42 percent for textiles.' In those cases where
1983 limitations less stringent than EPA's were considered, the range of
capital cost reductions (from EPA's BAT) is 9 percent for fruits and
vegetables to 14 percent for pulp and paper. With the. exception of-puip
and paper, the alternative technologies address the same pollutants as
the EPA effluent limitations. In the case of pulp and paper, Level III
achieves EPA's BAT limitations for all pollutants except color. The
$480 million increase in cost to achieve Level IV (EPA's BAT effluent
limitations) represents the incremental capital cost of controlling
color for this industry.*

*This cost assumes conventional end-of-pipe treatment would be used. As
discussed in Section 3.d., better strategies.involving in-plant changes
and/or product specification changes may be viable by 1983.

11-99

(3) Non-financial Resources

The non-financial resource emphasized in the Commission's technology
assessment was energy. others considered were land, labor (construction
and operation and maintenance), and chemicals. Chemical and labor
requirements from the technology studies are discussed in Chapter III,
Section G. The remainder of this'section focuses on the energy re-
sources that will be required to operate and maintain the abatement
systems that achieve EPA's BPT and BAT effluent limitations.,

All of the strategies for meeting the BPT effluent limitations con-
siderea in the Commission's industrial studies require increased energy
consumption. In plants using bi6treatment, the biggest share of the
increase is electrical ep* ' foi,mechanical air-water mixing (aeration).
gy
Physical-chemical systems use energy primarily for pumping and sludge
dewatering, and are usually legs'energy intensive than biological systems
using mechanical aeration. Some in-plant measures postulated for 1977
also consume energy in the form of fuel oil or natural gas. Table 11-33
shows the approximate fraction of on-site energy consumption for operating
BPT-level water pollution abatement equipment supplied by electricity in
several industries. With.the exception of petroleum refining, with its
significant fossil-fuel demands for sour water stripping (c.f. page II-101),
electrical consumption predominates.

TABLE 11-33: Fraction of Energy for BPT-Level Water
Pollution.Abatement Supplied by Electricity

Fraction of Abatement Energy
Industrial Category Supplied by Electricity

Canned & P 'reserved Fruits & Vegetables 100%
.Inorganic Chemicals., 82%
Iron & Steel' 85%
Organic Chemicals 91%
Petroleum Refining 42%
Pulp & Paper 83%
Metal Finishing 77%

Source: National Commission on Water Quality, February 1976. Calculated
from data contained in contractor technology studies.

Upgrading abatement perfor .mance to the levels associated with 1983
again increases the electrical and fuel energy requirements for end-of-
pipe treatment, the fuel in most cases being used to evaporate con-
centrated wastewaters, or to "regenerate" activated carbon -- a heating
process'which drives off and oxidizes the organic matter once the carbon

II-100

has become saturated. Some in-plant changes, however, result in a
savings in the plant's overall energy consumption. The resulting dollar
savings have been credited against increases in abatement-related operation
and maintenance costs. These savings result primarily from a reduction
in the amount of aeration needed for end-of-pipe treatment (through re-
ductions in raw waste loads), and from savings in the amount of steam
needed in the manufacturing process itself. (See Table 11-29 for a
summary of these changes.) The approximate fractions of on-site energy
consumption for operating BAT level abatement-equipment supplied by
electricity are given in Table 11-34. In most cases, more fossil fuels
will be required relative to electricity for BAT than at the BPT level.

TABLE 11-34: Fraction of BAT-Level Water Pollution
Abatement Supplied by Electricity

Fraction of Abatement Energy
Industrial Category Supplied by Electricity

Canned & preserved Fruits & Vegetables 100%
Inorganic Chemicals 33%
Iron & Steel 56%
organic Chemicals 26%
Petroleum Refining 32%
Pulp & Paper 86%(l)-
Metal Finishing 23%

(1) oil savings due to in-plant changes not considered..

Source: National Commission on Water Quality, February 1976. Calculated
from data contained in contractor technology studies.

Table 11-35 lists aggregated fuel oil, electrical and total energy
requirements for achieving the assumed pretrelatment, BPT, and BAT
effluent limitations.* Note the significant oil savings at level BAT
for pulp and paper. As mentioned previously, the savings potential of
the in-plant changes postulated by the Commission's contractor for this
study are speculative, but major opportunities for abatement through in-
plant change do exist for this industry, and some of these changes will
reduce operating.costs.

*Natural gas would be used in place of fuel oil in some situations.
Energy and steam requirements were first calculated, then converted to
barrels of fuel oil energy equivalents, assuming 5.8 million BTU or
5,000 pounds of steam per barrel.

Table 11-35 Aggregate Energy Requirements to Meet Pretreatment , BPT and BAT Ef fluent Limitations Promulgated
or Under Consideration by EPA.

(Industry as Configured in 1973)

Energy to Meet Pretreatment and BPT Limitations (4) Additional Energy to Meet BAT Limitations

Industry Electrical Fuel Oil Total(l) Electrical Fuel Oil Total
Category (million kwh/yr) (th@usand:bl/yr) (trillion Btu/yr (million kwh./yr) (thousand bl/yr) (trillion Btu/yr)

Canned & Preserved
Fruits & Vegetables 138 negligible 1.41 61 negligible 0.625

Inorganic Chemicals 492 r2j 5.75, 289 2,040 14.8

Iron & Steel 400 61' 4.45 680' 1,060 13.1

Metal Finishing 3,200 1,700 42.6 2,400 14,310 108.0

organic Chemicals 8,952 255 93.1 7,'4b5 32,000 26.1.0

Petroleum Refining 8,406 7,439 129.0 0 5,944 34.5
0
Plastics & Synthetics 167 negligible 1. 71 146 negligible 1.49
(2) (2)
Pulp & Paper 1,072 12.4 470 -6,257 -31.5

Textiles 669 negligible 6.85 154 negligible 1.58

All Other (3) 79.0 41.5
Grand Total-All Manufacturing 376 445

(1) Electrical energy converted to primary energy Btus assuming 33 ,%generating efficiency.
(2) A net savings see text, page 11-77.
(3) Based upon ratio of total O&M costs Ifrom "general" categories to those from the in-depth studies (cf. Table 11-29: Steam
electric and feedlots excluded from in-depth'figure).
(4) Not including requirements of abatement systems in place as of the base year (1973).

Source: National Commission on Water Quality, February 1976. Based upon data contained in contractor technology reports.

11-102

All industries studied in depth are shown separately, with the ex-
ception of steam electric power. 'The rest are lumped together in the
"All Other" category. The values shown for the "All other" category are
only rough estimates.* 'The energy penalty" associated with thermal
"i'
controls for the steam electr c industry cannot be expressed in terms
comparable with manufacturing industries as configured in 1:973 for two
reasons. First, the thermal limi ,tations do not apply to the bulk of the
generating capacity in existence'ift 1973, and second, the changes in
fuel consumed per unit of electrical energy produced depend intimately
upon the assumed mix of types of generation (fossil fuel, nuclear, com-
bustion turbine, hydro-electric) in each.utility system. The steam
electric industry is discussed separately'at the end of this section.

The total U.S. energy consumption in 1973 was 75 quadrillion BTU.
The.increase in total annual energy consumption by water pollution
abatement activities in manufacturing, after upgrading to meet the 1977
effluent limitations, is 0.5 percent of the national rate of consumption
in 1973. The total increase after upgrading to meet the 1983 effluent
limitations is 1.1 percent of the 1973 national rate,

Table 11-36 relates the increases in energy requirements to the
total energy purchased by selected industries.** For several industries,
increases are-significantly higher than national values of 0.5 and 1.1
percent given above, while for iron and steel -- one of the major energy-
consuming industries in the nation -- the relative increase is much
smaller.,

The organic chemicals category stands out as requiring the largest
increase. The 21 percent shown for BAT is particularly startling.
Substantial energy increases were projected for this industry due to the
high levels of COD which must be removed by 1983, and the correspondingly
large amounts of activated carbon requiring regeneration. The magnitude
of'the increase shown here is open to question, however, because little
data on operating carbon systems of the required type are available.
The contractor for this study based energy estimates on the only known
full-scale system for.which data were available. The results were
substantially higher than the energy Iuse suggested in an EPA technical
bulletin.*** Whatever*-increase is predicted by hypothetical designs at
this time, it is probable that in-plant changes not anticipated in the

Based upon multiplying the total energy requirement for the in-depth
industries by the,iatio of O&M costs for pollution abatement for the
!'general" cqtegori6s to that for the in-depth categories.

Selection was made on the basis of data availability.

***EPA Technology Transfer, Process Design Manual for Carbon Adsorption,
October 1973.

Table 11-36: Energy Requirements for Water.Pollution Abatement as Fractions of Total Energy Purchased in 1973
(industries as Configured in 1973)

Energy to meet
pretreatment and Total Energy to meet Total Fuels & Electrical BPT divided by BAT divided by
Industry Category & BPT Limitations(4) BAT Limitations(6) Energy Purchased in 1973 1973 total 1973 total
Subcategory(l) (trillion Btu@Yr); (trillion Btu/yr.) (trillion Btu)(2)
Canned & Preserved Fruits
& Vegetables:

SIC 2033 - Canned 0.75 0.95 61.0 1.2% 1.6%
SIC 2037 - Frozen 0.40 0.63 63.2 0.6% 1.0%

Inorganic Chemicals: 4.36 19.20 1,725 0.3% 1.1%
(less SIC 2816 - Inorganic
Pigments)
Iron & Steel 4.45 17.60 3,837(5) 0.1% 0.5%

Organic Chemicals 93.10 354-00 1,677 5.6% 21%
Petroleum Refining 129.00 163.50 3,104(5) 4.1% 5.3%

Plastics & Synthetics 1.71 3.20 295 0.6% .1. 1%

.Pulp &.Paper 12.40 1,466 0.8% -1.303)

(1) Only those categories and-subcategories for which total energy data are available-are shown.
(2) Electrical consumption converted to Btus assuming 33% generating efficiency.
(3) A net savings - see text, page 11-77.
(4) Not including requirements of abatement systems in place as of the base year (1973).
(5) Values for these categories include energy from raw materials, as-well as purchased energy.
This "captive consumption" is also important in the chemicals and pulp-and paper categories, but relevent
data were not available.
(6) Includes energy to meet pretreatment and BPT-limitations,
Source: National Commission on Water Quality, February 1976, and_Energy Cons!Mtion in Manufacturing, Conference
Board, Ballinger, 1974.

11-104

Commission's studies will be used to reduce the amount of COD to be
treated and, therefore, the carbon demands.

AS indicated in the tables, the energy requirements shown for
meeting the BPT limitations do not take into account the energy necessary
to operate the abatement systems already in place in the base years,
1973. When this is included, the energy required for abatement can be a
significant portion of a plant's total energy needs, as illustrated for
.a few industries in Table 11-37, using data on electrical energy consumption.

It should be remembered that the technologies used for these
calculations were developed during a period of relatively cheap energy.
Recent dramatic increases in energy costs (relative to other factors of
production) will encourage use of less energy intensive alternatives.
For example, more emphasis may be placed in anaerobic biotreatment,
which circumvents the large energy demands of mechanical-aeration. As a
result of this, the.extreme cases shown in Table 11-37, organic chemicals
and petroleum refining, are probably unrealistic. However, there is
little doubt that the effluent limitations will have a substantial
impact on some industries' power bills.

There is an increase in fuel consumption associated with imposing
evaporative cooling towers upon steam electric generating units which
are either currently using, or had been'designed to use, once-through
cooling systems. Both the thermal efficiency and the generating capacity
are reduced slightly (1.5 percent to 2.5 percent). The net increAse in
fuel consumption is difficult to calculate, however, because the genera-
ting efficiency of all other units feeding the same distribution system
("grid") must be taken into account. (These may be needed to compensate
for the lost capacity and to supply the unit's share of the load should
it have to be taken out of service during retrofitting.) Because the
characteristics of the entire utility system, and not-just those of the
individual generating unit must be considered, the calculation of a net
energy penalty@for the industry 'cis a whole is.complicated and depends
upon a large number of speculative assumptions.* A simplified approach
which takes into account the change in thermal efficiency, but which
assumes all units'on the affected grids to have the same thermal efficiency,
was used.

Two of several "scenarios" considered in the Cormission's study of
this industry were used to establish the limits on the energy require-
ments. The first assumes rather high exemption rates (about 80 percent
affected capacity) due to Sec. 316(a) of the Act, projected strictl

*This distinguished this industry from all others studied. Individual
plants were not treated as isolated entities, but as components of
multi-unit systems. This complicates the estimation of aggregate
costs, whether they be financial or energy.

TABLE 11-37: Total Electrical Energy For Water Pollution Abatement
(Industries as Configured in 1973)

Total Electrical Energy Total Electrical Energy BPT Divided BAT Divided
to meet Pretreatment and to meet Total Electrical Energy by by
Category BPT Limitations (million kwh/Yr(l) BAT Limitations (million kwh/yr(2) Consumed in 1973 (billion kwh) 1973 Total 1973 Total

Canned & Preserved
Fruits & Vegetables:

SIC 2033 - Canned 90 109 1.0 8.9% 10.8%
SIC 2037 - Frozen- 48 71 2.7 1.8% 2.6%

Inorganic Chemicals: 929 1,215 98.6 0.9% 1.2%
(less SIC 2816
Inorganic Pigments)

Iron & Steel 2,160 2,780 43.0 4.9% 6.5%

Organic Chemicals 11,940 19,300 24.9 48% 78%

Petroleum Refining 14,270 14,270(3) 25.5 56% 56%(3)

Pulp and Paper 2,121 2,591 30.3 7.0% 8.6%

(1) Including that to power systems in place as.of the base year (197j)
(2) Including BPT requirements.
(3) Electricalenergy increment is negligible.

Source: National Commission on Water Quality, February 1976. Based upon data contained in contractor technology reports, plus Energy Consumption in
Manufacturing, Ballinger, 1974.

11-106

on the basis of ecological criteri@, and.neglects any additional imposi-
tion of thermal controls to enfor6ez state water 4uality'standards.* The
second, which provides the upper limit, assumes a reduced number of
316(a) exemptions (half those of the first scenario) and imposition of
cooling towers for all other units wifh 25 megawatts or,more capacity
that would,otherwis'e-have been.using 6nce-through.pooling. (Refer to
Section 4.c. for more discussion of these scenarios.) 'Results-from the
Commission"s analysis of these t,@6 cases are summarized in Table II--@38,
which compares the operating energy increase due to EPA's promulgated
thermal-limitations in 1983 with-that estimated-previously for the
manufacturing sector. The latter vaiu6'is'taken to be 1074 trillion
Btu, which projects the total given in Table 11-35 for industry as
configured in 1973 to 1983, according to'the projected change in real
GNP*over that decade provided by the Economics and Sodial Impacts section
of the Commi@ssion's studies.**

.c
AS in the case of the thermal conir6l@ osts (Section 4.c.), the
range.is great. The actual value will certainly be greater than four
percent and less than 27 percent, but,the uncertainty will not be re-
solved until the procedures for obtaining exempt-ions from thermal limi-
tations under Sec. 316(a) of the Act are clarified and until the pattern
of state-level enforcement becomes established.

f. Best Available Demonstrated Control Technology (BADT)

The Act stipulates that effluent limitations, called New Source
Performance Standards,(NSPS),'be issued for plants wh6se construction
comifiences'after the date of their, publication, and which are consistent
with application of "best available demonstrated control technology"
(BADT). The NSPS are more stringent than the BPT limitations in most
cases, and will have a major impict on abatement expenditures for new
plants.

Because the NSPS are'ai3 stringent as EPA's' BAT limitations for
Several industries, many of the.,questions About technological feasibility
discussed in that context (Section 3.d.) Also apply to these limitations.
However, new plants generally have more options for abatement than old,
and this will mitigate the difficulty of satisfying the NSPS in most
cases: BPT-type treatment may bven be sufficient if the waste load can
be reduced substantially below that typical of older plants. Industries
covered by the Commission's in-depth studies for which particular concern
about the feasibility of the NSPS has sukfaced are:

Refer to Section 4.c. for an explanation of the Sec. 306(a) exemption
procedure, and page 11-109 for a discussion of the importance of state
standards to this industry-
**The date of enforcement for the thermal limitations is actually 1981,
but the-installation of towers will proceed throughout the decade.
The late date (1983) is used here to be consistent with the 1983
deadline for achieving the BAT limitations applied to manufacturing.

Table II-@8: Energy consumption due to Thermal Effluent Limitations for the Steam Electric Power Industry

Energy,for Thermal Limitations
Estimated Electrical Approximate Energy as Fraction.of Energy for'
Capacity Affected by Consumption for Meeting Pretreatment and BAT Limitations
Thermal-Limitatidns Thermal Limitations in in Manufacturing Sector in
Scenario(l) as of 1983 (MW)(2j
1983 (trillion Btll)(3) 1983(4)

1. Low Coverage Fossil fueled: 24,487 Fossil fueled: 2.7.0

Nuclear fueled: 14,511 Nuciea*'r fueled:- 17.6

Total '38,998 Tota1 44.6 4.2%

2. High Coverage, Fossil fueled: 201F956 Fossil fueled: 223.0

Nuclear fueled: 58,095 Nuclear fueled: 70.6 0

Total 260,051 Total 293.6 27%,

(1) See text, page 11-104.
(2) Electric megawatts of generating'dapacity.-
(3) Assumes 32%:and 38% thermal efficiency and 0.65 and'iO.70 annual capa
city factors for nuclear and fossil units
using one-through cooling, respectively, and a 2% increase in heat rate due to use of cooling towers.
(4) Value for manufacturing sector projected from 822 trillion Btu/yr (Table II@35) to 1074 trillion Btu/yr in 1983.

Source: National Commission on Water Quality, February 1976.

11-108

0 Iron and steel -- the NSPS are identical to the promulgated
BAT limitations, and the required technology is yet to be
proven in this industry. The ammonia limits appear to be
particularly difficult to achieve.

0 Pulp and Paper -- The requirement for color removal in new
(but not existing) pulping mills should be reviewed to verify
that the required technology exists today, and is reliable and
economically achievable. In addition, unproven filtration
techniques may be necessary for some mills to achieve stipulated
TSS levels.

Aggregate expenditures needed to install BADT cannot be quantified
without predicting future industrial growth, an exercise beyond the
scope of the technology assessment studies. Plant-level expenditures
are also difficult to estimate because new plants are expected to in-
corporate a variety of innovations that affect waste loads as well as
production costs, and assigning some portion of the costs of those inno-
vations to pollution abatement is often.difficult, if not arbitrary.
The Commission's technology studies focused upon the technological
feasibility of achieving the NSPS. with costs discussed only qualitatively.

4. Special Issues

a. Discharge to Water Quality Limited Waters

Where state water pollution control authorities judge that achieving
the technology-based point source effluent limitations will not clean up
,the waters sufficiently to meet state water quality standards, those
waters are designated "water quality limited" (WQL), and more stringent
limitations may be imposed. The number of industrial dischargers that
will be affected by these designations is unknown, but certainly signi-
ficant in many regions where industry-is concentrated. The Commission
was unable to quantify the impact of WQL designations for the following
reasons:

0 The limitations are derived by analyses that take into account
the nature of the receiving waters and therefore are unique to
each location.

0 Data on the number and location of plants issued WQL permits
to date either have not been collected or are so fragmentary
as to be unrepresentative.

0 Waters designated water quality limited are subject to periodic
revision according to criteria that are not uniform among the
states.

11-109

Limitations applied to a source discharging into WQL waters are
typically more stringent than the technology-based limitations for 1977
in one or more of the.following ways: 1) pollutants subject to the
technology-based limitations may be restricted more severely; 2) additional
pollutants may be controlled; 3) fl may be controlled -- the allowable
r1ow
rate may be adjusted seasonally, and discharge may even be prohibited
during periods of low receiving water flow.

For those cases which fall mainly,under category 1) above, the
assumption that BAT level technology (as defined by EPA) will be required
by 1977 gives a reasonable,estimate of the increased expenditures
associated with meeting WQL requirements. Unfortunately, this assumption
alone does not imply the aggregate increase in-expenditures because the
number of plants affected is unknown in.most categories.

Petroleum refining is the one exception. The Commission's contractor
surveyed all available permits issued in this industry, and estimated
that, as of 1974, there were 174 refineries discharging to surface
waters in the 50 states, 68 of which -- representing 47 percent of the
industry capacity -- were discharging into WQL waters. Assuming that
application of EPA's BAT technology by 1977 will be required in those
cases implies a 28 percent increase in aggregate capital expenditures
above that considered in our study to be necessary to meet'the BPT
limitations.; Whether this fractional increase is typical of other
industries is,not known.

state water quality standards can impact the steam electric power
industry in.a unique way.. The national limitations for heat discharged
by this industry do not become effective until 1981, and all generating
units placed into service before 1970 and those of less than 500 megawatt
capacity placed into service before 1974 ("old units")'are exempted'by
EPA from any thermal limitations. Some of these exempt plants are being.
required to install evaporative cooling towers or other heat abatement
-devices:by July 1, 1977, in order to comply with state water quality
standards. Data supplied by the private,electric utility industry in-
dicates that-there were 3,036 generating units with a combined capacity
equal to approximately 75 percent.of the total steam,electric generating
capacity in 1973 which fall within the "old unit" subcategory. A recent
survey by the industry found that generating units'representing 63
percent of the 28 percent of the "old unit" capacity covered by-the
survey were being subjected to some form of thermal regulation due to
state water quality standards. Not all of these situations will involve
the elimination of heat discharges called for in EPA's limitations, and
the applicability of this particular sample to the industry as a whole
has not been assessed. It does appear that.a significant number of
units that are exempt from EPA's thermal limitations will be forced to
retrofit cooling towers, azid the costs may be substantial for some

II-110

utility systems. In addition to cost, a more*fundamental constraint is
the time required to construct cooling towers. The Commission's study
of this industry,.indicates that even under ideal conditions, a minimum
of three years will be required to@retrofit a large generating plant
with such a system. (See Section 4.c. for further discussion of this
industry.)

b. Toxic Effluent Standards

The Environmental Protection Agency's "Proposed Toxic Pollutant
Effluent Standards" were published in the Federal Register December 27,
1973(16). The standards proposed limits on the discharge of the following
materials considered by EPA to qualify for initial treatment under Sec.
307(a) of the Act: the pesticides aldrin, dieldrin, DDT, (and DDE,
DDD), endrin and toxaphene, the compounds PCB, benzidine and cyanide,
and the heavy metals cadmium and mercury. Final standards have not been
promulgated, and the Agency apparently has vacillated widely in its
approach to defining them. Because of this uncertainty, little quantita-
tive analysis was completed by the Commission. However, some attention
was directed to the capabilities of existing technology to control the
relevant toxic materials. Table 11-39 summarizes the Commission's
tentative conclusions in this. regard.

In the case of metal finishing, iron and steel, and inorganic
chemicals, there is overlap among the proposed toxics standards and the
BPT, BAT, and BADT (new source) limitations. However, the proposed
toxics standards are given in concentrations, whereas the non-toxics
limitations are usually expressed as pounds discharged per unit of
product produced. These two approaches can conflict. A@i example is
iron and steel, where cyanide is limited in both the promulgated BPT
limitations and in the proposed toxics standards. This substance is
discharged by a blast-furnace complex, using generally accepted controls,
in concentrations of about two milligrams per lit@r with a flow 6f about
2,500 gallons per ton of "pig iron" produced -- giving a mass discharge
rate of 0.04 pounds of cyanide per ton of product.. The@'contract6r'for
the iron and steel study estimates the level of technblogy that 'would be
used to meet EPA's BPT limitations would reduce the discharge flow to
125 gallons per ton of product, with a cyanide concentration of 15
milligrams per liter -- 7.5 times the "baseline" level. However, the
mass of cyanide discharged at this new level would be 0.015 pounds per
ton, or about one-third the baseline level. Since the toxic limitations
have yet to be promulgated, and many industries are well on their way to
meeting the BPT limitations, potential conflicts in abatement strategies
may exist if the final toxics standards are derived without . considering
the mass discharge rates implied by the corresponding.5PT and BADT
limitations.

TABLE 11-39: Tentative Conclusions Regarding Capabilities of Technology
to Meet the Proposed Toxic Pollutant Effluent Standards(16)

Constituent
Industrial Category to Be Limited Comments

Inorganic Chemicals Cadmium Control with BPT-type of technology appears feasible in most
Mercury cases.

Iron and Steel Cadmium Technology capable of removal to specified concentrations
Cyanide only at pilot plant stage.
Mercury

Metal Finishing Cadmium Control part of BPT technology, but specified concentrations
Cyanide may be very difficult to achieve.

Organic Chemicals Benzidine Control of metals and cyanide with BPT-type technology appears
feasible in most cases. Feasibility of pesticide manufac-
Cadmium turers meeting the limitations was not studied.
Cyanide
Mercury
Pesticides
PCB

Petroleum Refining Cadmium Cadmium can probably be controlled to, specified level, but
Cyanide entire wastewater flow would have to be treated. Waste
streams containing cyanide can be segregated and treated
using proven technology, but specified cyanide concentrations
may be impossible,to achieve in cases where wastewater flow
is large compared to receiving water flow.

Pulp and Paper Mercury Reduction to required level not feasible with known technology
in cases where wastewater flow is large compared to receiving
water flow.

Textiles Benzidine Seldom used: Feasibility of meeting limitations was not studied.

Source: National Commission on Water Quality, February 1976. Based upon material contained in technology
contractor reports.

11-112

A second major difference between the proposed toxics standards and
the technology-based limitations is that the allowable discharge con-
centrations depend upon the dilution potential of the receiving waters.
In the case of cyanide, for example, the allowable concentration for
discharge to flowing waters is reduced by a factor of 10 when the receiving
water's flow rate is less than 10 times the waste stream flow. As Table
11-39 indicates, the extremely low concentrations that result will be
impossible to achieve with proven technology in many cases, without in-
plant dilution with clean water.

.Neither of the toxic materials listed in Table 11-39 for petroleum
refining are controlled by the promulgated BPT, BAT or BADT limitations.
Costs for controlling these materials to the levels specified in the
proposed toxics standards have been estimated and illustrate the ex-
pected magnitude of the "add-on" effect of toxics control for one major
industrial sector. Control of toxics to the levels defined for the
"high receiving water flow" case would add approximately 16 percent to
the capital cost of water pollution abatement needed by 1977, and about.
23 percent to the annual operation and maintenance costs.*

C. Thermal Limitations

All industrial processes release heat-to the surrounding air and
water. Heat discharges to surface waters are primarily from the use oi
intake waters-specifically for cooling, including condenser cooling for
steam electric power generation. Table 11-40 gives 1968 cooling water
usage by selected industries. The steam electric power industry dominates:
about 80 percent of the total water used for industrial cooling purposes
in 1968 was used for generating electric power for resale, 6 percent was
used for power generation at the plant site ("captive power"), and 14
percent for all other industrial purposes(22). EPA has indicated its
intention to issue limitations for heat discharged from captive power
generation, but has not done so to date. The potential impacts of such
limitations were not studied by the Commission.

The thermal effluent limitations promulgated for the steam electric
power industry are summarized in'Table 11-41. These differ from those
promulgated for most other industries in three important ways:

0 There is no BPT-BAT differentiation. There is only one set of
thermal limitations for existing units, to be achieved by
July 1, 1981.

*These percentages apply to total investment, including that in place
in the base year (1973).

TABLE 11-40: Cooling Water Used by Selected Industries
(Billions of Gallons Used in 1968)@

Air "Steam-Electric Other Total Use Use for Cooling
SIC No. Industry Category Conditioning Power Generation Cooling (Including Process Waters) as % of Total

2621 Paper Mills, except Building
Paper 8 248 97 .1,194 30%

2631 Paperboard Mills 8 141 107 722 15%

281 Industrial inorganic Chemicals 30 613 2,075 3,368 65%

282 Plastics and Synthetics 56 61 372 635 59%

2911 Petroleum Refining 3 167 1,056 1,427 74%

331 Blast Furnace, Basic Steel
Products 25 1,147 2,046 4,392 47%

4911 Steam Electric Power neg. 40,000 neg. 40,000 99%

*Water use as measured by intake. (Reuse or recirculation not included.)
Source: Data from 1967 Census of Manufacturers: Water Use in Manufacturing (Bureau of Census, 1971),
as reproduced in The Economics of CleamWater 1973. U.S. Environmental Protection Agency, December. 1973.
(Data for 1973 not available.)

Table II-41: Summary of EPA's Promulgated Effluent Limitations on Heat Discharged by Steam
Electric Generating Units*

All "no discharge" limitations allow for blowdown to be discharged temperature not to exceed cold-
side (after cooling) temperature, except where unit has existing closed-cycle cooling, blowdown may
exceed the cold-side temperature. All limitations for existing units to be achieved by no later
than July 1, 1981, except where system reliability would be seriously impacted, the compliance
date can be extended to no later than July 1, 1983.

EXISTING GENERATING UNITS

Capacity 500 Mw and greater
Placed into service prior to January 1, 1970. NO LIMITATION
Placed into service January 1, 1970 or thereafter NO DISCHARGE**

Capacity 25 Mw to 499 Mw
Placed into service prior to January 1, 1974 NO LIMITATION
Placed into service January 1, 1974 or thereafter NO DISCHARGE**

Capacity less than 25 Mw NO LIMITATION

** Exceptions prescribed on a case-by-case basis-for units in systems of less than 150 Mw
capacity, units with cooling ponds or cooling lakes, units without sufficient land avail-
able, units with blowdown TDS 30,000 mg/1 or greater and neighboring land within 500 ft
of cooling tower(s), and units where FAA finds a hazard to commercial aviation would exist.

NEW SOURCES NO DISCHARGE

*No effluent limitations on heat from sources other than main condenser cooling water.

Source: Development Document for EffluentLimitations Guidelines and New Source Performance
Standards for the Steam Electric Power Generating Point Source Category, EPA 440/1-74029-a,
October 1974, page 5.

� The bulk of the industry's steam electric generating capacity
as of January 1973 -- approximately 75 percent -- is exempt
from the-limitations by age and/or size criteria.*

� Sec. 316(a) of the Act allows for additional variance from the
limitations for new and existing units not otherwise exempt if
the discharger ". . . can demonstrate to the satisfaction of
the,Administrator (or, if appropriate, the state) that any
effluent limitation . . . for control of the thermal component
@,Will riqdiie effluent limitations more stringent than
necessary to assure the protection and propagation of a balanced,
indigenous population of shellfish, fish, and wildlife in and
on'that body of water" into which the discharge is to be
made.*%i

Despite the large part of the industry exempt because of size and
age criteria,-th6 thermal limitations.may require retrofitting heat
abatement measures (normally evaporative cooling towers) onto,a sub-
stantial number of plants. The final number of iequired retrofits will
depend critically upon the number of variances granted under Sec. 316(a),
another area of controversy. The rules for demonstrating "protection
and propagaiibn of a.balanced, indigenous population" of aquatic life
have yet-to be standardized, and too few 316(a) appeals.have been com-
pletbd to date to make an unequivocal prediction of the,impact of this
clause on the industry's eventual thermal abatement costs.

,The predominant technology in this industry for eliminating heat
discharges to surface water is recirculating cooling systems employing
natural or mechanical-draft cooling towers. These "closed-cycle" systems
have been used primarily in water-scArce areas where the reduction in
intake requirements by recirculating the cooling water has been an

Generating plants have from one to.ten generaiing units, each with its
own source of steam (boiler) and.turbinb generator. The limitations
are applied to individual units. As of January.1973, there were
approximately l,bOO steam electric plants with 1,000 generating units.

**"Newll,unit.pi are those whose construction began after March 4, 1974.
Another relevant section is 316(b) which requires that "cooling water
intake structures reflect the best technology available for minimizing
adverse environmental impact." Rotential intake effects were con- .
sidered together with heating effectA inprojecting probable exemptions
from the thermal. limitations in the Comission's analysis.

11-116.

advantage.* Projected additions to capacity imply increased use of
.---closed-cycle systems, partially because of the requirements of the Act,
and partially because of the increasing scarcity of suitable plant sites
with water supplies sufficient to support once-through ("6pen cycle")
cooling for modern, large capacity (800-1,200 megawatt) units.

Table 11-42 summarizes themost common types of condenser cooling
systems in place at commercial steam electric power generating plants as
of January 1973. Cooling towers are prevalent only in water-scarce
regions., "Impoundments" refer to man-made reservoirs or ponds. Once-
through cooling is predominant in these cases, and the impoundments are
often built by the electric utility for the specific purpose of sustaining
an adequate cooling water supply. EPA's thermal limitations exempt
plants using or in the process of constructing such cooling impoundments
as of the date of promulgation of the limitations (October 8, 1974).
New plants using "ponds", impoundments which do not impede navigable
waters, are also exempt from the no discharge of heat requirement.
(These exemptions are particularly important for the state of Texas,
since 46 percent of the installed capacity in that state used once-
through systems with cooling impoundments in 1972.)

Technologies other than evaporative cooling towers exist for thermal,
pollution abatement. Alternatives considered by the Commission include@
dry cooling towers, which release heat primarily by radiation to the
air; hybrid wet-dry towers; spray systems, which cool by evaporation but
do not require large towers; and "integrated" thermal systems in which
the-heated condenser water and/or a fraction of low pressure turbine
exhaust bteam would be delivered to near-by industrial facilikties and
residences for space heating and cooling. All of these systems have
been applied successfully in pilot studies and other special situations.

Although alternatives to evaporative cooling towers can be expected
to-play an important role in the long-term future of the industry, the
Commission concludes that they will have a minor impact on the industry's
thermal abatement strategies in the 1975-1985 decade. This conclusion
coincides with EPA's assessment. Commission studies have not revealed
any major points of disagreement with EPA regarding the capability or
cost of thermal abatement technology.** However, some aggregate thermal

The reduction in intake water requirements between open and closed
cycle cooling depends upon meteorological conditions and the quality
of the intake water. For a "typical" 1,000 megawatts [email protected]
using relatively clean river water, a closed-cycle design.would require
2@to@5 p6rcent of the intake rate of a,once-through design.

**The same is not true for costs of chemical pollution abatement in this
industry. The Commission contractor estimates chemical costs to be 80
percent greater than those estima ted by EPA.

TABLE 11-42: Steam Electric Cooling Systems In-Piace as of January, 1 975

Region Percent of Generating Capacity Provided by Units using the Following Types of Cooling Systems:

Once Through-N.Vigable Waters Closed Cycle-Towers Impoundment-Mainly once Through Mixed
New England (1) 87.3% 0% 0% 12.7%
Middle Atlantic (2) 89.3% 8.916 0% 1.8%
EastNorth Central (3) 90.4% 0.8% 4.2% 4.6%
West North Central(4) 59.5% 16.1% ,8.5% 15.9%
South Atlantic(5) 79.3% 5.3% 3.4% 12.0%
East South Central(6) 79.9% 6.7% 096 13.4%
West South "Central(7) 26.596 27@8% 25.5% 20.2%

Mountain (8)
8.7% 54.2% 29.1% 8.0%
Pacific(9) 85.5% 14.5% .0% .0%
Non-Contiguous (10) 100% 0% 0% 0%

All 72.9% 11.2% 6.7% 9.2%

(1) Conn., Maine, Mass., New Hamp., R.I., Vermont (6) Ala., KY, Miss., Tenn.'
(2) New Jersey, N.Y.,,Penn. (7) Ark., LA, Ok., Texas,
(3) Ill, Indiana, Mich., Ohio, Wisc. (8) Arizona, Colo.F Id., MO, NevadaF New Mex., Utah, WYo
(4) Iowa, Kansas, Minn., Miss., Nebraska, N. Dakota, S. Dakota (9) Calif., Oregon, Wash.
(5) Del., D.C., Florida, Georgia, Md., N.C., SC., Va., W. VA. (10) Alaska, Hawaii, Puerto Rico; Virgin islands

Source: National Commission on Water Quality, February 1976. Compiled from Teknekron, Inc., Water Pollution Control Act of 1972: Technologies and
Economic Impacis, Steam Electric Power Industry. 1976.

11-118

abatement costs projected by the Commission contractor are considerably
lower than those estimated*by EPA. T his difference results from alter-
native projections of the number of exemptions to be granted under Sec.
316(a), and of the number of plants that will be forced to closed-cycle
cooling to meet state water quality standards. Estimates of aggregate
thermal pollution abatement costs for this industry are critically
dependent upon these tenuous projections, and the Commission contractor
studied the effects of altering them by analyzing a range of possibilities.

.A total of 21-alternative "scenarios" were analyzed in the Commission's
study of the Act's impact on this industry. These included.alternative
assumptions about the number of Sec.'316(a) exemptions and the number of
plants forced to closed-cycle cooling to meet state water quality standards,
as well as consideration of alternative age and size criteria for sub-
categorizing the industry.* Two of these establish bounds on the probable
impacts of the Act. Both use EPA's age and size criteria (cf. Table II-
41) to define the units affected. In the "low coverage" scenario, a
rather liberal number of exemptions is projected (about 80 percent of
affected capacity), and no additional units are assumed to be-affected
by state-level thermal standards. The "high coverage" scenario re 'duces
the generating capacity exempted by one-half, and further assumes state
water quality standards require all unexempted plants in excess of 25
megawatts capacity to install closed-cycle cooling. In all cases, no
thermal abatement costs were assigned to those units expected to require
closed-cycle cooling because of a lack.of adequate water for once-
through operation. Table 11-43 summarizes the aggregate thermal costs
associated with these two scenarios.** These totals were produced by a
simulation model which assumed an average growth in industry capacity --
the primary determinant of capital costs -- of 6 percent per year. The
model predicted a growth in sales -- the primary determinant of operation
and maintenance costs -- of.2.2 percent per year. The predicted growth
in sales is about half that,expected by the industry and the Federal
Energy Administration. Increasing the sales growth rate to 4.4 percent
.per year would increase the operation and maintenance costs by approxi-
mately 20 percent. (See Chapter III, Section D for a discussion of the
simulation model.) The wide range of possible costs dramatizes the
uncertainties inherent in determining the impacts of the limitations-at
this time.

Alternative financial assumptions were also investigated. (All esti-
mates of aggregate costs were derived in the economic impact phase of
this industry study.)

**An "intermediate" scenario considers no state-level enforcement but
the reduced number of Sec. 316(a) exemptions. Thermal abatement costs
by 1983 in this case are $3,450 million capital, $630 million/year O&M.

TABLE 11-43: Capital and Operation and Maintenance Costs for Thermal
Pollution Abatementin the Steam Electric Power Industry
(Industry Growth Included)

Estimated Electrical Capacity Capital Costs for Meeting O&M Costs for Meeting
Affected by Thermal Limitations Thermal Limitations, 1973-1983 Thermal Limitations in 1983
Scenario(1) as of 1983 (MW) (2) (millions of 1975 dollars) (millions of 1975 dollars/yr)(3)

1. Low Coverage 38,998 1,001(4) 277(5)

2. High Coverage 260,051 6,968(4) 897(5)

(1) See text, page II-118.

(2) Electrical megawatts of generating capacity.

(3) Includes costs due to energy penalties as well as direct operation and maintenance.

(4) Capital costs for achieving chemical limitations is estimated to be $4.78 billion in both cases.

(5) O&M costs or achieving chemical limitations is estimated to be $1.39 billion per
year in both cases.

Source: National Commission on Water Quality, February 1976. Compiled from Teknekron, Inc., Water Pollution
Control Act of 1972: Technologies and Economic Impacts, Steam ,Electric Power Industry. 1976.

11-120

total generating capacity affected by the thermal limitations
and not assumed to obtain exemption through Sec. 316(a) is also shown.
The amount of this capacity provided by once-through-plants presently
operating or under construction is 19,306 megawatts (50 percent of the
total affe 'cted) low coverage scenario, 191,088 (73 percent of the total
affected) under the high coverage scenario. Much of the controversy re-
garding the application of EPA's thermal limitations revolves around the
problems of retrofitting closed-cycle cooling systems to these plants.
Some of the engineering problems involved are discussed below.

Because of the uncertainties associated with the sec. 316(a) variance
procedure, focusing on aggregate thermal abatement costs tends to obscure
some important issues:

0 Long lead-times imply a high incidence of retrofit. Under
current conditions, it takes seven to ten years for nuclear,
and three to five years for fossil fuel plant design, con-
struction and testing before commercial operation can begin.
This implies that some degree of retrofit -- either construction
or design -- will be required of the majority of affected
once-through plants scheduled to begin operation during.the
coming decade. Conversion from a planned once-through system
may entail an engineering re-design, or a major construction
change while construction is in progress. Conversion of a
unit already in operation requires shut-down of the unit for
two to five months beyond that normally allotted for maintenance,
with attendent loss of capacity and reliability of the utility
system.

� Cooling towers are not "add-on" technology in the usual sense.
Plant design involves optimizing a complex, interactive system.
Unlike many manufacturing processes, the operation of each
major part of a steam electric unit is intimately connected to
qll others. Retrofitting requires major changes in the largest
system in the plant, the circulating water system, and cannot
be effected without reducing the operating efficiency and the
capacity of the thermal power cycle.

� There are potential conflicts in siting criteria. Power plant
sites should be carefully planned to optimize performance and
minimize costs. A choice site for once-through cooling may be
a poor or even unacceptable choice for a plant required to use
cooling towers. For example, the requirement that a plant
with a once-through cooling system be near a large water body
often conflicts with the requirement that a site for closed-
cycle cooling provide adequate foundation bedding for large

11-121

cooling tower structures. other conflicting criteria for
layout and,arraingement tend to increase the..@osts of switching
from once-4irough to clo.@ed-cycle cooling after a site has
been selected. The incremented capital costs associated with
using closed-cycle cooling for new sources are also highly
site dependent. One factor is source water quality: .once-
through systems can generally use water with.high4r dissolved
solids than can closed-cycle systems.

Table 11-44 summarizes the difference in plant-level capital and
operation and maintenance costs estimated for closed and open-cycle*
cooling designs at five candidate locations considered for'a' new nuclear
plant.* The table shows the,,incremental costs for new soukce thermal
abatement, as well as the effects of the potential siting_,cri@eria
conflicts. The least capital cost site for the closed-cypliB'de6ign
(site D) is not the same as for the once-through design (site A).
Differences in expenditures for transmission facilities and other factors
would also have to be taken into account in actual practice --these do
not normally vary with type of cooling system, however.

Another aspect of the use of evaporative cooling towers raised in
response to EPA's limitations is the increased consumption of water re-
sulting from their use. In California, for example, a 1,000 'megawatt
nuclear generating unit using a once-through condenser cooling system
will evaporate approximately 7,400 acre-feet of water,per year, whereas
the same unit, equipped with mechanical draft cooling towers, will
evaporate approximately 12,000,,acre-feet per year.** The aggregate
impact of this increased demand upon fresh water supplies is not signi-
ficant in most regions of the country, even projecting to the year 2000.
However,,the Commission has studied the potential impact in two water-
scarce states -- Texas and California. Table 11-45 estimates the increase
in fresh water consumption in California and Texas due to imposition of
cooling towers under the "high coverage" scenario, assuming that coastal
plants using once-through systems with ocean or bay waters either will
receive Sec. 316(a)- exemptions or.will employ salt water cooling towers.
.The first set of figures applies to actual electricity sales in 1972.
Thesecond set includes all additional units planned to begin operation
by January 1980. (Data for the year 1983.were not readily available.)

The viability of cooling towers,operatingwith ocean waters has
been a controversial aspec@ of EPA's definition of "best available"
technology for this industry.. No closed-cycle cooling systems are

This is actual data, taken from the environmental impact s tatement for
a proposed nuclear power plant (two units, total capacity of 2,300
megawatts) on Long Island, New York.

**11000 acre-feet per year is approximately one million gallons per
day (mgd).

II-12@

Table 11-44: Cost Comparison of Once-Through
and Closed-Cycle Cooling for Different Sites

Closed-Cycle Cooling System

Plant Operati'12)
Site Plant Capital4l) and Maintenance

A 286.3 3.78

B 337.6 3.73

C 293.6 3.70

D 277.4 3.70

E 283.3 3.78

Once-Through Circulating Water System

A 262.8 0.165

B 327.4 0.'069

C 323.0 Base

D 268.6 0.127

E 290.7 0.029

(1) Expenditures are in millions of 1981 present worth dollars.
(2) Millions of 1981 dollars per year in excess t6 that requirea for,once-
through cooling at site C ("Base").

Source: National Commission.on Water Quality, February 1976.' Compiled from
Teknekron, Inc., Water Pollution Control Act of 1974: Technologies and
Economic Impacts,, Steam Electric Power Industry, 1976. (Present-worth
values shown in reference annualized, assuming 30-year life and nine
percent interest rate.)

TABLE 11-45: Consumption of Fresh Water by Evaporative Cooling Towers, Steam Electric
Power Industry, Assuming No. Conversions from Saline to Fresh Water Systems

------------------1972 Steam Electric Capacity-------------------- --------------------1979 Steam Electric Capacity-------------------

Increase in Consumption in 1972 Projected Consumption by Steam Increase in Consumption in 1979
Actual Consumption by Steam Assuming Conversions to Cooling Electric Plants in 1979 in Assuming Conversions to Cooling
Electric Plants in 1972 Towers Absence of the Act Towers
State (acre- feet) (acre - feet)(l) (acre - feet)(2) (acre - feet)

California 20,900 1,470 52,000 1,470(3)

Texas 144,000 11,200 243,000 29,800

(1)Mechanical draft systems. Assumes Sec. 316(a) exemptions for once-through plants consistent with high coverage scenario (42 percent of once-through
capacity exempted in California; 36 percent in Texas Gulf region, 50 percent in remainder of Texas); exempts all once-through systems using man-made
lakes or ponds and operating by 1974 or earlier.
(2)Assumes cooling, mix planned by utilities before passage of the Act. Units on-line by 1973 assumed to continue to operate at historical capacity
factors. Units coming on line after January 1973 assumed to have a capacity factor of 0.7, 38 percent fossil thermal efficiency, 32 percent nuclear.
Neither these, nor the 1972 figures take account of the increase in natural evaporation from the building of ponds nor the rainfall captured by them.
(3)No new once-through systems using fresh water had been, planned for the 1973-1979 period.

Source: National Commission on Water Quality, February 1976.

11-124

currently operating with ocean water, although they have been operated
successfully with bay (brackish) water. Previous calculations of water
consumption sponsored by the utility industry assume that all plants
using ocean and bay waters would be forced to install cooling towers.and
convert to fresh water supplies.* Under the "high coverage" scenario,
if all unexempted coastal plants operating in California by 1980 con-
verted to fresh water, the steam electric industry's share of the fresh
water consumed in the state would increase from 52,000 acre-feet to
132,000 acre-feet. The corresponding increase in Texas would be from
243,000 acre-feet to 294,000 acre-feet.

Although some coastal plants may convert to fresh water, the
assumption that all once-through saline cooling systems will switch to
fresh water supplies certainly would overstate the fresh water demand.
Some installation of salt water towers, at least where brackish water is
used, can be expected, and the number of Sec. 316@a) exemptions projected
by the Commission's contractor for California coastal and Texas Gulf
plants amounted to 80 and 70 percent of installed capacity, respect-
ively. But even assuming the conversion to fresh water systems, and.the
reduced number of exemptions associated with the "high coverage" scenario,
the increase in fresh water consumption does not appear to be significant
in either California or Texas when the state as a whole is considered,
at least not by 1980. The significance of increased water consumption
in each particular locale depends upon present water rights held by the
electric utilities and the appropriative water rights downstream that
might be affected by increased consumption by an upstream user.

Large volumes of surface waters used for cooling can impact the
water environment by raising the temperature of the receiving waters, by
damaging aquatic organisms as they pass through the system ("entrainment"),
and by trapping the larger aquatic species on the screens covering the
intake structure ("impingement"). The environmental impact of these
effects is highly site specific. No attempt was made to quantify these
effects in the steam electric technology assessment beyond those involved
in the projection of possible Sec. 316(a) exemptions. (See Chapter IV,
Section 4.f. for a discussion of the projection technique.)

d. Residuals to Land and Air

Pollutants removed from wastewaters or converted to bacterial
matter during biotreatment must go somewhere. The ultimate disposal of

*These calculations also did not take into account exemptions for existing
plants using man-made lakes or ponds. (See "Comments on EPA's Proposed
Sec. 304 Guidelines and Sec. 306 Standards of Performance for Steam
Electric Power Plants," Edison Electric Institute et. al., vol.3,
Attachment !X, May 31, 1974.)

11-125

these "captured residuals," generally called "sludges,," will be a
growing problem as effluent qualities are upgraded. Sludges are thickened
slurrys.of concentrated pollutants, including any chemicals added during
physical-chemical treatment, or thickened solutions of nonbiodegradable
pollutants plus bacterial matter generated during biological treatment,
or solid matter (dried sludges). of the commonly used biological treat-
ment schemes, activated sludge systems generally produce the most sludge,
per pound of BOD removed. 'Additional residuals include flotation skimmings,
filter backwashes and incinerator ashes.

Different types of residuals produced by advanced treatment systems
may pose particularly difficult disposal problems. Many of these
residuals,are soluble, inorganic salts, and their ultimate disposal may
be the most critical intermedi a issue associated with achieving very
high levels of treatment'. Because salts readily dissolve in water,
their disposal on land may lead to serious problems of groundwater
contamination and surface runoff to natural waterways unless proper
precautions are taken. Ocean disposal would appear to be the minimum
impact disposal strategy for some of these salts, but that option is not
available to many industrial dischargers. The energy requirements for
removing these salts will be high compared to conventional treatment.
This will indirectly increase air pollution or nuclear waste generation,
depending upon the source of the electrical energy.

By far the most common ultimate sludge disposal option is land-
filling. The effort required to insure that the sludges do not have an
adverse environmental impact depends upon their composition. Generally,
the more constituents in the plant's wastewater, the greater the pro-
bability that the sludges will contain potentially toxic or otherwise
undesirable materials -- including inorganic salts -- which must be kept-
from leaching into surface or ground waters. Sludges from chemical
plants, for example, often require a landfill underlain by a layer of
impervious clay,.with leachate collection and even treatment. Sludges
from food processors, on the other hand, often can be sprayed directly
onto cropland if sufficiently dilute, or plowed directly into the soil.
if in cake (solid) form.

When suitable land is not available for land disposal, or trans-
portation costs are high, sludges may have to be incinerated. This
option has the advantages of eliminating odors (if properly controlled),
independence from the weather, and great reduction in volume and weight.
Supplemental fuel may be required if the sludge heat value is low, and
measures must be taken to reduce potential air pollutants to levels re-
quired by air pollution regulations. In most cases, the remaining ash
is chemically inert and, except when the soluble salt content is signi-
ficant, relatively easy to dispose of.

11-126

The way in which sludge production increases with,the level of
water pollution abatement is illustrated in Figure 11-5, which shows
solid waste production as a function of abatement level for a petroleum
refinery using activated sludge biotreatment.

A large quantity of "oily solids" sludge is generated at the first
treatment step. The value shown at the "primary de-oiling" level is
that which is normally removed from the wastewaters before discharge as
part of a product recovery step. Additional biological sludges from the
activated sludge process are added at Level 1. Level III involves in-
plant changes to reduce water use, and has no effect upon sludge production.
Advanced treatment for partial effluent desalting and recycle is employed'
at Level V, and the great increase in sludge mass is due to extraction
of the inorganic salts. Complete desalting and recycle is effected at
the last level, with a doubling of the inorganic salts contribution.

At present, most sludges have little or no economic value. oils
are routinely recovered from refinery wastewaters prior to' treatment,
but none of the oily solids referred to in Figure 11-5 presently have
market value. Settled solids from fruit and vegetable processes have
been used successfully in animal feeds, but use of "secondary" solids
the biomass produced in biological treatment systems -- is only at the
experimental stage. options exist for using sludge for fuel (usually'
mixed with other combustibles), and even for making into products.
Sludge from pulping wastewaters can be used in making some types of low-
grade paper products, such as boxboard. Hopefully, additional uses for
captured residuals will be found in the future.

e. Uniformity

The "uniformity" of the BPT and BAT effluent limitations is some-
times questioned. There are several definitions of uniformity that can
be applied. Uniformity can refer to types of technologies, to con-
celitrations of pollutants in the treated effluent, to required percentage
removals of the pollutants, or to measures of economic burden.* Data
have been collected in the technology studies which relate to all of
,these but the economic measures, which are addressed in Chapter III.

Table 11-46 presents information on the fruits and vegetables,
petroleum refining, textiles, and pulp and paper categories, showing

*There is no reason to expect uniformity among the limitations when
expressed in terms of pounds of pollutant per unit of production --
inherent variations in the appropriate unit of production as well as
in the quality of wastewaters generated by different types of manu-
facturing processes render such a comparison meaningless.

11-127

Figure 11.5
SOLID SLUDGE INCREASE
AS A RESULT OF WATER POLLUTION ABATEMENT
FOR A PETROLON RERNERY "Lube" subcatepry 45,200 bl/day capadly
Levels & Type Waste Solids Generation (Tons/yr, dry weight basis)
of Treatment

Primary Deoiling 600
(Product recovery)
Oily solids

Pretreatment 2060
(Secondary deoiling)

Level 1 2170
(Activated sludge)
Biological solids added
Level I 1 2270
(Add filtration)

Level I 11 2270
(Reduce flow)

Lost carbon added
Level IV
(Add carbon 2402
adsorption)
Level V 1.m4652
(Partial recycling)
'Inorganic salts added

Level VI
(Complete recycling) norlanic ts 6900
111il HIM, I

Source: Nati. Commission on Water Quality, from Engineering Science, ln@., "Water Pollution Abatement
Technology: Capabilities and Costs, Petroleum Refining Industry 1975.
February 1976
OL60XO
1@2 71
22
;&227C(
24

:o Inor aniq salts
T*
ii,c, Salts

TABLE 11-46: Comparison of EPA's Effluent Limitations in.Terms of Implied Pollutant Concentrations
and Percent Reductions in Pollutant Mass Discharge

Effluent Concentration Limits (mg/1) & Percent (%)
Median Raw Waste Pollutant Reduction Required(')
Concentration BPT (1977) BAT (1983)(4)
BOD. TSS ICOD -BOD TSS COD- BOD TSS COD
Industry Mg/l m /1 Mg/l Mg/l mg/l % Mg/l % mg/l mg/l % mg/l %

Fruits & Vegetab@e2s
Max , 1820 1280 249 94.8 530 90.3 79 98.2 113 94.7
Ave(3) 955 535 93 90.8' 188 67.9 49 94.4 64 81.4
Min (2). 489 128 39 77.6 62 0 28 92.9 34 56.2

Petroleum Refining
Max 1854 610 4634 15 99.2 10 98.4 115 97.7 4.8 99.7 4.8 99.2 29 99.5
Ave 1242 378 3176 15 97.7 10 96.6 109 95.8 4.8 99.3 4.8 98.4 27 98.9
Min 51.5 176 558 15 70.9 10 94.3 80 85.7 4.8 90.7 4.8 97.3 20' 96.4 CD

Textiles
Max 5480 7500 3G500 296 94.7 898 89.8 3850 94.1 134 97.6 112 98.5 1000 98.3
Ave 477 193 897 44@ 93 137 53.9 276 67.3 18.7 95.8 13 91.6 921 89.1
I
Min 1:40 - 50 524 17 60 53 0 112 45.2 11 -88.6 7.5 74.6 32j 81.
Pulp and Paper
Max 849 1318 109 88.8 156 91.1 110 97.1 89 96.9
Ave. 321 361 47 85.2 75 76.7 19 93.6 24 92.5
Min 5.9 200 27 66 36 56.1 11. 86.8 16 75.1'

(l)Reduction.effici6ncies are based upon reduction from median raw waste loads for both levels.
TMaximum and Minimum values represent extreme values for all subcategories. (Values in successive columns
(3) do notnecessarily correspond.).
(4 )Averages are weighted by@subcategory flow.
Flow reduction.is projected for BAT level for all categories.

Source: National Commission on Water Quality, February 1976. Based upon data contained in technology
S

contractorls@reports.

11-129

effluent limitations in terms of concentrations (milligrams per liter,
mg/1) and percentage reduction in pollutant mass discharge for biochemical
oxygen.demand, suspended solids and chemical oxygen demand. The data
are based upon EPA's effluent limitations and the flows and raw waste
loads associated with representative plants in the Commission contractorst
reports.

It is instructive to examine the legislative history regarding the
concept.of uniformity. The Report of the House Public Works Committee
on H.R.1 1896 states that the identification of "best practicable" is
expected to be "in objective terms and (to) set out actual performance
levels for . . . point*sources rather than prescribing specific control
techniques, processes, or equipment,"(23) that the standards should be
based on treatment facilities at the end 'of the manufacturing process
itself(24). The Senate Debate of the Conference Report stated that best
practicable can be interpreted as the equivalent of secondary treatment
for industry but that such an interpretation should not beconstrued as
limiting the authority of the Administrator(18).

As a point of reference, EPA's definition of secondary treatment
for publicly owned treatment works restricts BOD and suspended solids to
30 mg/l each (average of 30 consecutive days) with minimum removal of 85
percent regardless of effluent concentration, and also limits pH and
fecal coliform bacteria.

Data in Table 11-46 show that the flow-weighted average BOD-per-
centage removal at BPT equals or exceeds 85 percent in each industry.
At least one subcategory of each of the industries will not achieve 85
percent, with the minimum ranging from 60 to 78 percent. The variation
in effluent concentration of BOD is quite pronounced, ranging from 15
mg/l to 93 m4/1 for the average of each industry and from 15 mg/l to 296
mg/l considering the extreme subcategories across the industries.
Effluent concentrations of suspended solids are higher and percentage
removals lower,than those for BOD, with wide.variations from industry to
industry and subcategory to subcategory. The average removal for three
of the four industries is less than 85 percent, and the concentration
exceeds 75 mg/l. The lowest percentage removals.are not always indicative
of poor performance, but may indicate low concentrations of suspended
.solids in theraw waste load. High removals (90 percent of more) are
hard to achieve with dilute wastes.

A.similar pattern emerges from the BAT effluent limitations, although
the extremes are closer. BOD removal -exceeds 85 percent for all sub-
categories of the four industries, but some subcategories are considerably
below 8@ percent removal for suspended solids. Concentrations of BOD
range as high as 134 mg/l, with a low of 4.8 mg/l. Suspended solids
range from 113 mg/l to 4.8 mg/l. The in-plant changes associated with
BAT make-these comparisons difficult to interpret. As wastewater flows

11-130

are reduced, pollutant concentrations in the raw waste load usually
increase and comparison of percentage removals becomes less meaningful.

Concentrations and percentage removals of BOD and suspended solids
are obviously not uniform from industry to industry and subcategory to
subcategory: BPT for one industry is more stringent than BAT for the
others. The results reflect differences in types and concentrations of
raw wastes, treatability of wastes, and available technologies.

All four categories shown in the table produce wastes which are
organic in nature. Two of the industries also discharge significant
concentrations of COD and EPA effluent limitations include this pollutant.
Petroleum refining must use carbon adsorption to achieve the BAT effluent
limitations and textiles must use some chemical treatment. Both techno-
logies are more sophisticated, costly and energy intensive than that
required of the other industries.

The four industries illustrate the wide variations found in effluent
limitations. The factors influencing technoloqy-based standards are
interrelated in such a complex web that "uniformity" in terms of appli-
cable technologies, required effluent concentrations or percentage
removals, can not be expected.

An often asked question pertaining to uniformity of costs relates
to what effluent reduction benefits will be obtained for each additional
abatement dollar. Unfortunately, there are few situations in which this
can be answered in terms of a single quantitative measure, such a's
"dollars per pound of pollutant removed."

It is generally true that the costs required to remove a pollutant
from a wastewater stream increase rapidly as the removal approaches
100 percent. With a waste stream containing a variety of pollutants,
however, "percent removed" is ambiguous, because any abatement technol'ogy
will remove different fractions of different pollutants. Furthermore, -
these fractions may change at different rates as more abatement technol-
ogy is added.

In addition to these technology oriented complications, an analysis
becomes even more complex when evaluating different effluent limitations
since some pollutants are not specifically controlled at,both the BPT
and BAT levels for the same industry. Table 11-24 shows that six of the
10 industries studied in depth have pollutants limited at the BAT level
that are not limited at the BPT level. The achievement of the 1985 goal
would bring even more pollutants under regulation than are controlled by
the 1�83 limitations. An additional complication which is important in
an assessment of BAT is that in-plant changes aimed at pollution abatement

11-131

usually have little in common with the technologies employed for end-7of-
pipe treatment, and therefore relations between costs and effluent
reductions for these strategies do not follow the traditional forms
associated with end-of-pipe treatment, even for the simplest types of
wastes.

Figure 11-6 shows the mass emission rates of pollutants from several
representative plants as functions of increasingly stringent abatement
levels. Annualized abatement expenditures per unit of production are
given for comparison. Most of the removal of BOD for the organic wastes
occurs at the first level of abatement, which corresponds to basic_--,
secondary treatment. However, suspended solids and COD do not reach
comparable percent removals until higher levels are reached. The.su,lfur
dioxide plant shows a substantial decrease in sulfite and COD emissions
at Level I, with zero reduction in suspended solids. Dissolved solids,
a parameter not controlled by the BPT or BAT effluent limitations for
the chemical industry, is also shown for this case to illustrate the
increase in dissolved materials which usually accompanies physical-
chemical treatment. Presumably, these.materials would have to be removed
at an abatement level designed to achieve the 1985 goal.

These examples illustrate the difficulties involved in assessing
uniformity in terms of cost pet pound of pollutant removed. A variety
of data of this type were examined by the Commission, but wide variation
and discontinuities.in the results dictate a much more exhaustive
analysis before reaching any conclusions, if in fact any can be reached.

11-132

Figure 11.6a
ANNUALIZED COSTS FOR ABATING POLLUTANT LOADS
FOR EACH LEVEL OF ABATEMENT

Example: Petmleum Relining Model Plant
"LuW type mfin!m. 45,200 bi/day capacity
Flow at 0 level= 1.9 MGD

30 Increase
ANNUALIZED COST** 27 -11% V to VI
24 12% IV to V
Dollars/100 bls cmde LEVELS
Levels cumulative 0 - No abatement
95% 111 to IV I = Basic secondary treatment
11 = EPA's BPT technology .
$11 2 - 8% 11 to III III = Achieves EPA's BPT limitations
=9% Itoll IV - EPA's BAT technology
V - Achieves EPA's BAT limitations
VI - EOD

0
No III IV V. VI
Treatment Level of Abatement
No Treatment Level POLLUTANT LOADS (lbs/day)
:&:
BOD SUSPENDED OIL & GREASE
SOLIDS

R s ;z Ch
V ;z
X
C4
tv
X 0 C11
- I M., r-1
o -94Q -*." . 1711 0
0 1 11 111 IV V VI 0 1 11 111 IV V VI 0 1 11 111 IV V VI
----------- ----------- - -----------
'0
f
AMMONIA PHENOL COD

to
X
to
Lo 'o
N -X-
W to -X
0
A .0
0 1 11 111 IV V VI 0 1 11 111 IV V V1 0 1 11 111 IV V VI
Level of Abatement

Percent reduction from prior level.
15 percent; 20 year.
CW

Source: Nati. Commission on Water Quality, from Engineering Science, Inc., "Water Pollution Abatement
Technology: Capabilities and Costs, Petroleum Refining Industry", 1975.
February 1976

11-133

Figure 11.6b
ANNUALIZED COST FOR ABATING POLLUTANT LOADS
FOR EACH LEVEL OF'ABATEMENT

Example: Canned Cam Plant
581 tons/day capacity
How at level 0 0.973 MGD

37.2
ANNUALIZED COST** Increases
Dollars per ton of com processed
48% IV to V
Levels cumulative
25.1- -
20.7 21.3 18% 111 to IV
=3% II to III
$18.1- 14% 1 to It LEVEL
0 -No abatement
I @ Achieves EPA's BPT limitations
11 @ Intermediate technology between
BPT and SAT
III -Achieves EPA's BAT limitations
and is generally equivalent to EPA's
suggested technology for 1983
IV - A level more stringent that EPA's SAT
V -Most advanced technology available,
which approximates EOD
0 111 IV V
Level of Abatement
NoTreatment Level---- POLLUTANT LOADS (lbs/day)
x
X
BOD SUSPENDED SOLIDS
X C.
in discharge
in discharge

ul
:-X_.-X

0
P_771
...... .....
0
0 1 11 111 IV V 0 1 11 111 IV V
Levels of Abatement
*Percent reduction f rorn prior level.
**15 percent: 20 years.
Source: Nati. Commission on Water Quality, from Environmental Associates, "Water Pollution Abatement Technology:
Capabilities and Costs, Canned Fruits and Vegetables", 1975.
Februa ry 1976

11-134
Figure 11.6c
ANNUALIZED COST FOR ABATING POLLUTANT LOADS
FOR EACH LEVEL OF ABATEMENT
Example: Suffur Dioxide (SO2) Manufacturing
50 million lbs/year capacity
Flow at 0 level = 0.82 MGD
30.7 LEVELS
Increase 0 = No Abatement
ANNUALIZED COST*** 18% 11 to III I = Achieves BPT limitations
Dollars/per ton S02 26.0 - I I = Achieves EPA's BAT limitations
III = Achieves EPA's BADT (Best available
Levels cumulative $20.8 25% Ito 11 demonstrated technology)

Ln
0

X.
0
Levels of Abatement
POLLUTANT LOADS Pbs/day)
No Treatment
NX-e.
No Treatment Level Level
Ln
SUSPENDED ..
SOLIDS

X
X

X
D
x
ED L
Is so

X,
X
X-*X:
..N.. X.I..
0 1 0 1 11 111
No Treatment Level No Treatment Level

X.
M
COD
SULFITE

-X: X

0
N
0
6. 0
0 1 11 111 0 1 11 111
Levels of Abatement
Percent reduction from prior level
Percent increase from prior level
C,
%

V I S

15 percent: 20 years.
Source: Nati, Commission on Water Quality, from Catalytic, Inc., "Water Pollution Abatement Technology: Capabilities
and Costs, Inorganic Chemical I ridustry", 1975.
February 1976

11-135

Figure 11.6d
ANNUALIZERCOST FOR ABATING POLLUTANT LOADS
FOR EACH LEVEL OF ABATEMENT
Examples: Textiles - Woven Fabric
Finishing of cotton and cotton/synthetic blends
Subcategory 6 - Representative plant
180,000 lb/day production
Flow at level 0 2.43 MGD

11.72
ANNUALIZED UNIT COST Increase
Dolars/thousand lbs. pmduct 41% 11 to IV
Levels cumulative

7.39 12% 11 to III LEVEL

0 = No abatement
I = Equivalent to EPA's suggested tech-
87% 1 to I I nology and achieves EPA-BPT
limitations
3.94 11 = I ritermediate technology
III = Achieves EPA.s BAT limitations and
Is generally equivalent to EPA's suggested
technology
IV = Further approaches EOD

.0
No 11 111 IV
Treatment-
Levels of Abatement
No Treatment L .evel POLLUTANT LOADS Pbs/day)
- - - - - - - - - - - - - - - - - - - - - - - - -
BOD TSS C
OD

-X
xx-e

V.
X.- -T
.... co
X.X -X..". LO 0
X.
-X
:0 X-X, C4
u, r. 10
Ln
N
to
X.
X.N.
%
X.
C4 % X
in in to X:
X.
X A r737-71 r11% M VA."'.
11 111 IV 0 1 it III IV 0 1 11 111 IV
Levels of Abatement

Percent reduction from prior level.
15 percent; 20 year.
Source: Nati. Commission on Water Quality, f rom Lockwood Greene Engineers, 'Water Pollution Abatement
Technology: Capabilities and Costs, Textile Industry", 1975.
February 1976

11-136

Figure 11.6e
ANNUALIZED COST FOR ABATING POLLUTANT LOADS
FOR EACH LEVEL OF ABATEMENT

Example: UnWeached Kraft Plant
1200 tons/day capacity
Raw at level 0 48 MGD

22.78
ANNUALIZED COST**
Dollars per ton 52 % IV to V
Levels cumWative
14.76- - - - 91 1% 11 to IV
12.38- 12.94 19%1 to 11

LEVEL
0 = No abatement
I = Equivalent to EPA's suggested tech-
nology for 1977
I I=Achieves EPA's BPT limitations
III = Intermediate technology
IV - Achieves EPA's BAT limitations and
is generally equivalent to EPA's
suggested technology
0 1 11 111 IV V V =Further approaches EOD
Levels of Abatement
No Treatment Level--POLLUTANT LOADS Pbs/day)

TOTAL SUSPENDED
BOD
SOLIDS

Xe-X-:

X N Lo

0
8 La
X
X.
co co
aL
X.

0 1 11 111 IV V 0 1 11 111 IV V
Levels of Abatement
Percent reduction from prior level
15 percent; 20 years.
Source:'Nati. Commission an Watet Quality, from Hazen and Sawyer, "Water Pollution Abatement Technology:
Capabilities and Costs, Pulp & Paper Industry", 1975.
14,- 5
1

February 1976

11-137

D. INNOVATIVE TECHNOLOGY

1. Introduction

The Act states that "it is the national goal that the discharge of
pollutants into the navigable waters be eliminated by 1985." [Sec.
101(a)(1).] Considering solely technological'knowledge, this goal could
be achieved, or at least closely approached, by 1985 for all types of
industrial and municipal (publicly owned treatment works) point dis-
charges by application of existing or projected technologies. in many
cases, the technologies required are now proved, at least on a.pilot
plant basis, but need to be transferred to other applications. The
capacities required in many instances would be several orders of magnitude
beyond present sizes.

Each Commission in-depth technology study contractor was asked to
assess economically and environmentally feasible technologies which are
available or likely to become available in the foreseeable future to
approach or achieve elimination of discharge of pollutants (EOD).* Only
in the case of the metal finishing(25) and petroleum refining(26)
industry studies was EOD fully examined. For metal finishing, EOD is
the proposed EPA abatement requirement for BAT. For three other in-
depth industry studies.(inorganic chemicals, canned and preserved fruits
and vegetables and iron and steel), Commission contractors examined EOD
to some extent for certain subcategories. Table 11-47 lists those
industry categories for which EPA has promulgated or proposed EOD for
BPT (1977) or BAT (1983) effluent limitations.

A separate technology study was undertaken to address specifically
the-1985 goal by characterizing the capabilities of innovative technologies
to achieve or, where that is not yet possible, to closely approach
elimination of the discharge of pollutants from municipal (including
combined sewer systems) and industrial point source discharges(27).
Effluent pollutant levels for-constituents controlled by EPA limitations
were assumed to be essentially the same as those defined by EPA for BAT
(1983) for industrial sources, and BPWTT (1983) for municipal sources.

*The Commission has defined EOD as follows: "The elimination of the
discharge of pollutants shall apply to removal of those constituents
which are added during use of the water. The resultant discharge must
be of equal or lower concentration than that of the original supply."

11-138

TABLE 11-47: Industries with Proposed or Promulgated
EPA Limitations Requiring EOD

EOD for BPT EOD for BAT
Industry (1977) Limitations (1983) Limitations

Metal Finishing None All Subcategories
Iron and Steel Some Subcategories Some Subcategories
Inorganic Chemicals Some Subcategories Some Subcategories
Petroleum & Gas Extraction Some Subcategories Some Subcategories
Fish Hatcheries & Farms One Subcategory One Subcategory
Cane Sugar Some Subcategories Some Subcategories
Beet Sugar None Some Segments
Timber Products Some Subcategories Some Subcategories
Furniture & Fixtures Some Subcategories Some Subcategories
Builders Paper & Board Mills one Subcategory One Subcategory
Non-Fertilizer Phosphates Some Subcategories Some Subcategories
Fertilizer Some Subcategories Some Subcategories
Paving & Roofing Materials Some Subcategories S ome Subcategories
Glass Some Subcategories some Subcategories
Cement Some Subcategories Some Subcategories
Asbestos Some Subcategories Some Subcategories
Insulation Fiberglass Some Subcategories Some Subcategories
Non-ferrous Metals Some Subcategories some Subcategories
Auto & Other Laundries Some Subcategories Some Subcategories

Note:

1. These cover only process wastewater pollutants, and include only those
industries for which proposed or promulgated limitations were available
during the Commission's study.

2. Where evaporation ponds are used as part of EPA technology, EPA often
allows an overflow during periods of excess rainfall.

Source: National Commission on Water Quality, February 1976.

11-139

Constituents not controlled by EPA effluent limitations for BAT and
BPWTT (mostly salts) will vary widely. 'The innovative technology study
did not cover elimination of pollutants from agricultural point sources
or separate storm sewer discharges.

2. Discharges from Industry

a. Scope

The evaluation of innovative technologies to achieve BOD for in-
dustrial discharges focused on nine of the 10 industries studied in-
depth (effluents from steam electric power were not included). These
effluents constitute the vast majority of industrial process wastewaters
to be discharged in 1983, both from the standpoint of volume.and pounds
of pollutants. The characteristics of these effluents and the innovative
technologies applied to them are representative of virtually all in-
dustrial discharges.

Table 11-48 presents the projected general quantity and quality
characteristics of the discharges from the nine industries.after meeting
the 1983 BAT effluent limitations. Pollutants have been divided into
seven groups with similar characteristics and for which common technol-
ogies would be appropriate. For example, soluble salts, regardless of
source, will be removed or reduced by the same innovative technologies.
These projections are of necessity generalizations and do not apply to
everyplant in every industry cited. Although the most common pollutant
in 1983 is projected to be suspended material, it will not be the major
problem in achieving EOD; on the contrary, it will be one of the simpler
to control since suspended material will be removed incidentally by
technologies necessary to remove more difficult constituents in the same
waste streams. The greatest challenge from the standpoint of both
technology and costs will be'removal of soluble salts, particularly
since these pollutants are prevalent in some of the largest volume waste
discharges at concentrations exceeding 1,000 mg/l.

Because of the high costs per unit of volume to achieve EOD (see
discussion in Section 2(b) below covering costs), most industries would
probably go to great*lengths to eliminate or reduce drastically waste-
water volume if EOD were a requirement, rather than a'goal. T6 achieve
this, in-plant process changes would be made in many cases. In others,
both innovative and-conventional technologies would be used within the
plant at the respective pollutant generating processes. These changes
would be difficult and sometimes almost impossible to make for many
older ficilities, but they would be used in new plants.

Elimination of waterborne wastes through modification of a produc-
tion process is highly industry and process specific. Many processes

TABLE 48: Wastewater Groupings Showing Contaminants after Application of 1983 Requirements

Quantity (1) quality

Toxic
S Soluble Heavy Undesirable High Suspended
Salt* (2) Metals (3) Compounds (4) COD (5) Nutrients (6) Material (7)

metal -
finishing (91

Iran and
Steel (in e-
t a
grated Plants) (phenol) (ammonia) (not biodegradable)

Inorganic 1000
Chemicals (8) ag/l
(not biodegradable)

Organic
Chemicals

Petroleum
Refining
(ammonia)

Plastics
and (WO tly 0
Synthetic* suspended)

Pulp and
Paper

Textiles
(color)

Canned Fruits
and Vegetables
Coickling)

saw, VL. very large, > 101 gal/day @4) Carcinogenic, toxic. colored, ate., non-metallic compounds.
L. large, to 6_107gnifday (5) COD about IDOO mg/l and CODIBOD @ 2-4.
x, wedium, 103 -106gal/day (6) Phosphorus and nitrogen, 1-20 mg/l.
S. Mau, 4 105 gal/day r 7) Suspended matter, oil and grease. 1-20 mg/l.
(afflufate from typical plants) (8) Probably; information lacking.
(2) Soluble salts. * 1000 mg/l. r91 1983 requirement is EOD.
r 1.) Toxic heavy metals. about I mg/l.

Source: Water Purification Associates and Process Research, Inc., Water Pollution Abatement Technology:
Capabilities and Costs, Innovative Technologies, 1976.

11-141

can be redesigned or operated to discharge less water, but few result in
completely eliminating the discharge of water. Examples of process
changes that would result in the elimination of process wastewaters
include replacement of wet scrubbers with dry bag collectors for air
pollution control;,replacement of barometric condensers with non-contact
heat exchangers; and improved housekeeping to prevent contamination. An
example specific to the iron and steel industry would be replacement of
blast furnaces with direct iron reduction facilities.

The innovative technologies studied can be classified into six main
groups:

1) Membrane separation technologies
2) Adsorption technologies
3) Thermal separation processes
4) Suspended matter removal
5) Chemical oxidation processes
6) Land treatment

Table 11-49 lists those innovative technologies now developed
sufficiently to permit reasonably accurate estimates of cost, energy,
residuals concentration and other pertinent information. Technologies
examined in the study, but omitted from Table 11-49, are freezing;
adsorptive bubble separation; electorphoretic separation; and several
adsorption techniques other than ion exchange. Some technologies have
been included not because the technology itself is innovative, but
because its suggested application.is innovative. Ion exchange and
evaporation are examples of commercially proved technologies which are
applied in new circumstances.

Table 11-50, an expansion of Table 11-48, shows those technologies
most applicable to achieve or closely approach EOD for each of the nine
industries. To decide on applicable technologies, each of the selected
seven pollutant classifications was considered individually. For two
industries (organic chemicals and petroleum refining), no technologies
are projected to achieve EOD because no presently known, absolutely
reliable treatment will capture all traces of organics.from these waste-
waters. Although evaporation might at first seem applicable, the heat
generated in the process will break down the organic molecules and
generate a'significant uncapturable volatile organic fraction which will
carry over with the evaporated steam.

Table 11-49 Innovative Technologies

Technology Energy & Other state Of
Technology capability Residuals Cost Requirements Development

Reverse Osmosis Removes dissolved Concentrated Medium to Low % 8 kwh/lOOO gal Demonstration. semi-commercial
materials of all solutions
sorts about 2Z

Ultrafiltration Removes large Concentrated Medium % 8 kwh/1000 gal Demonstration, semi-commercial
dissolved mole- suspension,
and,suspended
solids
Electrodialysis Removes dis- Concentrated Low 10 kvh/1000 gal Commercial for potable
demonstration for waste
(including other solved ionic solution. usu-
electromembrane Species only ally about 2%
processes) can be up to
20%

Absorption Removes dis- For Lon exchange low %1/3 of the cost Commercial for potable
(mainly ion solved salts Concentrated is chemicals & boiler feed; demonstration
exchange) a other dis- solution about for wastewater
solved compounds 12%
Evaporation Removes Von- Highly concen- Medium 400-1700 Btu/gal + Commercial
(including vapor volatile contam- trated solution 62-87 kwh/1000 gal
compression) inants or slurry (for vapor compreassion)
High Gradient Meg- Removes suspended Concentrated LOW % 0.7 kwh/1000 gal Laboratory
metic Separation material. prefer- slurry or sludge (depends an size)
ably magnetic
material

Filter Coaleocence Removes Oil Concentrated oil Low 0.1 kwh/1000 gal Demonstration

Net Oxidation Destroys COD. As vapor. as hot Nigh Depends on COD removal. Commercial
phenols, cyanides. suspension % 0.34 kwq/lb COD
etc.

Oronation Destroys COD. None Low %9 kWh/1000 gal Commercial for potable water
disinfect* & boiler feed; demonstration for water
Land Treatment Removes biode- None Low Large land areas for wastewater
Gradable solide 0.3-0.8 kvh/lOOO gal
SOD and nutrients-
Annualized (capital x 15%) Source: Water Purification Associates and Pro-
cess Research Inc., water Pollution Abatement
Technology: Capabilities and Cost, Innovative
Techonologies, 1976.
+ This amount of energy plus O&M costs, excluding
a High &7/1000 gal residuals disposal
Medium - $1-7/1000 gal
Low $1,000 gal Technology: Capabilities and Costs, Inn
+ This amount of energy would, at 40% efficiency. be use to
generate 47-200 kwh/12000 gal.

For spray Irrigation; other method a have lower requirements.

Table 11-50: Matrix of innovative teqhnoloqies to achieve or approach BOD

M S Soluble Toxic Undesirable i u r";;ts (6) Suspended Technology to AchLiews Bob Technology to Approach
a I"
salts (2) Beavy compounds (4) COD (.5)7;;;t %at&TJAI (7) and Possibly Achieve EOD
Hotels (3)

metal Evaporation
Finishing Ion exchange, Usetrodimlysis.
(predominantly Reverse Osmosis. Adsorption, YreexUS
(9) notL-VOIAtil*)

Irou and Evaporation Ultrafiltration
Stan
( I dablm)@ + Ion exchange or Electrodialysis + zlectrodialyals or Ion Nschmago
Integrated (pbenol) -(ammouis) (oat biodegra (for ammouls removal) + Adsorption of residual phanal
Plants) +Oxidation of residual phe"I
Inorganic. 1000 Ultrafiltration, Coagulation & Filtration
Chemicals (not biodegradable) Evaporation
(8 Mg/l

Organic OXidation + Land treatment,
Chemicals Adsorption + Oxidation

Non-Salt Streams I
petroleum Adsorption + Oxidation. Land Treatment
Refining (amm-LA) Salt Straws
Evaporation

Plastics Ultrafiltration Oxidation + Land treatment
am
Systbatice (mostly + Adsorption Adsorption, Coagulation
suspended)
Ultrafiltration Land Treatment
Pulp and
Paper -A 41 + Reverse Osmosis
Reverse Osmosis 4- land Treatment Land Treatmento Reverse Osmosis
Textiles
(color) IOU exthange or Reverse Osmosis Lead Treatment
Canned Fruits or Electrod1slysis + LaW
and Vegets- (Pickling) Y, Treatment
Use

ROM: (1) VL, very large, > 10? gal/day (4) Carcinogenic, toxic, colored. Ott...
L. large. 10 6-101 &.1/d.y (5) COD about 1000 mg/l and COD/BOD ), 2-4 Source: Water Purification Associates and Process Research, Inc.
M, medium, .105-106 gal/day (6) phosphorus and nitrogen. 1-20 mg/l. Water Pollution Abatement Technology. Capabili ties
and Costs, Innovative Technologies, 1676.
S. small, 4 105 &.,,day (1) suspended matter. oil and Stamen. 1-20 mo/I.
(affluents from typical plants) (8) Drobbly; i@formation lAcking.
(2) Soluble salts. > 1000 08/1. (9) For this industry the procedures
are f@r reaching RAT, which is EOD.
(3) Toxic be&vy metals. about 1 mg/l.

11-144

b. Costs*

The annualized costs of the innovative technologies to achieve EOD
for the various industries will generally range from $1 to $7 per 1,000
gallons treated, excluding residuals,disposal. An evaluation of residuals
disposal costs is included below in Section 2.d. Chemical oxidation is
a technology which will approach EOD for the organic chemicals and
petroleum refining industries, and the costs may be greater than $7 per
1,000 gallons. In those cases where land treatment alone is recommended
to approach EOD for industrial wastewaters, the cost will generally be
well below $1 per 1,000 gallons. The total cost for land treatment,
however, will depend greatly upon conveyance distance and the cost of
the land, including taxes. A more comprehensive discussion of land
treatment is included below in Section 3, covering discharges from
publicly owned treatment works.

Combinations of technologies will be necessary to achieve EOD for
virtually all industrial waste flows. Although evaporation alone could
achieve EOD for some, the energy demands would render it impractical and
unrealistic. A concentration process would be used fixst to minimize
the volume to be evaporated.

The costs noted above to achieve EOD are in addition to those re-
quired for BAT. For comparison, some examples of BAT costs are shown in
Table 11-51. These BAT costs range from a low of $0.35 per 1,000
gallons to a high of $65 per 1,000 gallons, and clearly illustrate the
caution that must be used when discussing and comparing costs. Although
it has been stated that EOD costs will generally range from $1 to $7 per
1,000 gallons, specific examples well outside this range can be found in
any industry. For example, a plant operating eight hours per day will
have unit abatement costs that are substantially higher than an identical
plant operating 24 hours per day. This is because the capital costs for
abatement systems will be essentially the same even though the facility
operating eight hours per day will treat only one-third the volume of
wastewater annually. Economy of scale is also important. All else
being equal, small treatment facilities will almost always have a higher
.unit cost than large facilities.

When two or more innovative technologies are required to treat the
same wastewater stream, the cost range for the system will increase
accordingly. For example, if ultrafiltration and reverse osmosis are
used in sequence, the incremental cost for EOD (over BAT) will generally
be in the range of $2-$14.per 1,000 gallons.

*Costs are in 1975 dollars and include operating and maintenance costs
plus annualized cost of 15 percent of capital.

11-145

TABLE 11-51: Typical'BAT (1983) Costs
for Selected lhdustry-Subcategories
IndustEX/Subcategory Cost--$/1,000 Gallons(l)

Pulp & Paper/Large Bleached Kraft Mill $ 0.45
Pulp & Paper/Small Dissolving Sulfite Mill 0.50
Petroleum Refining/Small Topping Plant 13.00
Petroleum Refinin4/Large Integrated Plant 1.80
Iron & Steel/Large Integrated Mill, 0.35
Iron & Steel/Large Scrap Mill with Hot Finishing 0.40
Metal Finishing/Small Job Shop 60.00(2)
Metal Finishing/Large Captive Shop 7 .00(2.)
Orgamic Chemicals 2.00 to 65.000)

(1) 1975 dollars. Sludge disposal not included. Actual.costs for any
specific facility can vary widely depending upon size, age and
location of plant, the treatment option selected, and hours of
operation per day.

(2) These costs are for EOD, the EPA requirement for BAT.

(3) Range of costs for 29 generalized plant configurations that represent
most of the real plants'in the industry.

Source: National Commission on Water Quality, compiled from technology
contractor reports to the Commission. February, 1976.

C. Energy

Table 11-49 shows that energy requirements for the recommended in-
novative technologies will generally be somewhat less than 10 KWH per
11000-gallons. There are two exceptions -- one much higher (evaporation)
and one usually lower (land treatment). For evaporation, energy demands
are from 5.to 20 times greater (50 to 200 KWH per 1,000 gaillons), de-
pending upon the type of thermal separation system employed. A less
energy intensive concentration step will almostalways be required to
,reduce the waste volume fed to a thermal separation process. This will
be the case even though, from a strictly technological point of view,
many wastes could be treated by "brute force" evaporation, one of the
few,commercially available and relatively well-understood innovative.
technologies.

At the other end of the energy scale is land treatment, where spray
irrigation generally consumes about 1 KWH per 1,000 gallons. other land

11-146

treatment techniques, such as overland flow and infiltration/perco-
lation, consume even less energy. However, total energy demands for
land treatment are highly dependent upon conveyance distance and related
pumping requirements. The significance of conveyance distance is dis-
cussed below in Section 3, covering discharges from publicly owned
treatment works.

The energy demands to achieve EOD are in addition to those required
for BAT. As was the case with costs, wide variations in unit energy
requirements would exist within any industry, and caution must be used
in making comparisons. For example, within the iron and steel industry,
unit energy requirements over base level for BAT technology range from
0.4 to over 2,200 KWH per 1,000 gallons. In metal finishing, where EOD
is the BAT requirement and for which evaporation is a key to achievement,
energy demands range from 20 to 100 KWH per 1,000 gallons. On an overall
basis, innovative technologies are'generally more energy intensive than
BAT technologies per unit of flow treated; the major exception is land
treatment when conveyance distance is short.

d. Residuals and Their Disposal

Regardless of the degree of removal of pollutants, there is one
inescapable fact -- everything has to go some place. Pollutants removed
from the wastewater become sludges or concentrated brines which require
careful handling and disposal elsewhere. If reuse, dispersion or
ultimate disposal of these sludges and brines is slighted or ignored,
they will, in turn, pollute the environment and the effort and expense
of removing them from wastewater discharges will be nullified.

Several innovative technologies for treatment and ultimate disposal
of residuals were studied. An effort was made to determine the increase
in residuals volume from industrial wastewater treatment in going from
the 1983 requirements to EOD; however, realistic data could not be
derived because of the complexity of evaluating various combinations of
innovative technologies applied to such a wide variety of separate
wastewater streams. Adding to.the complexity is the difficulty of
determining which residuals, and what amounts, might be recovered and
recycled for beneficial use. Nevertheless, the Commission contractor
believes the added dry weight of residuals generated in achieving EOD by
industry would not constitute a significant increase over BAT. However,
the c;haracter of these added residuals would, in many cases, be radically
different. Rather than the typical insoluble sludge, the residuals
generated in going from BAT to EOD will include substantial volumes of
concentrated brines. Disposing of these in an environmentally acceptable.
manner would be extremely difficult, particularly if they contain toxic
or otherwise hazardous substances.

11-147

Since some of the traditional so-called "ultimat"e" disposal means,
such as landfill, ocean dumping, deep well injection and incineration,
are no longer acceptable for many hazardous wastes, the Commission
contractor evaluated an innovative approach for handling at least some
of this material. This approach is called "Storage for Reuse" (SFR),
and involves carefully segregated storage of concentrated industrial
4 waste residuals at strategically located nationwide storage sites.
Eventually, some of the material would be recovered if and when markets
for their use develop and technologies for their recovery are perfected.
The belief is that the continued costs for storage will eventually
create an economic incentive for recovery and reuse of these residuals.
The SFR concept requires further developm6nt and is presented only as a
possibility for further examination and evaluation.

Although unable to develop the added residuals generated by industry
in achieving EOD, the contractor did determine total residuals generated
by the nine major industries when BAT is achieved. This data is shown
in Table 11-52 and provides-some perspective of the residuals disposal
problem. (@ee Table IV-9 for a listing of residuals developed by an
environmental studies contractor.) The BAT residuals total is 21.5
million tons (dry weight) per year based on 1973 production levels. An
estimated 3.1 million tons (or about 14 percent of the total) is con-
sidered to contain materials that could be classified as hazardous. A
hazardous waste is defined by EPA as "any waste or combination of wastes
which pose a substantial present or potential hazard to human health or
living,organisms because such wastes are lethal,.nondegradable, or
persistent in nature; may be biologically Magnified; or may otherwise
of
cause or tend to cause detrimental cumulative effects(28).

To visualize the potential impact, if the 21.5 million tons of
waste residuals from these nine industries were disposed to the land at
a concentration of 25 percent solids'(75 percent water), an area of 100
square milest' one foot deep, would be required every year. Although
17cind disposal will undoubtedly not be used for all these residuals, land
requirements will nevertheless be significant, and efforts to minimize
waste residuals must be aggressively sought. Brines generated in going
from BAT to EOD will add to this land requirement where land disposal is
used.

Although costs for sludge disposal were not included in the cost
figures presented in Section 2(b) above, they certainly cannot be over-
looked. An order of magnitude estimate can be developed using a range
of $27 to $100 per ton (dry wt.) reported by EPA(@9). This translates
to a total cost ranging from $580 million per year to $2,150 million per
.year, for the 21.5 million tons projected for BAT abatement from the
nine industries in Table 11-52. Since brine volumes generated in going
from BAT-to EOD could not be determined, it is not possible to estimate
added costs for th&ir disposal.

11-148

TABLE 11-52: Projected Industrial Waste Residuals Generated
from Application of Best Available Technology*

Total Waste Residuals
(Sludges & Concentrated Hazardous Portion
Brines) (in million (in million tons/
Industry tons/yr. dry wt.) yr. dry wt.)

Iron & Steel 6.0 0.7
Textiles 0.4 0
Canned & Preserved Fruits
& Vegetables 0.5 0
inorganic Chemicals 7.2 0.6
Organic Chemicals 0.2 0.04
Pulp & Paper 4.6 0
Plastics & Synthetics 0.5 0.5
Petroleum Refining 1.0 0.2
Metal Finishing' 1.1 1.1

TOTAL 21.5 3.1

By applying 1983 BAT requirements to 1973 production levels.

Source: Water Purification Associates and Process Research, Inc.
Water Pollution Abatement Technology: Capabilities and @osts,
Innovative Technologies, 1976.

3. Discharges from Publicly owned Treatment Works

a. Scope

The 'eval uation of innovative technologies to achieve EOD for dis-
,charges from publicly owned treatment works applies to both dry weather
flows and overflows from combined sewer systems. All combined sewer
overflows are assumed to be stored for ultimate treatment with the dry
weather flow at a common facility.

As with the industrial wastewater streams, the greatest challenge
in achieving EOD for municipal wastewaters will be the removal of soluble
salts, a particularly difficult problem with municipal effluents because
of the volumes involved and their tendency to form slimes.

11-149

Land treatment is considered by many to be a viable and obvious
means to achieve EOD for municipal effluents. However, in the context
of the Commission definition of EOD (no net addition of polluting con-
stituents to the water), land treatment only approaches tOD; it does not
achieve it. Additional technologies (both conventional and innovative)
would be required to fully control dissolved salts and nutrients,
pathogenic organisms, viruses and heavy metals.

Land treatment has advantages and benefits, the primary being: 1).
purification of wastewater along with its reuse as a valuable resource;
2) return or recycling of nutrients to terrestrial ecosystems with the
generation of.valuable agricultural, silvicultural or animal products;
and 3) substantial reduction of surface water pollution by limiting the
direct discharge of wastewaters.

The main disadvantages of land treatment are: 1) the significant
land requirement; 2) the possible encroachment on the water rights of a
downstream user by reducing the flow in the watercourse (a potential
problem primarily in arid regions); 3) the effect on air quality and
climate in the immediate area due to potential periodic odors and
humidity; and 4) the potential for adverse publichealth effects relating
to groundwater quality, insects and rodents, runoff, aerosols, and
contamination of crops.

The physical, chemical and biological processes by which wastewaters-
are renovated within the soil matrix are shown in Table 11-53. The
primary factors limiting renovation efficiency are the characteristics
of the'applied wastewater, the hydraulic loading, the nature'of the soil
and the method of application.

The three major land treatment methods are: irrigation, overland
flow, and infiltration/percolation. Figure 11-7 illustrates each of
these methods and the typical removal efficiencies anticipated from
well-managed systems. Only irrigation approaches complete removal of
nitrogen and phosphorus, and large land areas (150-500 acres per MGD)
are required for high levels of removal. The land requirement is primarily
related to the nature of the soil and the nitrogen uptake rate which, in
turn, is dependent upon the nature of the crop (both its nitrogen require-
ment and its growing season.)

All three methods are generally operated on an intermittent basis
and rely on the soil to retain a significant portion of the phosphorus
load. Over an extended period of time (generally well over 10 years),
the soil matrix will become saturated with phosphorus and lose its
efficiency for removing this nutrient. When this happens, a new land
treatment site will probably be required.

11-150

TABLE 11-53:
Renovation Mechanisms-of@Land Treatment Systems

Constituents Renovation Mechanisms

Suspended Solids Filtration

Organic Matter
Suspended organics Filtration
Particulate Organics Bacterial Oxidation
Dissolved Organics Adsorption, oxidation

Nitrogen
Organic Nitrogen Filtration, Mineralization
Ammonium Nitrogen oxidation, Adsorption (clay soils),
Plant Uptake
Nitrate Nitrogen Plant Upta@e, Denitrification

Phosphorus Adsorption, Plant Uptake

Heavy Metals Adsorption, Ion Exchange, Pre-
c1pitation

Boron Adsorption, Plant Uptake

Dissolved Solids (Potassium, Plant Uptake, Ion,,Exchange,
Calcium, Magnesium, Sodium, Adso3.qption"
Manganese and Chlorides)

Bacteria and Viruses Die-off, Sedimentation, Entrap-
ment, Adsorption, Predation
(insects and worms)

Source: Water Purification Associates and Process Research, Inc.
Water Pollution Abatement ITechnology: Capabilities and @osts'
Innovative Technologies, 1�76.

11-151

Figure 11.7
COMPARISON OF LAND TREATMENT METHODS
TO RENOVATE PRETREATED WASTEWATER

CROP IRRIGATION 150-500 acres/mgd NUTRIENT REMOVAL
water (Pements appwilmate)
Spray or surface! Harvesting
application of
pretreated waste@aieii`-*.-"--". .........
Crops and harvesting
remove: 85-90% Nitrogen
30-501/o Phosphorus

Retained in 4-5' root zone: 50-70% Phosphorus
M.
Renovated water recovei
rl

OVERLAND FLOW 50-100 a'CMS/Mgd (non harvesting shation)
For soils with low infiltration 60-90% Nitrogen released
Spray or surface to atmosphere due to
volatilization of
-application of
ammonia and action
p retreated wastewater 60-90% Nitrogen of soil organisms

water

Collected water in ditch retains
tained Collection
in 10-40% Nitrogen
S04:30-5 Ditch
Pho h 50-70% Phosphorus
r s

INFILTRATION - PERCOLATION Less tha n 50 acres/mgd
For deep permeable soils 1 D-50% Nitrogen Pump 10-50% Nitrogen released
water Well due to volatilization of
Wastewater Spreading Basin for reuse ammonia and action of
soil organisms

-Retained
in soil
50-80% Phosphorus
table
watev, G
ound water
retains
-O'd water table- 50-90% Nitrogen
20-50% Phosphorus

Source: Nati. Commission on Water Ouality. Redrawn from Water Purification Associates, "Water Pollution
Abatement Technology: Capabilities and Costs, Innovative Technologies", 1976.
February 1976

11-152

With a better understanding of hydraulic, heavy metals and nutrient
loading limitations, particularly over long periods of time, land treat-
ment-can be expected to be an efficient and effective means of wastewater
renovation. Added research is needed to understand better the relation-
ships among threshold nutrient level for crop uptake, hydraulic load,
ion exchange capacity, soil textural class and crop selection; and to
quantify denitrification in storage lagoons, soils, flooded fields and
various treatment processes.

Technologies required in conjunction with land treatment to achieve
EOD for municipal wastewaters are disinfection, plus one or more of the
following: reverse osmosis; ion exchange; and electrodialysis. In
fact, these technologies, in conjunction with carbon adsorption and
multi-media filtration applied to a secondary effluent, could achieve
EOD without land treatment. Disinfection should be performed in a
manner that does not add residuals to the wastewater. Two such approaches
are ozonation and high energy electron irradiation. The value of chlorine
is limited because it adds salts to the wastewater and may not be fully
effective in destroying viruses.

b. Costs

The total cost for land treatment of discharges from publicly owned
treatment works depends greatly upon conveyance distance, the cost of
the land, and the'loss of taxes due to removal of the land from the tax
rolls. In the case of irrigation, the value of the crop also enters
into the determination of true cost. Ignoring the cost of land, the
loss of taxes or the value of crops, the cost for land treatment can be
expected to range from $0,07 to $1.50 per 1,000 gallons, exclusive of
conveyance system and related pumping costs. The low cost figure applies
to large (50-100 MGD) infiltration/percolation systems. The high cost
figure applies to small (0.1 MGD) irrigation land treatment systems.

Table 11-54 provides comparative cost information for four irrigation
land ireatment systems ranging from 0.1 MGD to 100 MGD. The significance
of conveyance distance (five miles for this comparison) to land site is
apparent, particularly for smaller flow rates. This is more clearly
illustrated by the following tabulation:

Conveyance Percent of Total
Flow Rate -- MGD Cost $/1,000 gal. Cost

0.1 $1.65 53

1.0 0.28 31

10 0.09 17

100 0.04 10

TABLE 11-54 COMPARISON OF IRRIGATION LAND TREATMENT SYSTEM COSTS

COMPONENT COSTS(') DOLLARS PER THOUSAND GALLONS

AVE. FLOW RATE 0.1 MGD 1.0 MGD 10 MGD 100 MGD

CApITAL(2)
Conveyance System (5 miles) (3) $1.64 $0.27 $0.08 $0.03

Storage (50 day), Distribution System,
Recovery System, Land Preparation,
Administrative, Monitoring & Laboratory Facilities 1.02 0.43 0.33 0.30

O&M

Labor 0.31 0.10 0.05 0.03

Material, Outside Services
and Supplies 0.13 0.06 0.04 0.03 Ln

(4)
Energy (KM/1000 gal

- Conveyance 0.5 0.01 0.01 0.01 0.01
- Other 1.0 0.02 0.02 0.02 0.02

TOTALaCOST $3.13 $0.89 $0.53 $D.. 42

(1)1975 dollars. Land cost, tax loss and credit forsale of crop not included. Cost.based on
(2) applyinga pretreated wastewater (secondary quality) at a rate of 1.5 inches per week.
Annualized using a capital recovery factor of 0.10.
(3)Costs based on force main and 150 ft. total pumping head.
(4)This is almost entirely pumping energy and is calculated at 2@/KWH.

Source: National Commission on Water Quality, February 1976.
Compiled from information in EPA Technical Report, Costs of Wastewater Treatment by
Land Application, June 1975.

11-454

Irrigation and overland flow land treatment*systems generally re-
quire a wastewater pretreated to near secondary quality before land
application'(see Tables 11-2 and V-25). To avoid soil clogging and
resultant loss of flow capacity, infiltration/percolation:systems gener-
ally require the quality of the applied wastewater to be superior to
that from a secondary treatment plant. Tertiary treatment with multi-
media filters will satisfy this requirement, as will the water recovered
from an irrigation land treatment system. The costs given above and in
Table 11-54 for land treatment systems do not include preapplication
treatment".

Supplemental technologies required in conjunction with land treat-
ment-for removal of salts can be expected to add from.about $0.50 per
1,000 gallons to $2.25 per 1,000 gallohs, depending upon plant size.
The low cost figure applies @o 'very large systems (50-100 MGD) and the
high ficPare to systems near 0.1 MGD; These figures include operating
and maintenance costs and arinualized amortization bosts using a capital
recovery factor of o.lo. Costs for brine concentration and ultimate
disposal, although significant, are not in6ldded since they would be
very site.specifi6 and highlyvariable.

Table 11-55 permits a comparison of representative costs for three
systems'to achieve EOD from publicly owned treatment works. i!wo irrigation
land treatment approaches &re shown,.one iollowing conventional secondary
treatment, and the other following treatment in an aerated lagoon at the
land site. A conveyance distance of five miles to thei' land site is
assumed for this comparison. As pr6viously-noted, total costs for land
treatment systems are si
,gnificantly impacted by conveyance distance,
particularly for small flow iates. The third appr6ach shown in Table
II-55'is an advanced wastewater treatment system consisting of physical/
chemical processes (including nutrient removal) following conventional
secondary treatment. Under the conditions chosen for analysis, all
three approaches to EOD result in comparable costs.

C. Energy

The discussion of e'nergy-requirements in Section 2 above, covering
discharges from industry, applies here as well'. Note that land treatment
generally consumes about 1 KWH per 1,000 gallons, exclusive of conveyance
pumping, and that the other innovbLtive-technologies recommended to
achieve EOD for municipal wastewaters consume somewhat less than 10 KWH
per 1,000 gallons. Energy requirements for land treatment are highly
influenced by conveyance distance and elevation differential between the
wastewater source and the land site. Secondary activated sludge systems
generally consume about 5 IM per 1,000 gallons.

TABLE 11-55 REPRESENTATIVE COSTS TO ACHIEVE ELIMINATION OF
THE DISCHARGE OF POLLUTANTS FROM PUBLICLY
OWNED TREATMENT WORKS.

TREATMENT SYSTEMS COSTS(l) $/1,000 GALLONS

A. Aerated Lagoon/Land Treatment/Salt Removal Flow rate 0.1 MGD 1.0 MGD 10 MGD 100 MGD

1. Aerated lagoon system(2) $0.52 $0.12 $0.05 $0.04
2. Land treatment system(3) 3.13 0.89 0.53 0.42
3. Salt removal system 2.25 1.10 0.65 0.50

TOTAL COST $5.90 $2.11 $1.23 $0.96

B. Conventional Activated sludge/Land Treatment/Salt Removal

1. Conventional activated sludge $2.35 $0770 $0.39 $0.23
secondary treatment
(3)
2. Land treatment system 3.13 0A9 0.5i 0.42
Ln
3. Salt removal system 2.25 1.10 0.65 0.50 Ln

TOTAL COST $7.7@ $2 .69 @$1.57 $1.15

C. Advanced Waste Treatment/Salt Removal.

1. Conventional activated sludge $2.35 $0.70 $0.39 $0.23
secondary treatment
2; Advanced treatment including 1.95. 0.60 0.29 0.20
chemical treatment, multimedia
filters and carbon adsorption
3.@ Salt removal system 2.25 1.10 0.65 .0.50

TOTAL COST $6.55 $2.40 $1.33 $0.93

MAnnualized capital costs plus O&M costs. 1975*dollars. Brine disposal not included.
(2)
Based on 7 day detention. Includes grit removal and chlorination. Assumes -the lagoon is at the land disposal
site and the storage basin is used for effluent clarification.
(3)Based on irrigation land treatment systems as outlined in Table. IT-54. Land cost, tax loss and credit for sale
of crop not included.

om teqhnol gy contractor reports
Source. National Commission on Water Quality, February 1976. Compiled fr .0
to the Commission and from EPA Technical Report, Costs of Wastewater Treatment by .Land Application,
June 1975.

11-156

d. Residuals and Their Disposal

In 1983, when municipal systems are required to achieve BPWTT,
residuals (sludges) are estimated to be generated at a rate of 9.2
million tons per year (dry weight). Although this sludge amounts to
less than one-half of the residuals projected from the nine industrial
sources and is generally more amenable to beneficial use, it is still
significant and must be handled very carefully.

in going from the 1983 BPWTT requirement for publicly owned treat-
ment works to EOD -- as with industrial residuals -- substantial con-
centrated brine volumes will result. Except for treatment systems
serving highly industrialized areas, these brines will contain relatively
little toxic or hazardous materials since industrial dischargers to the
municipal plant will have substantially eliminated them. Toxic and
hazardous materials cannot be entirely overlooked, however, since recent
evidence has shown significant metals contribution from non-industrial
dischargers (see Appendix C of the metal finishing study(9)). These
brines will have little or no potential value and must be disposed of in
an environmentally acceptable manner. The "Storage for Reuse" concept
would not apply.

An estimate of the magnitude of the brine load generated in going
from BPWTT to EOD can be made by assuming that an average of 400 mg/l of
dissolved solids (salts) will be removed from a projected*35 billion
gallons per day of municipal effluent from separate and combined sewerage
systems. This results in a residuals generation of 21.3 million tons
per year (dry weight). At.2 percent brine concentration, typical for
reverse osmosis systems, this residuals volume would amount to about 0.7
billion gallons per day (2.0 percent of the total volume of municipal
effluent). Costs to dispose of these brines cannot be estimated easily.
ocean discharge would be the obvious and logical solution for communities
adjacent to the coast. Solar evaporation could be utilized in the arid
southwest, but inland communities in wetter climates would be faced with
a difficult and expensive disposal problem.

The commonly accepted ultimate disposal options for municipal
sludges include landfill, land spreading, subsurface disposal, ocean
disposal, incineration and, for chemical sludges, recycling. The
selection of a disposal option, or combination of options, will depend
upon the nature of the residuals and the alternatives available. To
economically and otherwise effectively handle these residuals requires
certain concentration and disinfection processes. Several innovative
sludge treatment technologies show potential, such as high energy electron
irradiation for disinfection; solvent extraction and ultrasonic techniques
for sludge dewatering; and a recirculating jet mill sludge drying/sterilizing
system, but little meaningful cost information is available for any of
these technologies.

11-157

Land spreading, incineration and recycling are the most effective
and generally applicable sludge disposal options. Land-spreading of
sludges from publicly owned treatment works provides two beneficial soil
effects: enhanced soil fertility; and reclamation or improvement of the
soil structure (soil conditioning). Costs vary, depending upon a number
of factors,'primarily size of treatment plant (sludge production rate)
and proximity to agricultural land. The Metropolitan Sanitary District
of Greater Chicago estimates that disposal costs for its Fulton County
land reclamation project range from $150 to $200 per dry ton(30). Costs
for barging the digested sludge 200 miles and then piping it another 11
miles to the disposal site are included in these figures.

A study of various combinations of sludge transportation methods,
hauling distances and application systems for a hypothetical large city
shows an expected range for land spreading of $40 to $60 per dry ton(31).
Transportation distances from 20 to 100 miles were considered. Credit
for fertilizer and crop values were not deducted because of lack of
data. Although sludge has historically generated costs rather than
revenue, it does have a value'. Based on the nitrogen-phosphorus-potassium
.content and the current value of fertilizers, Blue Plains, Washington,
D.C., sludge should have a wholesale price of about $15 per ton (dry
weight)(32). More experience'and data are needed to provide a net cost
for land spreading.

Land spreading of sludges from publicly owned treatment works
causes concern because of potential problems from three constituents:
nitrogen, micro-organisms and heavy metals. Nitrogen can adversely
effect both ground and surface water but is controllable by intelligent
sludge application and crop selection. Nevertheless, better understanding
of biological denitrification processes in soils under a variety of
situations is necessary.

Although not fully perfected, known technology probably can ade-
quately control pathogenic organisms and viruses.

The area of most concern i:s heavy metals, which can accumulate
through the food chain in concentrations toxic to humans and other
animals. While the.soil matrix has a certain ion exchange capacity, the
important factor is the time frame within which the soil will remove and
,hold the heavy metals. Further understanding is needed in this area.

Thermal destruction or reduction by means of incineration or pyro-
lysis is another viable alternative@for municipal sludge disposal. The
most effective approach would be energy recovery systems involving in-
cineration or pyrolysis of municipal sludges along with municipal solid
refuse. Estimated net disposal costs per ton of sludge/refuse range
from $5 to $20 (27)

11-158

Recycling as a means of handling municipal residuals is limited to
those materials which can be adequately separated and recovered for
.reuse. Presently, alum and lime are the only materials considered to be
economically recoverable,from wastewater*sludges produced as a result of
the addition of these chemicals in physical-chemical treatment pro-
cesses.

4. Recommendations for Research, Development and Engineering

Research and development efforts over the next decade should be
directed to membrane separation, adsorption and land treatment techno-
logies, as stated by the Commission contractor:

"Emerging from the analysis of these groupings aretwo technologies
that appear to have implicit in them the po ssibility to treat any
and all kinds of wastewater, cheaply, reliably and simply. These
two groups are membrane/adsorption technologies and land treatment
technologies. of significance is that these technologies operate
on the natural mechanisms by which water is purified for human and
animal consumption on the one hand, and plant needs on the other"(33).

With respect to membrane separation technology, the contractor states:

"Membrane technologies today appear to offer the possibility of
becoming almost the 'universal' means of meeting EOD requirements
cheaply, reliably, simply and at low energy. Moreover, membrane
processes have a high degree of flexibil ity and when operated in
conjiinction with innovative evaporation technologies can produce a
highly concentrated residual. Of the ten major sources of waste-
water (nine industrial plus municipal), membrane'tephnologies are
basic to achieving EOD standards in six of the ten categories and
are basic to approaching EOD standards in two of the remaining four
categories.

"The major obstacles limiting membrane technologies today are
membrane fouling and low fluxes. Membrane fouling leads, on the
one hand, to higher operating costs due to frequent replace@ient,
maintenance and required pretreatment. On the other hand, it also
leads to higher capital requirements because of the need to incorporate
larger membrane areas to compensate for the reduced rejections and
fluxes caused by fouling. Low fluxes also lead to increased'operating
costs associated with higher driving forces to push the water
through at the highest possible rate.

"It is recommended that research on the chemistry.and physics of
membranes should be accelerated to develop mezg?ranes which are:

11-159

"a. Anti-fouling,,
"b. Higher flux,
Uc. Longer lasting,
"d. Ch eaper to construct." (2 7)

Simultaneous with membrane development, process engineering develop-
ment for systems design is necessary to utilize membrane surface more
efficiently, and reduce the effects of polarization.

In the area of adsorption, the contractor states:

"Among the major impediments to the more widespread use of ad-
sorption technologies in general and ion exchange in particular, is
the expense and energy intensiveness of the regeneration process
coupled with the allied problem of the disposal of the regenerated
wastes. Another problem of many ion exchangers and adsorbents is
that they arenon-specific, so that they will remove (at a cost)
materials which it is not necessary to remove or should not be
removed.

"It is therefore recommended that chemical and physical-chemical
research be concentrated on the followingi

"a. The development of inexpensive regenerants for ion
exchange and adsorption.

"b. The elimination or minimization of chemical regeneration
in ion exchange.

"c. The development of specific iory exchangers and adsorbents"(27)-.

The contractor further recommends that process engineering development
be conducted to maximize process efficiency for a fixed quantity of
adsorbent, and to minimize the quantity of adiaorbent,.resin or complexing
agent required.

For land treatment by spray irrigation, the Commission contractor
recommends that further studies of potential pathogen survival and
proliferation in soils, and of heavy metal accumulation and contamination
of crops, should be conducted in full-scale operating facilitie's rather
than in laboratory or pilot programs.

Specific aspects of land treatment which would benefit from further
research and development are: 1)@quantification of denitrification
rates in storage lagoons and soils;@2) optimization of nutrient uptake
by specific crops, considering hydraulic loading rates an&soil texture;
and 3) development of automated'monitori.ng units.

11-160

For overland flow, further pilot scale facilities are needed to
develop the potential of this land treatment alternative.

Finally, in the area of ultimate disposal for toxic and hazardous
industrial residuals, substantial R&D effort is recommended on the
concept of "Storage for Reuse" (SFR). Areas requiring extensive ex-
amination are: economic projection of future material value; deter-
mination of government and private sector roles in the management and
operation of SFR systems; classification of industrial residuals into
recovery and storage categories; location of regional SFR sites; development
of safe transportation methods for industrial residuals; development of
storage strategies which allow easy retrieval of materials; development
of inert or secure containment materials; and development of specific
recovery technologies.

If the development of innovative technologies is fostered, not only
would EOD become more readily achievable, but BAT effluent limitations
could be reached more cheaply and effectively in many cases.

with proper support through applied research and demonstration pro-
.jects, several of the innovative technologies could become available as
viable full-scale treatment systems within about five years.

11-161

E. AGRICULTURE

1. Introduction

The Commission employed three contractors to assess the capabili-
ties and costs of technologies available for reducing or eliminating
discharge from three potential sources of agricultural pollution; 1)
feedlots, @) irrigation return flows, and 3) runoff from non-irrigated
cropland. Results reported in this section were abstracted from these
contractors' reports(34,35,36).

2. Feedlots

Beef cattle, hog, turkey, and sheep feedlots normally discharge
liquid effluents only in the form of runoff from precipitation-;-@ba@rr-@@---@----@
feedlots discharge runoff as-well as water-us6efor washing cows and
equipment. Feedlot runoff is-not a problem for totally covered pro-
duction units, but appropriate measures must be taken for collection,
storage, and possible pretreatment of wastes derived from such operations
@.prior to land application.

a. Numbers and Types of Feedlots

The one million feedlots of major concern in*this report are dis-
tributed by animal type as shown in Table 11-56. As indicated, meat
production increased by almost one-fourth, while the number of feedlots
declined by over one-half in the decade ending in 1973. These trends
are projected to continue through 1983. Historical data are not available
for sheep because of their relative unimportance to the national economy.

Layers, broilers, and horses were not studied in depth because they
are predominantly completely housed operations without liquid discharges.
Catfish and ducks were examined in a cursory manner, but the results are
not reported here because of their highly localized economic importance.

TABLE 11-56: Number of Feedlots and Marketings 1964 and 1973

Number of Lots Thousands of Head Marketed
Types of Feedlots 1964 1973 1964 1973

Hogs 802,000 425,000 86,086 82,217
Beef Cattle 401,000 185,000 22,202 31,600
Turkeys 42,000 4,000 101,000 132,200
Dairies 1,134,000 338,000 126,967* 115,620*

Million pounds of milk

Source: Development Planning and Research Associates, Technologies and
Economic Impacts of Water Pollution Control Act of 1972, The
Feedlot Industry, 1976.

11-162

b. Cost and Effectiveness of Pollution Control Measures

Effluent limitations promulgated by EPA emphasizing no discharge
require that runoff and process water be retained in holding ponds, then
spread on agricultural lands in keeping with sound agricultural practice.
BPT and BAT limitations require, respectively, facilities to retain the
runoff from 10 year-24 houri and 25 y6ar-24 hour rainfall events, plus
any process-generated waste water. Unlimited overflow of the specified
detention structures is ailowed when precipitation in excess of the
design storm occurs.

The original effluent limitations promulgated by EPA and published
in the Federal Register., Vol. 39; No. 32,-Part IIj February 14, 1974,
Rempt6d'-feedlots smaller than the following sizes from requiring a
'permit: 1,060 -sl-aughter@stee'rs and heifers, 700 mature dairy cattle,
2,500 swine,weighing over 55 pounds, 10,000 sheep, and 55,000 turkeys.
This exemption was successfully challenged in court, and proposed new
effluent limitations were published in the Federal Register, Vol. 40,
No. 225, Parts@124 and 125, November 20, 1975. The proposed limitations
require feedlot owners and operators to apply for a permit if any one of
the following conditions is met:' 1) measurable quantities of wastes are
discharged to a waterway through a man-made ditch, pipe, or flushing
system; 2) waste's are discharged directly into a waterway on the feedlot
property itself; or, 3) more than the following number of animals are
involved: 1,000 slaughter or feeder cattle, 700 mature dairy cattle,
4,500 slaughter hogs, 35,,000 feeder pigs, 12,000 sheep or lambs, 55,000
turkeys, A0,000 laying hens, or 290,000 broiler chickens.

The exact numberlof permits that will be required is unknown, but
it is anticipated that the vast majority of small feedlot operators in
the country will not be affected by the revised regulations.

The size of holding pond, pump, piping, etc., required to comply
with any particular level of control, and the cost and effectiveness of
the system are highly site-specific, as indicated by Table T-I-57.

As indicated, BPT or BAT sized' control structures are about three
times as large in high rainfall areas as in dry areas, but they are much
less effective in preventing discharge. Differences in facilities
sized* to eliminate the discharge of pollutants (EOD) 'are even more
striking, with one in Birmingham, Alabama, requiring nine times the
capacity required for a feedlot of the same size in Boise, Idaho.

*As defined in Table 11-57.

11-163

TABLE 11-57: Holding Pond Capacity Required And Percent of Runoff Not
Captured Between 1941 and 1970 From Holding Pond Designed
for Indicated Level of Control for 12 Acre Open Feedlot
for Any Type Animal in Location Shown.

LEVEL OF CONTROL
BPT BAT EOD*
Uncon- Uncon- Uncon-
Location of Cap.** trolled Cap.** trolled Cap. trolled
Feedlot (Ac.Ft.) Runoff (Ac.Ft.) Runoff (Ac.Ft.) Runoff

Birmingham, Ala. 5.5 51% 6.2 48% 33.5 0%
Sacramento, Calif. 3.0 39% 3.5 32% 12.0 0%
Dublin, Georgia 5.2 41% 6.1 33% __Q%
Boise, Idaho 1.8 2% 2.0 3.6 0%
Storm Lake, Iowa 4.0 26% 4.6 21% 16.0 0%
Garden City, Kan. 3.;-6 16% 4.2 10% 14.4 0%
Saginaw, Mich. 3.2 33% 3.4 31% 12.8 0%
Syracuse, N.Y. 3.4 48% 4.0 42% 20.4 0%
Ft. Stockton,.Tx. @.8 0.3% 4.4 0% 4.4 0%
Centralia, Wash. 4.0 53% 5.0 45% 24.0 0%

*An EOD-sized facility, as used here, is one of sufficient capacity to have
prevented runoff from occurring at the*site during the period in which
complete ;4eather records were available, 1941-1970.

**Figures shown under capacity in Ac.Ft. for BPT and BAT are also 90 percent
of 24 hour-10 year and .24 hour-25 year precipitation events in inches
respectively.

Source: Development Planning and Research Associates, Technologies and
Economic Impacts of Water Pollution Control Act of 1972, The
Feedlot IndustEy, 1976.

Many feedlots of all sizes are so located that runoff from them
never reaches a watercourse. The number of feedlots that would be
affected by "locatibnal exemptions" based upon whether or not runoff
reaches a wc,.@ercourse was estimated., and the cost of providing controls
for the remaining "potential problem lots" was determined. The costs
associated with 'potential problem Iotg@, were used for the economic
analysis and appeat in Table 11-30, page 11-82 (except costs for sheep and
catfish, which would increase costs by about 2 to 3 percent). If the
EPA regulations of'November 20, 1975 are followed, some portion of the
costs for all lots larger than 11000 animal units should also be added
to the cost for potential problem lots. However, most of the feedlots
over 1,000 animal units were included in the potential problem lots so.,
the omission is minor. The costs of providing control systems for all
feedlots larger than several specified sizes were also determined, with
all such cost estimates shown in Table 11-58.

TABLE 11-58: TOTAL INVESTMENT COSTS AND ANNUALIZED CqSTS
FOR SIX LEVELS OF FEEDLOT POLLUTION.CONTROL

LEVEL OF CONTROL
BPT BPT+BAT EOD*
Control Strategy Investment Annualized Investment Annualized, Investment Annualized
Cost Cost cost** Cost Cost** Cost

------------------------ Millions of June 1975 Dollars --------------------------

All Lots 2205 391 2698 454 2519 428

All Potential Problem
Lots 724- 133 896 155 865 150

All Lots Larger than
1,000 Animal Units (1) 113 25 148 29 168 30

All Lots Larger than about
its(2) 260 60 334 69 371 72
500 animal un

All Lots Larger than about
100 Animal Units(3) 842 172 1286 23.7 1036 192 41

All Lots Larger than about
50 Animal Units (4) 1535 298 2083 368 1175 317

As defined in Table 11-57.
BPT + BAT assumed two stage construction; EOD assumed one stage.
(1) 1, 000 Animal Units = 1 A 000 beef cattle (61 percent) , 2, 500 hogs (10 percent) , 700 dairy cattle (3 percent)
55,000 turkeys (29 percent), 10,000 sheep (50 percent).
(2) About 500 Animal Units = 500 beef cattle (77 percent) , 1,000 hogs (22 percent) , 200 dairy 'cattle (13 percent) ,
24,000 turkeys (81 percent), 5,000 sheep (64 percent).
.(3) About 100 Animal Units = 100 beef cattle (92 -percent), 200 hogs-(82 percent), 100 dairy cattle (27 percent),
14,000 turkeys (98 percent), 1,000 sheep (74 percent).
(4) About 50 Animal Units = 50 beef cattle (97 percent), 100 hogs (94 percent), 30 dairy cattle (83 percent),
2,750 turkeys (99 percent), 500 sheep (82 percent).

Note: Numbers in parentheses are percentages of total production in facilities larger than indicated sizes.

Source: Development Planning and Research Associates, Technologies and Economic impacts of Water Pollution
Control Act of 1972, The Feedlot Industry, 1976.

11-165

Costs estimated for BPT plus BAT are greater than EOD* in several
cases because it was assumed BPT would be built and later upgraded to
BAT, while EOD* facilities were assumed to be built in one operation.
Regardless, a significant saving is realized if "locational exemptions"
are considered.

Pollution control costs for both manure management and runoff con-
trol fall most heavily on small feedlots in wetter and colder climatological
regions. The ranges in investment costs required for pollution control
facilities for beef, dairy, and hog feedlots as they are affected by
feedlot size and climatic factors are shown in Figure 11-8. The costs
shown are for feedlots that provide no housing for the animals.

The upper curves in Figure II-S are the costs of BPT plus BAT.in
wet regions. The cost of EOD sized facilities would not be substantially
different from that for BPT plus BAT. These costs do not include expendi-
tures required for totally housed facilities currently not in compliance
with no discharge requirements because of the lack of available data on
which to estimate such-costs. Relatively small numbers of such operators
will be impacted fairly severely, but the overall impact on the entire
feeding industry will be slight.

C. Materials and Energy Requirements

As indicated by Table II-59,.because of the large number of facilities
involved, the requirements for materials, energy and manpower are large.
Major investment elements are earthwork and piping associated with dis-.
posal. Under the assumption that all feedlots, regardless of size or
location, must be equipped with controls, it iis estimated that 3,000
engineering man years would be required to design all the facilities.
(About 1,000 man years for potential problem lots.)

d. Residuals

The total quantity of residuals in the form of sludges that would
be generated by the construction of runoff control facilities was not
estimated because in most cases, such sludge would constitute an insigni-
ficant addition to the manure that is already disposed of by land
spreading, and it could generally be handled by the available manure
fiandling equipment.

Residuals that would be discharged after 'construction of BPT and
BPT+BAT sized facilities are shown in Table 11-60. As indicated, little
additional control is gained in upgrading from BPT to BAT.

*As defined in Table 11-57.

11-166

Figure 11.8
INVESTMENT COSTS FOR FEEDLOT POLLUTION CONTROL
INVESTMENT COST
Dollars per Head of Capacity
$120 127 BEEF CATTLE
79

51
4: --.'34 BAT - wet climate 29 '35
!17
BPT - dry climate 13 14
40200 :600 2750 FEEDLOT
CAPACITY
500 1000 2000 3000 4000 10,000 + (HEAD)

X
X: -X . ...... . . .. .
77JMProduction
33% 33% 33% ' 973
$80 .70
60 T7 HOGS Ap
40 -% BAT - wet climate O;p
20
20L --- ,BPT.- dry climate 10 5 10
0 6
60 350 1400
260 400 800 1200 1600 3000 HEAD

...........
Produ
ction
1973
$240 25% 51r/0 25%
231
DAIRY CATTLE
200 -

160 160
144

120 - 113
1107%@ BAT - wet climate
80 - : %
:83% 65'
BPT- dry climate
o16 fto 57
1 49
40- ro 48

0
2040165 135
50 160 200 300 400 800 HEAD
Milk
..................
Production
43% 33% .240% 1973

Source: Nati. Commission on Water Quality, from Development Planning and Research Associates, " Technologies
and Economic Impacts of Water Pollution Control Act of 1972, The Feedlot industry", 1976.
February 1976

TABLE 11-59 ESTIMATED MATERIALS AND ENERGY REQUIRED FOR EFFLUENT CONTROLS IN FEEDLOTS*-

BPT BPT + BAT EOD**
All Potential All Potential All Potential
Lots Problem Lots Lots Problem.-Lots Lots Problem Lots

INVESTMENT COSTS

Land ($ Million) 237 al 239 82 -280 100
Earthwork ($ Million) .629 212 -781 267 857- 316
Buildings and Structures($ Million) 291 68 595 196 322 100
Mechanical E(Ifiipment ($ Million) 159 53 @172 56 159 53
Piping ($ Million) 701 225 705 226 701 237
Electtical,Service ($ MilliOni 75 22 75 22 75 22
Engineering-..(1000 hours) 5284 1760 61814 2005 5884 1943

OPERATING REQUIREMENTS (SELECTED)

Labor ($ million) 55 20 55 20 55 20
Labor @(10.00- hours) 16680 5855 16680 5855 16680 5855
Energy. ($,. million) 9 4 .9 4 9 4
Energy (MILLION KWH) 289 124 291 124 291 124

*EKcludes duck and catfish categories.
**As defined previously

Source:, Development Planning and Research Associates, Technologies and Economic'Impacts of Water
Pollution Control Act of 1972, The.Feedlot Industry, 1976.

TABLE 11-60: ESTIMATED ANNUAL UNCONTROLLED RUNOFF AND BOD5 RESIDUAL
FROM FEEDLOT INDUSTRY COMPLIANCE WITH SPECIFIED LEVELS OF CONTROL

Level of Compliance Beef Hogs Dairy Turkey All Species
and Region Runoff BOD5 Runoff BOD5 Runoff BOD5 Runoff BOD5 Runoff BOD5

Ac.Ft. Mill Ac.Ft. Mill Ac.Ft. Mill Ac.Ft. mill AC.Ft. Mill
lb. lb. lb. lb. lb.

BPT

moisture Deficit,") 2,617 7.5 567 0.4 217 0.6 567 6.9 3,967 15.4
Moisture Balancer2) 2,642 7.3 6,550 6.8 1,333 3.8 892 5.5 11,417 23.4
Moisture Excess(3) 2,825 8.1 4,550 3.6 1,675 4.8 6,975 40.6 16,025 57.1

Total 8,084 23.9 11,667 10.8 3,225 9.2 8,434 53.0 31,409 95.9

0)
OD
BAT

moisture Deficitm 2,092 6.0 458 0.4 133 0.4 433 5.4 3,117 12.2
Mositure Balance(21 2,508 7.2 5,275 5.4 975 2.8 658 4.1 9,417 19.5
Moisture Excess(3) 1,708 4.9 3,491 2.4 1,067 3.0 6,383 36.9 12,650 47.2

Total 6,308 18.1 9,224 8.2 2,175 6.2 7,414 46.4 25,184 78.9

*Sheep feedlots not included, but not believed to be significant influence on totals
("The moisture deficit region is defined as that region where annual evaporation exceeds annual precipitation by 10 inches or more.
.r2lThe moisture balance region is defined as that region where annual precipitation and annual evaporation are within 10 inches
of each other.

(31 The moistur e excess region is def ined as that region where annual precipitation exceeds annual evaporation by 10 inches or more.

Source: Development Planning and Research Associates, Technologies and Economic impacts of Water Pollution Control Act of 1972,
The Feedlot Industry, 1976.

11-169

3. Irrigation Return Flows

a. Introduction.

About 25 percent of all farm sales in the United States are pro-
duced on the roughly 10 percent of cropland that is irrigated. Much of
this land could not be farmed at all without irrigation. On the rest,
irrigation is used to increase production, to produce different crops
than could be grown without irrigation, or to assure the production of a
crop each year.

irrigated agriculture impacts water quality and quantity in at
least six different ways: 1) it concentrates salts dissolved in water,
primarily by the evapotranspiration of water; 2) it may weather naturally
occurring minerals from irrigated soils; 3) it may add sediment to, or
remove it from, receiving water; 4) it may add nitrogen and phosphorus
to a receiving water; 5) it may add pesticides to a receiving water; and
6) it will alt"er the quantity.and temporal distribution of downstream
flows if it is derived from, or retruned to, surface waters.

The volume of irrigation return flow produced by a farm is the
difference between the volume diverted from the water supply and the
volume consumed by evapotranspiration. The proportion of the total
water infiltrated into the soil that is in excess of the consumptive
requrements of the crop (for both evaporation And transpiration) is
called the "leaching fraction'." The leaching fraction returns to surface
or groundwaters as-an irrigation return flow.

The leaching'water percolates through the soil where a portion of
it may be intercepted by artificial drains, collected and discharged to
a receiving water as a point source. Percolating water not intercepted
in drainage systems joins the local groundwater. It may return quickly
to a surface stream, or it.may remain in the ground for an extended
period. Certain irrigation waters, once diverted, do not enter the soil
but are returned directly to a receiving stream. Most operators of
flood.irrigation systems or ditch and furrow types do not completely
control water application. Excess waters that are diverted and pass
over the surface rather than through the soil are called "tailwater."
They are also frequently discharged as point source irrigation return
flows.

(1) salinity

The concentrations oftotal dissolved solids in subsurface irrigation
return flows are higher, typically, than those in the water delivered to
the field' The applied water contains some concentration of salts.
Growing plants consume pure water, leaving the salts behind in a smaller

11-170

remaining volume of water in the root zone. Leaching water serves to
carry the salts away, maintaining the productivity of the soil. In-
creasing irrigation efficiency -- reducing the leaching fraction --
reduces the mass of salt diverted with the water. The volume of return
flow in which the diverted salts are dissolved is reduced by a greater
proportion, and the concentration of salts in the return flow is increased.
The total mass of salt discharged is reduced, but the salts not diverted
remain in the water supply.

in addition to the salts contained in the applied water, irrigation
return flows may carry salts which are added to the leaching water as it
passes through the subsoil. It may also leave some of the applied salts
in the soil as precipitates, so that the relative concentrations of
dissolved salts in applied water and return flows are different. The
importance of this increment of salinity depends on the solubility and
composition of the subsoil material, and on the size of the leaching
fraction. In some regions it is of major importance, while elsewhere it
is insignificant.

In most cases, regardless of the type of irrigation system used,
and regardless of the efficiency of the irrigation system, most of the
salt in irrigation return flow will be salt that was contained in the
water applied to the land. Efficiency of irrigation has little effect
on the quantity of water consumed by evapotranspiration. Any particular
crop has a certain evapotranspiration requirement to produce a specified
yield. Any water supplied in excess of this requirement will appear as
return flow, and if a lesser quantity is applied, it will have an
adverse effect on the yield and may cause a buildup of salts in the soil.
Therefore, if the irrigation water is withdrawn from a stream, and the
return flow is delivered back to the same stream, the efficiency of
irrigation will not affect the total quantity of either water or salt
transported by the stream in the long run, unless the soil being irrigated
still contains native soluble salts.

(2) Suspended Sediment

Irrigation water which passes through the soil is essentially free
of suspended sediment, but tailwater may contain sediments. Whether
tailwater has a higher or lower concentration of suspended material than
the initial supply depends upon local factors. The amount of sediment
discharged with tailwater can be reduced by passing the return flow
through a sedimentation basin or, under certain circumstances, the
tailwater can be recovered and reapplied without any intervening dis-
charge to a receiving water body.

In areas where the natural sediment burdens in streams are very
large, the practice or irrigated agriculture can result in a net removal

11-171

of suspended material. Sediments originally carriedby a stream may be
deposited inh diversion channels or on irrigated lands..
The concentration of buspend6d material! in Watercourses is-detei-mined
by stream velocity. IAt points whdrb-the velocity is low, sediments will
be deposited; Where the velocity is high,,erosion will occur.' Excepting
areas where a stream bed is incised in bedrock, the burden of suspended
material carried by a stream cannot be controlled by changing the dis-
charge of Sediment to it.

(3) Fertilizer

Irrigation return flows may carry fertilizers with them depending
on local conditions.

In,general, because phosphorus is readily sorbed on soil particles,
its concentration in dr;aina4e water can.be expected to be very low.
Some phosphorus Will usually be asgociite'd with.sediment contained in
tailwater, but only small quantities are generally lost in this manner.

Nitrogen, particularly in.the nitrat6 fbrm, is a highly soluble and
.highly m"obile ion. It can therefore be,@kpected to be present in a
highly unpredictable concentrationin 6o*-h t1tailwater and drainage water.
Its concentration in tailwater is generally very l6v, and the concentra-
tion in drainage water is highly dependentlon factors such as nitrate
concentration in the.soil, depth of,drainage System, soil texture,
concentration of organic matter in the soil, and depth to which the soil
is aerobic.

(4) Pesticides

Pesticides may be' added to receiving waters by irrigation return
flows, but the quantity added is normally very low.and..Jp,highly dependent
on soil type, type of pesticide, time of application, method of appli-
cation and other factors..

Most of the pesticides in current widespread use are only slightly
soluble in water, and are strongly sorb6d onto s6il paAicles or onto
particles or organic matter in the Soil. Pesticides that-exhibit this
sorptive behavior will not usually be.found-in drainage water, but they
may be present in very low concentrations in tailwa*t6r.

Pesticides that are degraded rapidly by either sunlight or soil
microbes will seldom be found in.either tailwater or drainage water. In
most cases, recovery and reuse of tailwater or removal.of sediments from
tailwater will, for practical,purposes,.61iminate any threat of pesticide
pollution of receiving water by irrigation return flow.

11-172

(5) Hydrology

Aside from increasing salinity by evapotranspiration of water, the
greatest impact of irrigation on surface water is that it reduces total
streamflow and alters its temporal distribution. Irrigation is the
largest consumer of water, with forty to eighty percent of all water
diverted for irrigation being consumed by evapotranspiration.

The dry weather flow of most uncontrolled streams is derived from
groundwater, most commonly from groundwater recharged into alluvial
deposits in the river basin during periods of high precipitation or high
stream flaw. The amount of water stored 'in this manner is largely
dependent upon the magnitude and duration of flood flows. In regions
characterized by extended dry seasons, streams may go completely dry
toward the end of the dry season.

Diversion of water for irrigation can alleviate this problem by in-
creasing the quantity of water stored in alluvial aquifers. The return
flow from irrigation water applied to land at some distance --,a mile or
more -- from the river may require many months to flow back to the
river, and may increase the dry weather flow to the extent that a naturally
ephemeral stream becomes perennial. Such an alteration in the natural
regime of the stream may be highly beneficial not only to aquatic orgnisms
but also to downstream municipal, industrial, agricultural users. If
there is no upstream reservoir to control release during dry months,
increasing upstream irrigation efficiency may be detrimental, ratl@er
than beneficial, to all downstream users.

Deeper aquifers that are recharged as a result of inefficient irri-
gation may also be utilized by municipalities, industries, and agri-
culture., In many such cases, increasing irrigation efficiency would
result in impairment of the quality and decreasing the quantity of
groundwater that is available for reuse.

In basins where supplemental water is imported for agricultural
use, increased irrigation efficiency might have a detrimental impact on
downstream users. If irrigators apply more water than is required to
their fields, this water will be available later to downstream users.
If more efficient water use were required, the upstream irrigators
might well bring less water into the basin and deprive downstream users
of a supply.

In summary, the use of water for irrigation may affect local and
downstream hydrologic conditions in a,variety of ways, some of which are
beneficial and some of which are detrimental. Similarly, increasing
irrigation efficiency may be either beneficial or detrimental to down-
stream users. It is therefore inappropriate to suggest that changes in
irrigation practice should be made without thorough study of the specific
location involved.

11-173

b. Location and Distribution of Point Source Irrigation Return Flows

About 39 million acres of farm land were irrigated in the United
States in 1969. About 97 percent of this land is located in the 17
western states, Arkansas, Louisiana, and Florida. About 257,000 farms
in the United States were reported to be irrigated in 1969, and about
223,000 of them were in these twenty states. These data are shown in
Table 11-61. About 57 percent of all irrigated land is in California,
Texas, Nebraska, Colorado, and Idaho, and 36 percent is in California
and Texas alone. No state other than these five has as much as five
percent of the total irrigated acreage.

All irrigated farms are potential point source dischargers, at.
le4st of tailwater, but onlythose that are artificially drained are
potential point.source dischargers of drainage water. Artificial
drainage systems have been installed on only about 4.6 million acres (12
percent) of irrigated land. Artificial drainage systems have also been
installed on about 55 million acr-es of non-irrigated land, but the cost
and effectiveness of controls forthis land were not determined.

As indicated in Table 11-62, about three-fourths of all irrigated
land in the western states was in farms with more than 200 acres of
irrigated land in 1969. About one-fourth was in the 2.5 percent of
farms that irrigate more than 1,000 acres. It is likely that a greater
percentage of the irrigated land is in the larger farms at this time.

About 41 percent of all irrigation water is self supplied from
groundwater, 15 percent is supplied by direct diversion of surface
water, and 44 percent is supplied by irrigation organizations, primarily
(97 percent) from surface storage, including around 20 percent from
Bureau of Reclamation projects.

11-174

TABLE 11-61: LEADING STATES BY NUMBER OF IRRIGATED ACRES AND FARMS i969

Percent Number Percent
State of all of all of all
or Irrigated Irrigated Irrigated Irrigated
Region Acres Acres Farms Farms

United States 39,131,693 100.0 257,147 100.0

20 Leading
States 37,957,018 97.0 233,396 90.8

California 7,240,131 18.5 51,050 19.9
Texas 6,888,075 17.6 28,552 .11.9
Colorado 2,894,984 7.4 15,567 6.1
Nebraska 2,657,247 7.3 19,440 7.6
Idaho 2,760,852 7.1 17,840 6.9

Montana 1,841,421 4.7 9,197 3.6
Wyoming 1,523,422 3.9 5,034 2* '0
Kansas 1,522,317 3.9 64,271 2.4
Oregon 1,519,421 3.9 12,014 4.7

Florida 1,365,206 3.5 7,373 2.9
Washington 1,224,238 3.1 14,074 5.5
Arizona 1,177,618 3.0 3,709 1.4
Utah 1,025,014 2.6 10,282 4.0

Arkansas 1,010,200 2.6 5,728 2.2
New Mexico -822,637 2.1 5,698 2.2
Nevada 752,696 1.9 NA <1.4
Louisana 701,692 1.8 4,611 1.8

Oklahoma 524,065 1.3 3,809 1.5
Missouri 155,862 0.4 NA <1.4
Mississippi 149,920 0.4 NA 41.4

NA - Data Not Available

Source: Toups Corporation, Water Pollution Abatement Technology: Capabilities
and Costs, Irrigated Agriculture, 1976.

11-175

TABLE.II-662: FARM SIZE DISTRIBUTION IN THE WESTERN STATES

Fam Percent Percent CLEM-
Size Farms Of. irrigated Thtal Irrigated. lative
(acres) Reporting Fams Acres Acres

1-9 9,423 5.5 48,180 1,784,182 0.1 0.1
10-49 43,639 25.5 1,187,640 17,094,609 3.4 3.5
50-99 33,808 19.6 2,401,453- 20,886,224 6.9 10.4
1
199 37,898 21.9 5:j307,095' 34,139,817 15.5 25.9
00- 19.6 1-0,254.727 50,785,381 29.6 55.5
200-499 33,910
500-999 9,865 5.7 6,62@1182 28,558,057 19.0
1,000+ 4,299 2.5 8.1-817,870 37,174,801 25.5 100.0

Source: Toups Corporation, Water Pollution Abatement Technology:. Capabilities
and Costs, Irrigated Agriculture, 1976.

-The fraction of irrigated land that is drained varies widely in
different regions of the country, ranging from about two-thirds in
Florida to less than one percent in the lower Mississippi. These data,
along with figures on the amount of land irrigated by sprinklers and
surface irrigation systems are shown in Table 11-63.

Four primary methods are used for applying water to land. About 54
percent of the land is irrigated by furrows or ditches, 30 percent by,
flooding, 15 percent by sprinklers, and one percent by subirrigation,@@,
which is important in only a few regions of the country.

Sprinklers are g1nerally the most efficient method of applying
irrigation water because they allow excellent control of the amount,
applied and they provide uniform distribution of the applied water.
There are many areas, however, where sprinklers cannot be used because
of very low soil infiltration rates.

C. Cost and Effectiveness of Control 22tions

The cost and effectiveness of three levels of control of irrigation
return flow were investigated: "Low", "Medium", and "High". The three
levels are more descriptive of the cost of controls than, necessarily,
of their relative effectiveness in the control of pollution.

TABLE 11-63: DISTRIBUTION OF IRRIGATED LAND, METHOD OF APPLICATION OF WATER,
AND DRAINED LAND BY MAJOR DRAINAGE BASINS

Artificially Drained Land Undrained Land*

Region Sprinkler Surface Sprinkler Surface
Irrigation Irrigation Subtotal Percent Irrigation Irrigation Subtotal Total

I. Pacific
Northwest 180,067 445,198, 625,265 11.7 1,665,395 3,069,787 4,735,182 5,360,447

II. South.
Pacific 85,608 1,462,491 1,548,099 21.2 1,218,700 4,143,903 5,362,603 6,910,702a

III. Great Basin 3,261 229,899 233,160 15.6 116,228 1,142,065 1,258,293 1,491,453

IV. Colorado 720 210,149 210,869 8.3 79,444 2,242,211 2,321,655 2,532,524

V. Missouri 20,1;973 617,084 635,057- 8.9 858,994 5,635,754 6,494,748 7,132,805
V -I. Arkansas-Red 18,785 158,830 177,615 4.3 603,995 3,308,322 3,912,317 4,089,932 a/

VII. Rio Grande
& Western 14,188 223,832 238,020 3.9 1,074,342 4,246,943 5,321,285 5,559,305!@/
Gulf

VIII. Lower
Mississippi 15,406 0 15,406 0.8 37,458 658,851 696,309 711,715-

IX. :Florida 105,771 800,052 905,823 67.2 .373,175 68,862 442,037 1,347,860
444,779 4,147,535 4,589,314 10,418,736 24,516,698 30,544,429 35,136,843

Undrained land is defined as land that is not artificially drained.
a/ Acreage in rice production not included in total.
Source: Toups Corporation,.Water Pollution Abatement Technology: capabilities and Costs,-
Irrigated Agriculture 1976.

11-177

The low level of control would reduce the mass emission of pollutants
in return flow by increasing the efficiency of water use through irrigation
management servicing (IMS), or by tailwater recovery, as applicable. In
most cases, increasing efficiency reduces mass emission of dissolved
salts simply by reducing the mass of salt applied to the land. This
technique (IMS) has been developed in recent years and is presently
applied to about 1 percent of irrigated land. Detailed accounts of soil
moisture, soil moisture holding capacity, daily evapotranspiration
requirements, and other pertinent data are kept on a field by field
basis, usually on a computer. Proper manipulation of these data provides
the farmer with accurate information regarding the optimum date and
amount of his next irrigation.

This level of control was assumed to be applicable to all irrigated
land with artificial subsurface drainage facilities. Its application to
land that is irrigated by sprinklers and that is not artificially
drained cannot be charged to abatement of pollution, because such lands
do not normally have any point source return flows. Properly operated
sprinkler systems do not produce tailwater, because they apply water at
a rate equal to or less than the infiltration rate of the soil, and no
surface runoff occurs.

EPA effluent limitations as promulgated provide for monitoring of
return flows from.irrigation systems encompassing 3,000 or more acres,
although this size limitation has since been ruled illegal by the courts.
The cost estimates presented herein assume all will be required to
monitor their return flows, and the cost of monitoring has been estimated
to be about $2.00 per acre per year.

The cost of a typical irrigation management service averages about
$5.00 per acre per year and, since such a system does not eliminate
return flow, the cost of monitoring return flows must also be considered.
However, IMS has been estimated to save an average of about $2.00 per
acre per year in fertilizer cost, and this is estimated to balance the
cost of monitoring. Therefore, the low level of control is estimated to
result in a net cost of about $5.00 per acre per year.

The medium level of control would improve irrigation efficiency to
the maximum extent feasible by initiating IMS, lining unlined laterals
and canals, and installing sprinkler systems on all land that is now
surface irrigated. The above controls would apply only to surface
irrigated land that has no installed drained. The medium level of
control for land that is not artificially drained and that is surface
irrigated would be either sedimentation basins to treat tailwater or
recovery and reuse to eliminate the discharge of tailwater. Again, land
that is without installed drains that is sprinkler irrigated would
require no treatment.

11-178

The high level of control investigated would-add desalting of re-
turn flows from artificially drained lands to the medium level of
control, and would prohibit the discharge of tailwater by requiring the
installation of tailwater recovery systems, which are systems for
capturing and returning to the delivery system any water that runs off
the lower end of the field.

The theoretical effectiveness of each of these three options,
as demonstrated in laboratory soil columns, is shown in Table 11-64.
The effectivenes's shown in Table 11-64 could not be achieved in the
field because the variables such as precipitation, soil type, soil
texture, and soil uniformity cannot be controlled in the field as they
are in the laboratory, and because, even when land is drained, much of
the,return flow is not picked up in the drains.

TABLE 11-64: REDUCTION IN POLLUTANT LOADING ATTAINABLE UNDER LABORATORY
CONDITIONS FOR ASSUMED CONTROL OPTIONS

Reduction Below Existing Level (Percent)
Drained Land Undrained Land
Control Option Control Option
Constituent LOW medium High Low Medium High

Salinity (a) 20 30-50 90**
Nitrates 40-80
Sediment 20-40 100 100 20-40 100 100
Phosphates 20-40 100 100 20-40 100 100
Pesticides(b) 20-40 100 100 20-40 100 100

(alPercent reduction in tons.
(b)Pesticide pollution from surface flows
Negligible
Based on assumed 90 percent efficiency of R.O. desalting units

Source: Toups Corporation, Water Pollution Abatement Technology:
Capabilities and Costs, Irrigated Agriculture, 1976.

Annualized per-acre costs for the three options in different regions
.of the country are shown in Table 11-65. This table also provides cost
figures for drained and undrained land and for sprinkler and surface
irrigation systems.

11-179

TABLE 11-65: SUMMARY OF ESTIMATED ANNUALIZED PER-ACRE COSTS OF THREE
LEVELS OF CONTROL OF IRRIGATION RETURN FLOW

Cost of Control Option*`
Region, Irrigation, Irrigated Dollars per acre per year
And Drainage System Acres** Low Medium High***

I. Pacific Northwest 5,360,447
Sprinklers/Drained 180,067 5 42 85
Surface/Drained 445,198 5 81 124
Sprinklers/Undrained 1,665,395 0 .0 0
Surface/Undrained 3,069,787 5 7 7

II. South Pacific 6,910,702
Sprinklers/Drained 85,608 5 23 78
Surface/Drained 1,462,491. 5 117
Sprinklers/Undrained 1,218,700 0 0 0
Surface/Undrained 4,143,903 5 .7 7

III. Great 'Basin 1,491,453
Sprinklers/Drained 3,261 5 37 78.
Surface/Drained 229,899 5 76 117
,Sprinklers/Undrained 116,228 0 0 0
-Surface/Undrained 1,142,065 5 7 7..-

IV. Colorado 2,532,524
Sprinklers/Drained 720 5 42 94-,-:.
Surface/Drained 210,149 5 81 133,
Sprinklers/Undrained 79,444 0 0 0
Surface/Undrained 2,242,211 5 6 6.

V. Missouri 7,132,805'
Sprinklers/Drained 20,978 5 32 66-@
Surface/Drained 617,084- 5 71 105
Sprinklers/Undrained 858,994 0 0 0
Surface/Undrained 5,635,754 5 7 7

11-180

TABLE 11- 65. Continued

Cost of Control Option*-
Region, Irrigation, Irrigated Dollars per acre per year
and Drainage System Acres** Low Medium High***

VI. Arkansas-Red 4,089,932
Sprinklers/Drained 18,785 5 12 47
surface/Drained 158,830 5 51 86
Sprinklers/Undrained 603,830 0 0 0
Surface/Undrained 3,308,332 5 6 6

VII. Rio Grande-Western Gulf 5,559,305
Sprinklers/Drained 14,188 5 18 60
Surface/Drained 223,832 5 57 99
Sprinklers/Undrained 1,074,342 0 0 0
Surface/Undrained 4,246,943 .5 6 6

VIII. Lower Mississippi 711,715
Sprinklers/Drained 15,406 5 15 61
Surface/Drained 0 - - -
Sprinklers/Undrained 34,458 0 0 0
Surface/Undrained 658,851 5 7 7

IX. Florida 1,347,860
Sprinklers/Drained 105,771 5 7 46
Surface/Drained 800,052 5 47 85
Sprinklers/Undrained 373,175 .0 0 0
Surface/Undrained 68,862 5 6 6

No credit for fertilizer savings.
Does not'include rice cropland.
Does not include upslope drainage.

Source: Toups Corporation, Water Pollution Abatement Technology: Capabilities
and Costs, Irrigated Agriculture, 1976.

The cost figures shown.for the high option in Table 11-65 are based
on the assumption that the only irrigation return flow entering drains
on drained land is that which percolates past the root zone on the drained
land. This is an erroneous assumption in many cases, bec@us st of
the water flowing in many such drains was applied to land at higher
elevations, percolated through the root zone to the water table and was-
moving laterally downslope toward a surface stream when it was inter-
cepted by the drain. Thus, in many cases, the quantity of return flow
collected by drains would be from two to six or even 10 times the quantity
that percolates through the root zone on the drained land. Since this
is not always the case, it is estimated that the total quantity to be
treated might be two to four times the assumed quantity, and that the
total cost of the high option might be about twice the cost obtained by
summing total costs from Table 11-65.

Total estimated annualized and investment costs for the three
options are shown in Table 11-66. Investment costs for irrigators for
the low option are relatively low (compared to.the other options) because
it was assumed that most irrigators would purchase IMS as a service from
others rather than making the investment required to provide it to
themselves. Costs shown are the estimated costs of providing tailwater
recovery systems where such systems would be less expensive than IMS.

TABLE 11-66: TOTAL ESTIMATED NATIONAL COSTS OF CONTROL OPTIONS*

Control Investment Cost Annualized Cost
Option Billion) ($ Million/year)

Low 0.385 186
Medium 3.5 433
High 5.8-12.5 639-1255

No credit for existing controls.

Source: Toups Corporation, Water Pollution Abatement Technology: Capabilities
and Costs, Irrigated Agriculture, 1976.

d Energy and Manpower Requirements

Energy and manpower requirements for the control options are as
indicated in Table 11-67. Annual manpower requirements range from 9,000
man-years for the low option to 23,000 for the high option. Annual
energy requirements range from 107 million KWH for the low option to
.5,500 million KWH.for the high option.

11-182

TABLE 11-6-7:. SUMMARY OF ENERGY AND MANPOWER INPUTS

Installation Annual
Control Energy Manpower Energy Manpower
Option KWH(Mi'll.) Ma.@-yrs gal-gas (+) KWH(Mill.t@ Man-yrs

Low 7,895 3,459 341,530 107 8,850
Med* 12,725 81,510 3,094 22,022
High** 36 , 210 12,725 64,240 5,468 23,185

*Medium option (for all regions) does not include installation and annual
energy and manpower requirements for canal and lateral lining.

"High option (for all regions) does not include (*) above, or energy and
manpower requirements for installation of desalination systqlas.

Source: Toups Corporation, Water Pollution Abatement Technology:
Capabilities and Costs, Irrigated Agriculture, 1976.

4. Nonpoint Agricultural Sources

Runoff from agricultural cropland may deliver sediment, fertilizer,
pesticides, and organic material to@surface waters.

Non-irrigated cropland in the United States was estimated to total
about 380 million acres in-1967, roughly 90 percent of the total crop-
land. The volume of runoff from precipitation can be predicted with
reasonable accuracy, but the quantiiies of pollutants dissolved and
suspended in such runoff is much less amenable to accurate estimation.
Estimates of sediment delivery can be made, and associated quantities of
nitrogen, phosphorus, pesticides, and BOD can be estimated if one assumes
them to be present in sediment in proportion to their concentrations in
soil. The present estimates of quantities delivered to surface waters
and the quantities estimated to be delivered after compliance with one
system of control measures are shown in Table 11-68.

11-183

TABLE 11-68: QUANTITIES OF POLLUTANTS ESTIMATED'TO BE DELIVERED TO
SURFACE WATER ANNUALLY IN AGRICULTURAL RUNOFF BEFORE
AND AFTER IMPLEMENTATION OF CNI-RECOMMENDED CONSERVATION
PRACTICES

Quantity Delivered to Surface Waters

Pollutant Present After Implementation

Sediments 1,800 million tons 921 million tons
Nitrogen 4.3 million tons 2.2 million tons
Phosphorus 1.5 million tons 0.8 million tons
BOD 8.6 million tons 4.4 million tons
Pesticides 1.8 million pounds 0.9 million pounds

Source:^ Midwest Research Institute, Water Pollution Abatement Technology:
Capabilities and Costs, Control of Water Pollution from Selected
Nonpoint Sources, 1975.

The only measures evaluated for reducing pollutant contributions to
streams were those recommended by the Soil Conservation Service in its
1967 Conservation Needs Inventory (CNI). This CNI indicates that about
158 million acres - 40 percent -,of nonirrigated cropland needs to have
better soil conservation practices applied to it. The measures re-
commended and their costs are shown in Table 11-69. Potential benefits
accruing from implementation of these conservation practices have not
been considered.

implementation of these practices is estimated to require a capita1
investment of $2.6 billion.

The cost of preventing large quantities of sediment and pollutants
associated with sediment from reaching surface waters by better soil
conservation practices is seen to be about $0.73 per ton of sediment
saved. It is not clear that any mechanism now exists, however, that
could dictate implementation on all the land needing treatment, even if
all investment costs were borne by the government.

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TABLE 11-69-. COST OF IMPLEMENTING CONSERVATION PRACTICES INDICATED BY
CNI TO BE NEEDED IN CONTINENTAL U.S.

Acres Requiring rfbtal Annualized Annualized
Treatment Cost cost/acre
($/AC/yr)

Annual Cover 60,576,185 $287,000,000 $4.75

Sod 22,116,005 .101,200,000 4.58

Contour 16,033,297 7,900,000. 0.49

Terrace 316,218 500,000 1.73

Permanent Cover 15,848,194 100,000,000 6.36

Drainage 43,003,645 139,500,000 3'.24

Thtal 157,893,544 637,400,000 $4.04

Source: Midwest Research Institute, Water Pollution Abatement Technology:_
Capabilities and Costs, Control of Water Pollution from Selected
Nonpoint Sources, 1975.

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F. SELECTED NONPOINT SOURCES

1. Introduction

Certain nonpoint sources may contribute large quantities of pollutants
to the nation's waters on a temporary or intermittent basis. Construction
and timber harvesting are two activities that may cause large temporary
increases in the contribution of sediments and other pollutants to
receiving waters. Inactive mines, subsurface disposal, and salt water
intrusion may contribute pollutants either continuously or intermittently,
depending on local circumstances. These nonpoint pollutant sources are
significant to the Commission's study of the requirements of P.L. 92-500
because they may in some instances overwhelm and negate the reductions
achieved through point source effluent limitations. More commonly,
however, point sources are of primary concern during low-flow conditions
of streams when nonpoint sources (except for sources such as acid drainage
from inactive mines) are either non-existent or of minimum impact.
Nonpoint pollutants are usually contributed during high flow conditions
when point sources have little or no impact on water quality.

All data presented herein should be considered to be gross approxi-
mations rather than precise estimates because of the shortage of reliable
data on any of'these subjects.

2. Silviculture and Timber Harvesting

About 500 million of the 2.3 billion acres of land in the 50 states
are in commercial forests. About 1.7 and 1.5 million acres were harvested
in 1965 and 1970, respectively(37).

Logging operations, logging road construction and maintenance, and
site preparation for reforestation are the components of silviculture
and timber harvesting operations that have the greatest potential for
increasing the contribution of pollutants,(chiefly sediment) to surface
waters. All of these operations disrupt the overhead canopy and the
soil surface to some extent. Both disruptions increase erosion potential.

Logging operations are the major cause of increased sediment yield
in the Northeast and Pacific Northwest, while site preparation for
reforestation of upland forests predominates in the Southeast. Site
preparation frequently involves bulldozing, windrowing, and burning the
scrub hardwoods which grew in the shelter of the harvested timber and
must be removed before pines can be re-established(36).

The effect of a change in logging practice -- from skidding felled
logs to a loading point by use of tractors to non-tractor yarding (high
lead, skyline, balloon) -- was examined for the Northeast and Northwest.

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This change is estimated to decrease sediment yield on the order of one-
half ton per acre, and to increase logging costs by $39 to $130 per
acre(36).

The effect of a change in site preparation method for upland forests
from bulldozing and burning to chopping with a drum chopper was examined
for the Southeast. This change is estimated to reduce sediment yield by
as much as 70 percent (14 tons/acre, average) and to reduce the 'Cost of
site preparation by $26 to $39 per acre(36). It would not be applicable
to flatland coastal areas. A disadvantage of the method is that it
requires more frequent controlled burning of the growing forest to
control scrub hardwood size, thereby increasing air pollution to some
extent.

3. Construction

About 1.6 million acres of land are disturbed annually by construction
activities, 90 percent for highways and roads, and 5 percent each for
urban residential and urban non-residential construction.

The annual sediment yield from uncontrolled construction sites is
estimated to average 200 million tons, an average of 124 tons per acre
of disturbed land and 11 percent of the yield from the 380 million acres
of non-irrigated cropland.

Controls such as sedimentation basins, diversion ditches, sodded
ditches, grade stabilization, and other effective practices can be used
to control sediment production. In addition to reducing the sediment
contribution to surface waters, such controls may yield benefits in the
form of reduced quantities of fill dirt that must be hauled to the
construction site.

costs are estimated to range from about $910 to about $1,482 per
acref (average $1,170 per acre) for a reasonable mix of the above
measures(36). This would total $1.8 billion per year.

The proposed sediment controls are predicted to reduce sediment
yield by about 70 percent, or 140 million tons per year(36).

4. Inactive and Abandoned Coal Mines

The primary water quality problems associated with inactive mines
are sediment production from denuded areas and acid production from
exposed reactive areas. Sediment production problems may occur in all
areas where mining has been practiced, but acid mine drainage is .confined
primarily to the Appalachian coal fields. Total acreage utilized for
all mining activities in the nation from 1930 to 1971 is shown in Table
11-70.

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TABLE 11- 70

LAND UTILIZED FOR MINING IN UNITED STATES 1930-1971

Use Acres Utilized

Surface Mined 2,170,000
Waste area for surface mines 733,000
Subsided or disturbed by underground mines 105,000
Waste area for underground mines 190,000
Waste area for milling 454,000

Total 3,652,000

Source: CONSAD Research Corporation, The Cost Model for Mirfiftg,
Report to EPA, March 1975.

Yegetative buffer strips along affected streams have been shown to
be effective in abatement of sediment delivery. The width required is a
function of land slope, with 145 feet estimated to be required for a 30
percent slope. The cost of establishing such vegetative buffers is
estimated to average $520 per acre, or about $9,000 per mile of affected.
stream ($18,000 per mile-if sediments are delivered from both sides) :
About 5,000 miles of stream are reported to be affected by sediment in
Appalachia(38).

Acid production from surface mined lands can be controlled most
economically by reclaiming (including revegetation and silt control) the
affected land at a cost ranging from $130 to $5,200per acre, and averaging
$2,100 per acre. About one-third of all acres of inactive surface coal
mines in Appalachia are estimated to need such reclamation(38).

over half of all acid mine drainage is discharged from inactive
underground. mines(39). The cost of neutralization with limestone was
reported in 1969 to range from $Q.20 to $0.50 per thousand gallons,
depending upon'the strength and quantity of the acid(39). About 5,700
stream miles in Appalachia are affected by acid mine drainage.

5. Subsurface-Disposal

The deliberate use of subsurface excavations for waste disposal is
a growing practice that poses a continuing threat to the nation's ground-
water quality. Presently, the wastewater derived from about 32 million
people is discharged to septic tanks or cesspools, about 300 million
tons of municipal and industrial solid waste are buried in landfills

_AW

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each year, and around 300 industrial wastewater injection wells are in
operation in the country(40). The'subsurface is also used inadvertantly
for disposal of liquids spilled on the surface and leaked from pipelines,
pits, lagoons and storage tanks.

The threat to groundwater quality -- and ultimately to surface
water quality -- by subsurface disposal can never be entirely eliminated.
In most cases, it can be minimized by judicious site selection, utilization
of sound and proved design procedures, and careful management and
6peration of the facility. In rare cases, it must simply be'recognized
that groundwater quality deterioration will be an inevitable consequence
of development, and appropriate plans must be made to deal with the re-
sulting problem..

6. salt Water Intrusion

Only eight of the 50 states do not report salt water intrusion
problems(40). Seawater intrusion.into coastal aquifers as a result of
overpumping fresh groundwater is a ubiquitous problem in most coastal
states. Upstream encroachment of seawater as a result of deepening of
channels for navigation and of reduction of streamflow because of in-
creasing consumptive uses upstream presents problems to municipalities,
industries. and agriculture(40).

More than two-thirds of the nation is estimated to be underlain by
saline water. Frequently, saline water and fresh water are in direct
contact in an aquifer. In other cases, fresh and saline water aquifers
that were originally separated by impermeable strata have 'been connected
inadvertantly by improperly completed or sealed oil and gas wells or by
other disruptions of the earth's surface(40).

Salt water intrusion can be controlled or prevented in several ways
that are simplein concept, but that may be very difficult, expensive,
or impossible of implementation.

Seawater intrusion into bays and estuaries can be controlled (con-
ceptually at least) by increasing freshwater inflows, construction of
navigation locks, or allowing navigation channels to silt up. Seawater
intrusion into coastal aquifers can be controlled by decreasing with-
drawal, increasing freshwater recharge, or construction of hydraulic or
mechanical barriers between the fresh and saline parts of the aquifer.

Intrusion of underlying brine into freshwater aquifers through
improperly completed or abandoned wells can be controlled by finding and
sealing the offending wells(40)..-

one or more of the above solutions is likely to be effective in
solving the problem in any particular area, but the cost of implementation
cannot be generalized because of the extreme dependency of the optimum
solution on site specific conditions.

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G. OBSERVATIONS AND FINDINGS

Publicly Owned Treatment Works

1. Technology exists to achieve the 1977 "secondary treatment" and
1983 "best practicable waste.treatment technology over the life of the
wor-ks" requirements for publicly owned treatment works. As now inter-
preted by EPA, virtually no difference exists between them. EPA has
defined secondary treatment as follows:

Maximum Average Concentration
Characteristic Unit of 30 Consecutive 7 Consecutive
of discharge measurement Days Days

Biochemical oxygen
demand (5-day) mg/1 30(a,b) 45(b)
Suspended solids mg/1 30(a,b) 45(b)
Fecal Coliforms No. per 100 ml 200(c) 400(c)
pH pH units between 6.0 and 9.0 at all times
1310r, in no case more than 15 percen't of influent value.
(blArithmetic mean.
rc)Geometric mean.
,Source: 40 CPR 133. "Secondary Treatment information," Federal Register
Vol. 38, No. 159, pp. 2298-2299,.August 17, 1973.

Reftntly, EPA has, proposed that the fecal coliforms requirement be re-
moved from the definition of secondary treatment and that disinfection
be practiced only where required to achieve water quality'standards.

2. Of the approximately 16,000 treatment facilities'in place in 1974,
over 80 percent provide some form of secondary treatment (often not
achie,@ing effluent limitations consistent with EPA's definition) and
about 5 percent provide some type of treatment more advanced than
secondary. More than 3,000 untreated discharges are estimated to still
exist.

3. About 78 percent of the facilities with some type of construction
need are smaller than one MGD capacity (equivalent to about 10,000
contributory population), but these plants only account for about 7
percent of the projected 1990 flow'in plants requiring construction.
,Plants larger than 20 MGD (about 200,000 contributory population) con-
stitute only 2 percent of the facilities, but account for 61 percent of
the flow.

11-190

4. In 1970, about 144 million people -- 70 percent of the total
population -- were connected to public sewer systems. An estimated
210 million (82 percent) of the projected 1990 population of 256 million
will be served by sewers.

5. The Commission has used the 1973 and 1974 EPA Needs Surveys as the
primary source.of information for identifying publicly owned treatment
works which need to construct treatment or collection facilities to
meet more stringent effluent limitations, serve increased populations
or simply upgrade existing facilities. The Commission independently
derived costs to provide for projects capable of serving the.projected
1990 population and not funded as of June 1974. It modified population
estimates by state and local governments to conform with,acceptable
estimates. While effluent limitations projected in the Needs Survey
by state and local governments are intended to produce compliance with
the 1983 interim goal, there is considerable debate and uncertainty
over whether the projections are based on adequate information. Since
the Commission was unable to provide better site-by-site projections of
the application of effluent limitations, its estimates are based on the
Needs Survey. Cost estimates for all required.iacilities compared to
those of EPA in the 1974 Needs Survey are shown in Table 11-17, page
11-39.

6. The 1974 EPANeeds Survey contains six categories, with two further
subdivided. Category I, Secondary Treatment, and Category II, Treatment
to Meet More Stringent Effluent Limitations, provide for all treatment
plant heeds except those associated with control of combined sewer
overflows and storm sewer discharqes. The total estimated cost for
Category I, Secondary Treatment ($10.8 billion) and Category II, Treat-
ment to Meet More Stringent Effluent Limitations ($24.8 billion), is
$35.6 billion. While the total is considered reliable, the individual
components may not be strictly correct because state and local governments
sometimes reported facilities in the wrong category.

7. *In an effort to report what effect differ@nt effluent limitations
have on costs, the Commission also has estimated what portion of the
treatment plant costs is associated with secondary treatment and what
-portion is necessitated by treatment to meet more stringent effluent
limitations. This estimate totals $27.8 billion for 1) plants which
require secondary treatment only and 2) the secondary treatment portion
of plants required to meet more stringent effluent limitations. The
remaining $7.8 billion is attributable to treatment more advanced than
secondary treatment needed to comply with water quality standards (both
existing and as projected to meet the 1983. interim goal) or state and
local standards requiring-,more stringent effluent limitations than the
EPA definition of secondary treatment.

11-191

8. Although EPA has, in effect,,not required stricter minimum limi-
tations for BPWTT (the 1983 requirement) compared to secondary treatment,
the Commission did estimate the cost of achieving a more stringent
minimum effluent limitation than secondary treatment as defined by EPA.
The Commission examined a level similar to that once considered by EPA,
requiring a limitation onultimate oxygen demand when the wastewater
temperature exceeds 20* C. Meeting this effluent limitation would
entail strict control of BOD, ammonia reduction or both. Facilities
serving a population of fewer than 10,000 and located outside SMSA's or
those discharging to ocean waters were not included. The additional
cost to achieve this higher level of treatment is estimated to be $1.4
billion.

9. Sewage collection system costs are covered by two categories (each
with two subcategories) in the 1974 Needs Survey. After exploring
alternative means of providing independent estimates, the Commission
determined that the costs submitted in the 1974 Needs Survey for Categories
IIIA, Infiltration/Inflow Correction, and IIIB, Major Sewer System
Rehabilitation, were as reliable as could be obtained. The costs estimated
by the 1974 Needs Survey were $6.9 billion for IIIA, and $9.5 billion
for IIIB. The Commission's estimates are $13.0 billion for Category
JVA, New Collectors and $13.5 billion for Category IVB, New Interceptors.

10. Category V, Correction of Combined Sewer overflows, is difficult to
assess since EPA is not applying a: technology based effluent limitation
to combined sewer systems. Best practicable waste treatment technology
will be@utilized to fix requirements on combined sewer systems on a
case-by-dase basis. The Commission has estimated national co6ts for a
spectrum of effluent limitations which might be applied to combined
sewers. Cost estimates range from $1.5 billion for treatment of only
that volume which can be stored in-line to $88.4 billion for providing
secondary treatment of all combined sewer flows. in its cost estimate
of total publicly owned treatment works costs, the Commission has selected
a combination of primary treatment for all systems discharging to effluent
limited waters and secondary treatment for'those discharging to water
quality limited waters. The estimated cost for this combination is
$79.6 billion, with over 80 percent attributable to storage facilities.

11. Category VI, Treatment and/or Control of Stormwaters, presents
difficulties similar to those for combined sewers. There are not
uniform standards upon which to base technologies and costs, since
effluent limitations or control or treatment measures for storm sewer
discharges have not yet been considered by EPA. The Commission has
assessed several alternative technologies, with national costs ranging
from $160 billion for removal of debris to $430 billion for physical-
chemical treatment. For purposes of estimating national totals, the
Commission has estimated the costs for control or treatment systems

11-192

which will remove sediment and destroy bacteria from storm runoff from
the urbanized areas contained within the nation's 243 SMSA's. The
estimated cost is $199 billion, $92 billion of which is attributable to
stormwater collection.

12. Commission projections based upon Needs Survey responses and other
technical data indicate that a preponderance of publicly owned treatment
works will use some form of biological system to achieve secondary
treatment.* The larger biological systems will use mostly activated
sludge, with the smaller ones employing activated sludge, trickling
filter and lagoon-type systems almost equally. Physical-chemical
processes will be used where phosphorus removal or strict control of
suspended solids is required. Nitrogen reduction is infrequently required
but technically feasible. For proposed and existing treatment plants
which require new construction by 1990 to achieve compliance with effluent
limitations, the projected numbers of plants using the more common
technologies are estimated as follows:

Activated Sludge 6,000
Trickling Filter 4,500
Aerated Lagoon 1,000
oxidation Pond 3,500
Physical-Chemical 100
Land Application @1,000

13. Aerated lagoons and oxidation ponds often do not meet the svispended
solids limitations of the secondary treatment definition promulgated by
EPA, and additional upgrading is necessary. The solids are mostly algal
cells used in treating the wastewater, and this type solid may not exert
the detrimental effect normally exerted by the suspended solids present
in secondary effluent. Some argue that the Act does not require a
uniform definition of secondary treatment for all types of technologies
employed by publicly owned treatment works. EPA thus far has taken this
approach, but,may be reconsidering its definition.

14. The estimated raw sludge production from publicly owned treatment
works (not including separate stormwater treatment) in 1972 was 4.7
million tons per year (dry weight). By 1990, an increase to about 14
million tons (dry weight) it expected. Processes which convert the
sludge to gases -- portions of which are usable as fuel -- can reduce
the 1990 totals to about 10 million tons (dry weight). Sludges are
difficult to dewater, and will be even more difficult as higher levels
of treatment go into effect. Large quantities of water will accompany
the sludge to disposal sites or will require evaporation where sludge is
treated thermally.

15. Treatment of separate storm sewer discharges would add about 10
million tons of sludge per year (dry weight). Sludges from storm sewer
treatment are not readily converted to gases.

11-193

16. Land application of wastewater and sludges has gained considerable
attention in recent years. only a small percentage of publicly owned
facilities will utilize land treatment for wastewater; however, many
will resort to land (either in the crop production mode or by land-
filling) for disposal of municipal sludges. Many states have regulations
which restrict land application of wastewaters unless they have pre-
viously been treated to some degree, usually a level approximating
secondary treatment. The cost of a land treatment system in those cases
becomes equal to, or more expensive than, activated sludge, trickling
filter or lagoon systems. While many municipalities now practice or
contemplate landfilling of sludges, land application combined with
production of crops is a promising sludge utilization technology. A
major deterrent is health concern about consuming crops fertilized with
residuals from human and industrial wastes. Institutional problems are
severe. Large metropolitan areas must invariably seek disposal sites in
neighboring political subdivisions, since suitable quantities of land
are not usually available within their boundaries.

17. Annual operating manpower is projected to increase from 107,000
people estimated to be required to adequately operate existing facilities
in 1973 to.185,000 people by 1990, when the facilities reach their de-
sign capacity, exclusive of control of separate storm sewer discharges.
Control of storm sewer discharges could add 24,000 people to the 1990
total.

18. Electrical energy demands for all mun icipal systems-(except control
of separate storm sewer discharges) are estimated to increase from 7.6
to 22 billion kilowatt-hours per year between 1973 and 1990; fossil
fuels from 72,000 to 87,000 billion BTU's per year. Converting the two
types of energy to a common base, an increase of 106 percent is required,
equivalent to 27 million barrels of oil per year (76,000 barrels per
day). The increase Amounts to 0.20 percent of the.1973 national energy
use, while the total energy requirement in 1990 for publicly owned
treatment works (except storm sewers) equals 0.41 percent of the 1971.
national energy use. If control of separate storm sewer discharges were
included, the 1990 energy requirement expressed as a fraction of-the
1973 national energy use would increase an additional 0.04 percent.

19. If all publicly owned point-source discharges (except separate
storm sewers) are-controlled, 45, 13 and 13 percent decreases in the
discharge of biochemical oxygen demand, suspended solids and phosphorus,
respectively, are expected by 1990 as compared with 1973-(allowing-for*
the increased population and assuming that the total 1973 load for storm
sewers is still being discharged in 1990). However, the discharge of,
nitrogen will not decrease, since increased contributions will offset
removals by facilities specifically designed to remove nitrogen. If
separate storm sewer discharges are also controlled, the reduction in
BOD, suspended solids and phosphorus will be 52, 60 and 16 percent,
respectively, while nitrogen reduction stays about the same. Considering

11-194

only the pollutants associated with wastewater systems (including combined
sewers but excluding separate storm sewers), 58 percent reduction in
BOD, 61 percent reduction in suspended solids and 14 percent reduction
in phosphorus will be achieved by the controls to be implemented by
1990.

Industry

1. For the most part, technologies are or will be available to meet
the 1977 "best practicable control technology currently available" (BPT)
and the 1983 "best available technology economically achievable" (BAT)
requirements promulgated by EPA. Potential problems exist where technology
must be transferred from one application to another and where technologies
may not be able to consistently'achieve short-term (24 hour) effluent.
limitations.

2. The technologies which will be employed for achieving the BPT
effluent limita*tions are predominately end-of-pipe treatment. The
technologies for achieving BAT incorporate more process changes, although
additional end-of-pipe treatment is indicated in most cases.

3. For purposes of subcategorizing broad industrial classifications,
the subcategories used by EPA in developing effluent limitations are
generally suitable for application of common types of technologies.

4. Some difficulty may be expected in applying effluent limitations
for some industries with multiple process waste streams discharging into
a common treatment facility since effluent limitations are normally
associated with an individual process stream. The technologies required
for the combined process waste may be different from those employed if
the wastes were segregated. Effluent limitations have not been issued
(and apparently will not) for all products which contribute to every
waste stream. in these cases, some allowance must be made for the
increased pollutants attributable to the products for which no effluent
limitations have been promulgated.

5. The EPA effluent limitations specify numerical effluent require-
ments, not technologies. However, use of specific technologies was
comkidered in deriving the effluent limitations. In some cases, it will
be necessary to use more sophisticated, and more expensive, technologies
to assure compliance than were contemplated by EPA in developing the
effluent limitations.

6. In some cases, technologies in use for one process will ,have to be
transferred to another (or even another industry) to achieve compliance
with the effluent limitations. In other words, "practicable" and "available"
technologies are not now being used within a given industrial category
or subcategory in the specific manner that will be required.

11-195

7. While it will usually be possible to achieve the effluent limi-
tations on the basis of long-term averages (monthly and yearly), limita-
tions inherent in EPA's suggested technologies will sometimes preclude
achieving the-short-term (24 hour) limitations. Either technologies
other than or in addition to those contemplated by EPA will have to be
installed or those discharges using the technologies suggested by EPA
will violate the short-term limitations during some time periods.

8. The statistical methods employed by EPA to relate short-term to
long-term effluent limitations were not always consistent. Considering
the lack of background data, perhaps only long-term effluent limitations
can be adequately prescribed until additional information is developed.

9. The total capital costs to comply with BPT and pretreatment re-
quirements for industry as it was structured in June 1973 is $42.1
billion; the incremental capital cost above BPT to comply with BAT and
pretreatment requirements for industry as it was structured in June 1973
is $31.;5 billion. The total O&M cost in addition to 1973 requirements
to comply with BPT and pretreatment requirements for industry as it was
structured in'June i973 is.$7.3 billion per year; the incremental O&M
cost above BPT to comply with BAT and pretreatment requirements for
industry as it was structured in June 1973 is $6.4 billion per year.
The costs do not take into;account-new plants or plant closures, both of
which will affect actual expenditures.

10. Technologies installed to meet the 1977 and 1983 effluent limitations
will require considerable additional energy. Converting all energy
requirements to one common type of fuel, the equivalent of 169,000
barrels of oil per day would be required to meet the new energy demands
of the BPT requirements for industrial capacity as it existed in June
.1973; the equivalent of 211,000 barrels of oil per day would be required
to meet the additional energy demands of the BAT requirements for indus-
trial capacity as it existed in June 1973. The additional energy equals
0.48 percent of the 1973 national energy use for BPT and an additional
0.60 percent forBAT.

11. The'above figures do not take into account the energy penalty re-
sulting from installation of cooling towers at steam electric power
plants. From'0.06 to 0.40 percent of the 1973 national energy use could
also be required by 1983 to account for the cooling tower penalty. The
actual-loss will depend upon the number of steam electric power plants
which must:comply with new regulations.

12. A significant portion of industry discharges wastes to publicly
owned treatment facilities. Normally, industries discharging to municipal
systems tend to be smaller water users located in metropolitan areas.
Pretreatment standards for industries discharging to municipal systems
have not been :, finallyIestablished by' EPA, and the range of possibilities

11-196

presented to date in different EPA documents under.consideration at one
time or another would have drastically different impacts. Commission
studies assumed pretreatment equivalent to BPT for "incompatible" pollutants,
the EPA position at the time the studies were conducted (i.e. prior to
July 1, 1975.). The predominant portion of the 1977 costs for some
industries is attributable to compliance with pretreatment requirements
rather than direct discharges to navigable waters.

13. Reliable estimates of what technologies will be required for water
quality limited waters and at what cost have not been possible to obtain
on an industry-by-industry basis. Where information was available,
technology more stringent than required for achieving BPT but generally
less stringent than required for achieving BAT will be required when
discharging to water quality limited waters.

14. Industrial plants which start construction of a new facility or add
significantly to existing facilities must comply with new source performance
standards (NSPS), which the Act requires be equivalent to "best available
demonstrated control technology". The technologies considered necessary
to meet'these standards are often similar to those for achieving BAT,
and some difficulty may be encountered where transfer of technology is
required. However, more options are available when designing new facili-
ties than retrofitting existing facilities, which should'mitigate the
transfer difficulties in most cases.

15. Some technological solutions rely upon significant reduction in
water usage or recovery of by-products. While the full potential of
such approaches has not been fully developed, this type solution to
meeting effluent limitations is expected to become more prevalent.

16. Residuals remaining after treatment ("sludges") must be disposed of
or reused. There is potential for reuse of some sludges, and research
is underway in that direction. However, even recovery of by-products
still leaves a significant disposal problem for the unusable portion.
Incineration and landfilling are commonly employed methods of disposal.
Incineration must be performed in a manner that does not transfer the
pollutants to the atmosphere; land disposal must assure protection of
groundwaters and crops. Landfilling is the most commonly practiced
technique of ultimate disposal of industrial sludges.

17. Since EPA has not established toxic standards, it was difficult to
adequately assess the technological solutions available to achieve
controLof toxicants and the possible c osts of these technologies.
Under preliminary regulations, several industries will be impacted
significantly by toxic control 's. An adequate evaluation of this issue
was simply not possible, although techniques to achieve compliance were
explored and technologies are clearly available for some industries; for
others, major changes in process or treatment technologies may be necessary.

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Innovative Technology

1. Technologies are available, or will become available in the fore-
seeable future, to achieve or closely approach the elimination of the
discharge of pollutants (EOD), a stated goal of the Act.

2. The Commission has defined EOD as follows:

"The elimination of the discharge of pollutants shall apply,
to removal of those constituents which are added during use
of the water. The resultant-discharge must be of equal or
lower concentration than that of the original supply."

Since the Act does not define EOD, various interpretations have been
prepared. The chosen interpretation is important in assessing possible
technologies and costs.

@3. For some subcategories of some industries, the BPT and BAT effluent
limitations will achieve EOD. EOD usually is achieved by eliminating
the discharge of water, not by treatment and discharge. Most applications
involve relatively small water users, where the wastewater can be
treated and recycled. The most significant case requiring EOD is the
BAT limitation for metal finishing.

4. The dominant technological consideration for achieving EOD is the
capability for removing dissolved salts normally not covered by BPT or
BAT effluent limitations. Removal of these salts creates large quantities
of brines, which are difficult to dispose of'in an acceptable manner.

5. Technologies capable of achieving EOD are considerably more costly
than those for achieving BPT or BAT.

6. Technologies for achieving.EOD are energy intensive.

7. Land application is often regarded as a technological solution for
achieving EOD. While land application usually accomplishes somewhat
more effective removal of BOD, suspended solids and-nutrients from
untreated wastewaters than most conventional secondary treatment processes,
it will not, by itself, achieve EOD. Additional technologies to remove
dissolved salts and other contaminants would be required, just as would
be required following other secondary processes. in effectf land appli-
cation is similar to secondary treatment but serves as an efficient .
"pretreatment" system for the add-on innovative technologies which must
also be employed for achieving EOD.

8. To accelerate development of technologies capable of achieving EOD,
research and development efforts should be concentrated on dissolved
salt removal technologies, as well as on land application.

11-198

Agriculture

1. Drainage systems have been installed on about 55 million acres of
non-irrigated land and on about five million acres of irrigated land.
Although concentrations of all pollutants except dissolved mineral salts
are similar in drainage from irrigated and non-irrigated land, permits
are required only for return flows from irrigated land. @Ihile subsurface
drainage from non-irrigated land does po@ present a problem with dissolved
mineral salts, nitrate co'ncentrati6n@ are sometimes quite high.

2. Techniques that will control irrigation return flow pollutants have
generally been applied because of their beneficial impact'oh crop production,
rather than their capability for reducing pollutants. Increasing i .rriga-
tion efficiency is the main thrust of these efforts, and is beneficial
in reducing salts in iet*U'rn flows where leac4able saltsIare present in
the soil.

3. The techniques producing the greatest reduction in pollutant dis-
charges are improved irrigation sic@eduling, tailwater recovery, installa-
tion of sprinklers and lining of canals. Each technique is not always
applicable or capable of being implemented for every irrigated area
since site-specific consideratiohs are of prime importance.'

4. Increased irrigation efficiency may have an adverse effect upon
both the quality @nd the quantity of water in receiving streams where
flow during normally dry periods has been augmented by return flows from
alluvial groundwater baiiiis. In lands without installed subsurface
drainage, the quantity.replenishing the groundwater will be reduced and
groundwater quality may be impaired.

S. Improved irrigation scheduling can be obtained under service
contracts. A major limitation is the*availability of water in the
needed quantity at the right time. Where it can be employed, irrigation
demands'can be reduced by 20 percent, resulting in a decrease in volume
of irrigation return flow of up to 40 percent. Crop yield may increase
an average of 15 percent, The discharge volume of most pollutants is
reduced'fkom 20 to 40 percent, and the cost, assuming major structural
changes in the delivery system are not required, is estimated at about
.$5 per acre per year.

6. If tailwater recovery is practiced, the cost would approximate that
of an irrigation scheduling service but benefits to crop production may
not be'as great. Tailwater recovery will also prevent discharge of
sediments and pesticides to surface waters.

7. Although more expensive and energy intensive, sprinkler systems
have been installed extensively in recent years to increase irrigation

11-199

efficiency. Their effectiveness in controlling pollutants is about the
same as improved irrigation scheduling.

8. Desalting point source irrigation return flows is very expensive,
up to $130 per acre per year, and its benefit is severely limited since
only about 12 percent ofirrigated land isdrained, making it difficult
to collect the water for desalting. Return flows from land without sub-
surface drainage systems are returned as nonpoint sources and would not
be impacted by thedesalting treatment systems.

9. Agricultural pollution controls involve a complex matrix of variables.
Site-specific considerations are of prime importance, whether considering
water quality or crop yields. In some cases, water rights may be affected
by water pollution control policies.

10. Control of runoff from feedlots is required under the point source
provisions of the Act. The national cost for controlling feedlots is
very dependent upon which feedlots are placed under regulation. The
most recent-proposal by EPA in November 1975 would require control of
all feedlots larger than the equivalent of about 1,000 animal units and
all those*smaller contributing to pollution. The total capital costs
for all feedlots over 1,000 animal units for achieving BPT (control
runoff from 10 year, 24 hour storm) is estimated to be $113 million,
with an additional.$35 million required for achieving BAT (25 year, 24
hour storm). If all potential problem feedlots were controlled, about
$724 million capital costs would be required for BPT and an additional
$172 million.required for BAT. The cost per head will vary widely
depending upon climatic factors and the size of the facility.

Nonpoint'Sources

1. The nonpoint contribution of sediments and other pollutants to
surface waters by runoff from non-irrigated cropland could be reduced by
almost one-half by applying recommendations of the Soil Conservation
Service to all cropland needing improved practices. About 160 million
acres -- 40 percent of all non-irrigated cropland -- would benefit from
application of these recommendations. The estimated investment cost
would be about $2.6 billion, with the total annualized cost estimated at
$0.65 billion per year.

2. Control of other selected nonpoint sources was assessed in a
cursory manner. Promising control strategies are usually related to
changing operating techniques rather than by treatment.

11-200

REFERENCES

(1) 40 CFR 133. "Secondary Treatment Information." Federal Register,
Vol. 38, p. 2298, August 17, 1973.

(2) Environmental Protection Agency, "Alternative Waste Management
Techniques for Best Practicable Waste Treatment." March 1974.

.(3) Metcalf and Eddy, Inc., Water Pollution Abatement Technology:
Capabilities and Costs, Publicly Owned Treatment Works. National
Commission on Water Quality. 1976.

(4) U.S. Environmental Protection Agency, draft Water Quality Strategy
t
Paper, third edition. June 1975.

(5) American Public Works Association, An Analysis of the U.S. Environme ntal
Protection Agency's 1974 Needs Survey. National Commission on Water
Quality. 1975.

(6) 40 CFR 227. "Criteria for the Evaluation of Permit Applications."
Federal Register, Vol. 38, p. 28618, October 15, 1973.

(7) U.S. Environmental Protection Agency, "Municipal Sludge Management:
Environmental Factors." Technical Bulletin, EPA 430/9-75-XXX, 1974.

(8) 40 CFR 24. "Guidelines for the Land Disposal of Solid Wastes."
Federal Register, Vol. 39, p. 29328, August 14, 1974.

(9) Metcalf and Eddy, Inc., Urban Stormwater Management and Technology:
An Assessment. U.S. Environmental Protection Agency, Cincinnati, Ohio.

(10) U.S. Department of Commerce, Bureau of the Census, 1970 Census of
Population, Vol. 1, U.S. Government Printing.Office, May 1972.

(11) American Public Works Association, Institute for Solid Wastes,
Municipal Refuse Disposal. Public Administration Service, Chicago.
1970.

(12) Black, Crow and Eidsness, Inc. and Jordan, Jones and Goulding, Inc.,
Water Pollution Abatement Technology: Capabilities and Costs, Urban
Runoff. National Commission on Water Quality. 1975.

(13) Environmental Protection Agency, "440 CFR 137) Information on
Alternative Waste Management Techniques and Systems to Achieve Best
Practicable Waste Treatment Technology, Notice of Proposed Rule
Making." October 3, 1973.

11-201

(14) Farrell, J.B., "Overview Sludge Handling and Disposal." Proceedings
of the National Conference on Municipal Sludge Management,. Information
Transfer, Washington, 1974.
(15) 40 CFR 128, Federal Register, November 8? 1973, page@ 30982.

(16) 40 CFR 129, Federal Register, December 27, 1973, page 35388.

(17) Report of Senate Public Works Committee on S.2770, Report No., 92-414,
page 1468, October 1971.

(18) Senate Debate on Conference Report (Report No. 92-1236, October 14,
1972), page,170.

(19) Federal Register, February 11, 1975, page 6432.

(20) Draft Notice of Proposed Rule Making (40 CFR, Part 403), Pretreatment
Standards for Existing Sources and for New Sources General Provisions,
July 9, 1975.

(21) Lockwood Greene Engineers, Inc., Water Pollution Abatement Technology:
CMabilities and Costs, Textile Industry. National Commission on
Water Quality. 1975.

.(22) Environmental Protection Agency, The Economics of Clean Water,
December 1973, page 51.

(23) Report of House Public Works Committee on H. 11896, Report No. 92-911,
page 794, March 11, 1972.

(24) House Debate on Conference Report (Report No. 92-1236, October 4, 1972),
page 231.

(25) Lancy Laboratories, Water Pollution Abatement Technology- Capabilities
and Costs, Metal Finishing Industry. National Commission on Water
Quality. 1975.

(26) Engineering Science, Inc., Water Pollution Abatement Technology:
Capabilities and Costs, Petroleum Refining Industry. National Commission
on Water Quality. 1975.

(27) Water Purification Associates and Process Research, Inc., Water
Pollution Abatement Technology: Capabilities and Costs, Innovative.
Technology. National Commission on Water Quality. 1976.

(28) Environmental Protection Agency, Disposal of Hazardous Wastes, Report
to Congress, 1974.

11-202

(2.9) Environmental Protection.Agency, Report of the Non-Sewage Sludge
Residuals Work Group, January 1975.

(30) Alter, Joanne H., "Nu-Earth: Chicago's Merchandizing Program,"
Compost Science, May-June 1975, page 22.

(31) Bauer, W.J., "Economics of Sewage Sludge,Disposal on Land," a paper
presented at November-1974, meeting of the American Society of
Agrorjomy.

(32) National Commission on Water Quality, February 1976. Derived from
data in reference (27).

(33) Watek Purification Associates' Monthly Progress Report, July 2, 1975.

(34) Development Planning and Research Associates, Inc., Technologies and
Economic Impacts of Water Pollution Control Act of.1972, The Feedlot
Industry. National Commission on Water Quality. 1976.

(35) Toups Corporation, Water Pollution Abatement Technology- Capabilities
"Y
and Costs, Irrigated Agriculture. National Commission on Water
Quality. 1976..

(36) Midwest Research Institute, Water Pollution Abatement Technology:
Capabilities and Costs, Control of Water Pollution from Selected
Nonpoint Sources. National Commission on Water Quality. 1975.

(37) Environmental Protection Agency, Processes, Procedures-and Methods
to Control Pollution Resulting from Silviculture Activities, Report
No. 430/9-73-010.

(38) CONSAD Riasearch Corporation, The Cost Estimating Model for Mining,
Report to EPA, March 1975.

(39) Appalachia Regional Commission, Acid Mine Drainage in Appalachia,
1969.

(40) General Electric Company Tempo, Groundwater Pollution Control: An
Interim Report, Report to EPA, May 1973.

III. THE ECONOMICS OF WATER QUALITY

Table of Contents
Page

A. Findings and Observations. Economic and Social Impacts . . . III-1

B. Water as an Economic Resource . . . . . . . . . .. . . . . . . III-is

C. Trends in Economic Activity as Related to the Nation@s
Capacity to Achieve the Goals and Requirements of
P.L. 92-500: Industrial, Municipal and Macroeconomic . . . . 111-33

Macroeconomic Baseline Projections . . . . . . . . . . . 111-34
Industry Level Baseline . . . . . . . . . . . . ... . . 111-37
Trends in Municipal Abatement Activities . . . . . . . . 111-44

D.1) Industrial and Agricultural Requirements and Impacts . . . . 111-54

Capital Requirements . . . . . . . . . . . . . . . . . . 111-55
Distribution of Capital Requirements Among
Industries . . . . . . . . . . . . . . . . . . . ... . 111-61
.Prices . . . . . . . . . . . . . . . . . . . . . . . . . 111-62
Output . . . . ... . . . . . . . . ... . . . . . . . . . 111-66
Profits . . . . . . . . . . . . . . . . . . . . . ... . 111-66
Potential Short Term Transition Impacts Resulting
from Capital and Capacity Constraints . . . . . . . . 111-61
Distribution of Capital Requirements Between Plants
In Selected Industries: Intraindustry Impacts. 111-72
Plant Closures and Industrial Concentration . . . . . . 111-76
Regional-Impacts . . ... . . . . . . . . . . . . . . . . 111-82
International Trade . . .. . . . . . . . . . . . . . . . 111-84
steam Electric Power . ... . . . . . . . . . . ... . . . 111-86
other Industries . . . . I. . . . . . . . . . . . . . . .

D.2) Agricultural Crop Production: Economic Impacts of Hypothe-
tical Pollution Control Strategies . . . . . . . . . . . . . 111-91

Introduction . . . . . . . . . . . . . . .. . . . . . . . 111-91
Impacts of Alternate Controls Upon Irrigated
Agriculture . . . . . . . . . . . ... . . . . . . . . 111-95
Impacts of Erosion Control Upon Nonirrigated..
,Agriculture . . . . . . . . . . . . . III-101
Summary Observations . . . . . . . . . . . . . . . . . . 111-104

Page

E. Impacts of the Publicly Owned Treatment Works Program. III-110

Introduction . . . . . . . ;. . . . . . . . . . . . . . . III-110
Expenditure Patterns . . . . . . . . . . . . . . . . . . III-110
Financing the State-Local Share . . . . . . . . . . . . III-r118
State-Local Financial Outlook . . . . . . . ... . . 111-118
Required Methods of Financing Versus
Past Methods . . . . . . . . . I. . . . . . . . . 111-125
Distribution of Costs Among Users. . . . . . . . . 111-129
System Performance . . . . . . . . . . . . . . . . 111-133
Alternative Federal Funding Decisions and
Cost-Effectiveness Rules. . . . . . . . . . . 111-135
Priorities Among Categorips . . . . . . . . ... . . 111-135
Allotment Formulas . . . . . . . . . . . . . 111-135
Prefinancing . . . . . . . . . o . . . . . . . . . 111-136
Capacity Decisions . . . . . . . o . . . . . . . . 111,-137
Technological Choice . . . . . . . . . . . . . . . 111-139
Summary . . . . . . . . . :. . . . . . . . . . . . . . . 111-142

F. Macroeconomic Impacts . . . . . . . . . . . . . . . . . . . . 111-145

Introduction . . . . . . . . . . . . . . . . . . . . . 111-145
Summary . . . . . . . . . . . . . . . . . . . . . . . . 111-146
Description of Scenarios. . . .. . . . . . . . . 111-152
Analysis of Scenario Results . . . . * 111-162
Introduction . . . . . . . . . * 111-162
Scenarios 1 through 5 . . . . . . . . . . . . . . 111-164
Macroeconomic Impacts: Price Eifects . . . . . . . 111-166
Macroeconomic Impacts: GNP and Employment . . . . 111-170
Macroeconomic Impacts: Effects on Investment. 111-170
Macroeconomic Impacts: Effects on Trade Balance . 111-171
Macroeconomic Impacts: Other Effects. . 111-171
Sectoral Impacts: Prices, Output and Investment . 111-171
Scenario 2 . . . . . . . . . . . 111-177
Macroeconomic Scenario 3 . . . . . . . . . . . 111-181
Impacts: Scenario 4 . . . . . . . . . . . 111-181
Scenario 5 . . . . . . . . . . . 111-181
Impacts of a "Low Growth" Baseline Assumption
(Scenarios 6 through 10) . . . . . . . . . . . . 111-184
Description of Alternitive Baseline . . . . . . . . IIIr184
Analysis of Macroeconomic Impacts .
(Scenarios 6 through 10) . . ... . . . . . . . . 111-189
Additional Simulations (Scenarios 11-13) 111-199
Impacts Upon The.Capital Markets of Water Pollution
Control-Investment . . . . . . . . . . . . . . . . . . 111-205
Background . . . . . . . . . . . . . . . . . . . . 111-205
Capital Requirements of P.L. 92-500 . . . . . . . . 111-208

Page

Two Econometric Studies . . . . . . .. . . . . . . . 111-210
Industrial Pollution Control Bonds 111-212
Microeconomic' Problems . . . .. . . . . . . . . . . 111-217
Conference on Capital Markets and Water
Quality Needs. . . . ... . . . . . . . . . 111-217
Point Source Pollution Abatement, I. . . . . . . 111-219
Introduction . . . . . . . . . . . . . . . . . . . 111-219
Summary ... . . . . . . . . . . . . . . 111-220
Baseline Description . . . . . . 0. . . . . . . . 111-223
Scenario Analysis . . . . . . . . . . . . . . . ... 111-226
Energy Use . . . . . . . . . . . . . . . . . . . . . . 111-236

G. Supply Constraints . . . . . . . . . . . . . * . . . . . . . . 111-248

Engineers and Scientists . . . . . . . . . . . . . . . . 111-252
Construction Manpower . . . . . . . . . . . . . . . ... 111-256
Water Pollution Control Equipment . . . . . . . . . . * 111-258
Sewage Treatment Chemicals . . . . . . . . . . . . . . . 111-261
Sewage Treatment Plant Personnel . . . . . . . . . . . ..
111-263

.H. Benefits . . . . . . . . . . . . . . . . . . . ! . . . . . . . 111-272

Marine Fisheries . . . . . . . . . . . . . . . 1 111-275
Beach Reop
,enin4s . . . . . . . . . . . . . . . . . . . . 111-277
Property Values . . . . . . . . . . . . . . . . . 111-282
Summary . .. . . ... . . . . . . . . . . . . . . . . 111-285

I. Social Impacts . . . . . . . . . . . . . . . . . . . . . . . . 111-291

Introduction . . . . . . . . . . . . . . . . . . . . . . 111-291
Social Impacts: Demographic and Quantitative Anal'
Ysis- 111-!-292
Incidence of the Direct Costs of P.L. 92-500. 111-311

A. FINDINGS AND OBSERVATIONS ECONOMIC AND SOCIAL IMPACTS

1. The Setting

With an annual GNP approaching $1.5 trillion, individual components
of economic activity, such as those costs and benefits from the imple-
mentation of P.L. 92-500, are almost lost in the total economy. Those
interactions that can be measured are associated with dramatic upswings
or downswings in the economy, and are characterized by broadly varying
economic conditions reflected in the many dimensions of daily economic
activity. The state of the economy conditions both.the likelihood that
achievement can be fully realized on schedule and what the dimensions of
the positive and negative impacts resulting from that achievement will
be. For virtually every measure that exists, the economic fluctuations
independent of the Act dominate those that may occur due to the Act.

Independent of the interaction between general economic conditions
and impacts of the Act is the need to specify-those segments of the
public and private sector that will be of questionable economic viability
whether the forces impacting them are from the economy in general, or
the Act in particular --.and note that the Act's resultant expenditures
may compound this situation.

With this.as background, an important bit of hindsight relates to
the timing of the Act's passage. By most standard measures, the past
three ye ars were an inopportune time for attempting to accomplish the
Act's requirements in terms of the economic.climate. Economic cap- I
abilities of both the public and the private sectors have been severely
constrained. One cannot evaluate past progress under the Act or what
might be a reasonable course in the future without recognizing the
simple fact that progress is not independent of the state of the economy.

While these forces are beyond the control of the Commission, they
have been considered in the,Commission's assessments. Many economic
questions have been addressed that would not have been so important at
other times. Inflationary impacts, capital market constraints, unem-
ployment, interest rates and supply constraints are among many dimen-
sions that would not have been as critical-during many other periods of
history. More intensive examination of these issues has been required.

Not only have these conditions contributed additional uncertainty,
but a spate of national policies initiated or considered to combat these
symptons have complicated the Commission's assessment. Price controls,
energy policies, tax cuts and debates over the rate of money supply
growth have been critical to determining the economic impacts of the Act
so far, and will continue to do so in the foreseeable future. The

111-2

impacts of these policies can 'Substantially alter or;@override any impac.t
uniquely associated with the Act itself.

There have been some opportunities during the past three years to
take advantage of the economic situation in a manner that would have
generated so me substantial economic pluses beyond those originally
intended. Public works programs traditionally have been used to provide.
stimulus and employment during periods of depressed economic activity.
Mention of accelerated publicly owned treatment works construction
grant programs for this role has occasionally appeared during the past
yearl, but-while no specific employment-relatediprogram has developed,
stimulative impacts of a beneficial nature have been identified by our
studies.

2. The-Econ6mics of the Act

Assessing the goals and requirement's of the Act includes an analy-
tis of the economic impacts of a mechanism that was not designed pri-
marily to be economically efficient. The task is to try to separate the
ted with the specific
economics associa mechanism itself fromithe impacts
resulting from attaining the specific requirements and goals of .. t.he-Act"
by that mechanism.

Economics is the science of allocating scarce resources to meet
felt needs. This Act identifies the "need" as water quality adequate
to "provide for the protection and propagation of fish, shellfish, and
wildlife and provide for recreation in and on the water". Logical eco-
nomic analysis would examine the most efficient allocation of resources
to attain these-ends within the Act. However, this Act prescribes the
steps toward attainment as well, and thus as analysts, we are placed
in the position-of assessing the economic impact of a mechanism which
already may be judged tobe economically inefficient.

The Commission recognized this dildmma.explicitly and implicitly
and, cohsistent with its statutory assignment, chose to defer study of
alternative resource allocation mechanisms., All attention was focused
on the impacts of implementing the mechanism specified in P.L. 92-500.
Thus, while the language tends to presume that the Commission may be
measuring.the impact of, for example, the 1983 BAT requirement, it is in
fact measuring the impact of that requirement met by a specific tech-
nology/regulatory mechanism, as specified in P.L. 92-500. Achieving
that same.generally defined 1983 requirement by some other mechanism
might result in different impacts. The Co mission's economic impact
assessment actually examines both the mechanism and the requirement,
and there is no precise way to separate differential impacts of the
mechanism from those of the requirement itself. This dilemma is reflected
in the comments of many reviewers who apparently wished to have more

111-3

information regarding.the economic trade-offs between-alternative
mechanisms.

As a co,nsequence" should decision-makers conclude that the impacts
of this spibcific program are "too severe" and wish'to propose alter-
natives or changes, some.'consideration must be.given to whether the
change should be in.the ultimate requirements or goals, in the mechanisms
designed to attain those ends, or in both. While discussions have
focused on such ends as changing dates, proposing exemp tions, etc., it
is not unreasonable to presume that while these changes may alter the
impacts, they may not: improve efficiencies, and may even increase them.
Conversely, a chan@e in the mechanism alone might reduce negative
impacts, introduce greater efficiencies in re source use and,.further,
might result in greater benefits at lesser costs without a change in the
basic water quality targets.

Given these observations and the many complicating assuuptions
necessary for Commission studies of both the public and the private
sector, the'findings summarized below characterize the-measurable
economic and social impacts of the goals and the requirements of the
Act. Asintended, these focus upon the 1977 and 1983 requirements,
and the 1983 goal.

@Thb 1977 BPT requirements are unambiguouslystated. technologies
can be readily identified which will achieve most of the specifications
of the promulgated effluent limitations. Associated costs can be used
to derive resu ltant economic impacts. These are calculated by industry,
subcategory, region, and dimensions of consumer related impacts such
as price.increases. Most important, however, there is some evidence
that these impacts will not fully materialize because industry does not
appear to be proceeding at a rate equal to the Commission's calculation
of the expenditure level necessary to attain the required technologies
by the mandated deadlines. One possible consequence of this observed
pattern is that extreme efforts would be required to "catch up" and
achieve mandated levels by 1977 and substantial negative economic
impacts would result. This may not berealistic.

Aside from the many possible explanations of our findings regarding
theseverity of actually meeting the prescribed levels for 1977, it is
more fruitful to attempt to Assess what the actual pattern of expendi-
tures means. The most logical explanation for the divergence between
planned expenditures and our calculated costs of BPT is two-fold. First,
industry appears to be consciously moving in,the direction of attaining
something roughly equivalent to secondary treatment for publicy owned
treatment works. Requirements beyond this level are being (or have been)
widely,contested, or else are not yet fully promulgated. Secondly, there

111-4

is some evidence that industry* may have underestimated the cost of
compliance.

In neither of these instances does it appear rationalf for economic
reasons, to propose modification of the BPT requirements because of the
severity of the calculated impacts, unless from an enforcement point of
view.: The level of currently planned expenditures will not result in
significant negative economic impactse except in isolated cases. Efforts
which attempt to force industry to on-time compliance with final effluent
limitations would create severe consequences throughout many segments
of industry. This would be due primarily to the short time period
remaining to July.1, 1977, and the substantial increases in expenditures
that would be necessary. Even these probably could not be sufficient
to overcome the technical impossibility of compliance by that date.

Altered time-phading, such as that utilized in both our macro- and
micro- examinations, could alleviate much of these severe impacts. The
mechanism for this extension does not follow directly from the mechanisms
in the Act, however. A key characteristic is that the required expen-
ditures be somewhat evenly distributed over time.* Simply.shifting the
BPT deadline to 1980 or 1983 will not guarantee such distributio n. Also,
the further the time extension, the more population and economic growth
(including some inflation) as they impact water quality, become rele-
vant to the calculation.

3. -Industrial Impact Findings

o As the price of water and the costs of waste disposal increase,
there is a decrease in the quantities of water used and waste
generated.

o Subsequent to industry's patterns of responsej accumulated
capital and O&M expenditures are expected to be-$36.0 billion
and $6.8 billion respectively for BPT; and an additional
$23.2 billion and $5.8 billion for BAT. Cumulative new sources
dosts until 1983 are about $19.9 billion additional, witfi
associated O&M minimal for the time period.

This refers to the aggregated expectations of individual firms
within industry as opposed.to those estimates of industrial leaders
or industrial trade associations.

111-5

� The cumulative capital expenditures for BPT and BAT for"the
Chemicals, Steam Electric Power, Iron and Steel, Paper, Mining,
and Petroleum Refining industries as a percentage of BPT and BAT
requirements for all industry are; BPT - 50 perceht; BAT - 43
percent; BPT and BAT combined - 47 percent.

� Two types of price impacts were calculated by the Commission.
First, for selected industries, price impacts were calculated
based upon a detailed static analysis of each industry's
markets and plant-by-plant costs. Secondly, for all se@tors
of the economy, dynamic price impacts were calcu.Ilated based
on (1) each industry's own pollution abatement costs, (2) changes
in costs of goods and services purchased from other industries
due to pollution control, and (3) various indirect effects on
productivity, inflation, and aggregate demand. The first
calculation is referred to as the "direct" price impact and the
second as the "cumulative" price impact.

o Of the industries selected for detailed study, the direct price
increases due to implementing their BPT requirement- are- projected
to be three percent or less, with most of these industries facing
price increases of less than two percent. Metal Finishing may
incur price increases up.to 40 percent. The cumulative''price
forecasts are greater than the direct impacts since they reflect
a wider range of impacts due to implementation of the BPT require-
ments.. The average.cumulative price increases by 1985 due to
BPT for all sectors is 6.2 percent, with price increases of over
seven percent for instruments and fabricated metal prdducts;
which make extensive use of metal finishing services, and for
mining and furniture.

o Additional price increases due to BAT are smaller than those due
to BPT. Direct price increases due to implementing BAT require-
ments exceeded one percentAn only one case, Metal Finishing, which
is predicted to incur price increases up to 20 percent. Cumula-
tive BAT price increases, taking account of all econ omic inter-
actions are predicted to average 2.8 percent in 1985. Again,
the sectors with the greatest price increases, ranging from 3.0
to 4.6 percent are for those industries that make extensive use
of'metal finishing services, such as instruments,-fabricated
metal products, non-auto transportation. equipment, and non-
electrical machinery, and for chemicals.

o Beyond those firms that would closedue to depressed profits,
the profit level for remaining industry is not substantially
impacted . The Steam Electric Power industry is an exception,
with a .3 - .7 absolute decline in percent rates of return on
rate base.

111-6

o Capital expenditure requirements due to the Act may serve as a
constraint to capacity expansion. For pollution abatement
expenditures as a percent of total capital spending, Iron and
Steel jumps from 4 percent in 1974 to 27 percent in 1976,
Pulp and Paper from 1 percent in 1974 to 26 percent in 1976;
Chemicals from 4 percent in 1974 to 33 percent in 1976; and
Textiles from 2 percent in 1974 to 12 percent in 1976. (All
based on assumed BPT'compliance in 1977.)

� Industry, government, and independent surveys indicate that
planned abatement expenditures for 1975 are only slightly
higher than 1974 actual expenditures and lower than planned
.expenditures for 1974,

� The Commission's examination of selected major water-using
industries revealed that a small segment of capacity in each
industry bears disproportionately high abatement costs relative
to the majority of production capacity in the respective
industry. This high cost segment represents approximately
5 percent of capacity in Textiles and paper, 10 percen-E in metal
finishing, and 1-2 percent for Petroleum Refining and Iron and
Steel. These segments are vulnerable and may di *sappear due to
competitive disadvantages arising from pollution abatement
expenditures. These capacity segments consist primarily of
small plants with older, less efficient facilities, with
higher production costs.

o Plant closures are significant in Pulp and Paper, Metal Finishing,.
Textiles, Fruits and Vegetables, Feedlots (including dairies),
and Meat Packing. Generally they are the old, small, single-
plant firms, that in many cases could not remain economically
viable over the next decade regardless of water pollution
control requirements.

o The BPT requirements will have a greater economic impact on
industry than the RAT requirements. The BPT requirements alone
will result in nearly identical numbers of plant closures and
changes in industrial organization as the BPT and BAT require-
ments combined because most plants that might close as a result
of the BAT requirements would already have closed due to BPT.
Potential constraints on capacity expansion are more likely to
occur due to the BPT requirements than the BAT requirements
because the required expenditures are larger and must occur
during a shorter time period and because plant closures are
projected to occur by 1977, if at all. Changes in the level of
stringency do not change which plants 'in an industry are most
adversely affected. The segment of industry with disproportion-

111-7

ately higher costs for BPT requirements is the same segment
with disproportionately higher costs for the BAT requirements.

0 The majority of plant closures are for plants which are on Muni-
cipal systems and are defined by EPAas having incompatible
pollutants. Since the subjebt of pretreatment regulations remains
in a state of flux, the,exact number of plant closings of this
type must remain an estimate based upon pretreatment guidelines
.suggested at the time the Commission studies were completed
Pune@, 1975).

o Regional impacts are concentrated in the Northeastf. and to a
lesser extent, in the Middle Atlantic and North Central regions.
This is;due principally to the concentrations of metal finishing
facilities,@small pulp and pap@er mills, old textiles mills,
small feedlots, particularly dairies, and old fruit and 'vegetable
canning plants. The Northeast seems the least able to reemploy
Un.-the same industries) the reso@rces dislocated as a kesu ,lt
of the Act.

o Because of the estimated plant closures, the capacity of'these
industries probably will slightly become more concentrated. In
no case, however, is this'result exclusively@because of water
pollution control requirements. Rather it is a reflection of
existing trends in the industry which P.L. 92-500 tends to
exacerbate.

o Shortages,of capital and skilled manpower could impact industry's
ability to meet the BPT standards by 1977 due to the low level
of spending-during 1973-1975'. and the substantial acceleration
that would be required by 1977. However, these supply shortages
are not expected to materializ& because planned industry outlays
currently do not coincide with those required levels that could
lead to shortages. Except for isolated,cases, potential supply
and capacity shortages do not seem probable.

o Since long-run price impacts are expected to be small, the impact
of the Act on international trade and international investment
is expected to be insignificant.

4. Agricultural Impacts

o For a hypothetical set of controls on irrigation return flows and
erosion, national shifts in the production of commodities on dry
and irrigated land are not substantial in the absence of extremely
high export levels, Regional shifts are dramaticp however, due

111-8

to the differential magnitudes of irrigation return flow and
erosion controls needed in different regions. The resulting
price impacts are 18 percent by 1985 for a combination of high
irrigation return flow compliance and erosion control, both of
which approach the elimination of discharge. These price
increases must be regarded as only surrogates for the full
complexity of the resulting economic impact.

5. Impacts on Publicly Owned Treatment Works (POTW's)

� Two cost scenarios were examined. One was based on projected
EPA outlays and assumed 72 percent of Federal funds would be
spent for treat@ment plants and 28 percent for interceptor
sewers. The second was based on the funding of all needs
except control or treatment of separate st orm sewer flows by
1985. The resulting total capital expenditures by Federal,
state and local government from 1975-1985 in 1975 dollars are
$60.9 billion for the first scenario and $158.1 billion for
the second. Including effects of inflation, the first scenario
requires Federal appropriations of $52.3 billion and the
second $184.4 billion. The latter sum is ten times the original
appropriation contained in P.L. 92-500.

� Even with these increased expenditur es, complete funding of
treatment plants could not be.achieved before 1985 for the first
scenario and 1980 for the second. Even these dates may be
optimistic because they are contingent upon unrealistically
law design capacities, limited funding for other categories,
and an allotment formula that insures that these funds are
provided to states on a "Needs" basis.

� The relative shares of federally eligible capital expenditures
are 75 pe rcent Federal, seven percent state and eighteen percent
local. However, in the first scenario all collector sewer
6xpenditures are left to local government. This gives them a
37 percent share of total capital expenditures between 1975-1985.
In neither scenario is the local share of capital expenditures
significantly larger than historical trends in such expenditures,
due to the Federal government's assumption of a significant
portion of sewer costs traditionally supported by local govern-
ment. However, operating costs and annualized costs are signi-
ficantly higher than historical trends. Even with full Federal
funding of all categories, the state/local share-of total
annualized costs is 41 percent in the second scenario.

111-9

o- Impacts upon state and local revenues and expenditures were
assessed s6para,tely. Local budgets were aggregated to the st ate
level.',These aggregated flows were used to identify. those states
.where localities might experience imbalances between revenues and
expenditures under alternative expenditure levels and alternative
assumptions about expenditures and revenues. These data are
hereafter referred to as "local aggregates". For 1975-1980, using
present expenditure,trends, without an increase in present revenue
effort (taxes as a percent of income), 40 states could encounter
deficits. Increasing revenues in line with recent trends results
in lowering this number to 28 states. If all states moved to the
degree.-of revenue effort of the highest state, nine would have
deficits. The most likely trend in revenues and expenditures
suggests 21 states'and 21 l6cal aggregates could face fiscal
problems in 1975-1985.

0 A survey of recent grant recipients noted that funds budgeted for
recreation and parks was a primary choice to undergo reductions
to avoid these deficits. This presents disturbing implications
with respect to the ability of communities to use the newer
high-quality water for recreation.

o While financial prospects for many state and local governments
are not good, the projected sewer system expenditures do not
create a major demand on expected revenues. The question is
less one of the impacts of P.L. 92-500 on state and local
government, but rather one of the impact of poor state and local
financial outlooks on achieving the g6als of P.L. 92-500.

0 The use of local aggregates conceals the very different require-
ments placed on different types of communities. Forty percent
of the population has no.reported treatment plant needs at all;
either they have adequate present facilities or they do not plan
to be sewered by 1990.. of those.communities with treatment
plant needs, costs vary both by the magnitude of needs and by
size of community, with the smallest communities having the
..greatest per capita costs due to economies of scale. Thus a
small community with no need to have treatment beyond the
secondary level would have local capital costs of over $200 per
capita. The greatest impacts, however, are for those communities
with major combined sewer overflow problems. The local share of
captial costs for these communities could exceed $450 per capita.

o Over two-thirds of POTW capital costs usually are financed with
bonded debt. Use of sewer service charges has grown from 20 per-
cent of all municipalities in 1945 to 61 percent in 1960 and 85
percent in 1969. Property taxes are used by a significant number

III--;10

of communities and play a prominent role *in repayment of capital
expenditures and debt service. Whilemost communities use some
type of flow-based charge system for industrial users, only 20
percent account for waste loads through surcharges, and for a
significant number of these the surcharge program exists only on
paper.

0 The shift to user charges and industrial cost recovery will require
significant changes in billing and monitoring practices for the
vast majority of communities.

o Federal law and regulations provide for a subsidy of about 45
percent of capital costs for industrial users of POTW, even with
industrial cost recovery, because capital cost recovery provisions
do not require interest payments. Industries with compatible
waste can gain substantial advantages by discharging to publicly
owned treatment systems. The industrial user of a public system,
therefore, gains the advantage of both economies of scale which
may account for a saving of up to 86 percent for small users
and a substantial subsidy. However, a direct discharger able
to take full advantage of accelerated depreciation for pollution
abatement expenditures, state and local tax relief, and indus-
trial revenue bonds for financing, may realize subsidies almost
as large.

0 Cost savings for POTW's could result from improved capacity fore-
casting, shorter design lives, and better choice of technological
approach. The first two can result in systems operating closer
to capacity, thus reducing efficiency. In addition, hydraulic
overload problems that plague many systems today could be more
quickly encountered in the future for some systems. For lower
cost technologies the effect on performances is less clear,
.although they might lead to improved performance since less
costly alternative technologies normally require operators
with less skills then the higher cost technologies. Further,
lower operating costs may relieve local financing burdens. The
ability of some state and local governments to implement better
cost effective programs may be limited by the low salaries for
environmental engineers.

o Operating performan ce of treatment plants has been a serious
problem in the past. 1974 survey data reveals that over 30 per-
cent of all treatment plants for which adequate data were avail-
able were failing to meet design criteria. Over 56 percent of
the plants did not have adequate data to make an assessment of
their performance. The 1973 EPA Needs Survey indicated that over
18.percent of all facilities reported that they were operating

above design capacities., ;Over 39 percent of the facilities
serving-over 150eQ00 people- were operating above design capacity.
The comb,ination of rapidly growing operating expenditures and
poor financial outlooks f6r many communities' may ac.centuate
this problem, A shift from,property taxes.to user charges
would provide an increased revenue bate and separate POTWIs
from tax structures as use increases.

0 Recent operator training appears adequate to satisfy the current
numbers of operators needed. However, increased traihing is
needed to improve operator proficiency. Alsoi in the near
future A program to expand training and/or increase municipal
treatment plant.operat6r salaries wili be necessary to assure
that an.adeqdate' number of operators are available for the more
sophisticated.treAtmen@ Plants forthco6ming. The importance of
training to.treatment plant efficiency suggests that steps be
taken to guarantee@that treatment plants are staffed by
qualified personnel.*

6. macroeconomic fnpacts,

o The Wharton.Econo'metric Forecasting M6del,was,used in the analysis
of macroeconomic impacts. The Strategic Environmental Assessment
System (SEAS), based upon the INFOgUM/input-output model was used

An-October 16, 1575 comment by John C.' White, Regional Administrator,
EPA Region VI, reads as follo*s-.
loin Region VI, more than fifty pbrceht of the.wastewater
treatment fa@ilities need operator training for upgrading class
certification and in addition, facilities need more certified operators
to provide sufficient numbers of adequdtely,traihed_bperat6rs for
efficient operation and proper maintenance.. Of those-c@rtified
operators employed by municipalities operating treatment facilities,
too many have been assigned dual responsibilities that do hot allow
the operator to'spend,the requiredFtime at the facility.. Experienced,
certified operators are leaving this@field annually. The turn-over
occurring in states in this Region' vary from 12 to 30 percent.
Advance waste treatment (AWT) uhitzpr6c6sses and operations will
be required to meet NPDES permits in high density populated areas.
Few certified operators have been-tiained to operate and maintain
AWT processes and operations. There is' an acute teed for professional
quality instruction and certificationi and of equal significance is
the need to increase salaries, with professional recognition for
certified operators."

111-12

to forecast economic/environmental interrelationships. Long run
macroeconomic forecasting is difficult with even the most sophis-
ticated tools. The estimated impacts presented here should be
considered with this in mind.

o Thirteen alternative scenarios were analyzed to estimate a range
of possible impacts. The impacts on Gross National-Product,
prices, employment, and investment due to P.L. 92-500 are smaller
than the normal fluctuations in these variables.

o inflation is 9 percent above baseline projections in 1985 indi-
cating an inflation rate that is .9 percentage points higher
due.to the imposition of pollution abatement standards. The
conventi.onal price indices do not assign a value to "free goods"
such as water and air. Therefore, improved water quality is not
taken into account in assessing the average price-of goods and
services.

o The impact-on GNP and employment is stimulative through 1982
and depressive in 1983-1985. The unemployment rate could be
.9 of A percent lower in 1977-1980 and then much higher in
1984-1985 due to the Act. Unemployment has ranged from 3.5 to
9 per cent over the last ten years..

o Impacts on plant and equipment investment and housing are.generally
mildly negative. The stimulative effects of the abatement
expenditures tend to offset the depressive effects via increased
cost and prides. The most negative ef.fects,are projected to be
in the latter,years when both residential and non-residential
investment are 3-4 percent below baseline projections.

� Productivity'is positively effected in years of high uerunployment
and unused capacity, since an increase in output often is possible
without proportional increases in overhead costs. The increased
costs of production becuase of abatement tend to offset these
positive impacts so that in most years productivity declines
slightly -- that is, total employment increases more (or decreases
less) than total output.

� Results of alternative scenario analysis'include:

--A "smooth" pattern of total industrial expenditures
(1975-83) yields smaller impacts throughout the period than
in the strict compliance case where disproportionately
large expenditures occur in 1976-77. This "smooth" scenario
is more realis-tic in that it coincides much more closely
with industry's planned expenditures on water pollution control
(1976-78).

111-13

--The additionAl ijWacts Assoc@iated with BAT Cover BPT and
NSPS) are min=.al, They represent about one,@sthird of the
total price impacts after 1980 and less than.one-fifth of the
negative impacts on GNP and employment.

--If actual industrial expenditures turn out to be one,,-half
of Commission estimates macroeconomic impacts will also
be about onehalf of those forecast.

--High levels of public expenditures would add to stimulative
impacts and less so to inflationary impacts.

--If the economy continues to have high unemployment rates
in the 1980.'s, the economic impacts will be little different
from those forecast with a lower rate of unemployment.
The major difference is that public expenditures would tend
to be a more potent stimulative force given the higher
levels of unemployment.

--If 25-50% of the abatement investments are in productive
equipment (product and process change) the inflationary
effects would be significantly less than otherwise. Stimu-
lative impacts would also last 2-3 years longer and the
depressive effects in the later years would be much smaller.

-@-The addition of air pollution abatement expenditures (about
one-third the size of industrial water pollution abatement
expenditures) tends to increase all impacts proportionately.

o The Strategic Environmental Assessment System,(SEAS) was used
to make projections of pollution levels corresponding to the
different economic scenarios.

--Baseline
industrial pollution in the'absence of P.L. 92-500
(assuming no improvemeiit in abatement after 1971) by
1985 wo uld be 163 percent of the 1971 levels as measured
by BOD, 156 percent of the 1971 COD level, 140 percent
of the Suspended Solidslevel of 1971, and 101 percent of
the 1971 Dissolved Solids level.

Public discharges, however, assuming the continuation
of historical trends of public spending, would tend to be
stable for BOD and SS 1971-1985. Increased treatmeht
would offset population growth. Dissolved solids discharges,
would grow 27,percent over the period,given the low levels
of removal for these pollutants with conventional waste
treatment techniques.

111-14

--Compliance
Industrial discha*rges in 1985 would be,24 Percent of 1971
levels for BOD'given full compliance w;Lth P,L. 92v-500,
Without BAT effluent limitations, the 1985 BOD level would
be 46 percent of the 1971 levels.

Industrial discharge of Suspended Solids would be 6 percent
of the 1971 levelwithfull compliance, and 21 percent
without BAT effluent limitations.

For Chemical Oxygen Demand (COD) the comparable peicentages
would be 42 percent full compliance, 73 percent without
BAT.

For Dissolved Solids- 62 percent full compliance, 83 per-
cent without BAT,

Public discharges in 1985 would be 31 percent of the 1971
level for BOD, and 35 percent-of the 1971 level for Sus-
pended Solids given the increasea expenditures and treat-
ment associated with P.L. 92-500. Dissolved Solids are
forecast to grow 32 percent in spite of the increased
treatment.

Industrial and municipal discharges are projected to be
remarkably similar by 1985 given compliance. In 1971 in-
dustrial discharges were 34 percent greater than public
for BOD and 5 times the public level for suspended solids.

Average cost per ton of reduction in industria 1 discharge
is approximately 1/3 the cost of reduction for public
treatment systems for both suspended and dissolved solids.
The greater cost'effectiveness in reducing industrial
discharge is largely due to greater concentration in
industrial wastes.

7. Supply Constraints

o Strict industrial and municipal compliance with the 1977 and 1983
deadlines would cause severe shortages of sanitary engineers
needed to design and construct wat er pollution abatement facilities.
Chances of shortages of materials, especially pipes, valves, and
fittings, structural clay.products? service industry machinery,
industrial controls, and cemeftt and gypsum increase if the
deadlines are strictly enforced.

o Spreading water pollution control ekpenditures over a longer
period can eliminate shortages substantially, though problems
seem likely to remain for pipes, valves and fittings, and the
skill levels and capabilities of POTW operators.

o Current unemployment levels in the construction industry indioate
that shortages of construCtion labor will not be an impediment
to achieving the Act's requirements.

o Current over-capacity in the water.pollution control equipment
industry should provide adequate supply of this specialty
equipment. A reasonably "smooth" pattern of pollution abatement
expenditures should cause relatively low additional price
increases.

o Tight supplies of chlorine, caustic soda, lime, and soda ash
can occur in the future, primarily from demands for other uses.
Even major changes in wastewater treatment demand will not add
significantly to the total demand. Recent experiences by muni-
cipalities with chemical shortages may stimulate better methods
of insuring adequate supplies in the future.

8. Benefits

o Attainment of the goals and the requirements of the Act results
,in substantial impacts upon certain leisure time activities.
These impacts may be quantified partially in economic terms.

o Certain types of real estate near selected water bodies.will
expereince increased value due to improved water quality. This
value is $92.5 million annually in 1985 and 2000.

o New flows ofleconomic activity resulting from the reopening of
beaches due'to the Act's achievement will result in annual
values of $158.milli6n in 1985 and $212 million in 2000, as a
low estimate,and $521 million and $701 million,respectively,
as a high estimate.

o Increased values to marine resource use, both commercial and
recreational fishing, will result in economic gains of $3.9
billion in 1985 and $5.2 billion in 2000.

o Freshwater fishing activities resulting from attaining 1985
goals will bring gains of $220 million in 1985 and $217 million
in 2000jas a low estimate,and $521 milli on and $701 million,
respectively,as a high estimate.

111-16

:p Other boating will increase dramatically under the influence
of improved water quality, amounting to $498 million annually
in 1985 and $528 millionas a low estimate and $1.2 billion and
$1.7 billion,respectively,as a high estimate.

o An approximation of the cumulative "worth" of these measurable
-positive impacts of P.L. 92-500 may be obtained by deriving
the discounted present value for these activities. Using discount
rates ranging from zero percent for the time period,1972-85 to
4 percent for 1972-2000, resultant present values range from a
low of $33.3 billion to a high of $88.1 billion. Di scounting
at 4 percent to infinity yields a present value approaching
$200 billion,

0 These measures of gain include only-the direct effects of changes
in the referenced activities. They do.not include either indirect
benefits from changes in the level of these activities or
measures of changes in any other water-related leisure activities.
They also do not include measure of potential health benefits
in quantifiable economic terms, or any monetary value of
avoiding irreversible environmental damages Or preserving water
quality at-specified levels foruse by future generations.

9. Social Impacts

o The major groups affected by plant closures are white males
.(electroplating, pulp and paper) and women (textiles). Minori-
-ties do not bear a disproportionate share of job losses. The
majority of the negative employment impacts occur as a result
of the 1977 requirements.

o The expenditure peaks in 1977 and 1983 sustain positive employ-
ment from 1977 through 1983 with price and productivity effects
bringing a sharp downturn t6 negative employment impacts by 1983.
Without the 1983 requirements, the extent of impacts is moderated,
but the pattern is similar.

o The average annual cost per family for treatment plant and inter-
ceptor sewer needs and for BPT is $306. The costs per family
for both BPT and BAT and all municipal categories except urban
runoff is $522. In each case this is based upon the families
actually to be serviced by these projects, not all families in
the United States.

o The Federal income tax and user charges are the two most important
mechanisms in financing the publicy owned treatment works program.
User charges weigh particularly heav ily on.low income. groups,

III-IT:

while the Federal income tax is more progressive. one important
consequence of Federal funding is to shift burdens from lower
income groups and from regions like the South where incomes are
low relative to the rest of the nation.

o Price increases caused by the Act weigh most heavily on the
lowest income families and next upon upper middle income families.

o The benefit of increased property values accrues mainly to middle
and upper middle groups. Improved water quality benefits are
distributed to lower income groups, if adequate access exists.

B. WATER AS AN ECONOMIC RESOURCE

From the beginning of recorded history, water has played a crucial
role in man's economic activities. This historical pattern was repeated
in the United States where development followed the geographic dispersion
of water. Highly concentrated population centers evolved along ocean
shores, bays, estuaries, and river mouths. Inland development patterns
followed the principal rivers, and cities grew up along them.

Water has been a mode of transportation and an integral part of
many production processes. Industrial, agricultural, and municipal
activities were keyed to the availability of water. It was used for
power, steam generation and cooling, for drinking, and to enhance
agricultural productivity.

The motivation to develop along water bodies related to an economic
evaluation of water in industrial and agricultural production, municipal
supply and the transportation of industrial goods. Aside from cost
differences due @o transportation, storage, and ground water extraction,
water was essentially a free resource. Exceptions to this rule evolved
initially in arid western states where water has been relatively scarce.

As economic growth occurred, water passed from the free stage to
a resource with competing economic values. the price of water at
different locations and for different uses became more relevant to
economic d6cision-making. The actual quantities and prices associated
with varying rates of water use play a role in determining the costs
and impacts of meeting the Act's requirements and goals. This may take
the form of the individual entrepreneur's decision to reduce both the
amount of water being used and the quantities of resulting water-borne
wastes, explicitly-and primarily as a conscious strategy in minimizing
the costs of abatement.

Studies indicate that there are current trends in reduced water
use. In ]@art, these trends relate to regional water scarcities, but
there are other reasons. The increasing cost of water affects those
industries using huge quantities. Evolving technologies introduce new
production procedures which generate water savings. Knowledgeable
plant managers can reduce water use by applying existing technologies
more carefully.*

Ralph Stone, in a communication to Mr. Wendell E. Johnson, American
Society of Civil Engineers, Environmental Engineering Division, states
"American industries can often reduce water pollution by changing
their manufacturing processes to use other less polluting methodologies
such as substituting dry for wet processes." (7)

111-19

William R. Adams, Jr., Commissioner, State of Maine, Department of
Environmental Protection, reports in a February 4, 1976 communication
to the Commission that, "In some instances, abatement programs have
actually helped Maine industries save money. For example, one pulp
and paper company has offset wastewater treatment costs through fiber
recovery from better housekeeping practices." (1). This obs ervation
is supported by Emil Zars at a Commission public hearing in San Francisco,
January 10, 1976, where he stated, "Primary to my suggestions is a
conviction that pollution is a sign of poor housekeeping." (13). Further,
at that same hearing, W..R.Z. Willey observed, "Increased efficiency
in water use -- water conservation -- decreases the need for abatement
expenditures." (12). He also commented that the report recognizes
the economic relationship to water-use, but noted that the baseline
forecasts used here may not. He further commented that the staff report
forecasts are based on a history of inefficient water use and, therefore,
provide an inflated estimate of required abatement expenditures relative
to a more efficient water use pattern. If these statements about wd-Eer
use efficiency are correct, then Willey's observations concerning a'
bias in required abatement expenditures are correct.

There is also the opportunity to segregate water used for various
production processes. While this may hot lower total water use, it
may reduce water use for parts of the production process and thus reduce
or alter the character of waste loads. Figures III.B.1 through III.B.5
illustrate the trend in water use and withdrawal.

Water use per unit of outputis trending downward. Estimates of
costs and impacts of pollution control may be overstated when this
trend is not considered. Decline in water use as a response to economic
forces suggests that in the face of additional water-related costs there
is the possibility for further reductions to me et the Act's requirements.

Figure III.B.6 summarizes the key dimensions of water use in manu-
facturing, including the recently released 1972 data. There has been a
slight and gradual downward change in the use of water per unit of output.
The trend predominates 'in the major water-using industries, with the
exception of steam electric power, where intake quantities have increased
dramatically. Figure III.B.7 illustrates regional differences in water
.use.

Growth in leisure time activities, including recreation, hardly
needs documentation. As quoted in ORRRC Report No. 13 (1968), "the
demand for outdoor recreation 40 years hence may increase as much as
five to ten times over what it is now." (6). Participants in fishing
have increased from 25 million in 1960 to 35 million in 1970. (Figure
.III.B.8).-This does not measure the full impact of changes in the length

111-20

Figure I I I.B.1
INCREASE OF WATER USE IN U.S.
& POPULATION SERVED 1950-70

Billions of gallons a day withdrawn Millions of persons
400 1 1 1 300 1 1 1
WATER USE 372 million increase POPULATION
of 85%
1950-70

300
200- 203 =35%
growth
oo% 1950-70
264 .r_mll
200 Population X: =79%
151
growth
not served
By agr cultu e, industry, power, ..:-X-X-X-:-:-X 195WO
rural domestic 100 ...................

100
........ :Population servea.i.....,......
.......... ........
By pub ic water supplies public water::.*-*.*.*.*-,.,
27 ........
14 Increase
X X
xx;
..X.X. '01
0 of 9A .......
50 55 60 65 70 50 55 60 65 70
Gallons per day
2000 1 1 1 1
1821 37% Increase
WATER USE PERCAPITA 1950-70

1500 -

1000 -
By agriculture, industry, power, 41% increase
N& rural domestic 1950-70

500

152\ 164
7.9% increase
u ::v
'i 1* :%
y pu
1950-70
0
50 55 60 65 70

Source: National Commission on Water Quality. Redrawn from Murray, Richard C. & Reaves, E.Bodette.
"Estimated Use of Water in the U.S. in 1970", Geological Survey Circular 676,
1972. P.1 1, fig.8.
February 1976
165

111-21

Figure I I I.B.2
SHIFTS IN WATER USE BY PURPOSE 1950-1970

WITHDRAWALS OF WATER BY PURPOSE
In billions of gallons per day
100% 372

Public supplies
100% 204
Public supplies. Industry self
In, supplied
ustry self
U"
s
su . .....
uppl@iyeds!" 13%
x

4.
',eam@ 19%
electric
St el ctric povvtrl
p ower ..... ...
45%

Rural domestic %
& livestock ic
1950 & livestock
1970

Withdrawals for
\above uses

Hydro-electric p 1304 billion gals/day
950 ower 11010 87
2800
1970 Hydro-electric power 3259

Off channel
TOTAL U.S. WATER USE use

Source: Nati. Commission on Water Quality. Redrawn from Murray, Richard C. & Reeves, E. Bodette.
"Estimated Use of Water in the U.S. in 1970", Geological Survey Circular 676. 1972.
p. 10,fig. 12.
February 1976

111-22

Figure I I I.B.3
AMOUNT OF WATER' WITHDRAWN BY PURPOSE .1950-1970
In billions of gallons/day
Percent
increase
1950-70
1950 1110
Irrigation 18%
1970 X
130

Industry 140
Steam Electric 325%
Power
Other Industry 137
Self Supplied T X 27%
147

Public Supplies 14 92%
27

Rural Sul' 'es 3.1
(
olmes
s 25%
t:l
c
D , 8t 4.5
livestock)
Source: Natl. Commission on Water Quality. Redrawn from Murray, Richard C. & Reeves, E. Bodette.
"Estimated Use of Water in the U.S. in 1970", Geological Survey Circular 676.1972.
p. 10, fig. 12.
February 1976

111-23

Figure I I I.B.4
TYPE OF WATER WITHDRAWN 1950-1970
In billions of gallons/day

204
..... ....
........ .. . .... .... . .
1950 . .. .
..... . ........... X: ........ .......
0.5
............
........ .
..........
. .... . . .... ..........
..... .. ..... ..........
.... . ........... ..
...........
... . . ..... ........... ...... .
.... ... ..........
1970
I . . .......
. ..........
372
SURFACE GROUND LRECLAIMED
(2% saline)* (8% saline)* SEWAGE

SHIFTS IN GROUND WATER USE
Irrigation 1950 2 .3 .........
....... .......
45

5
Industry ..........

Public 3
Supplies 9
Rural 72.6
Supplies -r`-'-1-J3.6

SHIFTS IN SURFACE WATER USE
irrigation 1950 85
85
Industry** 172
..... . ...
. . ....... .. .. . ....... .. .
-.. . ...... ........ . . . ..
200
... ....... . .
U
Public
supplies
18

Rural
Supplies
Total U.S.

Use of saline groundwater increased 113% 1965-70
Includes steam electric power which accounts for the major increase in 1970 surface water
Source: Nati. Commission on WaterQuality. Redrawn from Murray, Richard C. & Reeves, E. Bodette.
"Estimated Use of Water in the U.S. in 1970", Geological Survey Circular 676. 1972.
P. 10, fig. 12.
February 1976

111-24

Figure I I I.B.5
PROJECTED WATER USE IN U.S. 1980-2000
Billions gals/day
1400 1 1 1 1 1 1 0.111368

1200-
X.
XV:-i
1000-

800-

.........
600- ..........

. .. .. ...
. .. .............. -.....Water used-*-.i'.*.'.*.,..,.*.,..*.,..,.,.*.*.,.*..*.*..i*.,.,..*.,..,.:*::::
400-
...........
eturnedi@ixiiiiii---i:ii: .......
r X
. ...... ..
X: .........
200
..... .... x
...........
157

0
Water co@nsumeq
1950 1960 1970 1980 1990 2000 201-0 2020

USE BY PURPOSE
PERCENT OF
Billions gal/day withdrawn Wit rawals Consumption
195=0:--. 110
Agricu ture r197& 30
" a
irrigation .1980 138 1980 31% 80%
(98%) -2000-1153 2020 12 64
10;L0 -Z:)166

"140
Steam 170 1980 44 2
Electric -1193 - - - - - - 1470 '2020 67 8
Power z::::7-::]
7137 914
Industry 47 1980 17 7
(Self -175
supplied) -Z::--:@12111 2020 15 10

Mu6icipal
.3 @7
(Public -134 19BO 8 10
al 2020 5 6
supplied) --274

Rural 1980 0.6 1.7
domestic 2020 0.2 1.6
Data on past water consumption not currently available. 1 100% 100%
t Under 3 billion gal/day, all years. both periods
Source: Nati. Commission on Water Quality. Redrawn from Murray, Richard C. & Reaves, E. Bodette.
"Estimated Use of Water in the U.S. in 1970", Geological Survey Circular 676.1972.
p. 10,fig. 12.
February 1976

111-25

Figure I I I.B.6

MANUFACTURING USE OF WATER 1954-72
3 4 3.36
2.4 Gallons per dollar of value added 3.3 -

Petroleum.
2.0- Fig. 3
INTAKE WATER USED

Paper
1.5 Fig. 4
GROSS WATER USED

1.0-

0.8-
0.6 Petroleum paper Primary Metals
Primary etals Chemicals
0.4

ALL BUSINESS
Chernica s
0.2 ZI, ----q -
ALL BUSINESS
01
54 59 64 68 72 54 59 64 68 72
Reuse factor 8.012 8.15
(Number of times water reused)
4- Fig. 5
REUSE

Petroleum

2- Paper

*The sharp rise in gross water use per dollar of ALL BUSINESS
value added in the petroleum refining industry
over the period 1968-1972 is likely attributable
to both a change in reporting methods and a de- Chemicals
dine in value added.
Source: Nati. Commission on Water Quality.
From National Bureau of Economic Primary Metals
Research. "Changing Water Use in Manu-
facturing", 1975. Of I
Febraiary 1976 54 59 64 68 72
Petroleum
@@aper
Z**'

111-26

Figure I I I.B.7
REGIONAL WATER USE BY MANUFACTURING
1954-68 2.1[5
Gallons per dollar of value added 2.0
1.0
CHEMICALS
PETROLEUM
0.8 Western Gulf Delaware
& Hudson

0.6- Western Gulf

Ohio
0.4- California

Lower
Mississippi
0.2-

Pacific Northwest
0
54 59 64 68 72 54 59 64 68 72
1.0 1 1 1 1 1 111
PULP & PAPER PRIMARY METALS
Pacific
0.8- Northwest

Southeast
0.6- Western
New Great Lakes
England

0.4- ppe Ohio
Upper Missouri Mississi pi

0.2-
Southeast
Colorado
0 1 1 1 _j
54 59 64 68, 72 54 59 64 68 72

Source: Nati. Commission an Water Quality. From National Bureau of Economic Research. "Chang-
ing Water Use in Manufacturing", 1975.
February 1976
7PETROLEUM D e @aa
I w re
a u s
We ern Gulf6 Hudson ,,/j
ar@
ifor st ia
n

,,@No lw@st
Upper @Missouri *-__@@M 2usspisps@,pp, Obio
___ @Colorado
Southeast

111-27

Figure I I I.B.8
HSHING PARTEIPATION IN THE UNITED STATES
Percent of population
Millions of fishermen participating in fishing
35 24%
33 million

30- 22
21%
.%voTs

25 - -.20
21 -@7@
milIlion 0 Ion Ot POP

20 - 18
7.6%

5- 2

0 0
1955 1960 1965 1970
Source: Natl Commission on Water Quality. from U.S. Fish & Wildlife Service USDI, "1970 Nat. Survey of Fishing
& Hunting", Resources Publication 95.
February 1976
Propo
in
million op In ls@jjjg
participat g
pa

111-28

of the participation activity and the associated increase in the growing
levels of expenditures per day of participation.

These studies also predicted various dimensions of future fishing
activity. Numbers of fishermen were to increase by 168 percent from
1976 to the year 2000, with fishermen days'doubling. Sports,catch for
existing water would increase 133 percent from 1960 to 2000 to 850
million pounds. This growth would develop in proportions consistent
with historical patterns for the various water body types and regions (5).

These statistics are consistent with historical trends in determining
recreation activity. Figure III.B.9 shows a continued rise in average'
hourly earnings combined with a decline in average weekly hours worked.
These are further reflected in a rise of both payrolls and employment
supporting the recreation industry. (Figure III.B.10). Aggregate personal
disposable income has been increasing two-fold every ten years recently,
with average hourly earnings increasing continuously since World War 11 (9).
Recreational expenditures as a percent of rising disposable personal
income have riserr slightly to 6 percent in 1973. They have risen even
more as a percent of personal consumption expenditures (PDI -Savings).

while not all of this information directly documents the.use of
water for recreation and leisure purposes, it does confirm that these
activities are continuing to increase as a function of the economic
standard of living. As growth occurs, pressures on relatively fixed
water resources also grow. The continuing increase in recreational
activities in the future.must be considered when evaluating the impacts
of achieving or not achieving the Act's goals and requirements.,

111-29

Figure I I I.B.9

RISE IN EARNINGS & DECLINE IN HOURS WORKED
1890-1970
Average Average
Hourly Earnings in Manufacturing* Weekly Hours in Civilian Economy"
$3.00 $2.85
50 -52hrs.
$2.50- NBER BLS
EARNINGS 40-
$2.00- 39 hrs.

30-
$1.50-
$1.00- 20- LENGTH OF WORKWEEK

$0.50 10
.46
- I I 1 0
1900 1920 1940 19601970 1900 1920 1940 19601970
(Earnings) 1890-1950 Not Our Econ Research INBER) in 1957 dollars; 1950-1970 Sur Labor Statistics in 1967
dollam
(Workweeki 1SM1965 Nat Bur Ecdn Research (NBER); 1945-1970 Sur Labor Statistics.

Source: Natl. Commission on Water Quality. From Dept, Commerce, Bur. Econ. Analysis, "Long Term Economic
Growth 18W-1970", June 1973
February 1976
:@12 h' S. @NBER
BLS

111-30

Figure I I I.B.10
PRIVATE EMPLOYMENT & PAYROLL ATTRIBUTABLE TO
DOMESTIC TOURISM 1970 and 1980

Thousands of Persons Employed Payroll in Billions of Dollars

790 3.4

................
.................. ....... ........... .
................. ...............
................ 42
r. ..... Lodging
920
...................................

1210 625 Food 1.0
............... .... ...... .I
....................................... ......
................................ . ..... ......
. ..................... 'service
................
.... ........
.... .............

32 Public 4.3 6.8

......................
transportation
....... ........ ......

Auto 2.6

.................. ......
.................
...... .........................
...... ......I.............. .
680 operators -14.3
..................
...........

Other 0.8
.......... .....
...... ....
300 incidentals

0 0.5
Recreation
180 1 . 0

Owned 0.05
vacation
17 homes 0.2

Total 1970-1980 Tdtal 1970-1980
Employment increase 70% Payroll increase = 60%
TOTAL $12.6 $20.3
DOMESTIC
.................
....................... .
['10: go ........ ....
........................
0

330

.......... TOURISM ........................ .........

Source: Nati. Commission on Water Quality. Figures derived from graph of The Conference Board, "Domestic
11 Travel and Tourism Road Maps of Industry", No. 1741, July 1, 1974.
February 1976

.111-31

REFERENCES

(1) Adams, William R. Jr., Commissioner, State of Maine, Department
of Environmental Protection, Communication to the Commission,
February 4, 1976,

(2) Leone, Robert A., Ginn, J. Royce, and Lin, An-loh. Changing Water
Use In Selected Manufacturing Industries. National Bureau of
Economic Research. A study for the Institute of Water
Resources, Corps of Engineers, Department of the Army.
Contract #DACW 31-72-C-0044, December, 1973.

(3) Changing Water Use In Manufacturing, Addendum for
NCWQ based on preliminary data from 1977 Census of Water Use
in Manufacturing. September-October, 1975.

(4) Murray, Richard C. and Reeves, E. Bodette. Estimated Use of Water
in the U.S. in 1970, Geological Survey Circular 676, Washington,
D.C., 1972.

(5) Outdoor Recreation Resources Review Commission. Sport Fishing,
Today and Tomorrow. Report V. Superintendent of Documents,
U.S. Government Printing Office, Washiniton,.D.C., 1962.

(6) Federal Agencies and Outdoor Recreation. Report
#13. Superintendent of Documents, U.S. Government Printing
Office, Washington, D.C., 1968.

(7) Stone,,Ralph. Communication to Mr. Wendell E. Johnson, American
Society of Civil Engineers, Environmental Engineering Division.

(8) The Conference Board. Road M s of Industry. No. 1741. Domestic
Travel and Tourism. New York. July, 1974.

(9) U.S. Bureau of Economic Analysis. Long Term Economic Growth:
.1960-1970. Washington, D.C., 1973.

(10) U.S. Fish and Wildlife Service. 1970 National Survey of Fishing
and Hunting. U.S. Department of the Interior, Resource
Publication 95, Washington, D.C., 1972.

(11) U.S4 Water Resources Council. The Nation's Water Resources.
U.S. Government Printing Office, Washington, D.C., 1968.

(12) Willey,-W.R.Z. Environmental Defense Fund. Communication to the
Commission, January 10, 1976.

111-33

C. TRENDS IN ECONOMIC ACTIVITY AS RELATED TO THE NATION'S CAPACITY
TO ACHIEVE THE GOALS AND REQUIREMENTS OF P.L. 92-500: INDUSTRIAL,
MUNICIPAL AND MACROECONOMIC

The health of the economy can be a principal determinant of the
nation's capability to achieve the Act's goals and requirements. Like-
wise, the capability of individual enterprises to achieve requirements
and goals will be greatly influenced by the overall conditions of the
nation's economy.

The Commission's economic impact analyses examined the ramifications
of the efforts toward compliance in terms of traditional measurable
variables. These included impacts upon prices, costs,.profits, capital
requirements, employment, and changes in.industry structure due to
plant closings. These variables are changing within the context of,
and in part due to, activities in the economy, such as economic growth,
patterns of consumption, the price of capital, levels of productivity,
employment, resource scarcity, macroeconomic policies, and other
factors.

A baseline from which to calculate impacts must be dynamic. Dimen-
@sions of impacts due to the Act can be ascertained only by separating
out trends that are independent of the Act. The following section
examines forces that will determine the patterns of progress toward
achievement and the magnitude of the economic impacts resulting from-
this progress. The detail of the baseline calculation will be repeated
in subsequent discussion summarizing the impact results.

In some of the industry studies, the Commission used detailed
baieline projections of prices, output, plant closings, water use,
and industrial organization. In other studies it was sufficient to
illustrate that changes in baseline conditions would not appreciably
alter the conclusions.

A "dynamic baseline" requires the projection of a minimum of two
sets of variables: (1). macroeconomic conditions in the absence of the
Act, (2) microeconomic or industry level conditions in the absence of
the Act.

The first set of variables focuses on the overall economy over the
next ten years, including rates of growth in GNP, unemployment, inflation,
and interest rates. The second, at the level of the individual industry,
focuses upon its rate of,growth, mix of production technologies, pattern
of water use, shifts in product mix, rates of capital obsolescence, and
trends in industrial organization. In addition to the macroeconomic
and microeconomic conditions a third set of variables, examining trends

111-34

in industrial water pollution control expenditures has been added. Water
.pollution control is not new. Local and state regulations and Federal
acts and amendments existed for many years prior to 1972. These tre nds
have to be factored into the analysis too.

Macroeconomic Baseline Projections

The size.and nature of the impacts studied are sensitive to the
macroeconomic baseline forecasts. The effect:of the Act upon prices
and employment depends on the degree of existing employment. The standard
baseline used by the Commission to forecast national economic activity
was obtained from the Wharton Model, with interindustry detail provided
by the University of Maryland Interindustry Forecasting Model (INFORUM)(15).
The results are summarized in Figures III.C.1 and III.C.2.

Several aspects of this baseline forecast should be noted. In the
1975-1980 period, gross private domestic investment, particularly
residential construction, are projected to have extraordinarily high
rates of growth. In the recession of 1974-1975, investment and housing'
expenditures declined far more rapidly than the general economy. Thus,
1975-1980 growth rates are large because they assume rebound in resi-
dential construction. In 1980-1985 all types of investment are estimated
to have a slightly lower than average growthrate, while the growth of
consumption of durables and services is slightly greater. Total govern-
ment purchases as a percent of GNP drop from 19 percent to 18 percent
from 1975-1985 as does personal consumption expenditures which decline
from 67 percent to 63 percent. Private investment absorbs this reduction,
moving from 13 percent to 19 percent of GNP.

Three factors account for the declining growth rate between the
periods, 1975-1980 and 1980-1985. First, the 8.5 percent unemployment
for 197.5 makes it.possible for employment to increase more rapidly
than the labor force, thus:realizing a lower level of unemployment
in 1980. Second, the labor force growth is projected to be greater
in 1975-1980 than in 1980-1985. Third, productivity, or output per
man hour, is projected to increa.se less rapidly in the second period.
PIroductivity commonly increases more rapidly during.cyclical expansions.*
During 1980-1985 there are both lower rates of growth in productivity
in most sectors and a shift in the mix of production toward sectors
with lower productivity and lower growth rates.

Three caveats should be made about this or any other long-term
projection of economic activity from econometric models. First, assump-
tions made external to the model are important determinants of the
resulting projections. Second, the accuracy of any Attempt to forecast
cyclical patterns beyond a year or two diminishes rapidly as the period
lengthens. Third, the components of the models use data for a period

111-35

Figpre I I I.C.1
BASELINE ECONOMIC PROJECTIONS 1975-85

CHANGES IN COMPOSITION OF GROSS NATIONAL PRODUCT

100% $1.46 Trillion* 100% $2.18 Trillion*

Government
purchases 18%

19%

Personal Gross private
X.-
domest XX. -.:':::X"'
consumption ic
:X
Investment
expenditure
63%

67%

1975 Estimates in 1975 dollars 1985

COMPARATIVE ANNUAL GROWTH 1975-80; 1980-85
(Percent August)
Gross- 54-73 13.4%
national
%X.
product 75-80 5.02
80-85 3.14

Personal Components of GNP
4.57
consumption
expenditures

Gross X
private
investment 6.55

Government 3.57
purchases 3J2

1975 excludes 1% not imports; 1985 excludes under 0.5% not imports.
Source: Nati. Commission on Water Quality: Fromcor4SAD Research Corporation, "Macroeconomi-c
Impacts of P.L. 92-500", 106.
February 1976

Figure I I I.C.2
ANNUAL GROWTH PROJECTIONS
Average annual for 5 yr. periods 1975-80, 1980-85

Components of GNP (Percent Growth)
7.8 Personal 8.5 Gross Government
Consumption 6.7 Private Purchases
Total GNP Expenditures Domestic 6.3
Growth Investment
5.2 5.1

4.1 4.0
1975-80 3.9 J. b

2.4 2.2
1980-85 2.2 .2.1 ---------
.2

Durable Non- Services Non- Nati. Federal State & Education
Goods durable Residential Defense Non- Local
Total Component Residential defense
Construction
Group Growth
1975-80 4.6 10.1 3.6
1980-85 2.2 6.6 3.1

Source: Nati. Commission on Water Quality. From CONSAID Research Corporation, "Macroeconomic
Impacts of P.L. 92-500", 1976.
February 1976
1.3

LL7

111-37

of relatively "normal" economic growth and employment -- i.e., no major
depression or war. The projections of economic activity are derived'
from assumptions regardi ng population, labor force, government fiscal
and monetary policy, and technological change. Beyond the future
expansion phase of the current business cycle, no cyclical forecasts
are made.

Industry Level Baseline

1. Output Projections: the,,INFORUM Model also projected standard
baseline growth rates for individual industries. Figures III.C.3 through
III.C.6 present these baseline projections of output, employment, plant
and equipment, investment, and productivity over the next ten years
for ten of the industrial categories studied.*- The INFORUM baseline
projections provide a common starting point for these industries,,,@;hich
constitute much of the primary manufacturing segment and reflect the
general level of national economic activity..

2. Trends in Plant Closings and Industrial Structute:-,Potential
impacts of.the Act are plant closures and associated shifts in industrial
structu're. Plant closures in response to economic change are not unusual
or totally undesirable. Exit (closure) and entry (new plants) into an
industry are part of adjustment to more efficient production when markets
and technologies are changing. Table III.C.1 presents baseline infor-
mation on the historical rates of plant closures from 1967-1974 for six
of the industries under study.

TABLE III.C.l: ANNUAL RATES OF PLANT CLOSING IN SELECTED
MANUFACTURING INDUSTRIES, 1967-1974

Industry Closures Per 100 Plants

Textiles 2.2
Pulp and Paper 1.7
Petroleum Refining 4-.7
Iron and Steel 1.7
Nonferrous Metals 4.0
Electroplating' 1.3

Source: NCWQ. From National Bureau of Economic Research, "Economi c
Impacts of Water Pollution Control Act of 1972, Plant Closures
and the Regional Consequences of Water Pollution Control". 1975.

These are the largest major water-using industries and the categories
studied in-depth by the Commission.

111-38

Figure I I I.C.3

BASELINE OUTPUT PROJECTIONS 1959-1985

Billions of 1969 dollars Average annual growth
in 15 yr. periods. Percent

19 5 9 77177717177A $ 16
1973 $35 5.9%
Chemicals 1985 q@ 1973-85
154 3.6
Petroleum 77177171771M 19 34 4.3
refining
49
-2.9
Electric 14 33 - 6.2
utilities 47
13. 1,
Iron and ------ 7M1 28 @37 1..8
steel
--7---r36

Nonferrous 3.6
29 1.9
Paper and 12 20 3.9
products
125 -110

Fabrics and 3.3
yarns 25 .5
Metal 9 16 4.4
finishing 22 2.6

Canned and 13 4.2
frozen foods 19
13.4

Plastics 12 8.4
synthetics 17 3.0

TOTAL 4.4
INDUSTRY
GROW H 2.A
Source: Ned. Commission on Water Quality. From University of Maryland Interindustry Forecasting
Model ONFORUM), May 1975.
12 18
@151,7;1
3.6

4.3

,2 .9

0
@14
23

February 1976

111-39

Figure I I LCA

BASELINE EMPLOYMENT PROJECTIONS 1959-1985

Thousands of persons employed Average annual growth/decline
in 15 yr. periods. Percent.

1959 U IV
1973 1959-73 1.6%
Chemicals 640 1973-85 0

Petroleum 210
refining 0 .1.7

A 4n
Electric 5 0 1.3
util ties 580 .0
Iron and 860
steel 94d -0.4
1900

Nonferrous 400 1.4
430

Paper and 500 1.3
prod ucts 1590 1.3
610
Fabrics and 620 Decline 0 Growth
yarns 0
610
Metal 2.2
finishing 610 1.5
240
Canned and 260
frozen foods 350 1.6

Plastics and 0 3.4
synthetics -1.3

TOTAL PRIVATE
M
500
"
0
1985

.210
80
18
0
.1.11973-857
0
1414 @O
4- 2
0
51
@0. 5
1-5
,24
0
261
1.6
57 17
0
0
240
2nn
00

EMPLOYMENT GROWTH 2.2
(Non-'agricultural) rJ1.6
Source: Nati. Commission on Water Quality. From University of Maryland Interindustry Forecasting
Model ONFORUM), May 1975.
February 1976

111-40

Figure I I I.C.5

BASELINE PLANT AND EQUIPMENT INVESTMENT PROJECTIONS 1.959-1985

Billions of 1971 Dollars Average annual growth
in 15 yr. periods. Percent

1959 $0.7 1959-73
1975 $2.0 1)0/
Chemicals 7312 1973-85 3.9
Petroleu .2 06 - 8.4
refining 5.5

Electric .6 10.6
utilities
8.5 1.9
Iron and 0.7 1.5 5.3
steel 2.8 5.3
Nonferrous 6.3 1.0 1.3 2. 9.8
0.6
Paper and 1.4 6.4
pIroducts 12.5

Fabrics and 0.5 6.9
yarns 0.7
Metal 0.1 0.4 7.6
finishing 1 4:;
0.6

0.1
Canned and 03 7.
frozen foods 0.6

0.2
Plastics and 0.9 11.2
synthetics
1.1
1.5

TOTAL
INDUSTRIAL 4.6
P 34
9

5.5
ME19 EMM
rMM7

6 -4

5.5

6
3 @2 .9
5; 4:6 ;7 =2
INVESTMENT "M
GROWTH 1.8
Source: Nati. Commission on Water Quality. From University of Maryland Interindustry Forecasting
Model (INFORUM), May 1975.
February 1976

111-41

Figure I I I.C.6

BASELINE PRODUCTIVITY PROJECTION 1959-1985

Average annual growth in 15 yr. periods. Percent

Chemicals 1959-73 4.3%
1973-85
3.5

Petroleum refining 5.6

Electric utilities 4.8
2.0

Iron and steel

-- --- -- - - -- --- ---- --
Nonferrous 2.2

Paper and produ ts 2.0
1.7

Fabrics and yarns 3.3
2.4

Metal finishing 2.0
1.2

Canned and frozen foods 3.0

Plastics and synthetics 413
4.7

TOTAL INDUSTRY 2.3
OUTPUT/EMPLOYMENT
GROWTH 0.9
Source: Nati. Commission on Water Quality. From University of Maryland Interindustry Forecasting
@Model JINFORUM), May 1975.
February 1976
- --- - -----
70.411
7-11 M,
M"1.7
7 M4

r1o E9M

111-42

Within the industries studied, there was definite,variance in the
incidence of closures among plant types. In Pulp and Paper some
sectors had an absolutely andproportionately high incide'nce' of closures.
Building Paper and Building Board Mills (SIC 26 61) has 45 percent of
that'industry's closings between 1967 and 1974, but only 12 percent of
the industry's establishments as measured in 1972. Closings in the
Paper Mill sector (SIC 2621) were roughly proportional to the sector's
share of the existing plants in t@e industry -- i.e., 41 percent of
the closings and 45 percent of the establishments. Conversely, only
13 percent of closings were paperboard plants (SIC 2631) a sector
that comprises over 35 percent of the industry.

Differences within the Textile.industi-y also illustrates the impor-
tance of the particular product manufactured. Of-22 subcategories
within textiles, six categories @- with 32 percent of existing estab-
lishments -- accounted for 60 percent of plant closures. Twenty-one
percent of all plant closings were in Narrow Fabrics (SIC 2241). Hosiery
(SIC 2252) and Knit Outerwear mills (SIC 2253) accounted for iO and 14
percent of closures respectively.. Other examples of sectors with higher
than average closings include,wool weaving mills, woven carpet and rug
mills, and miscellaneous knitting mills.

Commission studies examined existing.and projected trends in indus-
trial structure and concentration. Table III.C.2 presents existing
trends in employment, number of plants, and size of plants, in terms
of employment, for six industries. Net plant closures can explain
employment trends. The decline in Petroleum Refining industry jobs
coincides with a sharp decline in the number of refineries. In Elec-
troplating simultaneous increases in the average size and number of
establishments-contributed to employment gains. Although the number of
operating textile establishments actually.decr6ases,p the growth in the
size of surviving plants caused an industry-,Twide employment gain.

Projections of market structure data for selected agriculture-
related industries indicate that the general trend is toward a declining
number of establishments. Employment is rising.in eight of the Food
Processing industries, but declining in the other seven. New capital
expenditures and value of'production are generally moving upward, the
only notable exceptions are creamery butter, flour and other grain
products. Heavy concentration of new capital investment is projected
for the North Central states. In short, businesses in the agricultural
industries are expected to become larger and more centralized as they
handle increasing levels of production,; while small firms will have
difficulty staying competitive (7).

3. Trends in Production Processes and Product Mix: Changes in
-industry's input (labor and materials) prices, production technologies
and product mix often impact its water use and residuals generation

111-43

TABLE III.C.2: Changes in Employment and in the Number and Size of
Est ablishments in Selected Manufacturing Industries
.(1958-197@)

Change in
Change in Change in Number Emp loyment Per
Employment of Establishments Establishment
Industry (Percent) (Percent)' (Percent)

Textiles
SIC 22 +15.5 -6.1 +23.1

Pulp and Paper.
SIC 2611 -25-.3 +1.7 -26.6
SIC 2621, - 1.2 -1.4 + 0.4
SIC 2631 .+19.9 +8.3 +10.7
SIC 2661 -30.1 -

Petroleum
Refining
SIC 2911 -31.0 -27.6 4.7

Iron & Steel
SIC 331 - 4.3 +36.3 .-29.8
SIC 332 -20.3 -15.1 +41.6

Nonferrous
Metals
SIC 333 +24.2 +56.3 -20.6
SIC 334 +23.6 - 1.5 +25.5

Electroplating
SIC 3471 +50.4. +23.5 +21.8
SIC 3479 +75.8 +49.3 +17.8

Source: NCWQ. From National Bureau of Economic Research. "Economic
Impacts of Water Pollution Control Act of 1972; Plant,Closures
and the'Region+al Consequences of Water Pollution Control"j,
1975,

111-44

patterns. An impact analysis which focuses solely on-the costs of water
pollution clean-up for.industry's present production technologies and
product mix can misinterpret the impact of the Act.

For example, a major production process change affecting water
use in the Pulp and Paper industry has been the continuing shift from
sulfite to sulfate pulping. Sulfite pulping requires.roughly 50 percent
more intake and discharge water than does sulfate pulping. However, the
effluent from the bleaching of sulfite usually is much lower in BOD and
color than in that from the bleaching of sulfate pulp. The total resultant
BOD remains relatively stable. Between 1947 and 1973 sulfite wood pulp
dropped from 20 percent to 4 percent of total wood pulp production;
sulfate wood pulp increased from 45 percent to 67 percent over the
same period. Figure III-C-7 presents baseline projections of the.rela-
.tive shares in the production of pulp and.paper between "product/process
groups", indicating relative stability in the next decade. Figure III.d.8
illustrates trends in product mix in the Iron and Steel industry. By
.1983, open hearth furnaces are projected to be eliminated. It would be
wrong to assume that all such facilities,.even though they are in operation
today, will have to meet the water.pollution-control limitations for 1983.

Two cases in the agricultural industries illustrate the need to
'consider production changes. If grain prices rise, it becomes more
costly to maintain established feedlots. Grass-fed beef would become.
more economical. If such a shift should occur, water pollution control
problems at feedlots would diminish. In the Leather Tanning industry
the U.S. Department of Agriculture estimates that a shift from salt-cured
to fresh hides would result in about a 12 percent reductionin water
pollution control costs, in addition to other substantial economies.

Trends in municipal Abatement Activities

Any analysis of the Act's impacts on municipal abatement must examine
past accomplishments in the absence of significant Federal funding levels.
Figure III.C.9 shows the 1973 sewered population and the populations
served by various levels of treatment. This overstates the existing
degree of achievement. A population is counted as being served by a
given treatment level, if the wastewater ultimately empties into a
treatment plant. It does not take into account that many of these plants
have inadequate capacity to actuallytreat the wastewater.*. Over 19
percent of all facilities that reported this information in the 1973 Needs

"It should be noted that.many ofethe secondary facilities reported
(e.g., trickling filters and waste stabilization ponds) could not
meet secondary treatment effluent requirements." (1)

111-45

Figure I I I.C.7
TRENDS IN PROCESS/PRODUCT MIX
PULP & PAPER BASELINE PROJECTION'

PERCENT OF TOTAL PRODUCTION BY PROCESS/PRODUCT
100% in 1972 = 55.6 million tons
% 100% in 1983 = 86.3 million tons
30

24.7% 24.1% Unbleached kraft
M

13.6% Recycled paperboard
11.7% Bleached kraft pulp, paper, &
12 paperbo ard -
11.5% on inte lrated paper
Integrated newsprint& ground
10.3% 10.3% wood
9.3% Integra
7.8% 83%- ted bleached &
unbleached paper, paperboard
6 5.9% Sultite market pulp & paper
k5i % 5.8% Semichemical corrugated medium
4.9% 5.0% G...... wood printing
r,- De-inking
3 3.0% 3m5%:f

0
1972 1977 1985

Source: NatI. Commission on Water Quality. From the Conference Board Inc. "A Pilot Study on
Measuring the Economic Impact of Water Pollution Abatement - - Pulp, Paper & Paperboard
Mills", 1975.
February 1076

111-46

Figure I I I.C.8

TRENDS IN PROCESS/PRODUCT MIX
IRON & STEELPASELINE PROJECTION

PERCENT OR RAW STEEL PRODUCTION
(100%: 1954 88 million tons;-1973 151 million tons; 1977 166 million tons;
% 1983 =.191 million tons)

94%
PRODUCT STRUCTURE
80 -
OPEN HEARTH wool 0000 WOW
60 - BASIC
OXYGEN FURNACE
(BOF)

40 -
ELECTRIC
20 - FURNACE
20%
06% 2%
1954 59 64 68 73 77 1983

% PERCENT OF SHIPMENTS
50 50% Sheets & strips

40 PRODUCT MIX
100%:. 1954 = 63 million tons
30 1973 = 111 million tons
1977 =
1993 =

20
17% Bars & tools
14% Shapes & plates
10
8% Pipes & tubes
5.4% Semi-finished
---3% Wire products
0 - 1% Rails
1954 59 64 68 1972

Source: NatI. Commission on Water Quality. From The Confers nce Board, Inc., "A Pilot Study on Measuring the
Economic Impact of Water Pollution Abatement - - The Blast Furnaces and Steel Mills Industry", 1975.
February 1976

111-47

Figure I I i.C.9
1973 LEVEL OF ACHIEVEMENT
FOR PUBLICLY-OWNED WASTEWATER TREATMENT WORKS

TOTAL U.S. POPULATION
1973 78%1 Not 22% 100%
Sewered 210 million
*ori'public,systerns

76%1

50%dl

Have
1.3% TERTI A RY TREATMENT
(2.8 million)'

NUMBER OF TREATMENT PLANTS

1973 19,533

16,750

I
795 with
TERTIARY TREATMENT

Source: Nati. Commission on Water Quality. From U.S. Environmental Protection. "Economics
of Clean Water, 1973", pp. 19-20. Number of plants from EPA report to NCWQ; original
source given as February 1974 EPA "Point Source Inventory".
February 1976

111-48

Survey had inadequate capacity in their present treatment plants (11).
This problem was even more severe in those plants serving over 150,000
people, which reported over 33 percent of facilities with inadequate
capacity.

The 1973 levels of.achievement were not the result of a sudden
spurt of effort in the late 1960's due to the environmental movement.
Figure III.C.10 shows the growth in percentage of population sewered
and with at least primary or at least secondary treatment. In 1940,
50 percent of the population was sewered. Of those with sewers, 50 per-
cent received at least primary treatment and 28 percent at least
secondary treatment.* All three trends rose sharply through the 1950's
and less sharply in the 1960's.

This leveling off was not due to declining expenditures but reflects
population increases and the trend of accelerating cost of treatment
per person. Figure III.C.11 shows the dollar values of contracts awarded
for collector sewersf interceptor sewers, and treatment plants. Figure
III.C.11 also shows the level of Federal outlays, which were 15 percent
or less of the costs of contracts awarded for treatment plants and inter-
ceptor sewers. For collection sewers, financing was entirely local until
authorized by P.L. 92-500.

many large cities discharging directly into*major rivers, lakes, or
oceans dominate the population'@that currently has only primary treatment.
Table III.C.3 lists nine SMSA's of which major portions lacked secondary
treatment in 1972. Together they account for almost one-third of the
sewered population that still lacks secondary treatment.

TABLE III.C.3: METROPOLITAN AREAS SUBSTANTIAL PORTIONS OF WHICH
LACK SECONDARY TREATMENT

Bogton St. Louis
Detroit San Diego
Kansas City San Francisco
Los Angeles Seattle
Philadelphia

Source: NCWQ. From Association of Metropolitan Sewage Agencies.
Survey prepared for NCWQ. 1975.

EPA has noted that there can be confusion when comparing statistics
for conventional biological secondary treatment with presently
defined secondary standards.(2).

111-49

Figure I I I.C.10
TRENDS IN LEVEL OF ABATEMENT
BY- PUBLICLY-OWNED TREATMENT WORKS

Percent of Sewered Population Percent of Total U.S. Population
100 9 %

90 -
At. Least
Primary Treatment
80 77%

70 -
66%

60
56% Sewered
Population
50 - 50%

At Least
40 Secondary Treatment

30 -
28%

10 -

0.
1940 45 48 57 62 68 73 1940 45 48 57 62 68 73

Source: Nati. Commission on Wat4 Quality. From U.S. Environmental Protection Agency. "IEco-
nomics; of Clean Water, 1973", pp. 19, 20.
February 1976
@Sewed
r
Populati 0n

111-50

Figure I I I.C.1 1
CONTRACTS AWARDED FOR SEWER SYSTEMS
& FEDERAL CASH OUTLAYS

Millions of 1973 dollars/year
3,200 $3.2 billion
Total sewer
system spending

2,800 -

2,400 - $2.3 billion
Treatment'
plants &
2,000 - L interceptor
sewers

1,600 -

1,200 - A V

901 million $829 million
800 Collector sewers
562 in il
$605 million
,00, FEDERAL
400 J-00'0' CASH
01 OUTLAY
338 million

01 f I
1952 55 60 65 70 74

Source: NMI. Commission on water Quality. From U.S. Environmental Protection Agency, 1971
Sewage Facilities Construction Report for 1952-197Vand USEPA, Communication to the
commission,for Years 1972-1974.
February 1976

Communities may be more willing to spend money on treatment plants
to the extent that the resulting water quality improvements accrue
locally. A study of-the.Merrimack Valley found that the portion of the
community directly bordering'the river has a significant influence on
levels of expenditure (9)., The demand for collectors is largely influ-
enced by the degree'to which septic tanks become a nuisance or a public
health problem. A study of the Boston SMSA showed that almost all
communities with population densities of over 750 persons per square
mile have sewers (13). This further demonstrates the importance of
Population density 'as the key determinant of demand for s.ewering.

In summary, the Commission attempted to consider the consequences
of.changes in inputs, production technology, and final demand in its
industrial impact @nalysis to the extent that such factors appeared
to dramatically influence the costs of abatement over time. Trends in
key dimensions of municipal abatement are also examined. These forces,
in addition to those factors discussed in Part B above, set the stage
for the impact assessment.

111-52

REFERENCES

(1) Alm, Alvin L. U.S. Environmental Protection 'Agency. Communication
to the Commission, Washington, D.C. September, 1975.

(2) U.S. Environmental Protection Agency. -Communication
to the Commission. Washington, D.C. January, 1976.

(3) Association of Metropolitan Sew 'age Agencies. Survey prepared for
National Commission on Water Quality. 1975.

(4) The Conference-Board. A Pilot Study on Measuring the Economic Impact
of Water Pollution Abatement Pulp, Paper and Paperboard
Mills. New York, June, 1975.

A Pilot Study on Measuring the Economic Impact'of
Water Pollution Abatement -- Blast Furnaces and Steel Mills
Industries. New York, June, 1975.

(6) CONSAD Research Corporation. Macroeconomic Impacts of P.L. 92-500,
1975.

(7) Development Planning and Research Associates. Economic Impacts
of Water Pollution Control Act of 1972,i The Feedlot Industry,
Canned'Fruits and Vegetables, and Other Industries. 1976.

(8) National Bureau of Economic Research. Economic Impacts of Water
Pollution Control Act of 1972; Plant Closures and,the Regional
Consequences of Water Pollution Control. Cambridge, June, 1975.

(9) Roberts, Marc J. and Oster, Sharon. Determinants of the Distribution
of Environmental Protection Expenditures Among Local Governments;
Water Pollution Control in the Merrimack Valley. Paper
presented at the Conference on the Economic Analysis of
Political Behavior, sponsored by Universities-National Bureau
Committee for Economic Research. New York, 1975.

(10) U.S. Environmental Protection Agency. Communication to the Commission.
on Sewage Facilities Construction, 1972-1974, Washington, D.C.,
1975.

Cost Estimates for Construction of Publicly Owned
Treatment Facilities, 1974 "Needs" Survey. 1975.

(12) Economics of Clean Water-1973.. Washington, D.C.
1973.

111-53

(13) Evaluation of CEQ Report on Interceptor,and
urban Sprawl,

(14) Sewaqe and ConstructionTacilities, 1952-1971,
Washington, D.C., 1971.

(15) University of Maryland Interindustry Forecasting Model (INFORUM).
College Park, 1975. Various runs under National Commission on
Water Quality direction.

111-54

D.1) INDUSTRIAL AND AGRICULTURAL REQUIREMENTS AND IMPACTS*

The analysis of economic "impacts" is the measurement of the change
of certain economic indicators from baseline conditions due to the
requirements of the Act. This section presents the Commission's assess-
ment of the impacts on selected American industries as measured by
changes in the following economic varicibles from the baseline discussed
in Section III-C of this chapter:

1) Capital Requirements
2) Distribution of Capital Requirements Among Industries
3) Prices
4) Output
5) Profits
6) Short-term Transition Impacts Due to Capital and
Capacity Shortages
7) Distribution of Capital Requirements'Between Plants
in Selected Industries.
8) Plant Closures and Industrial Organization
9) Regional Consequences
10) International Trade

In this analysis the Commission distinguished between short-term
transition costs** and potential long-term increases in the costs of
production. Water pollution control costs will likely decrease over
time as industry incorporates the rising cost of water use in the
design and operation of production capacity, New plants and equipment
are designed to meet new standards of product quality, performance, and,

Only the Commission in-depth industry studies and certain agriculture-
related industries are analyzed in the full range of industry impacts.
Other industries, interindustry ramifications, and overall impacts
are covered in the macroeconomic section, Section III.F. Table
.III.D.9 lists those industries not analyzed in detail and relates
them to the macroeconomic sectors.

Roughly, those costs occurring during the compliance periods of
.1977 and 1983.

111-55

with the proper incentives, water usage and effluent generation.* Products
manufactured by polluting processes will be at a competitive disadvantage
if less-polluting substitutes are available. Figure III.D.1 presents
two sets of estimates of industrial responsiveness to higher costs of
water use and effluent discharge. The estimates illustrate that as the
price of'water use increases, the use of water decreases, and that as
the costs of waste treatment rise, the amount of waste decreases.

1. Capital Requirements

The Federal Water Pollution Control Act Amendments of 1972 require
extensive expenditures,for industrial water pollution abatement over the
next eight years. The Commission's estimates of the capital and operating
and maintenance expenditures which will result as individual industries
comply with@the BPT and BAT effluent limitations are presented in
!6able III.D.l. The cost estimates for the in-depth industries (except
Iron'and Steel) reflect plant closings, where they will occur (i.e.,
the estimates do not include expenditures for capacity which the Commission
projects to close rather than meet the requirements of the Act). For
flother" industries these numbers occasionally differ from Table 11-30
due to unique analytical steps for that industry (see supporting documents
for explanation), All impact analyses reported below began with the
numbers generated in the Technology studies reported in Chapter II.

To comply with the Act a plant has six principal options, none
of which are mutually exclusive:.

(1) install wastewater treatment technology

In some industries other regulatory programs may counter this trend,
thus precluding cost reductions for water pollution abatement.
Health regulations in food processing industries may require
increased water use for sanitation purposes, these regulations being
further compounded by noise,regulations. In other industries air
quality regulations may produce increased water use together with
generation of water-borne residuals. While the Commission's mandate
precluded examination of the combined effects of multiple regulatory
programs, we-acknowledge that these combined effects may be relevant
to broad questions of industry viability And vitality as measured by
profits, return to equity, availability of capital for "productive"
investment, etc. This.zuggests that any considerations of program
modifications may require consideration of.information beyond that
provided in this report as it relates exc.lu@ively to the impacts of
P.L. 92-500.

111-56

Figure I II.D.11

INDUSTRY RESPONSIVENESS
TO COST OF INTAKE WATER AND WASTE DISCHARGE

PRICE OF WATER
IF: THEN:
Price of water 1%1 Water intake volume decreases
Increases
0.70o
for chemicals

........ 1.4% Paper

1.4% Petroleum

1.6% Steel

Source: "Changing Water Use in Selected Man ufacturing Industries", by Robert Leone,Jr., J. Royce Ginn, ahd
An-loh Lin. December 1973.

COST OF WASTE.
Cost of Effluent Discharge Volume of Effluent Discharge
IF: THEN:
Combined water Flow decreases
& sewer flow
1.4%
charge increases
Suspended solids 1%1 SS concentration decreases
charge.increases
.. .. ...................
....... .......... .
........ ..... ..... .
I ... ....

Biochemical 1%1 BOO c oncentration decreases
Oxygen Demand 0.251 %
charge increases
BOO charge 1%1 BOO volume decreases
increases 0 1 %

Source: National Bureau of Economic Research Draft Report "A Cross-Section Analysis of Industrial
Waste Water Dischargers", 1975.
NatI. Commission on Water Quality
February 1976

TABLE III.D.1 111-57

I N D U S T R Y

Economic Impact E xpenditure Estimate
(Millions of 1975 Dollars)
BPT (1977) BAT (1983)
a Annual Annual
Indepth Capital O&M Capital O&M

Fruits & Vegetables 167 15@ 96 10
Inorganic 805 178 261 104
Organic 3325 487 2990 2242
Misc. Chemicals 965 163 650 228
Iron and Steel 2080 322 556 202
b
Metal Finishing-Job 1715 328 78Q 168
Captiveb 7418 2@75 7428 1365
1 b
Petroleum Refining 829 142 1184 429
Plastics &.Syntlietics 209 33 286 29
Pulp and Paper 2194 ill 437 20
Steam Electricc 3740 1420 2030 260
Textiles 458 58 203 61
23905 5532 16901 5118

Other

d
Ore Mining and Dressing 610 25 0 0
Coal Mining d 1700 95 0 0
Petroleum & Gas Ext. d 234 18 1070 61
Mineral Mining & Proc. 730 72 0 0
Meat Products & Rendering 148 20 181 10
Dairy Products 188 13 73 5
Grain Mills 33 2 8 1
Cane Sugar Processing 153 17 170 13
Beet Sugar 90 17 69 5
Canned & Preserved Seafood 41 12 120 12
Misc. Food &Beverages 5 1 5 1
Timber Products 14 1 25 8
Furniture and Fixtures 8 3 0 0
Bldg. Paper & Board 120 12 0 0
Paint and Ink 23 22 0 2
Soap and Detergent 10 1 2 0
Phosphate Mfg. 73 9 14 1
Fertilizer Mfg. 77 50 64 23
Paving and Roofing 6 6 4 1
Rubber Processing 220 18 48 12
Leather Tanning 77 20 47 7

111-58

TABLE III.D.1 continu .ed BPT BAT
Annual Annual
Capital O&M Capital O&M

Glass'Mfg. 42 5 16 3
Cement Mfg. 34 4 9 1
Concrete, Gypsum, Plaster 100 26 0 0
Asbestos 4 1 9 4
Insult. Fiber. 14 6 0 0
Terroalloy Mfg. 48 16 13 3
b,e
Nonferrous Metals f 40 21 31 7
Machinery & Mechanical Prod. 3900 390 3900 390
Transportation Industry 1200 130 140 39
Water Supply 1200 160 100 3
Auto & Other Laundries. 25 4 21 1
Foundries 180 26 0 0

Fish Hatcheries 50 10 47 31
Structural Clay 5 1 0 0
Pottery 3 1 4 3
Steam Supply 0 0 0 0
Nonferrous Mills 260 25 0. 0
Feedlots
Beef 100 8 30 0
Hog 178 9' 59 0
.Dairy 152 10 .46 0

All Other Industries 12095 1287 6325 -647
In-depth Industries 23905 5532 16901 5118
Total 36000 6819 "23226 5765

a. Cost estimates for all Indepth industries (except Iron and Steel)
and 7 of the Other Industries (Meat Products and Rendering, Dairy
Products, Grain Mills, Leather Tanning, Nonferrous Metals, Fertilizer, and
Feedlots) represent costs only for those plants which are projected
to remain open.

b. Municipal user charges included.

c. Growth included.

d. These cost estimates were based!-..upon a preliminary contractor report.
The Commission believes the cost estimates presented in Table 11-30
are more accurate; the cost estimates presented here are included
@because they were used in the impact analysis.

111-59

TABLE III.D.1 continued

e. These cost estimates were based upon a preliminary contractor
reportn, The differences in these estimates and those presented
in Table 11-30 are principally due to two factors: (1) the
estimates in Table.II-30 include $83 million for two bauxite
refineries on the Mississippi River to meet BAT requirements,
not included in the cost estimates aboveF and (2) the nonferrous
metals.estimates in table 11-30 do not attempt to take account
of treatment facilities in place as of January 1973 for primary
aluminum smelting and refining, a subsector of Nonferrous Metals.

f. Excludes Metal Finishing.

Supplemental Notes to D;ii

1. Costs reported relat6 to a specific set of existing treatment
technologies. As such, they do not tA6 into account possible
managerial respones to these costs which entail the substitution
of relatively long-cost inputs for hiqher-cost factor inputs over
the long term.
2. Cost reported do not account for,possible techn'olo'gic*al.in'novatio'ns
either in wastewater treatment or b*asic production processes,-except
where such trends are readily acknowledged (e.g., the,eventual
retirement of open hearth furnaces in the steel industry).

3. All the individual Posts reported in this table are estimated with
.varying degrees.of uncertainty. As such, they are not intended to
be either high or low-side estimates' of Costs, but reflect the
judgment of the Commission's c8h'tractorls and staff.

4. Costs reported do not include Aepicec,iation.or' indirect char4es.
Detailed discussion 'of these costs are included in the individual
in-depth contractor studies. It is possible to use this-table to
formulate an approximate present value estimate of compliance costs
which account for depreciation, interest and eventual replacement
of capital facilities. Assuming a 10 .percent annual rate of return
to equity after taxes and a 10 year capital life, the 1975 present
value of all future expenditures for water pollution associated with
those technologies and industries reported in this table is approxi-
mately $195.6 billion. See Appendix D.II for details.

TABLE III.D.1 continued 111-60

5. See Appendix D.II for a more detailed characterization of the
information in this table.

Source: National Commission on Water Quality
February, 1976

111-61

(2) initiate process or in-plant changes to eliminate or
reduce the need for wastewater treatment

(3) change product specifications to eliminate those characteris-
tics of products which generate pollution

(4) change the inputs into the polluting processes

(5) discharge wastes into a municipal system

(6) dispose of wastes on the land or in the air.

The Commission's estimates of required expenditures largely assume that
industry uses wastewater treatment technology or discharges to municipal
systems. For specific industries and specific subcategories, other
options are considered, but the vast majority of the Commission's
estimates of expenditures are for wastewater treatment technology.
Since.some plants have opportunities for effluent control through in-
process changes, the estimates may result in an overstatement of the
required expenditures. Conversely, some plants confront specific
abatement problems which the Commission's studies were unable to detect
or adequately address. Theresult in these cases is an understatement
of the costs.

The estimates of required expenditures do not take into account
administrative variances for BAT requirements, nor do they include any
estimates of expenditures to meet water quality standards. The estimates
are based on compliance with EPA effluent limitations as promulgated
and do not reflect actual plant-by-plant permit requirements. Final
EPA effluent guidelines were not available for some industries. In
such cases the costs are based upon EPA's contractor reports and the
Commission's judgment'of what the guidelines likely will be.* Pre-
treatment costs are included in the majority of the'estimates, but user
costs associated with municipal systems were included for only some of
the in-depth industries. (See Table III.D.1)

2. Distribution of Capital Requirements Amon2 Industries

As illustrated in Table III.D.2**, industries will bear Oifferent

See Chapter II for a complete discussion of the status of the
effluent guidelines used.

**,-This classification of industries is different than the list prepared
in Table III.D.1 due to the nature of investment projections in.the
macroeconomic models.

111-62

percentages of the water pollution control.expenditure.-- relative to
the total level of industrial commitment and the size of the projected
capital spending of each industry. The capital expenditures of six
industries -- Chemicals, Electric Utilities, Iron and Steel, Paper,
Mining, and Petroleum -- constitute about 48 percent of @he total
industrial capital,expenditures for water pollution AbA@:ement over the
period 1975-1983. Capital expenditures for Metal Finishing and Machinery
and Mechanical Products constitute a comparable percentage. This brings
the total for these industries to over 90 percent of the total industrial
water pollution abatement expenditures over the period 1975-1983.
Metal Finishing, Chemicals, Pulp and Paper, and Mining have the highest
percentage of water pollution abatement expenditures compared to total
plant and equipment investment. Electric Utilities and Petroleum
are near the industry average.

3. Prices

Estimates of industrial capital and'operating and maintenance
expenditures indicate the level of resources required by the Act. These
serve as a starting point for the calculations of economic impact. A
stream of costs is developed for each industry and subcategory studied,
representing full costs of compliance per unit of product'in each
subcategory. Principal additional dimensions of these flows, aside
from the base capital and O&M figures, are the costs of capital and
depreciation charges, derived from formulas reflecting the.tMique capital
structure of each segment studied. The elements of these formulas
are too numerous and varied to report herein and are referenced in
supporting documents.

Estimates of how these expenditures translate into price, output,
and,profit changes are summarized in Tables III.D.3 and III.D.4-, providing
a measure of economic impacts. Since these expenditures are representa-
tive of averages for industry subcategories, continued operation by
higher cost producers in the short run may result in higher prices for
that short-run period. The Commission's price estimates are more
representative of those resulting in the subsequent adjustment period.*
These estimated pr ice increases will be reached over about a ten year
period**, and represent the difference in prices over baseline levels

The Short Term Transition Impacts section (pp. 111-67 -111-72
discusses the likely magnitude of such short term price increases.

The macroeconomic section and the Short Term Transition Impacts
discussions which follow, address the implication of the timing
of both the requirements and the ensuing impacts.

111-63

TABLE III.D.2: INTERINDUSTRY COMPARISON OF WATER POLLUTION
ABATEMENT EXPENDITURES (1975-1983)

Abatement Capital Abatement Capital
Expenditures @BPT, BAT Expenditures (BPT, BAT
As A % of Total As A % of Total
Industry Abatement Investment in
Industrial Categories Capital Expenditures Each Industrya

Agriculture e
Mining b 7.3 13.9
Iron and Steel 4.8 7.2
Nonferrous Metals .6 1.6
Leather .2 2.1
Stone, Glass and Clay .4 1.2
Lumber .1 .2
Furniture .2
Printing & Publishing
Food & Beverages 2.6 2.4
Textiles 1.1 5.7
Paperc 4.6 8.3
Chemicals 16.5 13.8
Petroleum Ref ining 3.4 1.9
Rubber .5 1.7
Tobacco
Apparel
Electrical Machinery
Ordnance and Miscellaneous
Nonelectrical Machinery
Motor Vehicles d
Aircraft 42.4 13.0
Other Transportation
Fabricated Metals
Instruments
Transportation 2.3 .9
Utilities 11.9 1.8
Commercial .1
100.0

a. Total'industry investment refers to annual investment levels by
industries not total capital in place. Wharton Control Baseline
November, 1975 - See macroeconomic section.

b. IncludesIron and Steel (in@depth study) and Ferroalloys and
Foundries.

c. Includes Builder?aper and Board.

d. Distribution among these industries is'uncertain due to the uncertain
distribution of captive metal finishing operations.

e. Investment data not available.

Source: Industry investment from CONSAD Research Corporation, "Macro-
economic Impacts of P.L. 92-50011, 1976; Abatement investment
from Table III.D.1

TABLE III.D.3
INDUSTRIAL IMPACT PRICES, PROFITS, AND OUTPUT; MANUFACTURING

Percentage Change Percentage Change Percentage Change
Industry In Prices In Profits In Output
BPT Onlv BPT and BAT BPT Onlv BPT and BAT BPT Onlv BPT and BAT

a a a a
Pulp and Paper 3 4 N.A. N.A. N.A. N.A.

'Ir6n and Steel .8 1.1 2.9 3.7 -.5 -1.2

Petroleum
41 N.A. N.A. < i
Ref ining

Textiles .2-2.5 .3 4.7 N.A. N.A. N.A. N.A.

Metal
N.A. N.A. _5%
Finishing 40 60

c c
-Steam Electric .5 < 1 .5 - 1 .3- .7 Negligible Negligible' all

d
Chemicals 2.8 .3.4 N.A. Negligible Negligible

Aluminum .4 .5 Negligible Negligible -1.7 -1.7

Copper .1 AK.1 Negligible Negligible -.3 -1.2

Lead .3 .3 Negligible Negligible -.3 -.3

Zinc* .1 <.1 Negligible Negligible -1.0 -.3

a., Not available.
b. Estimate for job shops.only.
c. Absolute decline in rate of return on rate.base
d. IzIcludes 100 major chemical productsi not-the entire sector

Source: National Commission on Waiter Qualiiy. From economic reports. on each industry. 1975.

TABLE III.D.4

INDUSTRIAL DWACT PRICES, PROFITS AND OUTPUTi AGRICULTURE-RELATED

Percentage Change Percentage Change Percentage Change
Industry In Prices In Profits In Output
BPT Only BPT and BAT a BPT Only BPT and BAT a BPT Only 33PT and BAT. a
1977 1983 1983 1977 1983
Canned and
Preserved Fruits .26 .42 -16% -25% .13 .23
and Vegetables

Beef Feedlots .08 ..1 -25.. -5. -.02 -.05

Dairy Feedlots .37 .43 N.A. N.A. -.11 -.18

Hog Feedlots .6 .70 -20. -20. -.1 -.2 H
M
Ln

Dairy Products .20 .29 -1.3 -6.'5 -.07 .13

-T..--ather Tanning 1.6b 2.2b -65.% .-92.% -10P -7-15

Fertiliter 1 1.3 -4.7 -7.4 Negligible Negligible

a. Percentage difference from baseline in 1983.
-eLcqrjomi,q-._qrowth and depending op the elasticities of supply and demand,
it is possible for a higher percent price rise to have a smaller percent output decrease.

source: NCVIQ. From Development Planning and Research Associates, Inc., "Economic Impacts of
Water Pollution Control Act of 1972 on Selected Food Industries", Vols. III, IV, VI,
VIII and IX. 1976.

111-66

attributed to water pollution control requirements.* The price impacts
do not include any estimate of the likely reduction in impact as new
capacity with lower abatement costs per unit of output replaces existing
facilities (4). (Also see Figure III.D.1) These estimates of price
increases do not include the consequences of interindustry price changes,
which are presented in the macroeconomic section.

With the exception of the price increases for metal finishing
servicev, the price increases listed in Tables III.D.3 and III.D.4 for
meeting the BPT requirements are projected to be 3 percent or less, with
most industries facing increases of less than 2 percent. The additional
price impacts of meeting the RAT requirements are generally less than the
increases attributable to BPT requirements. Of these industries, only
Metal Finishing, Pulp and Paper, and Mining experience a cumulative
price increase greater than or equal to 4 percent, due to BPT and BAT
standards." The price increases for metal finishing services will be
widely distributed throughout the economy, increasing'the price of a
final product about 2 percent in most instances.

4. Output

Changes in-industrial output are similarly small relative to base-
line projections. In the agriculture-related industries only Leather
Tanning shows a projected reduction in output over 1 percent due to BPT
and BAT requirements. with the exception of Metal Finishing, changes
in output in the industrial sector are expected to be less than 2 percent
due to BPT and BAT. Metal Finishing would exceed this level d@e to
reductions in demand for Metal Finishing, including substitution of
other products.

5. Profits

The impact of pollution control expenditures on industrial profits
depends on 'the degree to which the costs are passed on to consumers. In
the extreme case where no costs cannot be passed forward the costs
will be absorbed by the firm and also partially by the state and Federal
governments through reduced income from taxes on corporate profits.
The extent to which governments absorb these costs will depend on the
marginal tax rate of the firm. For a firm that remains profitable but
owns some marginal plants, government could absorb up to half the costs

Thus, the estimated price-increases are not an annual compounding,
rate of price increase.

The price increase for mining is 7.98 percent in 1983; CONSAD
Scenario I (See Macroeconomics Section).

111-67

of pollution control. On the other hand, the firm with no taxable corporate
income will absorb all'the costs, if they cannot be passed on. These
effects are chiefly.relevant in the short-run. Once industry has adjusted
fully to the imposition of-pollution control costs, the dominant effect
upon profits will be through reduced output due to higher prices.

6. Potential Short Term Transition Impacts Resulting from Capital
and Capacity Constraints

Increases in production costs as a result of pollution control
requirements impact'upon price and output to create a new supply and
demand equilibrium. During the adjustment to this new:equilibriumo,
impacts may be either higher or lower, depending upon the particular'
market conditions and the cyclical state of the economy, A temporary'
price increase exceeding the cost of water pollution abatement may occur
if industrial capacity expansion is constrained by abatement requirements.
The demand for products could exceed available supply and could result
in a shortage. Cash flow would increase due to the price increases.
Thus, profits would rise until new capacity is built to relieve the
shortage. *These potential interim supply and demand equilibria are
temporary and unstable and would not be expected to last longer than
two to three years.

The two most significant sources of constraints.on capacity expansion
are: (1) plant closures, and (2) diversion of available capital resources
into pollution control. Plant closures do not significantly impose
capacity constraints in the agriculture-related industries. Only three
manufacturing industries face the possibility of enough plant closures
to impose capacity constraints: Pulp and Paper, Metal Finishing, and
Textiles.*

For several,industries the capital expenditures necessary to meet
the Act's requirements may constrain capacity expansion due to capital
diversion from plant and equipment investment into pollution abatement.
The year-by-year water pollution abatement expenditures required to meet
the BPT and BAT regulations** as a percent of total capital spendin4
are shown in Figures III.D.2 and III.D.3 in relation to the historical
data on water pollution abatement,-expenditures. Iron and Steel jumps
from 4 percent In.1974 to 27 percent in 1976; Pulp and Paper from 7
percent in 1974'to 26'percent in 1976; Chemicals from 4 percent in 1974

The dynamic analysis of these industries shows that while plant closures
as a percentage of capacity are large, this does not result in a
significant capacity constraint.

BPT expenditures are spread over 1975-1977 and BAT expenditures are
spread from 1978-1983.

111-68

Figure I 11.01.2
PERCENT OF CAPITAL EXPENDITURES
ON WATER POLLUTION CONTROL

Paper, Texfile, Electric Ufflies Industries
1967-1983
Percent of capital spent
34

Paper

Textiles

6
4 4.2% Paper
3.0 3.6% Textiles

0.4% Electric
0 Utilities
67 69 71 73 75 77 79 81 83

Source: (Historical data) McGraw -Hill Economics Department, "Oth Annual McGraw-Hill Survey -
"Pollution Control Expenditures", 1975. (Projection) NCW0 cost to meet Act's requirements
and from CONSAD Research Corporation. "Macroeconomics I npuu of P.L. 92-600", 1976.
Natl. Commission on Water Quality
February 1976

111-69

Figure I I I.D.3
PERCENT OF CAPITAL EXPENDITURES
ON WATER POLLUTION CONTROL
Chemical and Iron & Steel Industries Compared to All Industry
1967-1983
Percent of capital spent
34 1 1 1 1 1 1
Chemicals

11 ron
&
Steell

11.3% Chemicals

61.

2 2.2% Iron & Steel
1.6% ALL
INDUSTRY
67' 69 71 73 75 77 79 81 i3
Source: (Hist rWal data) McGraw-Hill Economics Department, "Sth Annual McGraw-Hill Survey -
10,
"Pollution Control Expenditures", 1975. (Projection) NCWC1 cost to meet Act's requirements
and from CONSAD Research Corporation. -Macroeconomics Inputs of P.L. 92-500", 1976.

Nati. Commission on Water Quality
February 1976

111-70

to 33 percent in 1�76; and Textiles from 2 percent in 1974 to 12 percent
in 1976.

These are dramatic increases over past trends, and could potentially
divert capital resources from other plant and equipment investment. The
July McGraw-Hill survey of capital expenditures* (9) indicates, however,
that industry's planned expenditures will not reach a level to assure
full compliance by July 1, 1977. Figures released by Cremeans, et al.
also lead to, the same general conclusion (27).

Supporting information of a different form is found by Oregon
Research Institute (20). Here, response to Question 26A "How good is the
chance that industry in your state will be able to meet the requirement
of BPT by l977?" was as follows--industry: 41 percent good, 27 percent
about even, 32 percent poor; consulting engineerst 24 percent good, 18
percent about even, 58 percent poor; municipalities: 30 percent good,
19 percent about even, 51 percent poor; and environmentalists: 31 percent
good, 25 percent about even, 44 percent poor. Only EPA and state
water pollution control agency representatives felt chances of compliance
were good, (57 percent and 52 percent respectively).

Howevero a comment from a California official merits consideration.
"In our state we believe the vast majority of our dischargers can meet
the 1977 goal by the early 1980's. We further believe it is too early
to make a realistic amendment to the'1983 and 1985 goals; and we believe
amendments of those deadlines and the general effort necessary to meet
them should be delayed until the results of meeting the 1977 goal can be
carefully appraised about 1980 or 1981." (1)

The National Canners Association, with heavy concentrations in
California, observes, "We concur with this statement (summary NCWQ
finding that achieving the 1977 deadline on.schedule will be unlikely)
especially since the effluent guidelines and standards for the majority
of the commodities processed by the fruit and vegetable processing
industry have yet to be promulgated." (19).

Iron and Steel and Chemicals have planned to spend 6 percent in 1975;
Pulp and Paper, 8 percent; and Textiles, 2 percent. All of these are
water pollution expenditures as a percentage of total capital expenditures.

The American Paper Institute's survey of capital expenditures plans
also indicates this gap between projected capital requirements and
planned investments. "The Economic Impacts of Effluent,Guidelines
.Compliance by the American Paper Industry" by URS Research Co.,
prepared for the American Paper institute. Sth Annual McGraw-Hill
Survey--Pollu@ion Control Expenditures, May 16, 1975. (26).

111-71

@Surveys of planned capital expenditures are only rough estimates
and are useful in most industries for only one or two years. Less than
two years remain, however, until the BPT compliance date of July 1977.
This gap between projected capital requirements to meet BPT and capital
expenditures plans is too large to be dismissed as a survey error. There
are six possible explanations:

1) The@Commissionls cost estimates may be too high, industry may
have found less expensive ways of reducing effluent discharges than end-
of-pipe waste water treatment technologies.

2) Much of industry may be intendihg to meet a BPT requirement
other than those identified in the Commission's technology studies.

3) Industry may be making commitments for the equivalent of
secondary treatment and not planning to meet the precise EPA promulgated
effluent numbers. A proportion of the Commission's cost estimates of
meeting the BPt requirements is for treatment beyond the equivalent of
secondary. industry may not be making investments to meet requirements
which it feels will have no water quality benefits and which may be
overturned by present litigation.*

4) Industry may be underestimating the cost of compliance.

5) It is possible that the planned expenditures will reach each
palnt's permit conditions, but that the permit conditions are less
stringent than the EPA promulgated guidelines.

6) .�ome industries do not have final effluent guidelines, and
these industries may not "plan" expenditures until these guidelines
are fully promulgated and any possible subsequent litigation is completed.

The concern in the industrial community over the problems of raising
sufficient capital.for pollution control equipment and plant expansion
reflects, in part, the increasing risk of planning for both pollution

An Elaboration of this point is offered by the National Canners
Association.. "Another*possible explanation is that EPA has issued
guidelines with requirements so unacceptable to industry that most
of the guidelines have been challenged in the courts. Industrial
plants are not likely to make capital investment plans to achieve
objectives which they believe to be unrealistically strict when there
is the possibility for judicial relief." (Comments in a letter to
the Commission from Edwin A. Crosby, Vice President and Director
of Agricultural and Environmental Affairs, National Canners
Association, February 6, 1976.) (19).

111-72

control'equipment and profitable plant and equipment investment. The
time between the decision to commit funds for capital investment and
the start of actual production has been increasing in the basic manu-
facturing industries, and is now typically as long as five years for
new facilities. This lag requires economic fore casts which inspire
some degree of confidence. The risks of making such investment decisions
have increased greatly in the last few years. Oil prices have quadrupled,
and future energy prices are highly uncertain. Capital goods inflation
has been continuing at unprecedently high rates..

Water pollution control requirements have contributed to this
economic uncertainty. Effluent guidelines are continually changing.
Permit requirements differ from-published guidelines and from plant to
plant. Municipal systems remain to be built. The conditions for
industrial entry into the municipal systems are unclear. User charges
have yet to be widely established. Subcategory definitions shift. The
toxics program is in disarray, and industry does not know what is expected.
Water quality-limited requirements are unsettled. Effluent guidelines
for many industries and subcategories remain to be promulgated. This
atmosphere of confusion as to what is expected of industry in terms of
water pollution abatement has contributed to an increase in the risk
component of the traditional investment.calculation.

The majority of the capacity in most of the industries with large
projected percentages of capital outlays for pollution control is composed
of the major corporations in the American economy. Pulp and paper, Steam
Electric Power, Petroleum Refining, Chemicals, and Iron and Steel
largely consist of corporations with access to national financial markets.
Their ability to raise funds will depend upon the balance sheets of the
individual companies and upon the state of the economy, and particularly
upon the capital markets. As discussed in the macroeconomic section of
this report, no significant crises are foreseen in the coming years
for the capital markets in general as a result of water pollution control
requirements. However, it is possible that some firms might find them-
selves temporarily unable to meet all of their investment goals because
of individual circumstances.

Many firms in the Electroplating industry are small, privately-
owned shops which depend upon local sources of investment -funds. Many of
the firms in this industry will find themselves with internal assets
that are insufficient as collateral for the required pollution control
investments.

7. Distribution of Capital Requirements Between Plants in Selected
Industries: Intra-industry Impacts

For some industries the impact of the Act on individual plants,

.111-73

particular subcategoriest or specific product lines in an industry can
be severe. The estimates of required industrial water pollution abatement
.expenditures and industry-wide price, output and profit impacts do not
address the differential burdens on different plants or subcategories
of plants within a specific industry. Different effluent guidelines
may be set for each subcategory depending upon such facto rs as location,
age of facilities, and production technologies. Plants within the same
subcategory may face different costs per unit of output due to variations
in size, age, local climate, land availability and plant.-specific
characteristics.

The impact of these requirements upon the distribution of BPT and
BAT costs per unit of output in selected industries is reflected in
Figures III.D.4 and III.D.5. The distribution of abatement costs per
unit of output between plants in an industry can be an important indica-
tion of the potential economic impacts of the Act. If a plant faces
significantly different abatement costs than its competition, it becomes
increasingly difficult to maintain a profitable enterprise unless market
conditions allow the plant to recover its costs.

Four characteristics of these cost distributions are similar for
the Iron and Steel, Textiles, Pulp and Paper, Metal Finishing, and
Petroleum Refining industries. First, a major percentage of the capacity
for each of the.five industries exhibits similar pollution abatement
expendituresper unit of output. In Petroleum Refining, costs per unit
are virtually equivalent throughout that industry. In the other four
the distribution of per unit abatement costs in the 90 percent of each
industry's capacity with the lowest costs per unit of output is slightly
more uneven.

Second,. all five industries exhibit dramatically rising abatement
costs for a small portion of total capacity. This suggests that only
that small portion is vulnerable and may disappear due to competitive
disadvantage arising from pollution abatement expenditures.. For Textiles
and Paper, this high cost segment consists of about 5 percent of capacity;
for Metal Finishing approximately 10 percent of capacity; for Petroleum
Refining and Iron and Steel, the high-cost segment consists of 1-2
percent of capacity.

Third, in all five in dustries a close examination of the composition
of the high abatement cost segment of capacity reveals that it principally
consists of small plants. This is in large part attributable to economies
of scale in wastewater treatment. Small plants in the 'se industries
are also more likely to be older, less efficient facilities with higher
production costs than most of their,competition. Large, modern plantsf
in general, face lower abatement costs per unit of output than the rest
of the industry.

111-74

Figure I I I.D.4
DISTRIBUTION OF WATER POLLUTION ABATEMENT COSTS
AMONG PLANT CAPACITIES IN INDIVIDUAL INDUSTRIES

1977 and 1983 LEVELS
Cents per pound of production capacity Dollars per ton
5 1 1 1 1 $20 1 1 1 1
Textiles Chemicals consumed by $18
4 - metal finishing industry
15 -

3 -

10-

5 -
1 1983 B 1983 BAT2
BATI

0 25 50 75 90 1001/6 0 25 50 75 90 10OD/o

Dollars per ton $25 Cents per Bbl.
$25 1 1 1 1
Paper Petroleum W
20 -
45-

15 -

30-
107
230
/
J
J
15-
5 - 1983 BAT

............
f ess than BPT
0, 25 50 75 90 100% 0 25 50 75 95 1001/o
PLANT CAPACITY AS A-PERCENT OF EACH INDUSTRY TOTAL

BAT Best available technology BPT = Best practicable technology

Source: Nati. commission on Water Quality. From reports prepared by National Bureau of Economic
Research.
Plf .00i@
01
I

1983 BAT

February 1976

111-75

Figure I I I.D.5
.DISTRIBUTION OF WATER POLLUTION ABATEMENT COSTS
AMONG STEEL PLANT CAPACITIES

1977 and 1983 LEVELS 20.2%
(BAT)
Unit cost as percent of price (1972) Unit cost as percent of price (1972)
'1 1 8.3%
Integrated Steel Mills 6.20 8% - Steel Scrap Mills (BPT)
6% - (BAT)

5 0/c
(BPT) 6 -

4 -
1983 BAT
4 -

2.2
2 - 1 1977 BPT 1983 BAT
Atj 2 -
1.3% 1 1977 BPT

0.9%
0 1 1 1 1 1 1 01 1
0 25 50 75 95 1001/0 0 25 50 75 95 1061/6
PLANT CAPACITY AS PERCENT OF INDUSTflY TYPE
100% 145 million tons/yr. 100% = 30 million tons/yr.

BAT - Best available technology BPT = Best practicable technology
Source: Nati. Commission on Water Quality. From National Bureau of Economic Research "Eco-
nomic Impacts of Water Pollution Control Act of 1972; Iron and Steel Industry", 1975.
February 1976
Integrated @tee
I Mills '0
1JTl

1983 BAT

I
jr
ly, RP
77 7 1983 BAT
r--rj
.04
_11977 BPT

111-76

Fourth, changes in the stringency of the water pollution control
requirements do not significantly affect the distribution of abatement
costs among plants in an industry. In other words, the same plants
that are most heavily impacted by the BPT control levels in general
also are the plants most heavily impacted by BAT.

8. Plant Closures and Industrial Concentration

The principal impacts of the Act fall upon a small segment of each
industry with disproportionately higher costs, as exhibited in Figures
III.D.4 and III.D.5. Although the Commission did not analyze the
economic situation of specific plants, it believes that the estimates
presented in Tables III.D.5 and III.D.6 are representative of the mag-
nitude of both the plant closures and changes in industrial concentration
which will result from the Act's implementation. These estimates of
plant closures in the manufacturing industries represent the number of
endangered plants* in the high-cost segment of capacity in-each industry.
The historical rates of plant closures presented in the baseline
projections indicate that many of these old, marginal facilities would
have closed by 1985 without the burden of additional abatement costs
imposed by P.L. 92@-500.**

One hundred and eight pulp and paper mills with 3.1 million tons of
capacity were closed during the period 1969-1973, a closure rate that
is significantly higher than the pre-1969 average. Although a few were
later reactivated, the closures were in some cases partly attributable
to pollution controls (21). The Commission estimates trends toward
large, integrated forest products companies and a greater degree of
concentration in the industry. Over a ten year period the influence
of water pollution abatement is expected to accelerate these trends
only slightly.

In Pulp and Paper, 47 of the 80 endangered mills (Tables III.D.5
and III.D.6) are non-integrated paper making facilities producing,fine
tissue, and coarse paper, including facilities using waste paper. The
bleached kraft subcategory, however, accounts for the largest share of

Endangered plants are defined as those whose water pollution abatement
costs per unit of output are more than 20 percent greater than the
water pollution abatement costs per unit of output of the plants at
the 90th percentile of industry capacity (or subcategory capacity
where data permitted) as ordered in Figures III.D.4 and III.D.5.

Willey accurately observes, "It should be noted that it is efficient
for the economy as a whole for such plants to cease production, even
though these are short-run distributional impacts." (28).

TABLE III-D.5: DISTRIBUTION OF INDUSTRIAL IMPACTS - PLANT CLOSURES, SUBCATEGORIES, PRODUCTS, AND REGION: MANUFACTURING

Number of Percentage Number of Percentage Most most Most
Industry Plant of Capacity Plant of Impacted Impacted Impacted
Closures 4 BPT/1977 Closures Capacity Subcategory Products Region
BPT/1977 BAT/1983 (Incremental)

5 5
Pulp and Paper max. so 4.5% No change No change Dissolved Bleached Northeast
from '77 from '77 Sulfite Paper North Central
Nonintegrated
Paper
2 1 2 1
Iron and Steel N.A. 1.7% N.A. 2.2% Independent Hot and Cold North Central
Forming and Finished
Finishing Products
Petroleum 10 1% No change5 No Change5 Topping High Sulfur Mid-Atlantic
Refining from '77 from '77 Lube fuel Gulf Coast
Lubricating
Oils
Textiles 479 4.8% No change No change5 Wool Dyeing wool New England
from '77 from 177 Fabric Mid-Atlantic
Finishing
metal 7 7.3% 7 11.2% Small-job California, Illinois
Finishing and captive Ohio, Michigan,
shops New England
Steam N. A.2 Negligible No change 5 No change Construction Northeast
Electric from '77 from '77 Retrofits North Central
6
chemicals 13 Negligible No change 5 No change5 Small volume New Jersey, Ohio,
from '77 from '77 Producers West Virginia,
Delaware

Aluminum Negligible 4cl% Negligible <1% Secondary Pacific Northwest
Aluminum Gulf Coast

Copper Negligible Negligible Negligible Negligible Secondary Refined East Coast
Copper Copper (New Jersey)
Smelting and
Refining

Lead Negligible Negligible Negligible Negligible Primary Lead Western Missouri
Smelting Prime
Lead

Zinc Negligible Negligible Negligible Negligible Primary Slab Pennsylvania
Zinc Zinc and Illinois
Smelting

I- Decline in productive capital stock, not necessarily due to plant closures.
2- Not available
3- Estimate of cost capacity due to retrofit downtime and loss in efficiency - 650,000 kilowatts; 3,900,000 kilowatts.
4- Cumulative over the period; not net of baseline closures.
5- All closures due to P.L. 92-500 were assumed to occur by 1977.
6- Includes only 100 major chemical products, not the entire sector.
7- Estimate of the number of captive metal finishing shops highly uncertain.

Source: National Commission on Water Quality. From economic contractor reports. 1975.

TABLE III.D-6: DISTRIBUTION OF INDUSTRIAL IMPACTS PLANT CLOSURES, SUBCATEGORIES, PRODUCTS, AND REGION: AGRICULTURE-RELATED

Number of Percentage Number of Percentage Most Most Most
Industry Plant of Capacity Plant of Impacted Impacted Impacted
Closures BPT/1977 Closures Capacity Subcategory Products Region
BPT/1977 BAT/1983
(incremental)
Canned and 2
Preserved Fruits 107 4% 128 5% Dehydrators Citrus, Florida,,
and Vegetables and Potatoes Northwest
Freezers Processing

Beef Feedlots 7,300- 1 to 3% 800- 1 % Less than Northcentral,
15,800 1,200 500 head Southeast

Dairy Feedlots 15,500- 2 to 5% 690- 1% Less than Equal
33,500 1,000 100 head National

Hog Feedlots 13,700- 2 to 5% 1,460- 1% Less than Northcentral
27,400 2,800 1,000 head Southeast
00
Dairy Products 164 1% 962 .5% Small Butter Northcentral
and Evaporative New York, Pennsylvania,
Milk California
Leather Tanning 38 12% 312 8% Entire Northeast
Industry
Fertilizer 20 1.5% 02 0 Phosphates Urea Florida
Di-ammonium
Phosphate

1- Difference in number of plants projected with and without P.L. 92-500 in 1977.
2- Closure *s due to BPT and BAT by 1983. This is the difference in the number of plants
in 1983, with and without P.L. 92-500. This difference may be smaller than the 1977
difference because of plants projected to close by 1983 without P.L. 92-500.

Source: NCWQ. From Development Planning and Research Associates, Inc., "Economic Imr)acts of Water Pollution Control
Act of 1972 on Selected Food Industries"; Vols. III, IV, VI, VIII and IX. 1976.

111-79

endangered industry capacity in any one subcat*egory (30.5 percent).
Dissolved sulfite and non@.,integrated paper are projected to be the
subcategories most severely impacted.

The distribution of vulnerable pulp and paper mills has interesting
implications for future process and product changes. Since-the bleach ed
kraft subcategory contains a relatively large proportion of vulnerable
mills, reductions in the level of bleaching may be implemented to reduce
abatement costs. Although the possibility of such cost reductions exists,
it is.not clear how acceptable a reduction in paper brightness would be
to the market, despite the potential savings.

The impact of P.L. 92-500 on Electroplating and Metal Finishing
threatens a fundamental restructuring of an industry due to water
pollution control requirements. In addition to the insistence by the
EPA that their most recent pretreatment requirements would alleviate
much of the negative impacts upon this and other industries, a further
observation has been Inade by an.official of a leading metal finishing
state. Robert B. Taylor, Director of Water Compliance and Hazardous
Substances, Connecticut Department of Environmental Protection,.said at
the hearing before the National Commission on Water Quality'in Boston,
Massachusetts, January-12, 1976, "1 feel that I can state categorically
that electroplating and associated metal finishing wastes can be
adequately treated to meet the objective of the Act without imposing a
standard of.treatment that, in effect, is going to destroy the industry."
(23). However, in another observation related more directly to EPA's
proposed pretreatment requirements, F.L. Rockefeller of Cranston Print
Works Co. notes, "Joint municipal-industrial treatment has been encouraged
by EPA to. achieve economies in scale and economies in land use. Advantages
of joint treatment are, however, effectively negated by EPA requirements,
that industry pre-treat to a degree approaching the standards for treated
effluent quality. The costs to industry under this arrangement should
be double what they could be in a separate treatment facility." (24).

Although the requirements are not expected to substantially affect
the volume of metal finishing done in the economy, they are expected
to have a significant impact on the number of establishments in the
industry because of the unequal distribution of abatement costs between
different plants.- This unequal distribution is largely attributable
to economies of scale in wastewater treatment. As shown in Figure III.D.5,
10 percent - 15 percent of the industry's capacity faces abatement costs
markedly different from the rest. This represents about 50 percent of
the metal finishing facilities in the industry, the vast majority of
which are a part of a much.larger industrial operation.

While the potential numbers of plant closures are large, the
plight of the small job or captive shops is understandable. Independent

111-80

shops are typically small; 57 percent had fewer than 10 employees in 1967.
Many of the small job shops are single-plant firms and loans for capital
investment are typically made against the owner's rather than the
business's assets. Since the shop does not own the goods it handles,
fixed assets are low. In such an economic environment, even if the
metal finishing shop wanted to make the requiredInvestment, it is
unlikely to obtain financing.

Any capacity shortage is not expected to last long. Approximately
90 percent of capacity is projected to be able to meet the requirements
and entry into the industry will still be easy relative to most other
manufacturing industries. Disruptions in services undoubtedly would
occur, however, if this percentage of facilities actually closed by
July 1977, or shortly thereafter. While the shift in industrial organi-
zation results in fewer, more capital-intensive metal finishing operations,
the industry will remain competitive. Unlike pulp and paper the
Commission does not anticipate the metal finishing industry becoming
concentrated into*a limited number of larger corporations.*

Petroleum Refining presents the opposite example -- an industry
with very few high-cost plants and negligible plant closures.- The shift
in the Petroleum Refining industry toward larger, modern refineries
occurred during the 1950's and 1960's, and the Act is not expected to
significantly impact industrial organization of concentration. The two
percent of capacity with significantly higher costs than the rest of
industry is largely insulated from competitive pressures and isp3pojected
to be able to pass on pollution control costs. Many of these high-cost
refiners produce specialty motor oils which compete in a much different
market than the bulk of refinery products, such as gasoline and jet fuel.
Other high-cost refiners produce asphalt in local markets and are not
anticipated to close due to pollution control. A maximum of ten small
refiners seem endangered by the Act.

Impacts upon Metal Finishing are highly contingent upon the EPA
pretreatment regulations. There is some indication that revised
regulations currently under consideration could provide some relief
for many of the endangered metal finishing enterprises, as would be
partially true also for Textiles, Pulp and Paper, and certain
food processing establishments.

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The Textile industry faces potential closures constituting approxi-
mately 5.percent of capacity.* Over 62 percent of the mills in the
wool dyeing industry are vulnerable. They represent 9.4 percent of the
subcategory capacity. The trend away from wool product consumption may
be accelerated by high abatement costs. Small woven and knit fabric
finishing operations also will face disproportionate impacts.

In the agriculture-related industries, plant closures are concentrated
in Feedlots, particularly dairies, Canned and Preserved Fruits and
Vegetables, and Meat Products. Water pollution control requirements
accelerate the existing trends in these industries toward larger,
modernized, capital-intensive operations. Many small dairies and mea@t
processors are currently only marginally profitable and at a competitive
disadvantage in their respective industry. 'For many food-related indus-
tries access to a municipal system is critical if they are to avoid
disproportionately higher costs than the rest of the industry.

In summary, the impacts of water pollution controls usually fall
most heavily on the small, old, single-plant firms which are often
marginal operations and least able to bear the-additional costs.** metal
Finishing is the only case where water pollution control requirements
mandate a radical-change in the industrial.structure.*** In most others,
water pollution controls are one of many factors forcing industry toward

The projected plant closures in the Textile industry are based upon
an assumption thatpretreatment requirements would be approximately
equivalent to BPT guidelines. EPA has subsequently indicated that
such stringent pretreatment requirements may not be promulgated, in
which case the plant closures projected-by the Commission would be
greatly overestimated.

Lest we presume that these are merely numbers in an abstract exercise,
the following comments from a food processor deserve attention:
"This week Agripac announced the closing of one.of these plants,
its 20,000 ton plant at Corvallis because of the impending substan-
tially higher cost of complying with the tightened wastewater
discharge permit requirements beyond the presently achieved 85 percent
reduction. ..
. "The closing of this Corvallis plant results in the loss of
employment for 22 full-time employees, and approkimately 590 seasonal
employees. Many of the seasonal employees were college students
attending Oregon State University, and their earnings from summer
employment paid a good portion, if not all of their tuition and other
college expenses." (2).

***This does not imply an increase in the industry's concentration ratio.

111-82

greater capital intensity, economies of scale, and modernization.
Conversely, smaller businesses in many of the industries produce specialty
products or operate in local monopoly markets and will not be as
heavily impacted as they appear when compared with the rest of the
industry.

9. Re2ional Impacts

The impacts of th 'e Act are concentrated in particular geographic
.regions and upon certain subcategories and products. -Petroleum refiners
in the Kid-Atlantic region face significantly higher abatement costs
per unit of output. Sixty-eight percent of the vulnerable capacity in
the Pulp and Paper industry and 87 percent of the vulnerable mills are
located in the Northeasti Mid-Atlantic and Northcentral regions, although
these areas account for only 3.1 percent of total industry capacity.
New York and New Jersey have 28 of the 80 endangered mills.

Potential plant closures in Textiles are relatively equally split
between the Northeast and the South. The Northeast, however, faces a
higher rate of plant closures relative to the number of mills in the
region. Forty percent of the textile mills in New England and 50
percent of the mills in New Jersey are endangered, compared to 20
percent in the South. The percent of capacity represented by these
endangered mills is much lower. Similarly, Metal Finishing and Iron
and Steel facilities are concentrated in the industrial Northeast
and Northcentral regions.

In the agriculture"related industries, regional impacts differ.
Moisture excess areas such as the Southeast have the greatest proportion
of Feedlot closures. The impact on Fertilizer establishments is concen-
trated in Florida, while the impacts on Leather Tanning is concentrated
in the Northeast.

Based upon historical closure trends in Iron and Steel, Pulp and
Paper, Textiles, Petroleum Refining, Electroplating and Nonferrous
Metals, and upon the Commission's estimates of projected plant closures,
the Northeast faces the most direct employment impacts from the Act.
As illustrated in Table III.D.7, during the period 1967-1974, the North-
east, with 24.5 percent of national employment in these six industries,
had 58.8 percent of the employment loss from plant closures. Three states,
in this region, New York, New Jersey and Connecticut, accounted for
44.5 percent of those national closure-telated employment losses in these
six industries. In contrast, during the period 1967-1974, the South had
44.6 percent of the national employment in these industries and only
23.6 percent of the employment@loss due to closures.

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TABLE III.D.7
REGIONAL DISTRIBUTION OF JOB
LOSS DUE TO PLANT CLOSURES
IN THE FOLLOWING INDUSTRIES:

Iron and Steel, Pulp and Paper, Textiles, Petroleum Refining,
Electroplating, and Nonferrous Metals (1967-1974)

Census Region
Northeast North Central South West
Distribution of
Employment in Plants
that closed, by Region
(percent) 58.8 13.0 23.6

REGIONAL DISTRIBUTION OF EMPLOYMENT
AND EMPLOYMENT TRENDS
IN DESIGNATED INDUSTRIES

Census Re ion
Northeast North Central ISouth West
Regional Distribution
of Designated'Indust27,,@.
Employment, 1972
(percent) 24.5 24.4 44.6 6.5

Percent Change in
Designated Industry
Em
,.,ployMent, 1967-1972 -15.6 -3.7 +3.6 +9.7

Source: NCWQ. From National Bureau of Economic Research, "Economic
Impacts of Water Pollution Control Act of 1972; Plant Closures
and the Regional Consequences of Water Pollution Control".
.1975.

111-84

The key issue in assessing the severity of the regional economic
impact of plant closings is the ability of displaced workers to find new
jobs.* The Northeast has borne the brunt of past plant closures and
has shown the least growth of any part of the country in recent years.
Conversely, the South has had relatively few closures in the past and
has shown the strongest growth rate. Thus, the South appears in the best
position to cope with possible future closings. Thus, not only does
the Northeast confront a disproportionate share of the nation's projected
plant closures due to the Act, it also seems to be the region least able
to accomodate additions to the industrial labor supply.**

This issue provides insight into alternative compensating strategies.
As noted in the statement of W.W. Adams of California (1), alternative
options do exist for compensating or minimizing the impacts of the Act
on an industry, a town or a region that could take the form of aid or
assistance, rather than relaxation of requirements.

10. International Trade

The Commission also examined the effects of water pollution abatement
requirements on international trade -- an issue of growing public concern.
Increases in price create pressure to shift.consumption towards substitutes,
in many cases an imported version of the same product. The effects on
net imports, domestic production, and domestic prices due to the BPT and
BAT effluent limitations were estimated using a set of econometric models
that described the domestic and imported sectors of the individual
industries. In most of the industries with high pollution abatement
costs, the volume of trade is.small compared to domestic production.
Even major percentage changes in the volume of trade will not significantly
affect the domestic industry.,

The projected changes presented in Table III.D.8 assume competing
foreign industries will bear no pollution abatement costs. In general,
the impact on the level of net imports is still minor with the exception
of the pulp sector (10 percent increase).

See Social Impacts section for discussion of local, community impacts.

During the compliance period, these industrial employment impacts are
counterbalanced by stimulative impacts in the supplying industries
and in construction activity for publicly owned treatment works. Thus,
while re-employment opportunities for displaced worke rs in their own,
industries are least likely in the Northeast, the overall employment
impacts are positive until 1964. See Section III.H for amplification.

TABLE III.D.8 MAXIMUM INTERNATIONAL TRADE IMPACT IN 1980 AND 1985 ON,SELECTED INDUSTRIES OF
BPT AND BAT EXPENDITURES

Net Imports as A Percentage Change in 1980 in Percentage Change in 1985 in ...
Industry Fraction of Domestic Net Domestic Domestic Net Domestic Domestic
Consumption Imports Production Price Imports Production Price
Year Percent

e
Steel 1974 7.9% 3. 0 -.63 1.6 6. 0' 2.0
Aluminum 1973 .9 -.403 .457 a .219 b .467 -5.919a 2.771 b

Copper 1973 5.0 .159 .042 .128 .382 .107 .888

Pulp and Paper

Pulp 1973 8.0 3.31 -.66 .08 10.1.9 -1.12 -.19

Paper 1973 3.5 1.30 -.36 .53 2.23 -.71 1.04

Newsprint 1973 69.1 .44 -1.11 .11 .94 01.91 .25

Paperboard 1973 .1 -1.15 -1.12 .73 -.43 -4.24 .84

Red Heat

Beef
1974 5. 3 c 1.142c -.152 .242 1.,12c -.136 .161

Pork 1974 2.7 1.186 -.373 .742 1.525 -.468 .787

M
Leather Tanning
Shoes 1972 36.1 .316 .169 d .284 .614 -.432 d .552

Leather -.965 2.097 -2.879 2.644
Hides -.361 -.791d .833 -1.293 d

Textiles

Apparel 1972 5.9 1.396 -.122 3.210 -.185 .641

Carpet -.166 1.115 -,283 1.909

a Primary aluminum
b Secondary Aluminum

c
Includes veal net imports
d using ending trend assumption
e Gross imports (not net)

Source; NCWQ@ From Public Research Institute, "The Effects of Effluent Discharge Limitations on Foreign Trade in
Selected Industries", 1976.

111-86

11. Steam Electric Power

The steam electric power industry poses a special problem for an
analysis of the economic impact of water pollution abatement requirements.
To a large degree, the industry's future economic condition depends upon
the way in which various governmental regulatory bodies resolve the
increasing requirements for additional revenues and other regulated
aspects associated with that industry's operation.. Unlike other sectors
of American industry, the investor-@owned portion of the electric utility
industry, which is by far the dominating share, is strictly regulated
as to consumer rates, marketing areas and, in many cases, location and
type of plant and equipment.

At this juncture, uncertainties plague the industry and its future
economic stability. These are:

� Impact of government actions on the prices of fuel, coall
oil, natural gas and uranium.
� Changing regulato@ trends toward a new rate setting and
pricing procedures. . I

o State and Federal policy toward continued expansion of nuclear
generating capacity and disposal of radioactive wastes.

o Siting of new generating capacity.

o Federal policies and programs @mpacting capital markets.

o Environmental regulations for air and water pollution control.

First, Federal energy policy continues to be in a state of flux.
Sin6e future fuel prices and availability 'in part determine the growth
in demand for-electric power and, thus, the amount of new generation
capacity required over the next decade, t@e- uncertainty of future fuel
prices contributes to an unstable investment climate. Changes in land-
use regulations, strip mining bontrols and'off-shore drilling rights
provide additi6nal examples of@potential regula@ory factors affePting
future Ienergy prices.

Second, regulator
'y policy at the state level is being seriously
re-examined in light of new economic and environmental"realities. Under
pub.lic pressure,z, manyIregulatory commissions are'questioning recurring
utility rate in6reases, and look skeptically at@the utilities' p 'rojected
needs of increased g@enerating-capacity. 'Because many utilities currently
have large capacity re@eives., there is inefficient utilization of capital
facility. The'buroen-of these inefficiencies.can only be borne by

111-87

consumers or stockholders. New pricing policies, such as charging more
for electricity during times of highest demand, summer-winter prices
differentials, and phase-out of the declining block-rate structurep are
being considered by some state regulatory commissions. Indeed, the
wisdom of rate base, rate of return regulation is even coming under
question. The results of some of these regulatory changes could be to
reduce the rate of growth in demand for electric power below historical
levels, thus further reducing the need for additional future generating
capacity.

Third, many questions surround the future development of nuclear
generation. The steam electric power industry currently faces extensive
regulations for the siting, construction, operation and waste disposal.of
nuclear units, and the future seems to promise additional public scrutiny.
In addition, the future cost of nuclear generating capacity is highly
uncertain, given'the excess cost inflation in nuclear plant construction,
and the poor showing of the present operating units in terms of operating
efficiency and dependability.

Fourth, regulatory scrutiny of the siting of new generating capacity
has been increasing, entailing additional lead time, planning design
and construction costs.

Fifth, equity capital poses a problem for the industry. The uncer-
tainties surrounding the industry's future have turned the market bearish
toward new stock offerings. Much of the current concern over capital
short-4all reflects', in reality, a concern as to the disposition of regu-
latory commissions toward pending and probable future requests for rate
.hikes.

Finally, air and water pollution control regulations have produced
intense public debate, and both remain uncertain pending the outcome
of current litigation. Air pollution'control requirements represent
the bulk of the projected steam ele6tri str 1
.c power indu. y1s pollution control
bill. EPA's policy toward granting Section 316(a) exemptions, allowing
a power plant to continue using once-through cooling,and the applicability
of.state water quality standards to' thermal discharges, are major
uncertainties contributing to the difficulty of investment planning in
the industry.

In addition to these regulatory uncertainties, the industry is faced
with an imponderable regarding consumer r4isponse to price increases.
How elastic is the demand for electricalopower? Real prices for elec-
tricity declined during the 1950's and 1960's at,about 2 percent per
year, and have only recently begun to climb. Thuse there is little
experience or statistical.basis for estimating long-term consumer response
to increases in the price of elect3ricity. This lack of data prevents'

111-88

an adequate economic anal3@sis of the consumer response to higher prices.
Available estimates of industrial, commercial and residenti al response
to higher prices do, however, indicate at least a substantial short term
consumption reduction, but how lasting this will be is uncertain.

To examine some of the implications and interactions of these
factors and future economic conditions in the steam electric power
industry, the Commission utilized a computer model.which simulated.
the financial statistics for both publicy owned and privately owned
utilities at the regional level over the period 1973-1983. Alternative
scenarios were constructed to estimate possible future economic cir-
cumstances within the industry. These results were compared with
scenarios with alternative water pollution control requirements
both more and less stringent than those set by EPA. Due to the impre-
cision of the modelling process and the future uncertainties of the
industry, great significance should not be given the precise numerical
estimates, but the Commission believes the direction and magnitude
of the impacts projected due to water pollution control ar e reasonable.

A key assumption built into the model is that real dollar increases
in rates are constrained to no more-than five percent in any one year.
with this assumption, real average prices rise four to five percent
annually over the next 10 years. Thus, by 1983, the rate of return
on rate base will have declined by 2.7 percent (absolute decline as
.percent of rate base) for investor-owned firms, and by 3.2 percent
(as percent of equivalent rate base) for publicly owned firms. The
pattern of return on common stock equity is even more severe with a
decline in return on equity from about 14.1 percent (nominal return)
in 1973, to plus or minus one percent (real rate of return) in 1977,
and thereafter increasing only moderately to 1983. Throughout the
scenario, return on common stock equity never attained the level achieved
during 1973.

The scenarios projected a generally worse picture for New England,
the Mid-Atlantic region# and the Midwest (Ohio,.Michigan, Tj@est Virginia,
Kentucky and Indiana) than for the rest of the nation. Publicly owned
utilities are projected to fare worse than investor-owned utilities.'
The percentage change in annual total operating costs over the period
1973-1983 is anticipated to be 124 percent for publicly owned utilities,
compared to 73.5 percent for investor-owned utilities. Average resi-
dential prices c'harged.by publicly owned utilities are projected to rise
54 percent over the period, compared with a 50 percent increase for
investor-owned utilities.

The constraint on real rate increases of 5 percent in any one year
resulted in a significant blunting of demand, containing the average
annual growth rate in consumption to 2.2 percent. This is much lower

111-89

than industry and governmental forecasts. As mentioned previouslyr the
Commission's estimates of demand elasticities should be used with caution.
These projections may well be too low. The demand elasticities them-
selves, however, were more conservative than most previous estimates.
The forecasting problem arises because of uncertainties in coupling
them with large price increases. The estimates of growth in demand
do not, however, change-the estimated water pollution control capital
expenditures or significantly diminish the results of the impact analysis
because capacity additions planned as of January 1975, were assumed to
be unaffected.

Since the estimates from the model are a simulation and not designed
to reach equilibrium-conditions, the results should be seen as tracing
alternative assumptions with regard to future parameters affecting
the industry. If fuel prides increase more than is projected, pressure
on prices will be even greater. 'If real rate increases larger than five
percent in any one year are granted, demand may be curtailed further.
To the extent that additional rate increases are granted, the realized
rate of return on rate base and the rate of return on common equity
will rise. If capacity expansion plans are cancelled, pressures for
rate increases may.diminish.

Water pollution control requirements do not influence the industry
,as much as the escalating cost of fuel, the costs of complying with
air pollution control requirements, and the total investment needs
of the industry. Water pollution control requirements are pr6jected
to have the following incremental effects:

0 Real dollar total operating costs will increase by 3-5 percent
by 1983, while overall costs for other reasons increase about
100 percent.

0 Electricity prices will increase 0.5-1 percent.

Q Rate of return on rate base will decrease by about 0.5-1
percent* as a percentage of the rate base by the mid to late
seventies, with recovery to about 0.3-0.7 percent decline in
rates of return on rate base by 1983.

Total change, not an annual rate of decline..

111-90

The,incremental effect of,water pollution control expenditures over
the baseline has a negligible impact oh @r'ojected demand, Water pollution
control expenditures* are.-estimated to be about two per6eht of-total
industry investment over the period, an&about 13 percent.of pollution
control investments. The Northea .st and Northcentral.regions contin u."e
to be the most heavily imbacteid although results differ depending upon
the economic:parameter'selected. While,publicly owned utilities confront
a more difficult period than investor-owned utilities in the baseline
scenario, they are relatively,less iipa6ted by-water pollution control
requirements than privately owned utilities.

Although the impact of water po.1lution,controls on such industry-
wide.edonomic variables as pricest' demand, rate ofreturn on rate base,
and capital investmeft is not, @arge in *' relation to the magnitude of the
industry's operations, the actual dollar outlays for capital and operating
and maintenance expenditures are si@:eible. Estimates of capital expen-
ditures for water pollution cofitrbl,ih the vari6us scenarios range from
$5.79'billion to $11.75. biliion,.dependi.ng largely on the number of
316(a) 'exemptions assumed to be granted.** Annual costs 'in 1975 dollars
are between $1 and $2 billion.

,Despite the pervasive uncertaint@@ in the analysis, the cost estimates
and economic assessment do not 1ndic&te seriou@ difficulties.in achieving
either the high or low e 'stimates of expenditures for water pollution
control. The economic impact of,water pollution control requirements
is less than the impacts of projected fuel cost increases and air
pollution control requ1irements. Although the economic future of-the

Capital expenditures for water pollution control in this case
are assumed to be $5.85 billionX75 dollars).

A description ofthe nature of the' 316(a) and 316(b) exemption clauses
of the Act, and how they were treated in the Commission analyses
of the Steam Electric Industry can be found'in Chapter II, "Thermal
Limitations" Section C, 46. The analysis of the expected effect of
these exemptions, based upon a limited amount of data, yielded the
following fractions of capacity by type of,receiving water likely to
qualify for Section 316(a) exemptions: Ocean -- 80 percent; Estuary
38 percent; River -- 80 percent; Lake 96 percent; River Impoundment
0 percent; Other Impoundments -- 100percent, Man-made ponds -- 106
percent. In contrast, EPA's economic analysis assumed the following;
Ocean 100 percent; Estuary -- 50 percent; River -- 74 percent;
Lake 50 percent. (See "Economic Analysis of Effluent Guidelines
for Steam Electric Power Plants", Temple, Barker and Sloaner.Inc.,
December, 1974.)

111-91

Steam Electric Power industry is dismal under several plausible scenarios,
water pollution control requirements are not one of the primary causes
of the difficulties, nor is relaxation of the stringency or coverage
of the water pollution control regulations a solution to the industry's
problems.

12. Other Industries

Section III.D.1 analyzed the "in-depth" industries and a limited
number of agriculture-related industries. Many other industries may
anticipate impacts as great as those studied in-depth. In particular,
Mining, Beet Sugar, and Seafood Processing may have greater'.impacts
than many of the industries examined in detail in this section. However,
no detailed analysis,was conducted of these industries. General price
and output effects by major industrial sectors may be found in Section
III.F. of this chapter. Table III.D.9 lists those industries not examined
in-depth by equivalent macroeconomics sector. The-table presents:'
(1) the predicted-1985 price and output effects for each sector from
the macroeconomic analysis (Scenario F-1); (2.) a judgmental ranking
based on size of pollution abatement costs compared to revenues of
each industry; and (3) brief comments on special impacts based-upon
EPA economic impact reports.. In many cases the Commission industry
studies represent only a small portion of a sector. For example, Soap
and Detergents phosphate manufacturing, and Paint and Ink are only a
small part of the total Chemical industry. The price and output impacts
listed are for the whole industry, including Organic and Inorganic
Chemicals and Plastics and Synthetics.

D.2) AGRICULTURAL CROP PRODUCTION: ECONOMIC IMPACTS OF HYPOTHETICAL
POLLUTION CONTROL STRATEGIES

1. Introduction

P.L. 92-500 explicitly_identifies certain agricultural practices as
coming under the NPDES program; feedlot production and return flows
from irrigated agriculture. EPA's initial proposals restricted controls
to operations above a certain size. Court rulings rejected EPA's
proposal to exempt operations below a specified size. Control mech-
anisms are not yet specified for these agricultural point source discharges,
which were intended eventually to be fully within the purview of the
permit mechanism.*

EPA has recently announced that it will reassess its whole approach
to the control of pollutants emanating from these agricultural
production activities, with immediate attempts at comprehensive
control to receive a low priority.

TABLE III.D.9: ECONOMIC IMPACT OF P.L. 92-500 UPON INDUSTRIES NOT ANALYZED IN DETAIL IN SECTION III.D.
Percentage Percentage
Macroeconomi Price Increase Output Change
c 985a 19B5a Magnitude Of Impactc
sectors 1 NCWQ Industry Titleb (H-High, M-Medium, L-Low) Comments

mining +8.5 -4.0 Ore mining and dressing H Meeting BPT requirements will
Coal mining H require a very high percentage
Oil and gas extraction H of total investment due to pollu-
Mineral mining and processing H tion abatement. Many small mines
and wells using low grade resources
may not be able to continue
operation.

P imary Metals 7.2 -3.0 Ferroalloy manufacturing
Foundries
Nonferrous mills

Stone 5.3 -1.9 Glass M 6-8 Plants, representing 15-20-
Cement M of capacity for hand blown
Asbestos
M glass, my be forced to close. d
Concrete gypsum and plaster L
Pottery L
Insulation fiberglass L
Structural clay L

Lumber 5.3 -1.4 Timber products L Some plant closures in the hard
plywood sector.d

Furniture 7.9 -7.0 Furniture and fixtures L

Food 10.8 -4.9 Beet sugar H Beet sugar and seafood processing
Canned and preserved seafood H may be subject to al.significant
Cane sugar M number of plant closures, up to
Miscellaneous food and beverages L 27% of capacity for beet sugar.
Both industries are season
al, so I
employment impacts my not be as
significant as the number of plant
Closures. Some plant closings are
also anticipated in cane sugar.d

Paper 6.3 Builders paper and board H Up to 17 mill closings. They
represent a small portion of
productive capacity.d

Chemicals 5.4 1.0 Paint and ink M
Soap and detergents L
Phosphate manufacturing M

Rubber 0.2 0.5 Rubber processing M 22 plant closing constituting
.8% of industrial capacity.d

Transportation 5.8 -.7 Transportation industries M Major impact on independent
trucking operations.

Utilities 2.9 6.3 Water supply
Steam supply BPT requires capital expenditures
as great as one year's capital
expenditures in the industry.
This means 1976 capital expendi-
tures would need to increase
50% for pollutionabatement
if there were to be no cutback
in other investment.

a. See III-F for a full discussion of the results and methodology used for these estimates.
b. Titles used on Table III.D.I.
C. Based approximately on size of annualized pollution abatement costs versus total revenue.
d. From EPA economic impact analysis.

Source: NCWQ, 1975.

111-93

EPA has only the responsibility to study a broad range of non-point
sources of pollutants, with possible future recommendations for the
control of these sources forthcoming. For certain regions agricultural
contributions to non-point loadings have been identified as critical.
Recognizing that an analysis of the relative impact of non-point sources
is necessary to determine the impact of P.L. 92-500 on point-source
agricultural discharges, the Commission studied the economic impacts of
a hypothetical control program for non-point pollution from non-irrigated
agriculture.

TWO research thrusts regarding irrigated and non-irrigated agricul-
ture were integrated into one effort. First, costs were estimated for
three levels and types of control of returns from irrigated agriculture.
Costs also were developed for the equivalent of implementing the National
inventory of Soil and Water Conservation Needs, 1967 (hereafter CNI).
These two sets of cost'data were then entered into a national multi-regional
model of agricultural production in the United States. This is a reduced
version of a model used to provide the results of the agricultural
component of the current Water Resources Council National Water Assess-
ment. Nine alternative scenarios, reflecting the alternative cost data,
alternative assumptions about export levels,*and.alternative assumptions
regarding energy developments were examined. (Table III.D.10).
Information also was used.to.identify any productivity gains associated
with changed irrigation or conservation practices, with these gains
serving in part to offset the costs of.compliance with the hypothesized
controls.

This analysis is not sufficient to delineate the entire range of
potential economic impacts of the imposition of pollution controls.on
irrigated and non-irrigated crop production. Resource limitations
precluded detailed farifi-by-farm, crop-by-crop examination of those impacts
that would be felt by in dividual enterpreneurs. Unquestionably for at
least the "severe" (high) scenarios, many farms would suffer severe
consequences equivalent to "plant closings" in the industry studies.
This result is supportdd in part by the information provided subsequently
on income effects. The analysis isolates broad policy.considerations
.relating to shifts in agricultural production among crops and between
regions, with results for alternative scenarios being the shifts between
irrigated and non-irrigated agriculture.and resultant impacts on water
use, production levels, prices, income and returns to land. Both irrigated
and non-irrigated agriculture should be subcategorized into the princi-
pal forms of farming activity and detailed technology and economic
assessments conducted to properly assess the microeconomic enterprise-
by-enterprise dimensions of potential impacts.

Additionally, the study of the impacts of attaining the Conservation
Needs Inventory presumes that the practice indicated within that inven-
tory will be followed precisely, ignoring individual enterprise in using

111-94

TABLE III.D.10

The Nine Alternative Futures of the ISU Analysis

Return Flow** ACP*** Energy Water
NAME Compliance Conservation Diversion Exports

BASE trend no trend trend
HIGH-RF high no trend trend
LOW-RF low no trend trend
ACP trend yes trend trend
ACP-RF high yes trend trend
ENERGY trend no trend trend
ENERGY-RF high no high trend
EXPORT trend no trend trend
EXPORT-RF high no trend high

These are the four target models for analysis.

See Technology Section for descriptions of control technologies.

Adequate Conservation Practice, as defined by the Conservation
Needs Inventory

Source: NCWQ. Iowa State University, center for Agricultural
and Rural Development. "Economic Impacts of Water Pollution
Control Act of 1972; Irrigated and Non-irrigated Agriculture",
1975.

111-95

less costly methods of attaining equivalent soil loss reductions.

2. Impacts of Alternative Controls Upon Irrigated Agriculture

Impacts of low, medium and high control options (see technology
section for description) were assessed for the production of barley,
corn# corn grain, cotton, legume hay, non-legume hay, oats, sorghum,
sorghum silage, soybeans, sugar beets, summar fallow, and wheat.
These impacts were assessed in the context of national markets, but
with the determining resource allocation mechanisms confined to the
17 western states. Costs per acre in the assessment are provided in
Table III.D.11. These costs resulted in annual costs for the four
principal scenarios as indicated in Table III.D.12.

Four of those scenarios examined reflect the range of the alter-
natives and the impacts. These include E'* demands with water use for
energy and high return flow compliance levels, and E' high-export
demands with trend water use high return-flow compliance.

The two high-export scenarios produce impacts that are both dramatic
and national in dimensions (Table III.D.13). While the levels of irri-
gated agriculture and water used substantially differ when comparing the
energy scenario and the high-export scenario, these changes are trivial
compared to the changing levels of economic returns to land and water.
These levels dramatize an important fact; aggregate agricultural produc-
tion does not suffer decreased returns from imposing these scenario
dimensions. Rather, the shifts in the distribution of-these returns is
the proper point of focus. These short term interregional adjustments
must of necessity result in substantial disruption, although the dimen-
sions of disruption are not examined in the Commission studies.

Aside from the enterprise-level disruptions, the product-level
impacts are perhaps most important. While aggregate production levels
do not fluctuate substantially and aggregate returns to land and water
increase, the sizeable adverse impacts upon crop production levels and
associated prices need further examination (Table III.D.14). Here the
information is dual in nature. High exports with high return flow
compliance produce substantial pride increases. more pertinent, however,
is the fact that these price levels are actually lower than those associ-
ated with high exports and trend level.return.flow control;. At high

Present OBERS projections of Agricultural Sector Economic Activity
prepared under the direction of the Water Resource Council (In Press).

TABLE III.D.11
Cost per acr'e to comply with specified levels of return flow water
quality limitations by 1985 under different irrigation systems.

Water set irrigation land type and irrigation method
Resource & % of compli- drained drained undrained undrained
Region ance level sprinkler flood sprinkler flood,,

percent or dollars per acre

Missouri % of irrig. 0.3 8.6 12.1 79.0
Low 5.00 5.00 0.00 5.00
Medium 24.40 54.40 0.00 5.20
High 50.60 80.60 0.00 5.20

Arkansas- % of irrig. 0.5 3.8 14.8 80.9
Red-White Low 5.00 5.00 0.00 4.70
Medium 9.60 39.60 0.00 4.70
High 36.40 66.40 0.00 4.70

Texas Gulf % of irrig, 0.3 4.0 19.3 76.4
and Rio Low 5.00 5.00 0.00 4.7
Grande Medium 13.80 43.80 0.00 4.7
High 46.00 76.00 0.00 -4.7

Upper and % of irrig. 0.1 8.3 3.2 88.5
Lower . Low 5.00 5.00 0.00 4.80
Colorado Medium 32.00 62.00 0.00 4.80
High 72.40 102.4 0.00 4.80

Great Basin % or irrig. 0.2 15.4 7.8 76.6
Low 5.00 5.00 0.00 5.00
Medium 28.30 58.30 0.00 5.10
High 60.30 0.00 5.10

Pacific- % of irrig. 3.4 8.3 31.1 57.2
Northwest Low 5.00 5.00 0.00 5.00
Medium 32.40 62.40 0.00 5.30
High 65.30 95.30 0.00 5..30

South % of irrig. 1.2 21.2 17.6 60.0
Pacific Low 5.00 5.00 0.00 5.00
Medium 17.70 47.70 0.00 5.10
High 5.9.80 89.80 0.00 5.10

Source: NCWQ. From Center for Agricultural and Rural Development, Iowa
State University. "Economic Impacts of water Pollution Control
Act of 1972; Irrigated and Non-irrigated Agriculture", 1975.

X:TT, @,7

TABLE III.D.12:
Annual expenditures for return flow controls by maj.or river ,basins
under alt6rnative.aqricultural futures and return flow control
levels in 1985..

E PRIME ENERGY HIGH EXPORT
Expert level El El E' high
Water use trend trend energy trend-
Return f low high low high high

River Basin (thousand dollars)

Missouri 35,748 26,698 35,748 75,847

Arkansas-Red-White 16,378 15,451 20,511

Texas-Gulf 10,564 10,107 10 564 11V887

Rio Grande 1,991 2tl9O 1P991 8t384,_-

Upper Colorado 2,115 1,527 1,931 @,786

Lower Col orado 8,739 4X417 --81,739 121*126

Great Basin 2,869 2,872 29869 8,412

Columbia-North Pacific 14,157 13,282 14,157 33,487

California-South Pacific 14,087 14,087 86,400

T otal 106t648 90,002 106,457 261,840

Source: NCWQ. From center for Agricultural and Rural Development,
Iowa State University. "Ecoriomic Impacts of Water Pollution
Control Act of 1972; Irrigated and Non-irrigated Agriculture",
1975.

TABLE III.D.13-- 111-98
SELECTED SUMMARY IMPACTS STATISTICS REFLECTING ALTERNATIVE.SCENARIO
COMBINATION OF EXPORTS, WATER USE AND RETURN FLOW CONTROL, 1985

E PRIME =RGY
Export Level E'
Water Use TREND
Return Flow HIGH TREND TREND
T,QW
Acres Acre- Labor- Land Water Land & Acres Acre Labor Land Water Land & Acres Acre Labor Land Water Land &
Irri- Feet Expendi- Values Values Water Irri- Feet Expendi- Values Values' Water. Irri- Feet Expendi- Values Values. Water
qated Used tures jh tures
7!2g Returns gated- Used at d Used tures Returns
cr! Vr
,C. (Mill)
River Basin (mill) (Mill)_
-(Mill) (Mill)

Missouri 6.9 17.0 567 6.86 9.10 767 6.5 17.0 551 7.80 3.70 840 6.9 17.0 567 6.90 9.10 770

Arkansas-Red- 4.2 6.6 310 10.94 18.73 565 4.2 6.7 301 11.66 7.25 .575 4.2 6.6 311 10.98 18.74 567
white

Texas Gulf 3.7 8.2 239 5.95 19.88 264 3.7 8.2 237 7.03 5.51 286 3.7 8.2 239 5.97 19.89 265

Rio Grande 0.9 2.2 22 0.0 7.74 9 1.0 2.2 24 0.00 0.00 11 0.9 2.1, 22 0.0 7.67 10

Upper Colorado 0.4 3.0 10 4.58- 6.73 8 0.4 3.0 12 1.81 6.86 8 0.4 2.9 9 5.02 6.77 7
Lower Colorado 1.1 5.5 48 1.46 8.44 43 1.1 5.5 49 2. 3L 14.79 57: 1.0 5.5 48 1.46 8.64 44

Great Basin 0.6 3.5 is 2.27 7.19 15 0.7 3.5 28 4.25 3.57 28 0.5 3.5 18 2.31 7.21 15

Columbia-No. 4.9 16.4 122 7.77 5.29 177 5.1 16.4 120 1.22 6.74 1.83 4.9 16.4 122 7.83 5.29 178
Pacific

California- 5.8 21.1 175 0.95 9.91 83. 6.3 21.1 200 2.75 0.77 99 5.8 19.6 175 0.98 9.91 83
So. Pacific

New England 6 4.36 3 6 4.34 3 6 4.24 3

Mid Atlantic 96 11.06 94 97 11.69 102 96 11.02 95

So. Atlantic- 193 2.99 61 195 3.42 70 193 3.02 61
Gulf

Great Lakes 214 25.37 557 215 26.08 r 57? 214 25.42 558

Oh m
10 254 32.04 953 255 33.56 998 254 32.12 956

Tennessee 43 7.30 21 43 8.33 24 43 7.36 21

Upper Miss. 517 41.04 2524 518 43.30 2G64 517 41.14 2530

Lower Miss. 304 27.06 534 401 28.69 5G5 303 27.12 535

Souris-Red- 72 4.66 87 72 4.55 05 72 4.70 87
Rainy

Total/Average 30.1 82.1 3211 16.64 10.18 6765 29.0 83.7 3226 18.66 4.68 7172 28.4 81.9 3211 16.69 10-21 6785
(Ave) (Ave) - (Ave) (Ave) (Ave) (Ave)

Source: NCWQ. From Center for Agricultural and Rural Development, Iowa State University.
"Economic Impacts of Water Pollution Control Act of 1972; Irrigated and
Non-irrigated Agriculture", 1975.

111-99
TABLE III.D.13 Continued
SELECTED SUMMARY IMPACTS STATISTICS REFLECTING ALTERNNrIVE SCENARIO
COMBINATION OF EXPORTS, WATER USE AND RETURN FLOW CONTROL, 1985

HIGH EXPORT
Export Level E' HIGH I IMF-
Water Use TREND TREND
-Return 1"low TREND HIGH
Acres Acre Labor Land Water Land & Acres Acre Labor Land Water Land
Irri- Feet Expendi- Values Values Water Irri- Feet Expendi- Values Values Water
cated Used tures Returns aated Used tures Returns
E'ver @8.sin (Mill) (mill) (Mill) (Mill)

Missouri 7.7 17.0 639 155.40 63.63 15512 7.4 17.1 639 87.93 20.99 8547

Arkansas-Red- 4.5 7.9 338 170.18 74.92 7807 4.3 7.6 333 97.29 56.36 4553
White

Texas Gulf 3.7 8.5 224 137.32 67.82 3640 3.7 8.6 81.05 47.50 2209

Rio Grande 1.9 4.2 61 103.04 30.58 304 1.8 4.2 62 36.04 17.43 126

mpper Colorado 0.8 3.0 22 111.64 22.99 163 0.8 3.0 20 59.41 15.31 89

1.1 6.0 50 233.22 26.90 425 1.1 5.9 so 79.36 8.64 136

Great Basin 1.3 3.5 42 84.87 42.80 313 1.0 3.5 35 50.37 27.60 176

Coluni.,Sia-No. 5.7 16.8 151 170.76 17.00 2766 5.2 16.6 149 97.15 9.88 1588
Pacific

California- 7.4 28.0 240 157.00 16.06 1225 7.2 26.7 226 42.72 11.45 449
so. Pacific

tiew England 17 86.99 100 17 33.40 39

Mid Atlantic 106 207.30 1857 105 123.40 1104

So. Atlantic- 230 151.84 3560 235 82.86 1944
Gulf

Great Lakes -.237 232.55 5232 237 141.07 3175

Ohio 271 268.39 8104 271 167.88 5070

Tennessee 6 4 142.41 539 64 81.66 309

Upper Miss. 540 301.04 18659 539 189.09 11721

Lower Miss. 291 213.98 4241 281 131.43 2608

Souris-Red-. 89 82.71 1553 89 so.. @5 949
Rainy

Tetal/Averaga 34,: 95.0 3619 192.57 37.20 760= 32.6 93.2 3570 113.33 20.83 44,793
(Ave)' (Ave) (Ave) (Ave) (Ave)

Source: NCWQ. -From Center for Agricultural and Rural Development,
Iowa State University. "Economic ImPacts of water Pollution
Control Act of 19721 Irrigated and Non-irrigated AgricultureP,
1975.

TABLE III.D.14
PRODUCTION AND PRICE EFFECTS OF ALTERNATIVE SCENARIOS OF EXPORT LEVELS,
WATER USE AND ALTERNATIVE RETURN FLOW CONTROLS, 1985
111-100

B PRIME ENERGY HIGH EXPORT
Export Level ff@ i- _V __E'_ HIGH E HIGH
Nate r Use TREND TREND ENERGY TREND TREND
Return Fl- LOW HIGH TREND IGH
Ir@igat!,'Ilcm Crop To al Irrigated Crop T-Total Irrigated Crop--- M-t-.T- irrigated Cr Total 2 -19-72
Total t OP Irrigated Crop
A,::s..,.,, Acres Pr Prices Acre Acres Produc- Prices Acres Acres Produc- Prices Acres Acres Prodc- fti... Acres Acres Prodmc- Prices Normalized
.a Gr -M =uc Harv:sted Grown tion Harvtd. Gro@ tio. Harvtd. G@OWn t,on Harvtd. Grown tion Prices
('aill.) mil
Acre!- Milts ,,-it 12.9 0.2 . 621
Barley (bu) 12.7 0.@ 618 13.1 0.5 642 7.2 o.7 350 1.3 0.5 351-
Corn (bu) 63.3 3.6 6076 1.12 63.8 1.4 6022 1.14 63.3 3.6 6073 1.12 74.5 4.0 6900 3.53 74.1 3.7 6881 2.47 1.42

Cotton (bales) 9.4 1.3 11 147.31 9.1 1.4 11 147.91 9.4 1.3 11 147.37 8.9 1.6 11 246.66 8.7 1.7 11 200.01
Hay (tons) 63.3 8.2 178 28.22 63.2 11.4 185 27.63 63.4 8.2 179 28.24 68.2 7.8 187 87.58 61.0 7.1 185 61.55 34.47

Oats (bu) 14.5 0.0 837 14.9 0.0 $58 14:6 0.0 839 7.9 0.0 447 9.0 0.0 511

Silage (tons) 14.1 3.0 182 13.8 2.1 171 14.1 3.0 182 21.8 4.6 275 21.5 4.6 275

Sorghw (bu) 14.8 4.0 861.2 14.8 4.0 868 14.8 4.0 861 13.7 3.0 757 13.7 3.0 772
Soybeans (bu) 80.0 0.6 2620 5.13 80.0 0.6 2619 5.16 80.0 0.6 2620 5.13 88.1 1.2 2871 15.17 88.1 1.1 2845 10 63 3.70

Sugar Beets 1.8 1.1 33 1.8 1.1 33 1.8 1.1 33 1.8 0.7 33 1.8 0.7 33
(tons)

Wheat (bu) 52.3 0.3 1482 1.84 52.3 0.6 1482 1.84 52.3 0.4 1482 1.84 59.8 4.3 1887 8.76 59.8 4.1 1887 5.89 1.72

Pork (.-t) 36.34 36.57 36.35 81.70 61.68 36.40

Beef (cwt) 61.65 62.42 61.69 160.44 117.63 61.75
Aggregate 101 IOL 101 247 183 100
(index)

source.. NCwg. From Center for Agricultural and Rural Developutent,
Iowa State tjni@ersity. 11@conomic Impacts of Water Pollution
control Act of 19721 Irrigated and Non-irrigated Agriculture",
1975.

III-101

demand and, therefore, high price levels, the productivity contributions
resulting from the high control technology provide a counterbalancing
effect because the higher prices produce a high value for this increased
productivity. This productivity impact on price is only noticeable in
the case of the high exports.

While Tables III.D.13 and III.D.14 do show substantial regional
adjustments for certain dimensions, flexibility constraints within the
model confine regional adjustment within assumed limits, significantly
modifying these adjustments. The existence of differential returns to
land and water by region suggests that more extreme regional adjustments
would have been indicated by the analysis had the adjustment constraints
been relaxed. These constraints also contribute substantially to price
impact, since they preclude full regional adjustment and resulting
relief (response) to price stimulus. This further suggests the conclusion
that whereas reactions to alternative scenarios were moderate nationally,
regional Adjustments of considerable maoitude are generated by the
.imposition of irrigation return flow controls.. 'In the absence of-a-more
precisely defined intermediate level of.control, ho@aever, as wellas
associated productivity information, these impacts materialize only for
the "high" control level, which is equivalent to EOD.

3. IMacts of Erosion Control Upon Non-Irrigated Agriculture

Impact patterns of controls upon non-irrigated agriculture are
substantially different from irrigated agriculture in their regional
dimensions, although the nationwide impacts are about the same. In
this analysis the contiguous United States is examined by regions of
agricultural productions as defined by the Water Resources Council.
While some impacts upon production.levels and return to land and water
and prices arefelt in regions where irrigated agriculture predominates,
these are not the regions where erosion controlis proposed under the
CNI. It is not surprising that the impacts ard felt mostly in the Delta
states and east of the Mississippi River.-- in the Atlantic and South-
central siates, such as Tennessee, because of the high natural vulner-
ability of soils and gradients to erosion, and in the Corn Belt due to
the intensive cultivation of unstable soils. In the Upper Colorado and
Southern California there are actually some acreage increases when only
erosion control practices are initiated for non-irrigated lands because
production shifts from dryland to irrigated land due to comparative
advantage (Table III.D.15).
As with irriga@tion controls, 6rosion Ocontrols cause some substantial
price increases (Table III.D.16) although the pattern is somewhat dif-.
ferent. Most notable is the increased production of grasses, which
because of the upward pressure of grain prices, leads to increased
prevalence of g:@ass-fed beef and lower beef prices. The overall impact

TABLE 111-102

VE NT
SELECTED SUMMARY IMPACT STATISTICS REFLECTING ALTERNATI COMBINATIONS OF = ROL
PRACTICES FOR IRRIGATED AND NON-IRRIGATED AGRICULTURE, 1985

Acres of cropland7 Acres of Cropland Average Land Average Water Total Returns
Cropland Utilized Irrigated Value Change Value Change
E' E' V Erosion E. E' V Erosion E' El E' Erosion E' E. to Land and Water
, V Ero@. I On V Erosion
Base Erosion & Return Base Erosion & return Base Erosion & return Base Erosion .1 & return Base Erosion & return
Control Flow Contro Control flow control Control Flow contro Control -Flow control Control Flow control
Mill.Acres Mill. Acres $/Acre $/Acre-ft. t- - -
Mill. dollars
Missouri 86.7 81.1. 81.2 7.4 6.9 6.5 7.37 4.92 1.77 9.79 9.41 9.42 830 884 861
Arkansas@ 37.9 36.4 36.5 4.3 3.4 3.4 10.06 2.42 2.45 19.03 16.71 16.83 572 563 593
Red-White

Texas Gulf 20.6 14.9 15.1 3.7 3.5 3.4 5.85 0.0 0.0 19.60 17.33 17.72 259 206 215
Rio Grande 0.5 0.3 0.3 1.1 1.1 1.1 0.23 0.0 0.0 10.54 16.06 16.80 24 49 51
Upper Colo. 0.2 0.1 0.1 0.4 0.6 0.4 4.49 0.32. 0.0 6.48 2.99 2.62 7 12 11
Lower Colo. 0.3 0.0 0.0 1.1 1.1 1.1 10.64 25.48 0.34 8.64 7.75 7.52 55 78 75
Great Basin 1.0 0.6 0.7 0.6 0.6 0.6 0.70 0.0 0.0 7.00 6.82 6.96 12 23 25
Columbia- 11.5 9.8 9.9 5.2 4.5 4@2 10.07 1.18 Q.0 5.13 2.43 2.44 210 175 ISO
No. Pacific

California- 2.5 1.7 1.7 6.2 6.7 5.9 1.96 1.56 0.0 9.99 10.64 '10. 84 96 268 261
So. Pacific

New England 0.7 0.5 0.5 4.38 0.00 0.00

Mid Atlantic 9.5 8.7 8.7 10.36 3.32 5.53

So. Atlantic 22.8 19.4 19.7 2.87 0.89 1.20
Gulf

Great Lakes 23.2 21.1 21.1 24.76 16.80 18.62

Ohio 30.1 26.2 26.2 30.96 2.13 11.97

Tennessee 2.9 2.2 2.3 6.18 0.0 0.0

Upper Miss. 62.6 57.4 57.4 39.73 15.93 15.99

lower Miss. 21.0 20.5 20.5 27.32 0.0 11.81

Souris- 19.9 18.6 118.6 4.76 0.19 0.19
Red-Rainy

Total 353.9 319.7 320.6 30.1 28.5 26.7 16.55 5.64 6.32 10.35 10.16 LO.37 6762 12817 12962
on
ro-iA
a
turn
@cont_ol

Source: NCWQ. From Center for Agricultural and Rural Development, Iowa State University.
"Economic Impacts of Water Pollution Control Act of 1972; irrigated and
Non-irrigated Agriculture". 1975.

TABLE III.D.16:
PRODUCTION AND PRICE EFFECTS'OF,ALTERNAT-IVE COMBINATIONS OF CONTROL PRACTICES FOR
IRRIGATED AND NON-IRRIGATE,D AGRICULTURE, 1985.

Acres of Acres Grown Crop Production Pr'ices
Crops Harvested .-Under Irrigation (Farm Level)
1971- E' E. E' Erosion 1971- E' E. El Erosion Ev EN E' Erosion El E, V.@Erosion
1973 Base @Erosion & return 1973 - Base Erosion & return Base Erosion & return Base -Erosion & return
Ave. - -Control flow control Ave-. Control flow control Control flow control Control flow control
Million acres Million acres Million Units $/'Unit
Barley (bu) 10.1 '12@9 26.2 25.6 0.4 . 3.0 2.3 630 1366 1341.

Corn (bu) 60.9 63.2 47.2 47.3 3.9 3.4 3.1 6059 4657 4669 1.11 2.-67 2.68

Cotton; (Bales) 12.2 9.4 9.9 9.6 1.1 2.2 2.3 11 11 11 147.21 309.69 315.10

Hay (ton) 6G.8 62.7 40.3 39.6 9.0 7.7 7.4 178 113 113 27.98 35.48 35.54
-,Oats .(bu) . 14.5' 14.7 18. 8 19.0 0.0 0.0 0.0 848 , 1096 '1107

Silage t(tons).-; 12.0 14.1 .4-.6 4.5 3.1 0.1 0.1 180 55 55
Sorghum (bu)'@ 13.,9 14.8 11..4 -11.5 4.1 -1. 9' 1.6 846 612 '6_68
Soybeans (bu) 48-.2 79.9 80.1 80.1 0.7 0.9 0.9 2619 2678 209 5.12 23.97 24.24

Sugar Beets 1.3 1.9 1.8 1.8 1.1 1.1 1.0 33 _33 33 0
(tons)

--Wheat, (bu) 47.9 52.5 52.3 52.3 0.4 2.1 1.9 1482 1537 1535 1.83 2.75 2.76

Pork (cwt) 36.25 '45.51 45.65

Beef (cwt) 60.89 46.00 46.20

Aggregate 117 118
Index

Source: NCWQ. From Center for Agricultural and Rural Development,
Iowa State University. "Economic Impacts of Water Pollution
Control Act of 1972; Irrigated and'Non-irrigated Agriculture", 1975.

111-104

of the erosion control program upon prices is a 17 percent increase
above base. The further addition of the return-flow compliance brings
some shifts back to dryland farming and an additional 1 percent price
increase. These observations are for the standard El demax;d scenario,
with no analysis made of the impacts of both erosion control and return
flow control in the presence of El high-export assumptions.

The basic results of the analysis are summarized in Table III.D.17.
With drylandacreages ranging from 367.5 million acreb to 319.7 million
acres and irrigated acreages ranging from 34.1 million acres to 26.7
million acres, high acreage levels for bath dryland and irrigated land
are associated with the highest price increase, 147 percent above the
base. This price level can be reduced from 147 percent to 83 percent by
instituting high compliance on return flow, given the productivity
contributions.* A high level also is associated with the highest returns
to assets and labor and the highest level of water use.

4. Summary Observations

Without high export levels in two of the five principal scenarios
examined, national shifts in the production of commodities between dry
-and irrigated land'are not substantial. Price effects reach a maximum
of 18 percent above base in 1985 for a combination of both high irrigation
return flow and erosion control as.detailed in the CNI. Regional
shifts are dramatic, however. Changing returns to land, labor and water
suggest considerable regional adjustments due to shifting comparative
advantage resulting from different magnitudes of irrigation return flow
and erosion control "needed" in different regions.

Productivity gains are critical to the analyses, in man .y instances
counterbalancing the increased cost of compliance. This result is
especially true of an alternative future which assumes high exports.
In this instance, the results suggest that if high exports prevail,
any attempts at return-flow compliance must be using methods that ensure
increased productivity.

As noted previously, these price effects are highly depend ent upon
(1) the flexibility constraints which prevent full regional adjustment,
(2) the compensating impact of productivity gains, and (3) the man-
datory production targets which drive the analysis, in particular
the El high export requirements- In the absence of these configurations
exports would be reduced due to higher prices thus lowering aggregate
effects, but regional shifts would be greater in the absence of
flexibility constraints.

TABLE III.D.17;
Summary of the impacts of al -ternative controls on return flow and erosion under varying
agricultural futures in 1985.

Waiter 'Expenditures Returns Commodity---
Alternative Dry Irrigated used for labor to*assets prices
(million acres) (million ac/ft) (million dollars), (index)

E' base 353.9 30.1 '84.5 3,239 6,762 100
E' energy water 353.9 30.0 84.4 3,240 6,764 100
E' high export 366.6 34.1 95.0 3,619' 76,002 247
V high return flow
compliance 355.4 28.4 82.1 3,211 6,765 101
E' low return flow
compliance 355.3 29.0 83.7 3,226 7,172 101
E' energy water-high
return flow compliance 355.5 28.4 81.9 3,211 6,785 101
E I high export-high
0
return flow compliance 367.5 32.6 93.2 3,570 44,793 183, Ln
E' erosion control 319.7 28.5 72.3 2,717 12,817 117
V-erosion control and
high return flow com-
pliance 320.6 26.7 69.7 2,693 12,962 118

An index of the farm level supply price of the commodities requi.red-to-maintain equilibrium in the
agricultural sector.

Source: NCWQ. From Center for Agricultural and Rural Development, Iowa state University.
"Economic impacts of water Pollution Control-Act of 1972; irrigated and
Non-irrigated Agriculture", 1975.

111-106

While the results of this analysis are informative as to the
order of magnitude and the form of the resulting impacts, they should
only be construed as representing the relative numerical dimension of
the measured impacts subject to the adjustment alternative input to
the analyses -- trade levels, costs, adjustment constraints. Actual
compliance would involve enterprise level:adjustments reflected in part
by the shifts in returns to land, labor and water. The resulting
price impacts would be determined in a dynamic competitive market which
would mitigate against the actual price extremes depicted for farm pro-.
ducts. The predicted price rises would,price U.S. products out of
international markets. Therefore, reduced demand would preclude the
attainment of the levels depicted. Furthermore, relaxation of the
regional flexibility constraints in the model would allow far greater
regional adjustment than actually predicted. This also would mitigate
against price rises. Nevertheless, the dramatic prices depicted do
serve as a reasonable surrogate for the loss of international markets,
drastic regional adjustment, moderate but higher actual price increases,
and thelsocial impacts associated with disruption in existing production
patterns: The latter-remain even without assumed high export demands.

111-107

References

Adams, W.W., Chairman, California State Water Board, Communication
to the Commission, January 10, 1976.

(2) Barger, R.H., AGRIPAC Inc., Communication to the Commission,
December 4, 1975.

(3) CONSAD.Research Corporation, Macroeconomic Impacts of P.L. 92-500,
1976.

(4) Development Planning and Research Associates, Economic Impacts
of Water Pollution Control Act of 1972; Selected Food Indus-
tries. Vol. 1-9. 1975.

(5) Internatioh,@@l Rese'arch and Technology Corporation. Economic
Impacts of Water Pollution-Control Act of 1972; Chemical
and_Allied Industries. 1975.

(6) Iowa State University, Center for Agricultural andRural Development.
Economic-Impacts of Water Pollutiork Control Act of 1972;
Irrigated and Non-irri ted Agriculture. 1975.

(7) Lancy Laboratories. Water Pollution Abatement Technology;
Capabilitieb and Costs; MetalFinishing IndustKy. 1975.

(8) Leone, Robert A.,'Ginn, J. Royce, and, Lin, An-loh. Changinq Water
Use in Selected Manufacturin4,Industries.,. National Bureau of
Economic'Research. A study for:,t-he Institute 'of Water
Resources, Coips of Engineers, Department of the Army.
Contract No. bACW 31-72-Coo44, December', 1973.

(9) McGraw-Hill Economics Department. 8th-Annual McGraw-Hill Survey,
Pollution Control Expenditures; New York, 1975.

(10) National Bureau of Economic Research. A,Cross-Section Analysis
of Industrial Wastewater Dischargers. Draft Report. July
1975.

(11) Economic Impacts of Watek.Pollution Control Act
of 1972; Iron and Steel Industry. 1975.
(12) Economi@-Impacts of Water Pollution Control Act
of 1972;.Metal Finishing Industry. 1975.

111-108

(13) Economic Impacts of Water Pollution Control Act
of 1972; Nonferrous Metals. 1975.

(14) Economic Impacts of Water Pollution Control Act
of 1972; Petroleum Refining Industry. 1975.

(15) Economic Impacts of Water Pollution Control Act
of 1972; Pulj2 and Paper Industry. 1975.

(16) Economic Impacts of Water Pollution Control Act
of 1972; Textile Industry. 1975.

(17) Economic Impacts of Water Pollution Control Act
of 1972; Plant Closuret and the Regional Consequences of
Water Pollution Control. 1975.

(18) National Canners Association. Communication to the Commission.
October 24, 1975.

(19) National Canners Association. Communication to the Commission
from Edwin A. Crosby, Vice.President and Director of Agricul-
tural and Environmental Affairs, February 6, 1976.

(20) Oregon Research Institute. Water Pollution Control Act of 1972;
Institutional Assessment, Attitudes of Participants. 1975.

(21) Public Research Institute. Economic Impacts of Water Pollution
Control Act of 1972; International Trade. 1975.

(22) Rockefeller, F.L., Cranston. Print Works Company, Communication
to the Commission.

(23) Taylor, Robert B., Director of Water Compliance'and Hazardous
Substances, Connecticut Department of Environmental Protection,
Janua* 12, 1976.

(24) Teknekron, Inc; Economic Impacts of Water Pollution Control Act
of 1972; Steam Electric Power Industry. 1975.,

(25) Temple, Barker and Sloane, Inc. Economic Analysis of Effluent
Guidelines for Steam Electric Power Plants. December, 1974.

(26) URS Research Co. The Economic Impacts of Effluent Guidelines
Compliance by the American Paper Industry. 1975. Report
prepared for'the American Paper Institute.

111-109

(27) U.S. Department of Commerce, Bureau of Economic Analysis, Survey.
Of Current Business. July 1975.

(28) Willey, W.R.Z., Ph.D., Environmental Defense Fund, Communication to
the Commission. January 10, 1976.

III-110

E. IMPACTS OF THE PUBLICLY OWNED TREATMENT WORKS PROGRAM

Introduction

For publicly owned treatment works, P.L.92-500 establishes a set of
treatment requirements, a funding mechanism to aid states and localities
in meeting these requirements, and restrictions on the methods local govern-
ments may use in financing their share of facility costs. Publicly owned
treatment works serve a variety of users and are subject to review according
to different criteria at various.levels of government. Therefore, the
determination of the costs is a complex problem. Once determined, the costs
must be allocated among three levels of government. Each level has a
variety of fiscal mechanisms at its disposal for raising revenues and each
mechanism has different consequences with respect to who ultimately bears
the costs. The timing of the predicted costs is not clear, due in part to
the unresolved question of whether publicly owned treatment works must meet
the requirements in the Act if public funding is not provided, and in part
to a lack of clarity as to what requirements should be Associated with the
specified compliance dates.

I Given these considerations'. this section is divided into three headings:
(1) Enenditure Patterns,.which develops the two basic scenarios and presents
their capital and operating costs, the dates of achievement of funding of the
various categories of needs, and the split of these expenditures among the
Federal, state and local government; (2) Financing the State and Local
Shares, which deals with general state and local financial outlook, the Act's
requirements with respect to methods of financing,, the distribution of costs
among users, and operating performance; and '(3) Alternative Federal Funding
and Cost Effectiveness Decisions, which examine alternative priorities among
categories, different allotment formulas, prdfinancing and cost effectiveness
rules. In each section, the impacts of the Act are determined by comparing
its requirements to either the present situation or projections of historical
trends.

1. Expenditure Patterns

a. Scenario Development: Two scenarios ard,analyzed. Scenario E-1 is
based upon projections of Federal outlays. Scenario E-2 is constructed by
setting target dates of accomplishment for different needs categories and
scheduling expenditures that can meet these goals. Determination of the
level of Federal expenditures for scenario t-1 is based on:

(1) EPA projections of Federal cash outlays by fiscal year through
1978(19). These projections were converted to a calendar year basis to
fit other Commission materials.

(2) These outlays were converted to purchasing power in 1975 dollars,
using projections of inflation for fixed business investment (from the

,Wharton June 1975 Macroeconomic projection: The average rate of inflation
for 1978-85 was 6.2 percent per year).

(3) Beyond 1978, Federal outlays were projected at the ratenecessary
to maintain an annual rate of Federal expenditures of $3.5 billion (1975
dollars).

The resulting projections for estimated Federal outlays and their buying
power in 1975 dollars are shown in Table III.E.l. To attain a purchasing
I
power of $35.4 billion in 1975 dollars, actual Federal outlays must be
$52.3 billion for the period from 1975 to 1985.

For Scenario E-2, a funding schedule was constructed which could meet
all treatment plant and interceptor needs by 1980 and all remaining needs
except urban runoff by 1985. Assuming 75 percent Federal funding, the
resulting Federal expenditures in both 197$ dollars and in estimated actual
outlays can be derived. The choice of 1980 as a target date for Category
I, II and IVB needs is based on the fact that it is not now possible to
meet thei3e heeds';by 1977; 1980 was considered to be a more realistic date
to pr6vide time for the necessary planning, design-and construction. Even
this date would cause serious problems with respect to adequate supplies
of design en.gineers and operating personnel (see Section III.G.). The
estimated Federal outlays in 1975 dollars Are then $119 billion, and the
estimated Federal outlays, including inflation, are.$184 billion, over ten
times the Federal appropriation level in P.L.92-500. Total capital expen-
ditures and the expenditures by category are shown in Table III.E.2.

Because scenario E-1 does not provide adequate funding-for all needs,
total expenditures can only be calculated after determining which heeds
are to be Federally funded and which needs local governments would still
me'et in the absence of Federal funding. For scenario E-1, it was assumed
that all funding would go toward financing projects from treatment plants
and interceptor sewers (categories I, II and IVB), and that 72 percent.of
the Federal funds would be for treatment plants (categories I and II), and
28 pe rcent for interceptor sewers (category IVB).* It was-furtherassumed
that local government would continue spending at historical rates for 6ol-
lector.sewers. The expenditures by categories and whether they are Federally
funded is shown in Table III.E.2. Alternative priorities for categories
are examined in section 3 of this chapter.

Table III.E.2 also shows the expenditures that would occur for 197t-
1985 if historical trends in sewer systems expenditures for the period
1955 through 1970 continued. This period was chosen to avoid introducing
a bias due to the significant rise in expenditures in the early 1970s

*These percentages are from Commission Costs and Capabilities of Technology
Estimates of relative needs.

TABLE III.E.1 Federal Outlays_and Their Purchasing Power for Scenarios El and E2
1975-1985 (billions of dollars)

Year 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 Total

Scenario El Federal Current 1.795 2.640 3.680 4.126 4.633 5.041 5.366 5.701 6.064 6.428 6.813 52.3
Dollar Outlaysa

Purchasing Power 1.795 2.447 3.245 3.437 3.500 3.500 3.500 3.500 3.500 3.500 3.500 35.4
in 1975 dollarsb

Scenario E2 Federal Current 2.6 6.4 8.5 10.4 13.2 16.2 19.1 22.6 26.2 28.6 30.2 184.4
Dollar Outlaysc

Purchasing Power 2.6 5.9 7.5 8.7 9.9 11.2 12.5 13.8 15.2 15.6 15.6 118.5
in 1975 dollars d

a. Through 1978 based on EPA projections as given in EPA, Construction Grants'Fact Sheet. After that date, computed as the current
dollar outlay necessary to maintain 1975 dollar expenditures of 3.5 billion dollars, using June 1975 Wharton Macroeconomic
projection of the deflator for fixed business investment. -

b. Through 1978, the 1975 purchasing power of EPA projected outlays using deflator for fixed business investment from
June 1975.Wharton Macroeconomic projection, thereafter projected at 3.5 billion dollars a year.
c. Purchasing power inflated to current-dollar expenditures using inflator for fixed business investment Wharton June 1975 Macroeconomic projection.

d. Individual years essentially arbitrary: the goal was a steadily increasing stream of expenditures which could easily meet
I, II and IVB needs by 1980 and all needs except urban runoff by 1985.

SOURCE: NCWQ, February, 1976

TABLE III-E.2.: Estimates of Capital Costs and Capital Expenditures (1975-1985) in Billions of 1975 dollars.

Capital-Expenditures (1975 - 1985)
Estimates of Costs Sc!pnario Scenario E2 Historical
1974 NCWQ All Expenditures d
Federally Sponsored Not Federally rrends
Needs Estimates"@ Expenditures (75% Feder 1 Sponsored (100% Total Federall Sponsored
Category Survey 25% State-Local)b State-Local)c (75% federal, 25%

I. Secondary Treatment 16.4 10 a 10.8
35.6 33.9 0 33.9 14.5
II. More Stringent
Treatment Required 20.4 24 81 .8
by Water Quality

IIIA. Correction of Sewer
Infiltration/Inflow 6.9 6.9 0 0 6.9

.IIIB. Major Sewer
Rehabilitation 9.5 9.5 0 0 9.5

IVA. Collector Sewers 22.8 13.0 0 13.8 13.8 13.0 13.8

IVE. Interceptor Sewers 23.1 13.5 13.2 13.2 13.5 10.4

V. Correction of
Combined Sewer 40.4 79.6 0 0 79.6
Overflows

Subtotal 139-15 158.1 47.1 13.8 60.9 158.1 38.7

VI. Treatment and/or
Control of 305.5
Stormwaters

Total 445.0

.a. For derivation, See Table 11-17

b. Given 35.4 billion dollars in real federal funds available (See Table III-F-1), with 75% grants the federal government can sponsore
47.1 billion dollars in projects. It was assumed that 72% of these funds wo uld be for categories I and II and 28% for category IVB.
(This rate is from Commission technology estimates.)

c. Based on time trend of contract awards for collector sewers.

d. Based on time trends of contract awards for collector sewers and waste treatment facilities
.7n red
so
(751, 7Fede-al
al
J
0
24

(assumed splite: 55% treatment plants and-4@i interceptor sewers).

Source: NCWQ and U.S. Environmental Protection Agency, "Cost Estimates for Construction of
Publicly Owned Wastewater Treatment Facilities, 1974 'Needs Survey". 1975.

111-114

from increased Federal,support under P.L.84-660 and P.L.92-500.* Scenario
E-1 represents a 75 percent increase over historical trends in Sewer
system expenditures with most of the increase in expenditures on treatment
plants. Scenario E-2 presents sewer system expenditures over 400 percent
greater for the period 1975 to 1985.

b. Dates of Accomplishment: Dates of accomplishment are based on Commis-
Sion technology cost estimates by category. The assumption used in these
estimates of building for 1990 capacity probably results in an underesti-
mate of actual design capacity and, thus, an underestimate of costs. On
the other hand, the treatment plant categories include a great deal more
spending for tertiary treatment than EPA actually has allowed in its review
of these needs. Finally, the needs survey has a number of-problems as a
data base (20).

Given these caveats, Table III.E.3 shows the dates by which various
categories will be completely funded under the two scenarios. For scen-
ario E-1, which is based upon EPA'projected outlays (the projected outlays
are far higher than those of recent years), secondary treatment plus
treatment beyond secondary where required by water quality limitations is
not,accomplished until 1986. Under scenario E-2, these requirements are
met@by 1980, based on the assumption that no more than $13 billion will be
spent on other categories by that date.,

TABLE III.E.3. Dates for Complete Funding for Publicly Owned
Treatment Works Categories

.Scenario E-1 Scenario E-2

I and II lg,,a 1980C
III Not funded 1985
IVA 1985b 1985
IVB 1986a 1980C
V Not funded 1985
VI Not funded Not funded

a. Assumes Federal expenditures continue at the rate given in scenario E-1
through 1986.

b. Funded by local governments.

c. Assumes these categories are given first priority on funds for 1975-1980.

Source: NCWQ estimates based on expenditure patterns shown in Table III.E.2
and Commission technology estimates of costs of categories.

*Based on.time trends of contract awards for.collector sewers and for treat-
ment facilities (treatment plants and interceptor sewers).

111-115

C.- Distribution among Levels of Government: From 1955 to 1970, total
Federal expenditures never rose above 15 percent of total contract awards
for treatment plants and interceptor sewers (see III.C). However, P.L.84-660
grants averaged 44 percent of eligible costs for grants that exceeded $1
million from 1967 to 1972. Many eligible projects that were not Federally
funded were constructed,although some of these may have taken place in the
hope of reimbursementi Under.P.L.92@500, grants have averaged 75 percent
of eligible expenditures(4). No adequate data base exists to determi, :ne
the division.of capital expenditures between state and local government,
but most state grant programs are tied to the availability of Federal.
grants. For purposes of analysis, it was assumed that existing state grant
programs will be fully funded by the states at authorized levels. Under
this assumption, state governments would fund 7 percent of the capital costs
for-eligible projects, and 18 percent of the capital costs will be paid for
by the local government.*

While states with grant programs frequently offer much larger grants than
7 percent, only.28 states have true grant programs. Table III.E.4 shows
the number of states with each type of assistance program. One common form
of assistance is through state loans, rather than outiight grant .s. -This
method commonly provides a loan at the interest rate relative to the-state's
credit rating. Such a loan can lower interest costs to local governments
by up to 30 percent.** The form of support also has the advantage of giving
the greatest degree of support to those sewage authorities with the most .
pressing financial problems. Administrative costs, plus the risk of default
implicit in any loan, are the financial burden to the state.

TABLE III.E.4: FORMS OF STATE FINANCIAL ASSISTANCE

States with only grant programs 25
States with only loan programs 8
States with both grant and loan programs 3
No financial assistance 14

Source,: NCWQ. From Meta Systems, "Economic Impacts of Water Pollution
Control Act.of 1972; Municipal Options." 1975.

*Derived from computer printout provided by Urban Systems Research and
Engineering,-,WQ5AC001, of state-tby-state divisions of state and local
costs. Weighting of states is based on percentage of category I, II and
.IVB needs.

**With a local net interest cost of 7 percent, this would require a divergence
of 2 percentalge points on the net interest cost between state and local bonds.
Such a divergence, though larger than average, could be due to both differ-
ences in credit rating and in underwriting costs.

111-116

Table III.E.5 shows the Federal, state and local shares of capital,
operating and annualized costs under each of the two scenarios and extra-
polates an historical trend. Compared to historical trends, scenario E-1
requires lower capital expenditures on sewer systems by state and local
government. Scenario E-2, on the other hand, requires a $3.3 billion in
additional state-local capital expenditures. Operating and annual costs
tell a different story. Incremental operating costs at least double over
historical levels for both scenarios. The combination of greater depre-
ciation costs and higher operating costs insure that annual costs for
state and local government are higher under all scenarios than with the
historical trends, despite the decrease in state-local capital expenditures.

Table III.E.6 shows the percentage of capital and annualized costs borne
by each level of government under each scenario. (Operating costs are
assumed to be a local expenditure; this omits state support of operating
costs in New York, but is accurate for all other states.) For scenario E-21

TABLE III.E.6. Percentage Shares of Total Sewer System Cost
Borne by Federal, State and Local Government

Federal State Local

Capital E-1 58% 5% 37%
Expenditures E-2 75% 7% 18%

Operating E-1 0 0 100%
Costs E-2 0 0 100%

Annualized E-1 37% 4% 59%
Costs E-2 58% 5% 36%

Source: NCWQ, 1976.

where all needs are Federally sponsored, the relative perce ntages of capital
costs are 75 percent Federal, 7 percent state, and 18 percent local. Scen-
ario E-1 put a greater capital cost burden on state and local government.
This brought a split of 56 percent Federal, 5 percent state, and 39 percent
local. Annual costs, which include capital costs, depreciation costs.and
operating costs are the best measure of the total costs of sewer system
expenditures, however. For annualized costs, the Federal -share is 58 percent
when all categories are fully funded under scenario E-2. This falls to 37
percent for scenario E-1.

TABLE III-E.5 Federal, State and Local Shares of Sewer System Costs
(Billions of 1975 dollars)
Historical
Scenario El Scenario E2 Expenditure Trends
Total Federal State Local Total Federal State Local Tota Federal State-Local

Capital Expen. -
(1975-85)a 60.9 35.3 3.3 22.3 58.1 118.5 '11.1 28.5 38.7 2.6 36.3

Incre ntal
Operating 1.52 0 0 1.52 1.98 0 0 1.98 .77 0 .77
Costs
(1985)

Annualized
Costs 6.66 2. 47 .23 3.96 14.2 8.30 .77 5.12 3.88 .18 3.70
(19.5)c

a. Totals from Table III.E.2.Fbr federally funded sponsored expenditures in scenarios D1 and D2
a split of 75% federal, 7% state and 18% local is assumed. Non-federally sponsored expendi-
tures are assumed to be 160% local, historical trends are assumed to be 15% federal for
treatment plants and interceptor sewers and 0% federal for collector sewers.

b. Incremental operating costs in 1985 are defined as operating costs above 1972-19.73 levels. Operating
costs based on Commission technology estimates, see Chapter II. They are assumed to be 100%
local, and do not take account of the New York state operating grant program.

.c. Annualized using an-interest rate of 7%, treatment plant life of 20 years, sewer life of
50 years, all depreciation costs borne by local governmentj

Source: NCWQ. 1976.

111-118

2. Financing the State-Local Share

Financing of the Federal share involves questions of national economic
policy, discussed in section III.F (Macroeconomic Impacts).

As previously noted, only under scenario E-2 are capital costs for state
and local government higher than historical trends. Under scenario E-1,
they are lower. Thus, in the aggregate, the capital costs that will have
to be borne by state and local government may not represent an added burden.
However, the fact that capital expenditures may be no greater than past
trends is not helpful if past trends lead to overall fiscal problems for
state and local government. On the other hand, operating costs will be sig-
nificantly higher and may present a serious problem. These observations
are reflected in the statements and testimony of municipal officials and
also*by the Michigan Municipal League(14).

a. State-Local Financial Outlook: The Commission study of the state and
local government financial outlook did not take into account sewer system
expenditures explicitly; rather,,the goal was to determine the general
fiscal outlook. To assess the financial outlook, a set of state-by-state
forecasts of revenues* and expenditures was made. For local government,
the forecasts are for the total sum of all revenues and expenditures for
all local governments within a state. These units are termed local aggre-
gates. This aggregation was necessary to keep some bounds on the forecast-
ing exercise, and also because of the diversity of forms that local
authorities can take. Figure III.E.1 shows the types of local authorities
and their expenditures in 1972.

Three sets of expenditure forecasts were made:

(1) Based upon 1970 patterns of expenditures with respect to income,
population, unemployment and school-age population. This was the lowest
expenditure forecast;

(2) Based upon past trends for each state; and

(3) Based upon the recent American Enterprise Institute's aggre4ate
state-local spending forecasts.

These expenditure trends were matched with three revenue paths:

(1) Present levels of revenue effort (taxes as a percentage of personal
income);

(2) Present trends in revenue effort; and

*Revenues are def ined to include estimated grants from the Federal government.

111-119

Figure I I I.E.1
LOCAL AUTHORITY RESPONSIBILITY
FOR PUBLICLY OWNED WASTEWATER TREATMENT COSTS

10,318 100% $3.3 Billion 100%

..................
ounties ..............
..... ... .........
...... ......... . ...............
..........
County
.....................
10%
...........

............. ........... 14%
........ 0 088)
..........................
Special
(048)
... .... ....
............................. special
..........
............................... District
S
..........
................
.................
District
20% Municipal:"'
nicipalities:-'-*,. .... .....
..........
(2,042)
.. ...........
...........
............. % 20%
........ .....
-66W@i%***:':':*:
...... ...... ..... ......
.: (0.66)
....... ........
................... ... ...
..........
0 ...........
...............
. .......... .......... ....... .. . ......... ......
X-N .... 11 88@
. . .................. :.......... ...........
................ ........
.... ....................... X.,
..............
. . ................................. .. .. .... ........
...............
................. ..........................................................
................
............ ..............................
............................... ........
. ......... .........................................
................
.......... ......
......................... ......... .......
.........................
... ...........................

NUMBER DIRECT
LOCAL AUTHORITIES (U.S.) EXPENDITURES 1972**
RESPONSIBLE POfi WASTE TREATMENT

Source: *Perc6ntages f rom'examination of grant recipients under PL92-500 and PL84-600.
Total numbers are estimates except for special districts.
"From Census of Governments. Direct expenditures include both capita.1 and operating costs.
Natl. Commission on Water Quality
February 1976

111-120

(3) Degree of revenue effort equivalent to the highest state or local
aggregate.

Tables III.E.7 and III.E.8 show the number of state or local aggregates
that would incur a deficit under each combination of revenue and expenditure.
Using present expenditure trends, examination of Table III.E.7 for the
period 1975 to 1980 indicate-s that without an increase in present revenue
effort, 40 states could expect to encounter aggregate deficits for this
period. If present trends in revenue effort continue, 28 states would
expect to encounter deficits, while if all states moved to the degree of
revenue effort of the highest state, nine would encounter deficits.* Focus-
sing on a continuation of present trends in revenue and expenditures, 28 .
states and 21 local aggregates will face fiscal problems in the period 1975-
1980, while 44 states and 40 local aggregates can expect fiscal problems in
the period 1980 to 1985(26).

As a qualifier, W. R. Z. Willey points out:

. . . The report (November Draft of.above statements) does not,
however, forcefully point out that such "recent trends", i.e.,
the 1970-75 period, have occurred in the context of a significant
national recession with its concomitant drag on governmental tax
revenues and capital market vitality. At present, most leading
economic indicators show an upturn in the national business
cycle. The stock market has rebounded dramatically. monetary
and capital markets are improving. Two-thirds of capital costs
of publically-owned (sic) treatment works are covered by bonded
debt. . . Personal and corporate income are on the upswing. These
factors imply that the state and local revenue pictures are in
for significant improvements, so that the report's analysis of
projected deficits resulting from the Act is overestimated.

To illustrate the relative importance of sewer system expenditure within
the overall picture, Tables III.E.9 and III.E.10 show for state and local
aggregates, proje@tions of revenues, deficits and sewer system expenditures
on a state-by-state basis for the year 1979. In almost all cases, sewer
system expenditures are a minor demand on revenue.

The use of local aggregates tends to conceal the fact that, rather than
being evenly spread across the entire state, requirements will be very dif-
ferent among communities and more concentrated in some. Over 40 percent of
the 1990 population will either not be served by sewers or will have no

*Note carefully that this is not a prediction that nine states will engage
in deficit spending; it says; rather, that nine states cannot continue a
given pattern of revenues and expenditure trends without encountering a
deficit.

TABLE III-E.7z STATE FINANCIAL OUTLOOK: NUMBER OF STATES WITH PROJECTED DEFICITS

A. 1975-1980

Present Revenue Present Trend Revenue Effort
Effort in Revenue Effort of Highest State

1970 Expenditures
Patterns 0 0 0

Present Expenditure
Trends 40 28 9

American Enterprise
Institute Expenditure 50 38 10
Forecast

B. 1981-1985

Present Revenue Present Trends Revenue Effort
Effort in Revenue Effort of Highest State

1970 Expenditures
Patterns 50 0 0

Present Expenditure
Trends 43 44 31

American Enterprise
Institute Expenditure 50 50 34
Forecast

Source: Data Resources, Inc. Economic Impacts of Water Pollution
Control Act of 1972; State and Local Revenues and Expenditures. 1975.

TABLE III.E.8: LOCAL AGGREGATES FINANCIAL OUTLOOK: NUMBER OF LOCAL AGGREGATESa WITH
PROJECTED DEFICITS

A. 1975-1980

Present Revenue Present Trend Revenue Effort of Highest
Effort In Revenue Effort Local Aggregates

1970 Expenditure
Patterns 1 0 0

Present Expenditure b
Trends 37 21 43

American Enterprise
Institute Expenditure 51 48 16
Forecast

B. 1981-1985

Present Revenue ..Present Trend in Revenue Effort of Highest
Effort Revenue Effort Local Aggregates
F,
t1j
1970 Expenditure
Patterns 2 0 0

Present-Expenditure b
Trends 50 40 48

American Enterprise
Expenditure 51 49 42
Forecast

a. Includes all states and the District of Columbia---
b. In some cases it was found..that higher revenues'resulted in more than proportional increases
in expenditures.

Source: NCWQ. From Data Resources, Inc.. Economic Impafts of Water Pollution
Control Act of 1972; $tate.and Local Revenues and Expenditures. 1975.

111-123

TABLE III.E.9: STATE GOVERNMENT FINANCIAL CAPACITY

STATE SHARE
OF SEWER
SYSTEM CAPITAL
STATE PROJECTED TOTAL EXPENDITURES (b)(c)
DEFICIT(a) REVENUES(al (scenario zi)
ALL MILLIONS OF DOLLARS

Alabama 6.3 3548.4 0
Alaska -924.4 1097.8 3.1
Arizona 17.2 2313.0 1.0
Arkansas 525.2 1780.6 0
California 2598.0 27901.6 40.0
Colorado 34.9 2678.6 1.0
Connecticut -1295.8 3181.2 5.7
DelawarO. -296.3 767.2 1.6
Florida -383.3 7614.0 0
Georgia -1072.1 4478.1 0
Hawaii -470.3 1634.1 3.4
Idaho -69.1 867.4 2.5
Illinois -2618.2 11556.2 0
Indiana -426.4 4125.9 6.5
Iowa 41.9 2646.5 0
Kansas -86.1 1962.0 0
Kentucky -58.0 3590.5 0
Louisiana 110.3 3807.6 0
Maine -231.8 1020.8 2.1
Maryland -672.2 4764.5 22.6
Massachusetts -2885.1 6524.7 15.5
Michigan -2423.6 10989.0 6.5
Minnesota 200.9 5073.9 3.3
Mississippi 17.7 2513.8 0
Missouri -862.7 3579.9 9.9
Montana 3.8 873.0 0
Nebraska -114.3 1279.1 2.2
Nevada 20.6 857.6 0
New Hampshire 136.3 1016.2 6.0
New Jersey -1629.0 7355.0 30.4
New Mexico 158.0 1469.0 .9
New York (d) -1918.2 27047.5 44.8
North Carolina -512.8 5059.7 10.2
North Dakota 57.7 625.6 0
Ohio -1251.3 9266.2 0
Oklahoma -884.2 2427.2 0
Oregon 16.6 2684.8 0
Pennsylvania (e) -3542.1 13731.0 0
Rhode island -61.3 1195.1 2.2
South Carolina @142.6 2613.0 0
South Dakota 5.1 595.2 .3
Tennessee -403.1 3715.9 0
Texas 39.4 10012.3 0
Utah 82.7 1560.2 0
Vermont -257.6 743.9 1.5
Virginia 14.4 5176.2 8.8
Washington -967.9 4577.7 7.9
West Virginia -75.6 2187.7 0
Wisconsin -126.0 5542.0 3.7
Wyoming 10.1 573.7 0

(a) Source: NCWQ. From Data Resources, Inc. "Economic Impacts of
Water Pollution Control Act of 19.72; State and Local Revenues and
Expenditures'!, 1975.
(b) Source: NCWQ. From Urban Systems Research and Engineering.
"Economic Impacts of Water Pollution Control Act of 1972; Incidence
of Costs". 1975.
(c) Includes only grant program expenditures. All loan programs
are excluded (See text).
(d) Does not take account of New York State Operations grant program.;
(e) Pennsylvania has a grant program which pays back two percent of local
share of eligible costs. This program is not accounted for here.

111-124
TABLE III.E.10: LOCAL GOVERNMENT FINANCIAL CAPACITY

LOCAL SHARE
OF SMR
PROJECTED TOTAL SYSTEM ITAL OPERATING
STATE DEFICIT (a) REVENUES (a) EXPENDITURES (b @ l(c) COSTS (b)
(Scenario 1) (Scenario 1)

-- ALL MILLIONS OF DOLLARS

Alabama 406.6 2430.2 19.6 5.4
Alaska 222.6 1002.6 6.9 3.7
Arizona -311.2 2131.4 16.7 3.0
Arkansas 380.1 1375.1 24.7 6.7
California 4382.4 31523.7 34.2 4.7
Colorado 158.6 2514.4 3.1 3.0
Connecticut -649.3 2923.5 44.9 5.5
Delaware -4.9 523.8 5.9 2.2
Dist. of,Columbia -500.5 2513.4 1.3 .8
Florida -98.9 7079.4 77.1 21.5
Georgia 136.4 4608.8 30.8 11.6
Hawaii 8.2 397.9 9.7 5.0
Idaho -49.0 512.5 7.2 2.5
Illinois 1932.4 10433.2 71.0 26.8
Indiana -297.9 4703.7 27.8 9.6
Iowa 167.1 2754.7 16.9 6.1
Kansas 139.9 1942.1 27.4 6.0
Kentucky 133.5 1821.7 34.7 7.4
Louisiana 288.6 3196.8 27.8 5.7
Maine -72.3 595.0 3.7 3.1
Maryland 1030.2 5583.2 28.5 26.6
Massachusetts -195.7 5633.5 27.2 15.1
Michigan -614.3 10196.1 30.1 19.1
Minnesota -665.5 5154.6 15.7 8.1
Mississippi 110.1 1755.6 J0.1 4.1
Missouri 178.9 3766.0 26.0 9.7
Montana 14.3 547.7 2.9 1.0
Nebraska 563.0 1526.6 3.6 2.6
Nevada 217.4 880.6 5.1 2.0
New Hampshire -60.5 562.5 11.1 4.3
New Jersey -1681.5 8080.7 49.7 29.8
New Mexico -129.2 844.0 3.9 1.1
New York (d) -6807.8 35122.4 199.6 52.7
North Carolina -200.8 3541.9 31.0 11.9
North Dakota 44.8 385.6 6.5 .6
Ohio -526.5 8815.6 78.3 27.1
Oklahoma -11.6 1763.2 24.5 7.6
Oregon 226.4 2254.9 13.1 3.5
Pennsylvania (e) -1745.7 9819.2 99.5 18.6
Rhode Island -65.3 613.4 10.7 2.1
South-Carolina 253.1 1764.2 26.5 8.3
South Dakota 141.0 524.9 1.2 .8
Tennessee 642.1 3341.2 31.3 7.8
Texas 426.8 9096.2 75.2 23.2.
Utah 27.8 842.9 7.3 2.5
Vermont 9.1 325.7 2.8 1.4
Virginia -130.0 3837.9 15.7' 12.9
Washington -714.1 3222.4 21.5 7.7
West Virginia -48.8 936.0 63.5 15.1
Wisconsin -234.5 9204.3 35.4 10.8
Wyoming 43l..8 2.6 1.0

(a) Source: NCWQ. From Data Re sources, Inc. "Economic Impact of
water Pollution Control Act of 19721 State and Local Revenues
and Expenditures", 1975.
(b) Source: NCWQ. From urban Systems Research and Engineering.
"Economic Impact of Water Pollution Control Act of 1972; Incidence
of Costs", 1975.
(c) Includes only grant program expenditures. All loan programs are
excluded (See text).
(d) Does not take account of New York State Operations grant program.
(e) Pennsylvania has a grant program which pays back two percent of
local share of eligible costs. This program is not accounted
for here.

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treatment-plant needs(13). Also, costs will vary both by the magnitude of
the need and size of community, with the highest costs to small communities
due to economies of scale.

Thus, while some communities will face no local costs due to treatment
plant needs, a community of less than 5,000, with no treatment plant and a
requirement of beyond secondary treatment, could incur local capital costs
of over $200 per capita. (Derived from cost data contained in meta
Systems, 1975(11).) The.greatest possible community impacts, however, occur
in scenario E-2 for communities that must deal with combined sewer overflow
control. The local share of these capital costs is over $450 per capita.*

The Commission.sponsored a survey of grant recipients o f either
P.L.92-500 or P.L.84-660 in recent years to determine the methods of finan-
cing used by these facilities. About 10 percent of those surveyed stated
that cutbacks in other expenditures had played a role in the financing.
The cutbacks most commonly mentioned were natural resources and recreation,
.police, fire and road maintenance.

b. Required Method s of Financing versus Past Methods: Over two-thirds of
capital costs for state-local sewer expenditures are normally financed
through bond issues(21). Table III.E.11 shows the types of bonds used by
recent grant recipients.

TABLE III.E.11. Bonds Used by Loca 1 Government to Finance
Local Share of Grants under P.L.84-660 and P.L.92-500a

General Special Sewer
Obligation Assessment Revenue Other (includes
Bonds Bonds Bonds state loans)

Percentage 48.6 4.4 26.1 31.4
.Usingb

a 226 respondents from authorities receiving grants of over $1 million
under either Act since 1967.

b. Add to over 100 percent due to use of more than one type of financing.

Source: Urban Systems Research and Engineering, 1975.

*Derived using Metcalf and Eddy(13) estimates of the cost of combined sewer
overflow and the total population served by combined sewers, and assuming
a .25 percent local share of capital costs.

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General obligation bonds are backed by the full tax revenues of the
city, while revenue bonds are backed solely by the revenues of the sewer
system. Usually, revenue bonds carry a higher interest rate than general
obligation bonds, but offer the governmental entity some other advantages.
In many states and cities, debt limits do not apply to revenue bonds,
there are fewer restrictions.on underwriting practices, and they are less
likely to require voter approval.

For maintenance and operation costs and repayment of bonds, the most
popular system at present is some form of sewer service charge. The use
of sewer service charges has grown from 20 percent of all municipalities
in 1945, to 61 percent in 1960 and 85 percent in 1969(24). However, other
taxes to supplement or sustain O&M and debt service costs may be used by a
given community as well as sewer service charges. Table III.E.12 shows
the types of financing methods used in a survey of communities that had
received grants of over $1 million under P.L.84-660 and P.L.92-500(25).*

On the average, for those surveyed, 57 percent of operating and main-
tenance costs are financed by user charges; 20 percent by property tax;
14 percent by industrial contribution; and 9 percent from other revenue
sources. For capital costs, sewer or water charges account for 75 percent
of the financing, property taxes for 20 percent, and 5 percent from other
sources.

Data on types of taxes and charges tend to conceal the variety in the
types of user charges among communities. Table III.E.13 shows some of the
methods used to establish the base and variable portions of sewer service
charge. Most communities use some type of flow-based charge for industrial
users, but only 20 percent account for waste loads through surcharges.
For a significAnt number of these, the surcharge program exists only on
paper(24).

P.L.92-500 imposes two specific requirements upon grant recipients
with respect to financing methods -- industrial cost recovery and user
charges.

Industrial cost recovery provisions require industrial users to pay
their portion of the Federal share of capital costs over a 30-year period.
No interest or debt service payments are required. The industrial share
must be determined on the basis of waste loads and water volume, with a

*A full and adequate data base from which to assess the use of property
taxes is not available. However, three sources give somewhat similar
results. The Urban Systems survey found 25 percent using property taxes
for capital repayment. A survey by DuPre(5) found 27 percent used property
taxes, while a 1970 AMSA survey of large authorities found 33 percent report-
ing that they planned to use property taxes for some portion of operating
.costs in the period 1971-75(3).

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TAJBLE III E. 12 Methods of Financing Local Shares of P.L. 92-500 and
P.L. 84-660 Grants

Percentage of P.L. 92-500 and P.L. 84-660
Grant Recipients Using A Particular
-Financing Method

For For
Financing Repayment of Maintenance and
Method Capital Costs Operating Costs b

Property 25 @0

Special Assessment 8 1

Special Industrial 3 NA
Contribution

Sewer Service Charge 54 NA

Sewer Service Charge NA 72
to Industrial Users

Sewer Service Charge NA 81
to Other Users

Water Supply Charge 15 12

Other Charge 4 10

Local Sales .4 0

Local Income 0 0

Other Taxes NA 10

Other Towns 3 10

Other .... .. 5 -lo-

NA. Not Available

a. 226 respondents from authorities receiving grants over $1,000,000
under either Act since 1967.

b. May total over 100 percent due to the use of more than one tax.
Source: NCWQ. ;rom Urban Systems Research and Engineering. "Economic
Impacts of Water Pollution Control Act of 1972;,Incidence of
Costs", 1975.

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TABLE III.E.13: Forms of User Charge Systems: Rate Bases for Minimum
and Variable Charges, 1969

Percentage Of Municipalities Surveyed Usin2:
Rate Base for Rate Bise for
Minimum Charge Variable Charge
a a,b a a,b'
Residential Industrial Residential Industrial

Flat Rate 36 12

Flow 22 32 67 87

Derived from 29 37
Water Bill

Surcharges 20

Other 11 21 6" 11

None 27 9

a. Total may not sum to 100 percent due to rounding error.

b. Excludes comercial (wholesale and retail trade, serviceb, etc.)

c. Total exceeds 100 percent due to use of more than one type of charge.

Source: NCWQ. From Urban Data Services, Inc. "Sewer Service and
Charges", 1970.

111-129

variety of cost accounting methods acceptable as methods of.defining the
capital share. Industrial users need not pay for excess capacity unless
they have specifically requested it for their use. They may withdraw at
any time without further obligation to either the community or the Federal
government.*

The Federal government gets one-half of the repayments, with.the rest
going to the local community, which must use 80 percent of its share for
grant eligible construction. The community may use 20 percent for any
purpose except for operating and maintenance costs of the facility.

@rhe other statutory requirement -- that of user charges -- must.be
based upon,volume or waste loadings for each user or use class. A volume-
based user charge may be used for wastes the strength of domestic use.-
With wastes of greater strength, a user charge which incorporates waste
loading must be used. As noted in the discussion of user charge systems,
only 20 percent of all municipalities had surcharges that took into account
waste loadings in 1969.

Major'administrative changes would be necessary for.many .communities to
implement industrial cost recovery and user charges because this will
require implementing surcharge systems and altering existing financing mech-
.anisms to ensure they reflect proportionality among classes of users. -In
addition to changes in billing and bookkeeping methods, some form of moni-
toring.or metering will be'peeded. For those systems without a water
metering system, the change to metering could result in substantial costs.
Even for systems that already have some form of water meter, thi@ is not a
simple change." Where there is significant residential use of water for
lawn and garden use, water use metering results in more than proportional
costs to residential.users.**

.Industrial cost recovery involves highly complex accounting problems.
Some of these problems are similar to those of rate making for traditional
public utilities such as electricity and telephones. However, even in
these areas, the proper capital recovery methods are subject to debate.

C. Distribution of Costs among Users: Because industrial cost recovery
allows the,capital costs to be recovered over a 30-year period without
interest or depreciation, industrial users receive a substantial subsidy.
Assuming an interest rate of 7 percent, industrial users of municipal

*Local communities may require more binding agreements, however.

t*One solution to this, in areas of.suitable climate, is-the use of winter
water use for residential sewer bills.

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systems receivea subsidy from the Federal government of 44 percent of
capital costs, compared to 75 pe.-cent received by all other users.*

The distributional impact of shifting to user charges depends on the
nature of the original system andprecisely what types of user charge
systems are considered allowable. Table III.E.14 shows how costs are dis-
tributed among users under different formulas for an industrialized hypo-
thetical community. Two features are notable. The shift from an ad
valorem tax to virtually any other charge system chiefly,benefits commercial
users, and any system that takes into account waste loadings shifts costs
from residential to other users.

This. comparison may be somewhat misleading, however, since many systems
now use a mix of ad valorem taxes and surcharges. Table III.E.15 shows how
costs are distributed among users in the Los Angeles County Sanitation
District, which uses a combination of ad valorem taxes and surcharges. The
effect of moving from this type of system to a flow and waste-based user-
charge system would be to shift the burden of charges away from commercial
users to residential users and users with property tax exemptions, such as
schools, h6spitals, etc.. A question not clearly answered by current regu-
lation is what constitutes a user class. Is it sufficient that non-indus-
trial users as a class should pay their share of the costs and no more, or
must sectors of this non-industrial class, such as commercial, multi-family
and single family residences, each pay their exact share as well?

While Federal requirements apply only to grant recipients and that
portion of the system sponsored by the grant, the requirements have, in many
cases, caused communities to alter their whole charge system, including
methods of repayment. Spectacular increases in industrial costs frequently
result. However, these increases will not necessarily drive industrial
users out of the system.

Two factors will encourage industrial users with compatible wastes to
use publicly owned treatment works: economies of scale which, for small
users, can reduce costs of treatment as much as 80 percent, and the implicit
Federal subsidy on capital, noted above. Industries building their own
systems also may receive an implicit Federal subsidy through accelerated
depreciation and the use of tax-exempt bonds for pollution control. (See
Section III.F. for further discussion of @his use of the tax-exempt bond

@*Based on comparing the present value of a 30-year stream of payments for
75 percent of the capital costs to the actual capital cost. This will, in
most cases, be a minimum estimate of the size of the subsidy. The actual
subsidy for a particular firm will depend on a number of complex factors,
such as the relevant discount rate for the firm, whether debt, equity or
industrial revenue bonds are considered as the alternative, and the Federal,.
state and local tax treatment and definition of pollution abatement facili-
ties.

111-131
TABLE III.E.14: PERCENTAGE DISTRIBUTION OF USER CHARGES AMONG USERS FOR
A HYPO`rHETICAL COMMUNITY a

Residential Commercial Industrial Other
1. Distrbution of Flow
and BOD among users:

a. Flow to treatment 42.2 11.2 41.8 4.8
plant

b. BOD 33.1 10.8 51.2 4.9

2. Charge Formulas:

a. Constant Rate per
Gallonc (sprinkling 56.0 8.5 31.8 3.7
included)

b. Flat Fee Modifiedd
by user type 77.7 7.8 14 1.5

c. Flat Fee & Constant e
cost per gallon 78.3 7.1 13.1 1.5
d. Flat Fee & constant f
cost per gallon and 72.1 6.9 19.6 1.4
constant rate per
pound of BOD removed
above normal c6ncen-
tration

e. Constant cost perg
gallon and constant 38.1 11 46.1 4.9
cost per pound of
BOD

f. Pioperty Assessment 66.3 25.7 8.0 0

a Data based insofar as possible on an unnamed real city, Industrial Flow
is somewhat higher than average.
b
Schools, Hospitals, etc.

c $.16 per 1000, gallons

d
Approximate charges: flat monthly fee of $1.20 for residential and com-
mercial customers and.$2.40 for industrial customers plus $.04 per
1,000 gallons of water.

e
Approximate monthly charges: residence--$1.20, gasoline stations, car
washes, restaurants, laundries--$2.40, hotels,--$3.20, other commercial
customers- ,$2.00, schools, hospitals--$12.00, industrial customers--$40.00
f Approximate charges: $1 .00 per month for residential and commerical
customers and,$2.10 per industrial customer, $.04 per 1,000 gallons of
water used for all customers, and $.015 for each pound of oxygen demand
that causes the biochemical oxygen demand concentration to exceed
that of,domestic sewage.

Source: Johnston, James. "The Distribution of the Burden of Se wer
User Charges Under Various Charge Formulas", National Tax
Journal. 1969'.

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TABLE III.E.15: Los Angeles County: Percentage Distribution of
Flow, Effluent, and Charges
Among Users for Fiscal Year 1973

1. Distribution of
Flow, COD, and
Suspended Solids
Percentage Percentage
from @rom
Industrial Users Non-Industrial Users

a. Flow 33 67

b. COD 51.7 48.3

c. Suspended Solids 40.6 59.4

2. Percentage Distribution
of Total Tax Burden
Industrial Users Non-Industrial Users

a. Ad Valorem 15.7 64.5

b. Surcharges 19.8 0

c. Total 35.5 64.5

Source: Los Angeles County Sanitation Districts
Communication to the Commission. 1975.

111-133

market.) An industry that can take full advantage of both of these implicit
subsidies may obtain as great a subsidy as that received by users of publicly
owned treatment works.

Thus, there seems to be no economic reason why industrial cost recovery
and user cost regulations should drive a typical user with compatible wastes
out of the municipal systems. Indeed, the industrial user of a municipal
system frequently will gain a substantial competitive advantage over direct
dischargers. A second and highly significant long-term effect on the effi-
ciency of water use and the treatment facility of user charges that vary
with flow and waste loadings is that they provide an incentive to indus-
trial users to.reduce both flow and waste loadings.* (See Figure III.D.1.)

d. System Perfor mance: At present, treatment plant performance represents
a serious problem. EPA found that over'30 percent of all treatment plants
for which adequate data were available were failing to meet design criteria.
Over 56 percent of the plants surveyed did not have operational performance
data adequate to serve as the basis for a performance assessment(18).
Table III.E.16 shows the reasons for deficiencies reported by EPA in 1973
and 1974.

A second source of evidence concerning performance problems comes from
the State of New York operation and maintenance grant system. This grant
mechanism is performance-based, but has been very lenient in handling
systems with performance problems. Nevertheless, about one-third of all
treatment plants in the state have chosen not to be a part of the program
(10). one study has suggested that the major reason for the lack of parti-
cipation was that a 33 percent grant was too small a financial incentive
to stimulate communities to pay their share for adequate operation(8). A
final source of information concerning operating problems is in the 1973
Needs Survey, where over 18 percent of.all facilities reported that they
were operating above design capacities. Over 39 percent of facilities
serving over 150,000 people were operating at above design capacity(12).
While the Act provides remedies for infiltration/inflow problems and for
inadequate capacity through Federal funding,, it is not yet clear how well
the system will work i@ dealing with other types of operating problems.

Two economic factors may affect the operation of treatment works. The
greatest increase in costs over historical trends at the local level is
from increased operating costs for treatment plants. Other Commission
studies have noted that many communities are more concerned about .
financing operating costs than capital costs(15). In a tight fiscal situa-
tion, it may prove difficult to find adequate funds to operate the facili-
ties. The change in user-charge mechanisms also may have some influence.

*It should be noted that a charge system can guarantee proportionality among
major user classes without providing for the kind of user-by-user monitoring
that encourages more efficient use of water and effluents.

111-134

TABLE III.E.16

REASONS FOR OPERATING DEFICIENCIES REPORTED
IN CLEAN WATER 1973 XND 1974

Type of Problem Percentage of Percentage of
Facilities Facilities
(1973) (1974)

Hydraulic Overload 20 26

Infiltration Inflow 40 9

Structural 14

Operator Related 49 71

General Maintenance 17

Inadequate Lab 24 21
or Testing

Source: U.S. Environmental Protection Agency. Clean Water-7Peport to
Congress, 1973. 1973.

U.S. Environmental Protection Agency. Clean Water-Report to
Congress, 1974. -1974.

111-135

Ad valorem taxes have the advantage of rising somewhat with inflation, thus
requiring fewer rate increases than user charges. User charges, on the
other hand, have the advantage of rising to correspond with increased use
of the system, and encourage more efficient use of the system.

3. Alternative Federal Funding Decisions and Cost-Effectiveness Rules

The previous two sections have assumed that the technology costs were
representative of how needs would actually be met. for design capacity and
technologies selected. The sections also assumed that categories will be
funded with priorities indicated,. and that local authorities will proceed
with construction,as Federal funds become available. The purpose of this
section is to examine the impacts upon dates of accomplishment and expen-
ditures if these assumptions are removed.

a. Priorities among Categories: Scenario E-1 makes the simplistic assump-
tion that all Federal funds will be spent for treatment plants and inter-
ceptor sewers (categories I, III and IVB), while scenario E-2 assumes only
$13 billion is available for other categories before.1980. Both scenarios
neglect the requirement for infiltration/inflow control.where cost-effective,
and the fact that EPA does not insure that only categories I, II and IBV
would be funded even if this were deemed desirable. EPA estimates that past
grant awards had the following breakdown in terms of dollars: 52 percent
treatment plants, 30 percent interceptor sewers, and 18 percent other non-
treatment plant expenditures(l). If this pattern of federal funding were
to continue in the future, using scenario E-1, categories I and II would not
be fully funded until 1990. The effect upon total sewer system spending and
the state-local share would depend upon the extent to which other non-
treatment plant expenditures replaced locally funded collector sewer expen-
ditures and the extent to which they constituted spending for previously
unfunded categories. If the non-treatment plant spending were for categories
other than collector sewers, the resulting total expenditures and their
shares would be virtually identical to those of scenario E-1, except for
the categories breakdown. If a significant portion were for collector
sewers, then total sewer system expenditures would be. lower and the state-
local share of spending also would be lower.

b. Allotment Formulas: The dates of accomplishment previously discussed
depend upon ability to fund all needs as they arise. However, the measure-
ment of needs, particularlyon a state-by-state basis, has, in fact, proved
very difficult. This presents problems for an allotment formula.constructed
on the basis of a given percentage of funds available in a given year to
each state. The basis for this allotment has been the EPA Needs Survey, but
serious questions have been raised about the Survey's validity(2)(12).

Three allotment formulas will be considered here: one based upon treat-
ment plants and interceptor sewer needs from the 1974 EPA Needs Survey (I,
II and IBV categories); one based half upon population and half upon needs

111-136

(one-half I, II and IVB, and one-half population); and the old formula
based upon earlier needs surveys.

For scenario E-1, an allotment formula based upon the most recent
assessment of treatment plant and interceptor sewer needs would seem most
appropriate if the goal is the most rapid fulfillment of backlogged treat-
ment needs. One objection to this is that many of the differences between
states may represent the result of under and overestimates by individual
states. However, this is not universally true. Some states with@high per
capita needs have not overestimated them; others with low per capita needs
have not underestim@ted them. One example is a comparison of West Virginia
and New Mexico. At'least one study gives credit to both states for a fairly
accurate estimate of needs(10). Table III.E.17 shows their respective dates
of accomplishments@-i@nder alternative allotment formulas. As this table
shows, allotmentformulas can very seriously alter dates of achievement on a
state-by-state basis. A question of the relative equity of distribution

.TABLE III.E.17. Date of Achievement of all I, II and IBV Needs
under Alternative Allotment Formulas, Assuming 1974 Needs
Survey Proportions Are Approximately Accurate for Scenario E@l.

Allotment Formulas
I, II I, II, IVB Old Allotment
state IVB Plus P ulation Continues Indefinitely

West Virginia 1986 1991 2000*(?)
New Mexico 1986 1981 1987

Source: NCWQ, 1976.

between states arises if a state with-low treatment plant needs completes
th ese needs, should it receive grants for projects like collector sewers
while other states still have serious treatment plant needs?

c. Prefinanrcing: The historical relationship between increases in the con-
struction cost index and the rate of interest that must be paid on municipal
bonds is such that it is almost always cheaper to undertake a major con-
struction project sooner, rather than later. For this reason, many communi-
ties have become frustrated with delays in treatment plant construction
caused either by difficulty in obtaining approval of plans or by a low position
on state p.riority lists, or both. Considering the length of time that some
communities may have to wait for Federal funding under scenario E-1, the

111-137

Commission analyzed ways to assist communities faced with delays. One
approach is prefinancing, which allows communities to proceed with the
assurance that they will receive their share of Federal financial assist-
ance at a later date.

With 75 percent Federal financing, prefinancing arrangements may not
be an economically advantageous proposition for local governments. Table
III.E.18 shows the interest costs versus 'the construction savings that a
community would incur by prefinancing, with an interest rate of 5 percent
and a rate of inflation of lb percent.* Prefinancing is not advantageous
as a purely economic proposition because the community must bear the interest
costs on the full costs of construction, while the construction cost savings
are on only one-fourth of this cost. In general, prefinancing becomes
more economically attractive with high inflation, low interest rates, longer
delays in Federal funding, and low Federal grants. Thus, with a 55 percent
grant, prefinancing would be of interest under the conditions shown in
Table III.E.18.

d. Capacity Decisions: The costs presented thus far in the study are
based upon building facilities to meet the flows associated with the 1990
population. The actual capacity decisions that communities must make are
more complex. Design of an individual facility must be based on a deter-
mination of the population and industrial flow that will be using that
'facility in the future. But, even with an accurate projection of flows,
cost effectiveness problems remain, such as how much capacity to.build
initially or what design year to build for. These two questions are not
.Unrelated. Conventional economic theory suggests that when there,are major
uncertaintie's.associated with future capacity, it is better to build for
less capacity initially, and wait to see the extent to which anticipated
needs actually materialize. The consequence, however, of this cautionary
approach can be major environmental impacts if the actual growth rate out-
strips the treatment facility's capacity.

The result of using 1990 flow's probably yields lower cost estimates.,
If scenario E-1 were applicable, the last treatment plants built would
have design lives of only four or five years if they were built for only
1990 capacity. By comparison, typical design lives for treatment plants
are 20 to 25 years and for some, design lives of over 50 years are common.
one study, which examined a sample of communities on the urban.fringe,
found interceptor sewers with an average design life of over 100 years,
and a median life of over 50 years(24). However, EPA has noted that the
sample of facilities was,not typical, and was approved before present cost
effectiveness guidelines were in effect(22).

*The divergence is larger than likely to occur. It is used to show that,
even under very favorable qircumstances, prefinancing is not economically
.advantageous..

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Table III.E.18: Costs and Savings of Prefinancing With 5 Percent
Interest Rate, 10 Percent Rate of Inflation, and a
75 Percent Federal Grant.

CONSTRUCTION COST
INTEREST COST SAVINGS PER
PER $1,000,090 $1,000,000 OF
OF LOCAL SHAREa LOCAL SHAREb

3-Year Delay 600,000 331,000

5-Year Delay 1,000,000 610,000

10-Year Delay 2,000,000 1,593,000

a. Derivation: .05 x 4,000,000 x Length of Delay

b. Derivation: $1,000,000 compounded at 10 percent annually

Source: NCWQ. 1975.

111-139

Quantifying the existence 'and importance of the excess capacity problem
is difficult, however, especially with respect to population and flow fore-
casting. In the 1973 EPA Needs Survey, 32 percent of all communities
reported planning for excess capacity of oVer 50 percent, and 17 percent
reported excess capacity of over 100 percent. 'This excess @apacity was
most often reported for smaller communItiesi- with those under 25,000 having
18 percent in the over 100 percdnt excess capacity category. Those with
over 150,000 population reported only 4.6 percent with over 1,00 percent
excess capacity(ll). One solution t9 this capacity estimation problem is
"top down" control of population estimates by EPA and the states. Such a
system is,used by the State of California.

Small changes in treatment plant capacity'do not,.however, appear to
have major effecti-upon the costs of treatment plants. A change of the
design year for treatment plants for'1990 to 1985, equivalent to change
of pre*ent design life of 15 years to 10 years, results in only a 10 per-
tent reduction in total capital.costs(12).* In the context of-scenario E-1,
a design life of 15 years for all treatment plants increases the total
cost estimated by less than 10 percent.*

In contrast to these possible capital savings, lowering design capacity
would create significant additional burdens for state and local govern-
rqents. If the Federal government does not fund the necessary incremental
capacity @7hen it is required, the effect will Jpe to increase the local
annual costs significantly abovethose shown in Table III.E.5. Further,
operating costs may be lower in systems with greater excess capacity(9).
In many systems, excess capacity-also"can,be used directly to improve
removal efficiency and-help handle peak load flows.,

e. Technological Choice: The burden of these technological design and
operation decisions falls most heavily upon the local governments and the
states, placing a heavy requirement ozi jurisdictions to acquire and main-
tain expert technologically trained staff. -There are only about 3,500
sanitary engineers for 50 states and over 10,000 treatment authorities
(Section III-G, Supply Constraints).' MQreover, relatively low municipal
and state pay scales (Table III.E.19) makp., it more difficult to attract
and retain the most qualified personnel.

Further on-the-job experience is not always the best preparation for
the kinds of design decisions that n.eed to be made. The typical treatment
authority lacks experience in these de"Cisions-since it has'a new treatment
plant or significant expansion oqly once every 20 years. (Derived from

*Derived using Series E population growth, industrial flow growth equal to
growth in manufacturing output, and a scale factor of .7 for increasing
costs.

111-140

Table III.E..19: Salaries for Engineers in State Environmental
Agencies in 1973.

Salary of Average Salary of Top
Engineer in Engineer in
Environmental Environmental
Division Division

Below Average Below Median Below Average Below Median
.for Civil for College for Civil for College
Engineers Educated Engineers Educated

Number
of
States 42 .39. 17 7

Source: NCWQ- From U.S. Environmental Protection Agency.
"Fiscal Year 1973 Program Review", 1973, and U.S.
Department of Cormerce, Bureau of the Census, "Statistical
Abstract of.the United States 1974",, 1974.

111-141

contract awards historical data.) As a consequence,. the consulting
engineer must play a critica'1 role. However, as discussed in Section
III-G, even under scenario E-1, there is a barely adequate supply of
design engineers with sanitary engineering backgrounds. The key design
decisions with respect to overall approach and cost effectiveness, though
critically important, account for a small portion of the engineer's total
fee(12). Also, the consulting engineer will be judged by his client more
on how well and expeditiously he succeeds in getting design approval, and
much less on the innovation and cost effectiveness of the solution or the
associated risks.

Some evidence of this is provided by examining technological choices
indicated on the EPA Needs Survey. Activated sludge is presently the
method used in 33 percent of existing facilities" and 72 percent of those
indi6ating a planned technology to meet needs requirements report that*
activated sludge is the technology choice(12). This is despite the fact
that activated sludge has significantly higher costs than aerated lagoons
and trickling filters for both capital and operating and maintenance. The
reasons for this may be that it is easier to-design an activated sludge
plant that will clearly meet the current definition of secondary treatment
than it is to design a -facility using stabilization ponds or trickling
filters to meet the requirement.

if communities were to choose the least-cost solution, rather than the
choice indicated on the 1974 Needs Survey, both capital and operatingcosts
could be reduced by about 32 percent(12). This represents a maximum cost
savings, however, because it fails to take into account special local pro-
blems. The impact on performance of choosing least-cost options, rather ..
than those indicated in the EPA Needs Survey, is more difficult to estimate.
Data on actual performance of different systems, compared to design perform-
ance, are conflicting. One study of operator skills shows, however, that
unskilled operators find it much easier to obtain high performance from
trickling filters than activated sludge systems(B).

In terms of total costs, far more important cost effectiveness deci-
sions are available with respect to.combined sewer overflow control in
scenario E-2. The cost used here assumes the use of primary treatment and
disinfection for all combined sewer overflows and secondary treatment and
disinfection on water quality limited streams. This represents both a
very high level of control, and also may not be the most effective method
of control. Results cited in the technology section (Chapter II) suggest
that offline storage of the first flush, combined with treatment of the
stored runoff at existing plants, could achieve roughly comparable levels
of control for a total capital cost of $6.7, as against the $79.6 billion
suggested in scenario E-1. For a full discussion of the various options
for combined sewer overflow and their cost effectiveness, see Chapter II.

111-142

4. Summary
7

P.L.92-500 will require vastly greater F ederal funding than now appro-
priated. At'any level of appropriation, full funding of any major needs
category before 1980 is unlikely. Even this date can only be met by
establishing clear-cut priorities among categories and providing mechanisms
to assure that the necessary funds go to the states with the greatest needs.
While the bulk of the capital expenditures will be supported by Federal
grants, state and local governments must bear a share of the capital costs
and the full burden of the operating costs. Commission forecasts of fiscal
trends suggest that state and local governments may have difficulty finan-
cing their portion of expenditures. While the required expenditures are
small relative to total state and local revenues, many states and'localities
will face serious fiscal problems, particularly after 1980, thereby impair-
ing their ability to obtain revenues to insure adequate operation of
publicly owned treatment works. Already, in response to a survey of pre-
sent grant recipients, 10 percent indicated that they had used or planned
to use expenditure cutbacks as a means'of financing their grant shares.

The Act's requirements with respect to local financing mean that the
majority of communities must alter their financing methods. While most
communities now'use some form of user charge, they also may use ad valorem
taxes, which may not adequately reflect costs by user or'useir class. The
resulting switch to user charges has the advantage of encouraging greater
efficiency in the use of municipal @ys+,ems and may serve to partially iso-
late sewer system finances from the general fiscal problems of the local
governmental unit. Becausip of the implicit Federal subsidy on capital,
the proposed industrial-municipal payment mechanism will not ordinarily
discourage users with compatible wastes from using municipal systems.

Cost savings for POTWs could result from improved capacity forecast-
ing, shorter design lives and better choice of technological Lpproach.
The first two can allow systems to operate closer to capacity where they
function more efficiently. For lower cost technologies, the effect on
performance is less clear, although such technologies normally lead to
improved performance since they require less-skilled operators. Further,
lower operating costs may relieve local financing burdens. The ability of
state and local governments to implement better cost effective programs .
may be limited by the relative scarcity of skilled environmental engineers
and the inability of the governmental units to pay competitive salaries.

111-143

References

(1) Alm, Alvin. U.S. Environmental Protection Agency, Communication to
Commission.

(2) American Public Works Association. Water Pollution Abatement Techno-
logy: Capabilities and Costs: An Analysis of U.S. Environmental
Protection Agency's Needs Survey. 1975.

(3) Association of Metropolitan Sewage Authority, Communication to the
Commission, 1975.

(4) Data Resources Incorporated. Economic Impacts of Water Pollution
Control Act of 1972-;-State and-Local Revenues and Expenditures.
1975.

(5) Dupre, E. t., Jr. "Survey of Wastewater Rates and Charges," Journal
of the Federal Water Pollution Control Federation. 1970.

(6) Johnston, James. "The Distribution of the Burden of Sewer User Charges
under Various Charge Formulas," National Tax Journal. 1969.

(7) Los Angeles Sanitation Districts, Communication to the Commission, 1975.

(8) Mc.Canahan,J.C. and Tefft, R.C. "Effectiveness Evaluation of Operator
Training Conducted under the PSC Program." U.S. Environmental
Protection Agency. 1973.

(9) Marsden, James R.; Pingry, David E.; and Whinston, Andrew. "Regression
Analysis Applied to the Wastewater Treatment Field," Journal of the
Water Pollution Control Federation. October, 1973.

(10) Meta Systems, Inc. New York State Aid for operation and Maintenance of
Sewage Treatment Plants Implications for Federal Pol-icy. Cambridge,
Massachusetts., 1973.

(11) Meta Systems, Inc. Evaluation of Alternative Methods for Financing
Municipal Waste Treatment Works. 1975.

(12) Meta Systems, Inc. Municipal Choices Among Waste Treatment Options.
1975.

(13) Metcalf and Eddy. Water Pollution Abatement Technology: Capabilities
and Costs; Publicly Owned Treatment Works. 1975.

(14) Michigan Municipal League, Communication to the Commission. February,
1976.

111-144

(15) Price, Victoria and Hartley, David K. Institutional Assessment of the
Water Pollution Control Act of 1972; Problems of municipal Doers.
1975.

(16) U.S. Department of Commerce, Bureau of the Census. Statistical Abstract
of the United States, 1974.

(17) U.S. Environmental Protection Agency. Clean Water Report to Congress,
. 1973. 1973a.

(18) U.S. Environmental Protection Agency. Clean Water Report to Congress,
1974.

(19) U.S. Environmental Protection Agency. Construction Grants Fact Sheet.
1975.

(20) U,S. Environmental Protection Agency. Cost Estimates for Construction
of Publicly Owned Treatment Facilities, 1974 "Needs" Survey. 1975.

(21) U.S. Environmental Protection Agency. The Economics of Clean Water, 1973.
1973b.

(22) U.S. Environmental Protection Agency. Evaluation of the Report on Inter-
ceptors and Urban Sprawl. 1975.

(23) U.S. Environmental Protection Agency. Fiscal Year 1973 Program Review.
1973c.

(24) Urban Data Service. Sewer Service and Charges. International City
Management Association, Washington, D. C. 1970.

(25) Urban Systems Research and Engineering. Economic Impacts of Water
Pollution Control Act of 1972; Incidence of Costs. 1975.

(26) Willey, W.R.Z. Environmental Defense Fund. Communication to the
Commission, January, 1976.

111-145

F. MACROECONOMIC IMPACTS

1. Introduction

a. Background

Implementation of the Act began in 1973 during the worst peace
time inflation in the country's history, a very inauspicious time for
the launching of a major new program. Double-digit inflation persisted
throughout 1974 despite the onset of what became the deepest recession
since the Great Depression. We have experienced more than 9 percent
unemployment, a 60 percent-decline in housing starts, 45 percent drop
in stock prices, 15 percent fall in industrial production and 10 percent
loss in per capita income. What's more, this recession was preceded
by other extraordinary economic events.

Interest rates set historical records in the 1969-1970 "credit
crunch", with the average corporate bond yield reaching 9 3/4 percent.
Records were broken again in 1974 - with the average yield going to
1.0.3 percent and average short-term rates exceeding 12 percent.

In 1971 the imposition of wage and price controls and the first
of two devaluations of the U.S. dollar emphasized the seriousness of
our economic problems. All of this had its impact on the Act's imple--@
mentation, to date, and will continue to exercise an influence over
its future implementation and the associated impacts. The interrelation-
ship of the Act with the predictive forces of the overall economy is
what this chapter is about.

b. Objective

The objective of the macroeconomic impact component of this study
was to integrate the data developed in the studies of industry techno-
logy and public treatment systems into alternative forecasts of the
general economy over the next decade. The resultant measure of the
economic impact of P.L. 92-500 is the difference between parallel
forecasts of alternative futures with and without the Act.. The results
of this econometric forecasting are, therefore, the basis for this chapter.

The quantity of our specific data as well as the complexity of
the U.S. economy required the use of a large scale computer model.
Econometric models are useful in that their results are internally
consistent and based upon a much more complex set of simultaneous
considerations than could be handled without them. However, a broad
caveat about this work is necessary. Although these models have proven
mildly successful with short term forcasting, their usefulness in.

111-146

long term forecasting and analysis is limited. Thus, we would place
_greater emphasis on the comparative di fferences between equ@va-
le-nt-alternative futures with and without the Act than upon the actual
numerical results for,a distant year in any particular scenario. Further,
part of the design of alternative scenarios is intended to provide dif-
ferent views of the future so that the consequences of alternative eco-
nomic futures can be evaluated. We have attempted to answer the question,
"What will be the impact of,P.L. 92-500 if the future economy is . . .
(several alternatives)?" rather than, ",What will be the impact of P.L.
92-500 if the future economy is . . . (one unequivocably predicted alter-
native) ?".

There is' a tendency to overestimate obvious impacts since only the
more direct routes of impact are easily simulated. Many of the less
direct or secondary effects are difficult to quantify or integrate into
the model. For example, research will undoubtedly be stimulated by the
requirements of P.L. 92-500, leading to less costly and more efficient
abatement techniques and even profitable side effects, such as material
recovery and more efficient production technology. Less obvious are the
possible effects of resultant improved health and worker morale:.on.labor
productivity. The majority of these less obvious impacts had to be ignored.
The results presented here are, therefore, necessarily incomplete.

A,,first approximation of the economic importance of the water pollu-
tion abatement expenditures in the next decade may be made by means of
comparison. While $100 billion is 7 percent of GNP in 19750 it is .5 per-
cent of the $20 trillion GNP forec6st for the next ten years - or $35-40
per pei@on per year. Defense and Public Education budgetswill total
over $900 billion' each over the same period. Over the same time.period
Americans will spend $1 trillion on medical services and drugs, $1.2
triili6n buying new cars, $600 billion on petroleum products, $4'00 billion
on'advertising, $300 billion on computers, $200 billion on alcoholic
beverages, and $150 billion on tobacco products.

2. Summary
a. Met@odology

The study used the Wharton Annual and Interindustry Model of the U.S.
economy to forecast impacts of P.L. 92-500 on the U.S. economy(5). Impacts
of interest include those on major economic indicators as well as on
prices, output and investment at the sectoral level.

This section summarizes the methodology used to modify the-model
to incorporate the economic impacts of additional industrial and
municipal abatement spending due to P.L. 92-500. These modifications
are discussed briefly below.

111-147

the investment levels for each industry in the final demand calcu-
lations wOre increased in order to include the estimates of capital.
spending for abatement purposes. This was done for each year's calcula--:-
tions with the amount of adjustment in any year depending*-on assumed
levels and Phasing of costs.

For each industry the proportions of abatement investment assumed'
productive and nonproductive was specified to determine the amount of this.
investment-to be added to.regular (productive) capital stock. In most
simulation's the proportion that is productive was assumed to be zero.
As'productive' and nonproductive stock have different roles in the model's
calculations, only productive stock affects employment by industry.
Conversely, total capital stock determines the level of depreciation
costs that enters into the industry price equations.

The usek.cost.6f capital variable for each industry was increased
to reflect the estitated.spending by industry to comply with New Source
Performance Standards over the forecast period. This..captures the
effects that these requirements are expected to have on regular plant
and equipment spending. Since the marginal cost of capital is increased,
some 'investment projects that are forecast in the absence of these
standards may no longer be @ndertaken. Figure III.F.1 schematically
presents investment feedbacks.

The labor requirements by industry were adjusted to include the
labor component of abatement operating costs for each industry. This
tends to reduce productivity in abating industries since this additional
labor is.conside'red nonproductive.

The price equations were modified to capture the additional abate-
ment costs in each industry. Since the adjustments to capital stock and
labor requirements mentioned above directly feed into the price equations.
(through unit depreciation and labor costs) only additional adjustments
for*interest costs were needed for mostindustries. In those industries
where a depreciation cost term was not included in the price equation,
the adjUstment included the effect of these costs as well.

These adjustments to sector and final demand prices captureall
the indirec-L effects of prices increases in.one industry'on other
industries in the system. Thus, if the price of steel goes up because
of abatement, all final demand goods that directly or indirectly use
steel as inputs (e.g., autos),reflect the effects of these increases.
Price feedbacks are diagramed in Figure III.F.2.

Adjustments were also made to sector output levels to capture
the direct and indirect effects of materials purchased for operations
component of costs. Thus, the output of industries like electric

FIGURE'III.F.l: FEEDBACKS OF ABATEMENT INiJESTMENT

Abatement Investment
by Year

Input-Output Sector
Productive Non-Productive Conversion from final
Abatement Abatement Demands to Gross
Outputs

Productive Non-Productive Labor Sector Price Consump-
Stock Stock Requirements Equations tion

Total Capital Consumption
Stock Allowances (Depreciation)

Regular Final Demand
Investment Prices

Source: NCWQ. From CONSAD Research Corporation, "Macroeconomic Impacts of P.L, 92-500", 1976.

FIGURE III.F.2: PRICE FEEDBACKS OF ABATEMENT

Abatement Total Interest
Capital Stock Rates
Costs
Abatement Capital'Consump
Operating tion Allowances
CIosts Markups on
Percent to Unit Capital Interest Abatement
Labor Cost Cost of Costs
(Exogenous) I Abatement

Sector Price as
Real Wage Amount of Equations Abatement
Rate Labor Materials
40- (Employees) Costs
ko

Manhours Manhours Compensation Unit
to Employ- of Direct (Wage Bill) by Labor Final
ment Ratios Labor Sector Cost Demand
Exogenous Prices
Employment Current Wage
Rate
4w- by Sector

Source; NCWQ. From CONSAD Research Corporation, "Macroeconomic Impacts of P.L. 92-500",
1976.

111-150

utilities, ch 'emicals, etc., which supplied abatement operating materials
will increase. This is interme@diata output and does not in itself
automatically increase final sales (or GNP). The impacts of capital
costs are captured by the adjustment to the investment levels described
earlier. The latter feed directly into the input-output calculations.

Finally, the amount of Federal qrants-in-aid was increased to
reflect Federal finahci 'ng of additionzl@l Publicly Owned Treatment Works.
State and local spending was increased to capture the spending for both
capital and operating purpo@eg. All,spending by government is included
in GNP, but the operating c6str. for'%-'industries is treated as an inter-
mediate good and does not directly affect GNP.

With these modifications, the model simulated the interaction
of abatement expenditures with q.donomic activity. Thus, these costs
became an integral part of the dynctmic solution to the model and
affected levels of prices, output and investment, etc.

A total of thirteen scEinailos@ustre run using different assumptions
about the level and phasing of ekperiditures and other variables. Twelve
of these considered the impacts bf costs for water-pollution abatement
only. The last scenario analyzed the combined impacts of air and
water pollution abatement.

The first ten scenarios consist Of two sets in which identical
assumptions were made about the phasing and level of abatement costs
(i.e., 1=6, 2=7, 3=8, 4=9, 5=10). The economic growth forecasts used
as a baseline were different ih th6te-two sets. For Scenarios 1-5 a
11control" solution is used. A tight money "lower growth" alternative
baseline is used in Scenarios 6-10. These baselines are described in
detail below.

b. Major Results

Under the assumptions of a fulf employment (by 1985) control
baseline and adherence to compliance schedules (Scenario 1: BPT.in 1977
and BAT in 1983) the scenario @retultb indicate that abatement expenditures
do serve as a stimulus to the economy initially; however, about midway
through the forecast period the forecasted real GNP level drops below
baseline. By 1985 GNP is about 3 perc,(@nt below baseline. There is a
steady pressure on the inflation ratei. The GNP price deflator is about
9 percent above baseline in 1985 indicating an inflation rate that is
about .9 percentage points higher due to the imposition of pollution
abatement standards. The uneinployment rate follows the pattern of real
GNP. It initially dips bdlow'b&tefin6#'1 reaching about .4 percentage
points below baseline by 1978; however, it is about .9 percentage points
above baseline by 1985.

III-151
Price increases are widely felt through all sectors of the economy
including sectors that do not have significant abatement costs. Generally,
the largest price increases are found in sectors with high levels of
abatement costs with price increases of over 10 percent in the following
industries: Fabricated Metals, Chemicals, Furniture, Mining, Instruments,
and Textiles. Impacts on investment for many industries at the industry
level indicate a significant peaking of investment in 1977. Industries
where investment levels increase by more than 25 percent over baseline
level in order to meet the 1977 BPT schedule include: Fabricated Metals,
Non-electrical Machingery, Non-auto Transportation, Chemicals, Mining,
Paper, Iron and Steel, and Electrical Machinery.
Under the assumptionof a smoothing out of abatement investment
(Scenario 2) the impacts are slightly milder. The rate of inflation
and unemployment do not rise as much when abatement investment is
"smoothed" and the stimulus to GNP is sustained somewhat longer. The
primary difference is found at the industry level where the large peaks
in investment levels are dampened considerably.
If a "high municipal abatement scenario is used along with the
other asumptions of Scenario 1 (Scenario 3) the pressure on prices
is slightly greater. Real GNP and unemployment rates show industry,
the increase in the annual inflation rate is .6 precentage points compared
Scenario 2. Impacts on GNP and unemployment rates are also proportionately,
milder than in Scenarios 1 and 2 which included BAR expeniditures. The
incermental economic impact of BAT is not great. (Comparing Scenarios
2 and 4): Finally in Scenario 5, assuming a level of costs one half
those of Scenario 1, the impacts on inflation are reduced considerably.
Prices rise by .4 percent compared to .9 percent in Scenario 1.
With slower economic growth (Scenarios 6-10), impacts of abatement
expenditures are largely comparable to impacts estimated in the high
growth secnarios (Scenarios 1-5) baseline. The major difference is
found in the "high-municipal" expenditure case (Scenario 8), where
because of the depressed economy, this stimulus of public expenditures
incrases industry output and keeps prices below (and GNP above) what
they are forecast to be in the low municipal scenario (Scenario 6).
This is different than the result obtained with the full employment
baseline and suggest that abatement expenditures can serve as a useful
short run stimulus under less than full-employment conditions.
Three other scenarios were run (Scenarios 11 through 13). The first
two attempt to test the sensitivity of impacts to the assumption that a
portion of abatement investment is productive. The portions assumed
productive in these scenarios were 25 and 50 percent, respectively. The

111-152

other assumptions were the same as in Scenario 1 (compliance schedule,.
control baseline). Results indicate that the stimulative effects are
stronger and inflationary pressures weaker under these assumptions.
Finally, a scenario in which air and water pollution abatement costs
were both included suggests that the incremental impacts of water pollution
abatement costs are comparable to those seen in the scenario 'in which.
air polluiton abatement was not.included in the baseline. The combined
effect of air and water abatement tends, however, to increase the rate
of inflation. The GNP deflator in 1985 is about.13 percent higher
than the baseline compared to 9 percent in Scenario 1 (in which only
water pollution abatement costs were included). The eventual drop in
GNP growth rate is greater as well. GNP is'4.2 percent below baseline
in 1985 compared to 2.9 percent in Scenario 1.

3. Description of Scenarios

a. Data Inputs

The basic input data on costs for meeting BPT and BAT standards
used in these scenarios is given in Table III.F.1 for the Commission
industry categories. (Operating and maintenance costs are on an
annual basis.) These costs were then allocated to the industry sectors
of the Wharton Model; the latter are generally at a two-digit level of
Standard Industrial Classification (SIC). Costs derived from this
allocation are given in Table III.F.2. This table also lists costs
associated with growth in industries for the period 1976 through 1985.
These were derived.from the SEAS* cost model which estimated costs at
the Commission subcategory and industry level an d were subsequently
aggregated to the Wharton sector level.

The levels of municipal expenditure are specified in Table III.F.3.
Only Scenarios 3 and 8 use the high estimate.of municipal expenditures.
The assumed phasing and level of industrial expenditures for the thirteen
scenarios is given in Table III.F.4.' Table III.F.5 lists the complete
set of assumptions a8out other variables and Table III.F.6 gives total
industrial and municipal capital costs by year for each scenario. The
pattern of expenditures'in Table.III.F.4 refers to the percentage
allocation of costs by year, ending with the year the relevant standard
is met. (For example, the 10% - 40% - 50% pattern for BPT costs in

U.S. Environmental Protection Agency, Strategic Environmental Assess-
ment System (SEAS).

TABLE III.F-l 111-153

I N D U S T R Y

Economic Impact Expenditure Estimate
(Millions of 1975 Dollars)
BPT (1577) BAT (1983)
a Annual Annual 1975-93
Indepth Cmital O&LM_ Capital O&M NSPS
K
Fruits & Vegetables 167 is 96 10 47
Inorganic 805 178 261 10.4 351
Organic 3325 487 2990 2242 1873
.Misc. Chemicals 965 163 650, 228 380
Iron and Steel 2080 322 556 202 647
Metal Fini shing -Jo 9b 1715 328 780 168 3967
Captive b 7418 2275 7428 1365 f
Petroleum Refining 829 142 1184 429 294
Plastics & Synbthetics 209 33@ 286 29 91
Pulp and Paper 2194 ill 4137 20
Steam Elettricc 4089 989 12.75 16 900
Textiles 458 58 203 61 275
24254 5101 16146 4874 9559

Other
Ore Mining d Dressing d 610 25 0 0 146
Coal Mining In d 170.0 95'. 0 0 .0
Petroleum & Gas.Ext. 234- 18 1070. 61 --266.
d
Mineral Mining & Proc. 730 72 0 a 496
bleat Products & Rendering, 148 @0 ni 10 64
Dairy Products 188 13 73 5 0
Grain Mills 33 2 8 1 0
Cane Sugar Processing is! 17, .170 13 8
Beet Sugar 90 17 69 5 2
Canned & Preserved Seafood 41 12 @120 12 38
Misc. Food & Beverages 5 1. 5 4
Timber-Products 14 1 25 33
Furniture and Fixtures 8 3 0 0 2
Bldg. Paper & Board, 120 12. 0 0 13,
Paint and Ink@ 23 22 0 2 2
Soap and Detergent 10 1 2 0 2
Phosphate Mfg. 73. 9 14 1 46
Fertilizer Mfg.. 77 50 64 23 50
Paving and Roofing 6' 6 4 1
Rubber Processing 220 .18 .48 12. 299
Leather Tanning -77 20 47 7 13

111"154

TABLE III.F.1 continued BPT RAT
Annual Annual 1975-83
Cal2it, 1 O&L%1 Capital O&M NSPS
K
Glass Mfg. 42 5 16 3 26
Cement Mfg. 34 4 9 1 12
Concrete, Gypsum, Plaster 100 26 0 0 36
Asbestos 4 1 9 4 3
Insult. Fiber 14 6 0 0 3
Ferroalloy Mfg. b,e 48 16 13 3 11
Nonferrous Metals f 40 21 31 7 39
Machinery & Mechanical Prod. 3900 390 3900 390 8295
Transportation Industry 1200 130 140 39 137
Water Supply 1200 160 100 3 28
Auto & Other Laundries 25 4 21 1 8
Foundries 180 0 0 0
Fish Hatcheries 50 10 47 31
Structural Clay 5 1 0 0 2
Pottery 3 1 4 3 1
Steam Supply 0 0 0 0
Nonferrous Mills 260 .25 0 0 33
Feedlots
Beef .100 8 30 0 225 9
Hog 178 9 59 0
Dairy 152 10 46 0

All Other Industries 12095 1287- 6325 647 10344
In-depth Industries ..2-4254 _U_U 16146 A83 4 -9559.
Total 36349 6388 22471 5521 19903,

a. Cost estimates for all Indepth industries (except Iron and.Steel)
and 7 of the Other Industries (Meat Products and Rendering, Dairy
Products, Grain Mills, Leather Tanning, Nonferrous Metals, Fertilizer, and
Feedlots) represent costs only for those plants which are projected
to remain open.

b. Municipal user charges included.

c. These BPT and BAT -cost estimates were used as an input to -Ehe
macroeconomic analysis. This total BPT and BAT cost estimate is
consistent with the Steam Electric Power cost estimate presented
in Table 11-30. The allocation of this total between BPT and BATf
however, is different in this presentation because it is based on
an earlier contractor estimate. @he NSPS cost estimates presented
here are based on a growth rate for electricity demand which is
higher than was estimated in the Steam Electric Power industry study.

d. These cost estimates were based upon a preliminary contractor report.
The Commission believes the cost estimates presented in Table 11-30
are more accurate; the cost estimates presented here are included
because they were used in the impact analysis.

TABLE III.F.1 continued

e. These-cost estimates were based upon a preliminary contractor
report. The differences in these estimates and those presented
in Table 11-30 are principally due to two factors: (1) the
estimates in Table 11-30 include $83 million for two bauxite
refineries on the Mississippi River to meet RAT requirements,
not included in the cost estimates above, and (2) the Nonferrous
Metals estimates in Table 11-30 do not attempt to take account
of treatment facilities in place as of January 1973 for primary
aluminum smelting and refining, a subsector of Nonferrous Metals.

f. Metal Fin ishing BPT and BAT costs are excluded from Machinery and
Mechanical Products BPT and BAT costs but Metal Finishing Captive
NSPS costs are included in Machinery and Mechanical Products
NSPS costs.

9. Includes All Feedlots.

Source: National Commission on Water Quality

TABLE JTj,,Ft2-, Abatement Expenditure Estimates by Wharton Model.Sector
(Millions of 1975 dollars)

BPT BAT New Source (1975-85)*
Annual Annual Annual
Capital O&M Capital O&M Capital O&M
Agriculture 480 37 182 31 438 30
Mining 3274 210 1070 61 1069 66
Iron-and Steel 2308 364 569 205 1231 231
Nonferrous Metals 300 46 31 7 94 16
Electrical Machinery 1753 411 1749 273 1232 230
Nonelectrical Machinery 2989 700 3023 461 2106 393
Motdr Vehicles 1880 441 1874 291 425 79
Non-auto Transportation 2227 523 2224 343 1808 337
Stone,.Clay, Glass 208 50 42 12 107 23
Fabricated Metals 33@5 718 2392 426 5948 1161
Lumber 14 1 25 8 8
Furniture 8 3 0 0 3 1
Instruments 634 149 632 97 792 @148
Misc. Manufacturing 215 51 214 32 99 18
Food 825 97 722 57 268 27 Ln
Textiles 458 58 203 61 324 46"
Paper 2314 123 437 20 1128 57
Chemicals 5487 943 4267 2629 3344 1229
Pttroleum Refining 829 142 1184 429 358 127
Rubber 220 18 48 12 91 10
Leath er 77 20 47 7- 1 . 1
Transportation 1200- 130 140 39 312 34
Utilitier@ 5289 1149 1375 19 2149 373
Commercial 25 4 21 1 8 2

Total 36349 6388 22471 5521 23343 4640

Totals differ from Table III.F.1 due to the use of the.period 1975-1985 rather than
1975-1983.

Source: NCWQ. From CONSAD Research Gorpoo-rationt "Madroeconomic Impacts of-
P.L. 92-500", 1976.

111-157

TABLE III.F.3: INPUT DATA FOR "INCREMENTAL" MUNICIPAL
EXPENDITURE ESTIMATES (Millions of 1975 dollars)*

'Low' Municipal Case 'High' Municipal Case
Capital O&M Capital O&M

1975. 502 17 606 7

1976 1388 60 4808 56

1977 2310 142 7028 127

1978 2682 234 8360 211

1979 2610 324 10056 312

1980 2538 412 11 632 429

1981 2490 498 13206 563

1982 2442 581 14902 714

1983 2370 663 16600 881

1984 2298 742 17084 1053

1985 2252 826 16720 1222

Total 23942 4499 121002-. 5575

See Section III.E. (Scenarios El and E2). Slight differences from
totals:in Section III.E are due to the use of a different
calculation method.

TABLE.III.F.4: ASSUMPTIONS ABOUT LEVEL ANDPHASING OF INDUSTRTAL @[email protected]

YearStandard Le'velof PattIb rn
Scenario Met (If Any) Cost (Percentage -Allocation by Year)
I BPT 1977 Table III.F.2. 10-40-50'
BAT 1983 Table 10-12-15-18-21-24
2 BPT <1983* Table 5. 6-7. Z-8. 9-10 6-1@1. 8-12. 7-13. 5-14. 4-15. 3
BAT 1983 Table tfor -combined co'sts
3 BPT 1977 Tab'le 10-40-50.
BAT 1983 Table 10-12-15-18-21-24
4 BPT 1980 Table 10- 12. 6-15. 7-18. 7-20. 7-22. 3
BAT Not Met Table
5 BPT 1977 5 Level of 10-40-50
BAT 1983 -Table 10-12-15-18-21-24
6 BPT 1977 Table 10-40-50 Ln
BAT 1983 Table 10-12-15-18-21-24 Co
7 BPT -Cl 983* Table 5. 6:-7. 2-8. 9-10. 6-11. 8-12. 7-13. 5-14. 4-15. 3
BAT 1983 Table. Ifor combined costs
-8 BPT 1977' Table 10-40-50
BAT 1983 Table 10-12-15-18-21-24
9 BPT 1980 Table 10-12.6-15.7-18.7-20.7-22.3
BAT Not Met Table
10 BPT 1977 5 Lev-el of 10-40-50
BAT 1983 Table 11 -
10'12-15 18-21-24
11 BPT, 1977 Table of 10-40-50
BA T' 1983 Table 10-12-15-18-21-24
12 BPT 1977 Table 10-40-50
BAT 1983 Table 0 - 12 8- 21 - 24
13 BPT 1977 Table- 10-40-50
BAT 1983 Table 10-12-15-18-21-24

See text for explahation.
Source: MCWQ. From CONSAD Research Corp.Qration, "Macroeconomic Impacts of P.L. 92-50011 1976.

TABLE III.F.5: ADDITIONAL ASSUMPTIONS ABOUT ABATEMENT COST AND OTHER VARIABLES

Economic Growth Muni cipal Air Pollution Productivity of
scenario Baseline Costs costs Abatement Investment

1 Controlk 'Low' Case (Exhibit 3.3)' Not Included iero
2 LOW to It
3 High go it
4 LOW to
5 it LOW to
6- Low-Growth Low
7 Low
8 High
LOW
10- Low
11 Control Low 50% Productive
12 of Low 25% Productive
13 LOW Included Zero

*Full. employment by 1980.

Source: National Commission on Water Quality

TABLE III-P.6: PHASING OF CAPITAL COSTS (INDUSTRY AND MUNICIPAL)
1975-1985
(In millions of 1975 dollars)

Scenario 75 76 77 78. 79 80 81 82 83 84 85 75-80
Total
1,6,11 Industrial 3030 14452 17478 4640 5102 5792 6484 7176 7868 2334 2334 76690
Municipal 502 1388 2370 2682 2610 2538 2490 2442 2370 2298 2252 23942
Total. 3532 15840 19848 7322 7712 8330 8974 5618 -10238 4632 4586 100632

2,7,12 Industrial 2988 6192 7082 7990 8628 9110 9536 10018 10478 2334 2334 76690
Municipal 502 1388 2370 2682 2610 2538 2490 2442 2370 2298 2252 23942
Total 3490 7580 9452 10672 11238 11648 12026 12460 12848 4632 4586 100632

3,8 Industrial 3030 14452 17478 4640 5102 5792 6484 7176 7868 2334 2334 76690
Municipal 606 4808, 7028 8360 10056 11632 13206 14902 16600 17084 16720 121002
Total 3636 19260 24506 13000 15158 17424 19690 22078 24468 19418 19054 197692

4,9 Industrial 3000 6180 7090 7998 8604 9090 2334 2334 2334 2334 2334 53632
Municipal 502 1388 2370 2682 2610 2538 2490 2442 2370 2298 2252 23942
Total 3502 7568 9460 10680 11214 11628 4824 4776 4704 4632 4586 77574

0
5,10 Industrial 1515 7226 8739 2320 2551 2896 3242 3588 3934 1167 1167 38345
Municipal 502 1388 2370 2682 2610 2538 2490 2442 2370 2298 2252 23942
Total 2017 8614 11109 5002 5161 5434 5732, 6030 6304 3465 3419 62287

13 Industrial 6800 18894 24228 11920 8586 7740 8136 8190 8566 2836 2962 108860
Municipal 502 1388 2370 2682 2610 2538 2490 2442 2370 2298 2252 23942
Total 7302 20282 26598 14602 11198 10278 10626 10632 10936 5134 5214 132802

Note: Totals for industry have been adjusted for BPT expenditures in 1972-74.

Source: NCWQ. From CONSAD Research Corporation, "Macroecnomic Impacts of-P.L. 92-500", 1976,.

111-161

Scenario 1 indicates that 10 percent of BPT costs are incurred in 1975,
40 percent in 1976 and 50 percent in 1977.)* A brief description of
each scenario is given below.

b. Scenario 1

The "control" baseline is used. Table III.F.4 indicates BPT
standards are met by 1977 and BAT by 1983 The level of costs is that
given in Table III.F.2. The pattern.'for BPT costs is a 10-40-50
allocation and that for BAT 10-12-15-18-21-24, indicating a peaking
of investment in 1977 for BPT and 1983 for BAT. Municipal costs use
the "low" case figures in Table-III.F.3. None of,the abatement investment
is considered productive.

c. Scenario 2

The pattern of Menditure for every industry is "smoothed" by
combining the total of BPT and BAT costs for each industry and assuming
a fixed pattern of investment starting in 1975 and ending in 1983. The
pattern is given by the following percentages: 5.6 - 7.2 - 8.9 - 10.6 -
11.8 - 12.7 - 13.5 - 14.4 - 15.3, for the nine years. Thus, Each indus-
try will have undertaken expenditures to meet BPT at some point prior to
.1983 (unless it had zero BAT costs, in which case 'it will meet BPT in
1983; this is true for only the furniture industry). However, this
point will differ from industry to industry depending on the relative
magnitude of BPT and BAT costs.

The low municipal case is assumed here as well and the other
assumptions are the same as in Scenario 1 (control baseline, zero
productivity of abatement investment).

d. Scenario 3

Same as S6enario 1, except municipal pattern assumes the "high"
case of Table III.F.3.

e. Scenario 4

BAT standards are assumed not to be met in the forecast period
and, in fact, no BAT costs are incurred at all. The level of BPT costs

Operating costs are always assumed to rise in proportion to the
fraction of capital stock in place. Thus, with a 10-40-50 pattern
for capital expenditure, O&M costs in the three years would be
10-50-10b percent of estimated annual BPT operating costs.

111-162

are the same as in the previous scenarios but yearly expenditures are
assumed to be in the following percentages: 10 - 12.6 - 15.7 - 18.7
20.7 - 22.3. BPT standards are assumed met in 1980, and the low muni-
cipal case is assumed. The control baseline is used and it is assumed
that none of the abatement investment is productive. A comparison of
this scenario with Scenario 2 gives an estimate of the economic impact
of BAT requirements.

f. Scenario 5

The industrial costs used here are one-half that of the previous
four scenarios, for all components (BPT, BAT and New Source) with,phasing
being identical to Scenario 1. The "low" level of municipal costs,
the "control" baseline and zero productivity of abatement is used.

g. Scenarios 6 through 10

0e,
These scenarios use the same assumption as Scenarios 1 through 5
respectively, except that the "low rowth" baseline is used instead of
the "control" baseline.

@h. Scenarios 11 and 12

These two scenarios analyze the sensitivity of impacts to the assump-
tion (discussed in the previous section on methodology) that some-of the
abatement investment may be productive. The former assumes that 25 percent
of the investment is productive and the latter that 50 percent of abate-
ment capital is productive. The other assumptions are the same as in
Scenario 1 (control baseline, compliance schedule, "low" municipal costs).

i. Scenario 13

This last scenario analyzes the combined impacts of air and water
pollution abatement costis. The level of air pollution abatement costs
by industry is given in Table III.F.7 and are estimated from recently___._-
available studies. Assumptions about costs for water are taken from
Scenario 1. For air costs the same pattern was used for all industries
with a peaking of costs in 1978 implying delayed compliance with air
standards.

4. Analysis of Scenario Results

a. Introduct ion

This section summarizes the major results from the scenario runs.
The focus is on theimpacts on the.overall economy, but the analysis
describes industry impacts as well. This includes analysis of price,

111-163

TABLE III. F.7: ESTIMATED COSTS FOR AIR POLLUTION ABATEMENT
1975-1985 (Millions of 1975 dollars)

Operation &
Industrial Capital Maintenance

Agriculture $ 112 9.
Mining 246 43
Iron and Steel. 3,856 421
Nonferrous 2,764 521
E lec tric al Mac hine ry 52 65
Motor Vehicles 282 130
Stone, Clay & Glass 2,045 441
Furniture 108 134
Food 1,443 121
Textiles 126 9
Paper 2,866 627
Chemicals 1,941 235
Petroleum 1,310 124
Printing and Publishing .29 7
Utilities 9,567 1, 449
Commercial 4,873 932

31,620 5,268
Municipal 549 410

$32,169 $ 5,678

Source: NCWQ.- From U.S. Environmental Protection Agency,
Strategic Environmental Assessment System, 1975.
(Unofficial Preliminary Estimates)

111-164

output and investment impacts at the Wharton sector level. Because of
the large volume of computer output involved; the comparison tables do
not include details for all the variables. These are available in
the full report of the Commission. Occasional references are made to
results which are not documented in the summary tables presented here
but are taken from these detailed computer outputs for each scenario.

b. Scenarios 1 through 5

(1) Description of (Control) Baseline

This solution is targeted at full employment in the early 1980's.
It carries the assumptions of the Wharton Quarterly Model March forecast
in the near term (1975-1976).*

The solution forecasts a slow recovery with unemployment still
high at 8.4 percent in 1977 (see Table III.F.8). The recovery is
assisted by an accommodating monetary policy and the consequent boom
in the housing market as private housing starts reach a peak of 2.3
million in 1978.

Real GNP grows at an average of 4.1 percent through 1985 and at
5 percent for the period 1975-1980, with the highest rates of growth
in 1977 and 1978 at 7.7 percent and 6.3 percent, respectively.

The rate of inflation as measured by the GNP price deflator averages
5.4 percent (1975-1985) with a peak of 6.7 percent in 1980, while the
consumer price index rises an average of 5.3 percent per year through
1985.

Personal disposable.income in current dollars increases at 8.7
percent per year through 1985, while personal consumption expenditure
rises an average of 8.8 percent per year through 1985.

Money supply grows at an average of 8.2 percent per year,'thro.ugh
1985, with a peak growth of 14.1 percent in 1979.

Corporate profits show a strong initial recovery with growth of
27.2 percent and 20.5 percent in 1976 and 1977, respectively.

Since this baseline assumes continued dependence on foreign oil,
the trade balance deteriorates as the economy recovers, reaching
deficits of $36 billion by 1985.

A listing and discussion of the major assumptions is given in
CONSAD's report to the National Commission on Water Quality.

TABLE III.F.8: Control Baseline Summary Tables

ITEM 1975 1976 1977 1978 1979 1480 1981 1982 1983 1984 1985

GNP (Current $) 1464.27 1616.94 1824.81 2032.07 2246.91 2459-82 2698-05 2934.-31 3182.47 3413.83 3692.70

% Change 4.83 10.43 12.86 11.36 .10.57 9.48 9.68 8.76 8.46 7.27 8.17

GNP (58$) 788.00 -824.71 888.27 943.97 981.22 1006.45 1045-11 1077.50 1106.72 1130.36 1174.81

Change -4.07 4.66 7.71 6.27 3.95 2.57 .3.84 3.10 2.71 --2.14 3.93

Consumption Expenditure (58$) 526.49 540.11 580.22 616.55 644.07 658.53 675.38 688.72 700.80 712.17 734.55

Fixed Investment ($58) 104.23 112.76 127.31 -141.18 146.63 154.19 170.42 183.13 192.89 199;16 213-83

Residential Invest. ($58) 20-21 26.70 28.46 33.67 30.74 27.95 28.47 26.77 23.05 24.44 26-06

Non-residential Invest. ($58) 84.02 86.06 98.85 107.51 115.89 '126.24 141-95 [email protected] 169.84 174.72 187.77

Governmental Purchase ($58) 149.20 154..30 160.10 166.0 0 171 .90 177.80 [email protected] 189;60 195.50 201.40 207.30

GNP Deflator 185.82 196-06 205.43 '215.27 228.99 244.40 258-16 272 .33 287-56 302.01 314.32

% Change 9.27 5.51 4.78 4.79 6.73 5.63 5. 4 9", 5.59 .5-03 4.08

Consumer Price Deflator 177.01 187.72 196.6.6 205-45 216.90 230.53 243.38 256.60 270.75 283-99 295.50

% Change 8.83 6.05 4.*76 4.47 5.57 6.29 5.57 5.44 5.51 4.89 4.0.5

.Money Supply 770.79 826.28 888.93 996.17 1136.31 1263.07 1356.21 1444.62 1523.07 .1605.92 1692.81

% Change. 10.26 7.20 7.58 12.06 14.07 11-15 7.37 6.52 5.43 5.44 5.41

Bond Rate 9.17 8.83 8.38 7.62 7.07 6.96 7.06 7.34 7.66 7.82 7.75

Short Rate 6.16 6.85 6.50 6.07 6.05 6.45 6.98 7.18 7.33 7.11 6.87

Corporate Profit (Current $) 122.26 155.47 187.33 201.93 225.26 244.96 263.28 277.09 293.10 308.14 339.12

Unemployment Rate 8.80 8.52 8.37 6.87 5.33 4.55 3.98 3.83 4.03 5.13 5.47

Government Surplus (Current $) -79.33 -87.28 -71.04 -53.22 -37.53 -23.88 - 6.61 11.57 15-95 8.13 -3.22

Source: NCWQ. From CONSAD Research Corporation, "Macroeconomic Impacts of P.L. 92-500", 1976.

111-166

(2) Analysis of Scenario 1 (Compliance, High Growth)

Scenario 1 assumes compliance dates are Met; BPT by 1977 and BAT
by 1983. Investment expenditures are spread over the three years 75-77
for BPT and the six years 78-83 for BAT.

Impacts on Major Economic Indicators

Real GNP rises initially under the stimulus of increased spending
on pollution control, reaching a peak of 0.9 percent above base case
projection by 1977. However, the stimulus gradually subsides and by 1980,
real GNP falls below base, sagging to 2.9 percent below the base proj:ec-
tion by 1985. The general price level represented by the GNP deflator
rises steadily throughout the.term reaching 9 percent over base in 1985.
On average it rises at 6.3 percent a year as compared to 5.4 percent in
the base case projection. in other words, inflation, as measured by
this indicator, is 0.9 percent higher with the addition of pollution
abatement standards.

The unemployment rate, following the pattern of the overall economyr
declining initially with a maximum decrement of 0.4 percentage points in
1978, but eventually rises above the base projection by 198"3, reaching
0.9 percentage points above base in 1985.

Residential construction (in constant dollars) declines throughout
the forecast period,'reaching 7.3 percent below base in 1985.

The trade balance shows a strong improvement, after an initial
increase in the deficit with a trade surplus in 1984 as opposed to
the base forecast of A deficit of $22 billion. Table III.F.9 presents
a summary comparison of Scenario 1 with the "control" baseline.

Macroeconomic Impacts: Price Effects

Sector price equations were adjusted to capture pollution abatement
costs. It is assumed that pollution abatement costs are passed on like
other expenditures, entering the sector price equations through the unit
labor cost and unit depreciation terms. Interest costs are also included.

Pressure on prices,remains steady throughout the decade. One source
of continuous pressure is the capital consumption allowance which rises
steadily throughout this period due to the addition of-abatement
equipment to capital stock. Also, unit labor costs kise due to the
addition of abatement labor. The drop in output due to price increases
,adds further pressure until employment adjusts. Final prices of durable
goods rise slightly more than hon-durable goods prices, since demand
for these slackens more than for non-durables. Prices for services

TABLE.III.F.9:- Comparison of Scenario 1 and Control Baseline

ITEM 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985

GNP -(58@,):
Scenario 1 790-14 831.83 896.58 945.92 982-04* 1005-44 1041.35 1069.12 1093.54 1107.78 1140.97

Control 788-00 824.71 888.27 943.97 981.22 1006.45 1045.11 1077.49 1106.72 1130.36 1174..82-

% Difference, .27 .86 .94 .21 .08 -.10 -.36 -.78 -1.19 -2.00 -2.88

Consumption Expen. (58$)
Scenario 1 526-93 @540.32 580.17 616.00 642.55 655-39 669.96 679-.67 688- 00 694.56 709.55

Control 526.49 540.11 580.22 616.55 644.08 658.53 E575.38 688.72 700.80 712.12 734.55'

% Difference .08 .04 -.01 -.09 -.24 -.48 -.80 -1.31 -1.83 -2.47 -3.40

Fixed Investment (58$)
Scenario 1 105-86 119.96 135.73 142.84 143.18 155.51 171.19 182-72 191.04 191.76 201.84

Control 104-23 112.76 127.31 141.18 146.63 154.19 170.42 183.13 192.89 199.16 213.83

% Difference 1.56 6.39 6.61 1.18 1.05 .86 .45- -.22 -.96 -3.72 -5.61

Residential Invest.-(58$)
Scenario 1 20-20 26.62 28.23 33.37 30.48 27.65- 28-06 26-14 22.19 23.14 24.15

Control 20-21 26.70 28.46 33.67 30.74 27.95 28.47 26.77 23.05 24.44 26.06
% Difference -.05 -.28 -.81 -.87 -.84 -1-06 -1.46 -2-34 -3.72 -5.34 -7.34

Non-residential Invest.(58$)
Scenario 1 85-65 93.64 107.50 109.47 117.69 127.86 143.13 156.58 168-85 168.62 177.69

Control 84.02 86.06 98.85 107.51 113.'89 126.24 141.95 156.36 169.84 174.72 187.77
% Difference 1.94 8.46 8.75 1.82 1.56 1.28 .-83 .14 -.59 -3.49 -5.37

Government Purchase (58$)
Scenario 1 149-46 155.02 161.36 167.46 173-37 179.28 185.19 191.11 197.02 202.92 208.84

Control 149-20 154.30 160.10 166.00 171.90 177.80 183.70 189.60 195.50 201.40 207.30

TA13LE III-F-9 continued page 2

ITEM 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985

% Difference 0.17 0.47 0.78 0.88 0.85 0.83 0.81 0.80 0.78 0.76 0.74

GNP Deflator (1958 = 100.0)- 342.62
Scenario 1 185.87 196.76 207.12 217.97 233.19 250.76 267.30 284.85 304.03 323.42

Control 185.82 196.06 205.43 215.27 228.99 244.40 258.16 272.33 287-56 302.01 314.32

% Difference .03 .36 .82 1.25 1.83 2.60 3.54 4.60 5.73 7.09 9.00

Consumer Price Deflator 265.60 284.13 301.77 319-35
Scenario 1 177.0-3 188-23 197.86 207.41 220.07 235.46 250.56

Control 177.01 187.72 196.66 205.45 216.90 230.53 243.38. 256.60 270.75 283.99 295.50

% Difference .01 .27 .61 .95 1.46 2.14 2.95 3.90 4.94 6.26 8.07

Money Supply
Scenario 1 771.07 829-04 895.30 1004.83 1145.08 1273.06 1367.99 1458.08 1537.03 1622.14 1713.19

01)
Control 770.79 626.28 888.93 996.17 1136.31 1263.07 1356.21 1444.62 1523.07 1605.92 1692.81

Difference .04 .33 .72 .87 .77 .79 .87 .93 .92 1.01 1.24

Bond Rate 8.84 8.41 7.68 7.15 7.04 7.15 7.43 7.76 7.93 7.87
Scenario 1 9.17

Control 9.17 8.83 8.38 7.62 7.07 6.96 7.06 7.34 7.66 7.82 7.75

Short Rate 6.52 7.05 7.26 7.41 7.21 6.98
Scenario 1 6.17 6.88 6.57 6.14 6.11

Control 6.16 6.85 6.50 6.07 6.05 6.45 6.98 7.18 7.33 7.11 6.87

Corporate Profit (Current $) 313.14 325.96 366.49
Scenario 1 124-12 167.25 203.21 208.41 233.09 254.52 275-18 292.49

Control 122.26 155.46 187.33 201.93 225.26 244.96 263.28 277.09 293.10 308.14 339-12

Difference 1.52 7.58 8.48 3.21 3.48 3.90 4.52 5.56 6.84 5.78 8.07

TABLE III.F.9 Continued page 3

ITEM 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985

Unemployment Rate
Scenario 1 8.70 8.31 8.03 6.48 4.94 4.21 3.76 3.80 4.22 5.62 6.35

Control 8.80 8.52 8.37 6.87 5.33 4.55 3.98 3.83 4.03 5.13 5.47

Net Exports (Current $)
Scenario 1 3.7 -5.7 -8.1 -11.1 -7.1 -1.2 -3.6 - .4 8.0 16.2 19.1

Control 4.3 -3.9 -6.8 -13.1 -11.3 -8.8 -15.8 -19.3 -18.9 -22.4 -36.3

Government SurPlus (Current $)
Scenario 1 -78-62 -83.63 -65.77 -49.69 -31.27 -13.96 7.91 30.59 39.43 33.89 28.94-

Control -79.33 -87.28 -71.04 -53.22 -37.53 -23.88 -6.61 11-56 15.95 8.12 -3.22

Housing Starts 0"
Scenario 1 1183.60 1791.13 1815-87 2253.07 1982.35 1745.76 1800.33 1635.26 1219.96 1340.26 1401.54 w

Control 1184.06 1795.05 1829.87 2268.11 1993.61 1760.25 1822.37 1674.38 1339-92 1434.76 1541-52

% Difference -.04 -.22 -.76 -.66 -.56 -.82 -1.21 -2.34 -4.47 -6.59 -9.08

Source: NCWQ, From CONSAD Research Corporation, "Macroeconomic Impacts of P.L. 92-50011, 1976.

111-170

are the least Affected because they carry negligible pollution cost.

Macroeconomic Impacts: GNP and EMloyment

The scenario results suggest that abatement expenditures initially
serve as a stimulus to the economy. Real GNP stays above base through
the 70's; thereafter, it gradually drops below the projected level.
This weakening of the economy is due partly to fiscal drag from increasing
tax burdens resulting from increased inflation, wherein the effective
tax rate increases due to progressive tax schedules and government
receipts increase dramatically. Instead of the projected $3 billion
Federal deficit in 1985, the abatement scenario registers a $29 billion
surplus. Similarly, state and local governmentstshow a $15 billion
increase in surpluses. These surpluses thus becomethe prime cause of
the declining GNP in the 1980's, both of which would likely be countered
by tax adjustments. All other macroeconomic impact dimensions.are
conditioned Similarly by these surpluses.

Unemployment follows the pattern of the overall economy. It stays
below base through the initial period, rising above base only in 1983.
Employment is relatively strong partly because bf the additions of
labor for abatement purposes, which reach a level of 1/2 million workers
by 1985.

Macroeconomic Impacts: Effects on Investment

Nonresidential investment registers a sharp increase in the initial
years, approaching 8.8 percent over base in 1977 as a result of the large
concentration of BPT abatement investment. However, it starts declining
thereafter and by 1983 falls below base.

Pollution abatement investment substitutespartially for "productive"
,investment, which falls below base initially from the higher user cost
and prices, and later from decreased economic activity. Productive
investment falls steadily through the forecast period, reaching 4 percent
under base by 1985. By 1985, productive capital stock is approximately
2 percent lower than it would have been without the pollution abatement
activity.

The housing market is only marginally affected in the early years;
toward the end of the forecast the drop becomes more pronounced due
to the weakness of the overall economy.*

This analysis does not account for the potential stimulus provided
by the increased availability of muni@ipal sewage services as a result
of the full implementation of P.L. 92-500.

111-171

Macroeconomic Impacts-a Effects on Trade Balance

The export equation is not sensitive to changes in the economy,
and is, therefore, barely affected. Imports, however, rise initially
due to the increase in domestic prices, but fall below base later as
the economy sags. This leads to a remarkable improvement in the current
dollar trade balance. In 1984 a trade surplus of $16 billion is forecast
as opposed to the projected $22 billion deficit in the control solution.

Macroeconomic Impacts: Other Effects

Personal consumption expenditures rise marginally in the early
yearsf then fall below base by 1977, dropping to 3.4 percent below
base by 1985. Demand for durable goods drops first, followed by the
demand for non-durables and then services.

Corporate pr6fits rise strongly at the beginning, registering an
8 percent increase in 1977, but levels off later to an average 4 percent
over base, which does not keep pace with the-increased inflation. Cash
flows, however, stay strong as capital consumption allowances rise
steadily to 8 percent over base by 1985.

Short term interest rates are only slightly affected, rising .1 of
a percentage point above the projected level. Bond,rates follow the
pattern of the short-term rates with a slight-time lag.

Sectoral Impacts Scenario 1

Table III.F.10 presents price and output impacts at the Wharton
sector level for this scenario. Several patterns appear in these results.
While BPT costs are higher than the BAT cost for most industries, the
major impact on prices is in,the latter part of the forecast. Until
1977, the price increases are minor. The economy is relatively slack
in the earlier years; thus, the effects of the stimulus on wage rates
and-labor costs does not occur until later years. An additional factor
causing pressure on prices in later years is th at regular (i.e., non-
abatement) employment.adjusts with a lag to the slackening of output
that is observed; conversely, abatement labor requirements are rising
steadily through the period, resulting in higher unit labor costs which
in turn contribute to the price increases observed. Price increases
of over 10 percent (above baseline) are predicted in the following
.industries: fabricated metals (11.6W), chemicals (11.3%), furniture
(10.6%), mining (10.2%), instruments (10.2%), textiles (10.1%). These
industries, except for furniture, have major share of abatement costs.

Some.of the industries which areexperiencing price increases do
not have any direct abatement costs. This is due in large part to the

111-172

TA13LE III.F.10: Price and Output Impacts: Scenario 1
(Percentage Changes From Baseline)*

Price Changes Output Changes,
Sectors 1977 1985 1977 1985 r7l

All Industries .8 9.0 .9 -2.9
Agriculture .8 5.8 - 3.5
Mining 1.7 10.2 -.8 -3.5
Manufacturing 1.3 9.1 - -2.9
Durable Goods 1.3 9.1 - -3.2
Primary Metals l.Z 9.6 -.7 -4.4
Electrical Machinery 1.5 7.4 - -1.4
Non-Electrical Machinery .1.4 9.6 - -3.0
Motor Vehicles .8 8.5 - -2. 1
Non-Auto Transportation 1.6 9.4 - -1.4
Stone .9 8.3 - -3.1
Fabricated Metals 2.2. 11.6 -.8 -7.4
Lumber .7 8.5 - _Z.5
Furniture .6 10.6 - -1Z.6
Instruments 1.6 10.Z - -2.8
Non-Durables 1. 3 9.2 - -Z. 4
Food .8 10.1 - -5.5
textiles .9 8.7 - -1. 1
Paper 1.4 8.6 - -
Chemicals 2.9 11.3 - -2.2
Petroleum 1. 4 9.Z -.6 -Z. 8
Rubber 1. 1 6.9 - -.6
Tobacco .5 6.8 - Z.4
Apparel .6 8.9 - -8.1
Leather .8 8.5 - -Z.4
Printing and Publishing .5 7.8 - -1.7
Transportation .7 8.6 - -1.3
Communication - 5.7 - 1.7
Utilities 2. 1 8.4 - -8.6
Commercial and Other .5 9.5 - -3.9
Government - - .8 1.5

01
*Note: < 50/0

Source: NCWQ. From CONSAD Research Corporation,
"Macroeconomic impacts of P.L. 92-500", 1976.

111-173

fact that wage rates i:n these industries follow those in leading sectors
and keep labor costs at a high level. In addition, the higher prices
in durable goods lead to higher depreciation costs which influences
prices in all industries.

Price increases are widely spread across the economy. Sectors'with
the largest abatement costs, such as chemicals and fabricated metals,
have the largest price increases. However, some sectors with only
moderate levels of abatement costs (for example the food sector) shows
above average increasest indicating significant indirect effects.

The impacts on industrial outputs-are relatively minor in the
early years. In later years, outputs of durable goods industries are
more significantly affected than those of nondurable goods, reflecting.
the relatively larger decline in personal consumption expenditures in
the former category as well as the effects of a decline in fixed (pro-
ductive) investment on the output of heavy industries. Changes in the
pattern of industry investment are shown in Table III.F.11. These
investment figures include both abatement as well as regular investment
expenditures. The largest changes are seen in 1977, reflecting the
peak year, in which 50 percent of BPT capital expenditures are assumed
to take place. It is interesting to note that while total nonresidential
fixed investment in that year increases by 8..8 percent, changes in
individual industries range-froma small decline in the printing industry
(which has no abatement costs) to an increase of over 100 percent in the
fabricated metals industry. Other industries which show increases of
more than 25 percent are: nonelectrical machinery (89%), non-auto trans-
portation (96%), chemicals (47%), mining (47%), paper (39%), iron and
steel (360, electrical machinery (26%). Some evidence of the relative
importance of abatement investment can also be seen from Table III.F.12
which shows abatement capital stock as a fraction of capital stock
at the end of the period. In most industries unproductive stock at
the end of the period is being forecast as being less than five percent
of the total stock.

Some decline in levels of productive investment are to be expected.
User cost of capital is increasing partly due to required investment
in new sources, as well as the price increases in capital goods indus-
tries. Table III.F.13 gives the pattern of productive invest@ment for
Scenario 1. While some industries with high new source costs, such as
fabricated metals, reduce productive investment significantly, the
the changes appear to be weakly related to new source costs for most
industries. For example, productive investment in chemicals and paper,
with significant new source costs, is affected only mildly. However, the
apparel industry reduces investment significantly despite no abatement
costs. The pattern of productive investment in many'industries thus
appears to be more directly'linked to changes in demand for their goods

111-174

TABLE III.F.11: SCENARIO 1: IMPACTS ON TOTAL INVESTMENT
BY INDUSTRY (Percentage Change from Baseline)*

1977 1985

All Industries 8.8 -5.4
Farm 4.3 2.3
Minihg 46.9 -3.8
Durables

Iron and Steel 36.o -5.9
Nonferrous Metals 5.0 -2.8
Electrical Machinery 26.0 -3.4
Non-electrical Machinery 88.8 -7.7
Motor Vehicles 22.8 -2.0
Non-auto Transportation 96.o -5.1
Stone, Clay Glass 3.1 -2.5
Fabricated Metals 102.1 3.2
Lumber
Furniture - -13.0
Instruments 22.5
Miscellaneous 6. z

Non-Durables

Food and Beverages 7.3
Textiles 20.4 .7
Paper 39.4 ..8
Chemicals 46.5 .5
Petroleum 3.6 -2.8
Rubber 7.5 -2.8
Tobacco -4.9
Apparel 1.0 -19.6
Leather 10.2 -3.-6
Printing -1.1 -1.1
Transportation 2.0 -4.3
Utilitie s 8. Z -8.3.
Communication - 1.8
Commercial and other 1.1 -9.9

*Note 51a

Source: NCWQ. From CONSAD Research Corporation,
"Macroeconomic Impacts of P.L. 92-500", 1976.

111-175

TABLE III.F. 12: SCENARIO 1: ABATEMENT CAPITAL STOCK AS
A FRACTION OF TOTAL STOCK (1985)*

1985
(Percentage)
Agriculture 8. 8
Mining
Durable
Iron and-Steel 4.3
Non-ferrous Metals 1.0
Electrical Machinery'. 5.8
Non-electrical Machinery 6. 9
Motor Vehicles 6.1
N
-Auto Transportation 2.1
on
Stone Clay glass 6
Fabricated Metal Products 17.6
Lumber
Furniture
Instruments 6.5
MiscellAneous 1.1
Non-Durables
Food and Beverages 1.2
Textile s 4.4
Paper 5. 6
Che M'icals 9. 3
Petroleum .9
Rubber - 9
Tobacco -
Apparel -
Leather .6
Printing and Publishing -
Transportation -
Utilities 1.0
Communication -
Commercial and other

*Note < .57o

Source: NCWQ. From CONSAD Research Corporation,
"Macroeconomic Impacts of P.L. 92-500", 1976.

111-176

TABLE III.F.13: SCENARIO 1: IMPACTS ON PRODUCTIVE INVESTMENT
(Percentage Change from Baseline)*

1977 1985

Non-residential Fixed Investment -6.o

Farm 2.1
Mining -2.4 -7.9
Durables

Iron and Steel -2.1 -7.7
Nonferrous Metals -.9 -3.0
Electrical Machinery -5.5
Non-electrical Machinery -3.7 -9.3
Motor Vehicles -1.0 -3.2
Non-auto Transportation -22.5
Stone, Clay Glass -.8 -2.8
Fabricated Metals -7.4 _10.9
Lumber
Furniture -1.3 -13.0
Instruments -3.6
Miscellaneous

Non-Durables

Food and Beverages
Textiles -.9 -1.6
Paper -2.1 -2.0
Chemical -2. 1 -3.9
Petroleum -3.0
.Rubber -3.2,
Tobacco -4.9
Apparel 1.0 -19.6
Leather -3.6
Printing -1.1 -1.1
Transportation -1.1 -4.5
Utilities -8.5
Communication 1.8
Commercial and other 1.1 -9.9

*Note 5%

Source: NCWQ. From CONSAD Research Corporation,
"Macroeconomic Impacts of P.L. 92-500", 1976.

111-177

as reflected in changes in output. Also, in some industries (food and
paper are examples), product price increases also compensate somewhat
for the higher user cost of capital and keep expected profit levels
high. This tends to offset some of the declines in investment levels.

(3) Analyses of Scenarios 2,through 5

Macroeconomic Impacts: (See Table III.F.14)

Scenario 2 (Smooth, High Growth)

In this Scenario it is assumed that instead of meeting two specified
compliance dates for BPT and BAT, pollution abatement costs are spread
more evenly soias to grow steadily,through'1983. Total costs are
the same as in Scenario 1.

As might be expected, the effects on the economy are less pronounced
without the large concentrated shocks reflected in Scenario 1.

Prices rise slightly less in Scenario 2 than in Scenario 1, with
an average rate of inflation of 6.2 percent. This compares to 6.3 percent
in Scenario 1 and 5.4 percent in the "control"'baseline. Real <WP remains
over base through 1980, before sliding down and going below base in 1981
instead of in 1980. Likewise, the employment picture is a little brighter
as the unemployment rate rises by 70 percent of the increment in Scenario 1.

Personal consumption expenditures (constant dollars) are also
stronger, dropping below base in 1978 instead of in 1977. Durable goods
expenditure shows the most improvement, following the same pattern as
nondurable goods., Services,'as before, are the least affected..

Nonresidential investment exhibits amore stable pattern, remaining
about 3 percent above base until the late 701s, with a maximum increment
of 3.7 percent in 1976', instead of the 8.7 percent in Scenario 1. There-
after it starts weakening, going below base in 1984. The housing market
shows the same pattern as in Scenario 1, but the effects are less pro-
nounced. Housing starts dip 7.4 percent below base in 1985 instead
of the 9.1 percent of the earlier run.

The trade balance in current dollars also improves dramatically
by 1985, registering almost as much improvement as in Scenario 1.

The pressure.on the money market, with free reserves as an indicator,
shows little change, with a slight "loosening" at the beginning, and
"tightening" later following the new pattern of pollution abatement
investment.

TABLE III.F. 14 Scenario comparisons (Scenarios 1-5 Against Baseline)

1975 --1976 1977 1978. 1979 1980 1981 1982 1983 1984 1985

Real GNP
(1975$) 146 4.3 1532.3 1650.5 1754.0 1823.1 1870.1 1941.8 2002.0 -2056.2 2100.3 2182.8
Percent
Difference:

Scenario #1 .27 .86 .94 .21 .08 -.10 -.36 -.78 -1.19 -2.0 --2.88

Scenario #2 -30 .45 .44 .41 .33 .19 -.05 -.46 -.84 -1.68 -2.45

Scenarip.-#3 .28 1.15 1.30 .61 .60 .52 .33 -.03 -.37 -1.15 -2-04

Scenario #4 .27 ..43 .45 .43 .35 .22 -.31 -.69 -1.04 -1.42 -2-06

Scenario #5 .16 .49 .56 .22 .16 .07 -.07 -.32 -.54 .91 -1.35

GNP Deflator
(Price Index) 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985

Baseline 185.8 196.1 205.4 215.3 229.0 244.4 258.2 272.3 287.6 302.0 31443

Percent
Difference:

Scenario #1 .03 .36 .82 1.25 1.83 2.60 3.54 4.60- 5.73 7.09 9.00

Scenario #2 .01 .25 .56 .94 1.44 2.13 3.02 4.07 5.18 6.42 8.13

Scenario #3 .03 .35 .81 1.27 1.89 2.71 3.75 4.93 6.14 7.52 .9.46

Scen ario #4 .03 .22 .48 .80 1.25 1.85 2.53 3.29 4.04 4.95 6.24

Scenario #5 .01 .17 .39 .61 .90 1.29 1.77 2.32 2.86 3.49 4.39

TABLE III.F. 14 (Continued)

-Unemployment (Percent)

1976 1977 1978 1979 1980 1981 1982 1983 1984 1985

-Baseline -8.8 8.5 8.4 6.9 5.3 4.5 4.0 3.8 4.0 5.1 5.5

--Rate:
Scenario #1 8.7 8.3 8.0 6.5 4.9 4.2 3.8 3.8 4.2 5.6 6.4

.Scenario #2 8.7 6.3 A.1 6_6 5.0 4.2 3.7 3.7 4.1 5.5 6.2

Scenario #3 8.7 7.9 6.4 4.8 4.0 -3.6 3.6 4.1 5.5 6.2

,-Scenario #4 8.7 8.4 8.2 6.6 -5.0 .4.2 3.8 3.8 4.2 5.6 6.2

Scenario #5 '8.8 8.4 8.2 6.6 5. 1 4.3 3.8 3.8 4.1 5.4 5.9

Personal Consumption Expenditures
1975 @1976 1977 1978 1979 -1980 .1981 1982 '1983 1984 1985

Baseline 931.9 956.0 1027.0 .1091.4 1140.1 1165.5 '1195.5 1219A -1240.4- 126.0.6 1300.1
(1975$)

Percent
Difference

Scenario #1 .08 .04 -.01 -.09 -.24 -.48 -.80 -1-31 -1.83 -2.47 -3.40

Scenario #2 .12 .07 .01 -.05 -.15 -.32 59 -1.07 -1.55 -2-95

Scenario #3 .09 13 .13 .07 -.03 -.23 -.54 -1.06 -1.56 -2-19 -3.09

Scenario #4 .08 .,06 .02 -.03 -.11 -.27 -.53 -.97 -1.38 -1.80 -2.46

Scenario #5 .05 .04 .04 .00 -.07 -.19 - -'36 .66 - .94 -1.24 -1.69

Table III.F. 14 Continued

Residential Investment

1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985

Baseline 75$ 41.9 55.4 59.1 69.9 63.7 57.9 59.1 55.6 47.7 50.6 54.1
Percent
Differences

Rate:
Scenario #1 -@05 -.28 -.81 -.87 -.84 -1.06 -1.46 -2.34 -3.72 -5.34 -7-34

Scenario #2 -.05 -.21, -.45 -.52 -.70 -1.01 -1.50 -2.32 -3.28 -4.41 -6.06

Scenario #3 -.05 -.29 -.81 .-.83 -.67 .67 ---.88 -1.61 -2.93 -4..'47 -6.42

Scenario #4 -.05 -.20 -.41 -.46 -.61 -.85 -1.16 -l..60 -2-37 -3.49 -5.20

Scenario #5 -.02 -.13 -.38 -.40 -.36 -.42 -.59 -1.01 -1.69 -2.62 -3.73
CO
0
Nonresidential Investment

Baseline 75$ 149.4 1 153.0 175.8 191.2 206.0 224.4 252.4 278.0 302.0 310.6 338.8
Percent
Differences

Scenario #1 1.94 8.46 8.75 1.82 1.56 1.28 .83 .14 -0.59 -3.49 -5.37

Scenario #2 2.00 3.66 3.45 3.45 3.29 2.94 2.32 1.49 .70 -2.81 -4.45

Scenario #3 1.95 8.78 9.16 2.22 2.07 1.88 1.44 0.73 0.04 -2.80 -4.66

Scenario #4 1.93 3.60 3.42 3.40 3.21 2.86 -.31 -1-03 -1-71 -2.61 -4.01

Scenario #5 .98 4.23 4.42 1.04 .93 .81 .60 .18 -.19 -1.55 -2.49

NCW@ From-tdlmb- Research Corporation,
OlMacroeconomic Impacts of P.L. 92-500", 1976.

'ZI

Scenario 3_(Compliance, High Growth, High Municipal Expenditures)

In this run, the "high" municipal scenario (Table III.F.3) is used.
The other assumptions are the same as in Scenario 1.

Because of this added expenditure by the government, the.pressure
on prices is slightly greater. Prices rise 9.5 percent over base by
1985. This additional inflation is of the "demand pull" rather than the
11cost-push" variety.

Real GNP is stronger showing a maximum increment of 1.3 percent in
1977 and hot dipping below base until 1982. As a result, employment
is higher, with a maximum decrement of .6 percentage points in the
unemployment rate in 1979.

The major difference from Scenario 1 comes in corporate profits,
which remain strong through the decade, with increments triple those
of the standard abatement scenario through much of the period. This is
because price increases are not totally offset by increased expenses.

The improvement in the trade balance is not as strong here because
of increased imports due to increased domestic activity.

Scenario 4 (Smooth, High Growth, No BAT)

In this run, BAT standards are assumed not to be met and the BPT
compliance date is delayed to 1980. New source standards are unchanged.

With decreased abatement expenditures, the impact on prices is
lessened, with a maximum increment of 6.2 percent in 1985. The average
rate of inflation is 6.0 percent or .6 percent above baseline.

Thestimulus to real GNP is also less, as it dips below base by
1981. However, due to the reduced inflation, its maximum decrement
in 1985 is only 2.1 percent.

Residential investmdnt,follows the same pattern as Scenario 1
with milder effects.

The improvement in the trade balance is diminished, registering
only 80 per cent of the increment in Scenario 1.

Scenario 5 (Compliance, Low Industrial Expenditures, High Growth)

IR this run all,costs (except municipal) are-half those in Scenario
1. The time phasing is unchanged.

111-182

With this decrease in pollution abatement expenditure, the price
impacts are substantially reduced. The GNP price deflator shows a
maximum increment of only 4.4 percent in 1985, or less than half the
increment in Scenario 1. The average inflation rate over the decade
is 5.8 percent per year as compareid-to 6.3 percent in Scenario 1.

Real GNP is only moderately affected in this run, with a maximum
increment of .6 percent in 1977 and a maximum decrement of 1.3 percent
in 1985.

Sectoral Impacts (Scenarios 2 through 5)

As pointed out in the previous discussion of macroeconomic impacts,
the rate of inflation is lower in Scenario 2 with its smoothed pattern
than in Scenario 1. Table III.F.15 gives the price impacts at the
industry level for these scenarios. (Scepario'l is inc-luded to 'ease
comparison.)

The generally smaller price impacts in Scenario 2 can be partly
explained by some of the dynamic features of the model. Because of
the smaller accumulation of nonpro4uctive capital stock, associated
depreciation costs tend to be lower. In addition, levels of operating
costs of abatement are lower for the ypars prior to 1983 because of
the smoothing out of BPT costs. In addition,* demand in later years
falls relatively less in the smoothed case., These factors combine'to
keep unit Costs lower here'than in Scenario 1. Scenario 3 shows a small
but distin@t pressure on prices in the-later years as a result@of the
demand pull of the considerably-higher leVels of municipal spending.
For durable goods price i@creases ovei baseline in 1985 are 8.2 percent
compared to 9.1-perpenp in Scenario 1; prices of nondurable goods rise
to 9.9'percent' over their baiseline'@level tqmpared to'-9.2 percent in
Scenario 1.

The price impacts in Scenario 4 (with the assumption of no BAT costs)
show that the incremental effects of BAT posts (c ''Are Scenario 2 and 4)
OMP
are relatively small:- This i's,-expected since for most industries BPT
and new sour6e costs together are the 'major part of total abatement costs.
However, even in industries like machinery and fabricated metals in which
BAT costs are comparable to BPT costs, th@! dif erence in price impacts
between Scenario 2 and 4 is. comparable to thepiice difference for sectors
like paper and primary metals where BAT qos@s aie relatively small. A
significant 6ource'of the price pressures in su6h industries are factors
other than direct abatemeA dostsl;.this would include increased input
costs due'to abatement in other industries as well as increased deprecia-
tion and wage c 'osts.1,114aily., pride impacts for'Scdnario 5'(which had
.assumed industrial abatemei)t costs at one-half the level of Scenariq 1)

TABLE III.F.15: IMPACTS ON PRICES - SCENARIOS 1-5
(Percentage Change from Baseline)*
1977 1985
Scenarios 1 2 3- 4 5 1 2 3 4 5

All Industries .8 q .6 .3 .5 9.0 8.1 9.5 6. z 4.4
Agriculture .8 . 5 .8 5.8 5.2 6.1 4.0 2.8
Mining 1.7 .8 1.7 .8 .8 10.'Z 9.5 10.9 7.4 5.0
Manufacturing 1.3 .9 1.3 .7 .6 9. 1 8.3 9.7 6. z 4.3
Durable Goods 1.3 .9 1.3 .8 .6 9. 1 8.2 9.6 6.3 4.2
Primary Metals 1.2 .7 1.2 .7 .6 9.6 8.7 10.0 6.7 4.7
Electrical Machinery 1.5 .9 1. 6 .8 7.4 6.0 8.0 4.9 z. 6
Non-electrical Machinery 1.4 .9 1.4 .8 .7 9.6 8.8 10.1 6.6 4.5
Motor Vehicles .8 .6 .8 8.5 7.7 9.0 4.8 4.1-
Non-auto Transportation 1.6 1.0 1.6 .9 .8 9.4 8.7 9. 9 6.4 4.5
Stone, Clay, and Glass .9 .7 1.0 .6 .5 8.3 7.6 8.9 5.7 4.0
Fabricated Metals 2.2 1.5 2.2 1.4 1. 1 11.6 10.7 1Z. 1 8.4 5.5
Lumber ..7 .5 .7 8.5 7.7 9. 1 5.9 4.2
Furniture .6 lo.6 9.4 10.9 7.3 5.0
In-struments 1. 6 1. 1 1. 6 1.0 .8 10.2 9.4 10.7 7.0 4.8
Non-Durable Goods 1.3 1.0 1.3 .7 .6 9.2 8.5 9.9 6.1 4.5
Food and Beverages .8 .5 .8 10.1 9.1 11.3 6.9 4.9
Textiles .9 .6 .9 .6 .5 8.7 7.9 9.2 6.o 4.2
Pape r 1.4 .8 1.4 .7 .7 8.6 7.,q 9.0 6.1 4.2
Chemicals 2.9 2.4 2.9 1.5 1.4 11.3 10.9 11.3 6.9 5.4
Petroleum 1.4 1.2 1.4 .8 .7 9.2 8.4 9.7 5.9 4.5
Rubber 1. 1 1.0 1.3 .7 .5 6.9 6.4 7.6 4.7 3.3
Tobacco .5 .5 6.8 6.1 7.2 4.8 3.4
Apparel .6 .5 .6 8.9 8.0 9.4 6,1 4.3
Le athe r .8 .5 .7 8.5 7.6 9.0 5.9 4.2
Printing .5 .5 7.8 7.0 8.2 5.4 3.8
Transportation .7 .5 .7 6.6 7.8 .9.3 6.1 4.3
-Communication 5.7 5.0 5.9 3.9 2.8
.Utilities .2.1 1.7 Z.Z 1.4 1.2 8.4 7.8 8.8 6.1 4.6
Commercial and Other .5 9.5 8.5 8. 9 6.6 4.7
Government

*Note <.5%

SOURCE- NCWQ. From CONSAD Research Corporation, "Macroeconomic Impacts of-P.L. 92-500", 1976.

111-184

indicate that price impacts are reduced proportionately if industrial
costs are lower than estimated.

The output changes for Scenarios 2 through 5 are small, less than
one-half those in Scenario 1 (Table III.F.16). The industries most
affected are the fabricated meta ls, utilities, furniture, and apparel
industries. Output levels are responding to changing patterns of final
and intermediate demand caused by changes in the relative price structures.
In turn, however, the output changes have lagged impacts on unit costs
and the price changes themselves.

Finally, there are significant differences in the pattern of impact
on gross-investment across these scenarios (Table III.F.17). The large
shocks resulting from pollution control costs in Scenario 1 are reduced
considerably with the assumption of a smoothed pattern of investment.
For example, while the change in investment for the fabricated metals
industry in 1977 (compared to baseline) was 102 percent for Scenario 1,
it is about 50 percent for Scenario 2. For the paper industry the dif-
ference is even more significant. The.increase in investment is 12 percent
in Scenario 2 compared to 39 percent in Scenario 1. The relatively
.large share of BPT costs in total abatement spending for this industry
is being smoothed over a considerably longer period.

c. Scenarios 6-10 (Impacts under a "low-growth" baseline assumption)

(1) Desctiption of Alternative Baseline

An alternative baseline scenario was implemented by assuming tighter
money than in the control baseline. (See Table III.F.18). It is
essentially identical to the Wharton Annual Model solution for June 1975
entitled, "Tight Money in 1977-197911 (5). The two policy instruments
that were varied over the period 1977 to 1985 include the discount rate
and the nonborrowed reserves. All other exogenous variables are the
same as in the control solution. The rate of growth of nonborrowed
reserves was reduced and the discount rate increased to 7.8 percent
by 1979 and held at that level through 1985. Table III,F.19 compares
this scenario to the control baseline.

The effect of this tight monetary policy is low growth in the
economy for the period 1978-1980 and 1983-1985. Tight money policy
throughout the remainder of 'the 1970's produces unemployment rates
averaging T.5 percent (6.7 percent in the period 1981 through 1985).
One result of the operation-of the economy at this slack level is a
reduced demand for imports and large@trade surpluses toward 1985. Other
results include continuation of large deficits in the Federal sector
as tax revenues fail to climb to meet expenditure levels due@to poor
performance of the tax base.

TABLE III.F.16:@ IMPACTS ON OUTPUT WENARIOS 1-5
(Percentage Changes from-Baseline)*
1977 11985
acenarIUS 2 1 3 4 5 2 3 4 5
Lj

All In stries .9 1.3 .5 .6 -2.9 -2.5, -2.0 -2.1 -1.4
Agric@ure 3.5. 3. IL 4.3 2.3 lo 8
Mining -.8 -.6 -3.5 -3.2 -3.1 _3. 1 -1.6
Manufacturing -2.9 -2.5 .-2.5 -2.1 -1.3
Durable Goods -3.2 -2.7 -2.7. -2.4 -1.4
Primary Metals -.7 -4.4 3.9 -3. 8 -3. 5 -2.1
Electrical Machinery -1.4 8 -1.0 -1. 1
Non-electrical Machinery -3.0 -2.7 _z. 6 -2.4 1
'Motor Vehicles _?.. 1 7 -1.7 -1.5 -1.0
Non-auto Transportation -1.4 -1.2 -1.3 -1.0 -.6
Stone, Clay, Glass .8 -3.1 -2.5 -2. 2L -2.3 -1.4
Fabricated Metals .8 -.5 -.5 -.6 -7.4 -6.8 -6.8 -5.8 -3.4
Lumber .6 -2.5 -1.9 -1.7 -1.9 -1. 1
Furniture .9 -12.6 -10.5 -11.2 -8.9 -6.0
Instruments -2.8 -2.4 -1.9 -2.0 -1.2
Miscellaneous Mnf g. -.6 -4.9 -4.4 -4.5 -3.4 -2.3 Ln
Non-Durable Goods -2.4 -2.2 -2.2 -1. 5 -1. 1
Food and Beverages -5.5 -4.9 -6. 9 -3.7 -2.5
Textiles - 1 @ 1 -1.0 -.8 -1.0 -.6
Pape r - - 7
Chemicals -2.2 -2.3 -1.5 -1.0 -1.0
Petroleum -.6 -.6 -.5 -2.8 -2.7 -2.4 -.7 -1.3
Rubber 7- -.6
Tobacco 2.4 2.4 2.8 1.5 J.2L
Apparel .7 -8.1 -7.0 -7.8 -5.8 -3.9
Le athe r -2.4 -2.0 -2.2 -1.9 -1.2
Printing and Publishing .8 -1.7 -1.3 -.9 -1.3 -.8
Transportation .6 -1.3 -1.0 -.8 -1.0 -.6
Communications 1.7 1.7 2.2 1.3 1. 1
Utilities -8.6 --8.5 --8.7 -7.5 -6.7
Commercial.and other 7 - 3.9 -3.2 -3.1 -2.8 -1.9
Government .8 .8 2.3 .8 .8 1.5 1.5 5.1 1.3 1.2

*Note < . 5%

Source: NCWQ. From CONSAD Research Corporation'L- "Macroeconomic impacts of P.L. 92-500", 1976.

TABLE I I I F.17: IMPACTS-ON TOTAL INDUSTRY INVESTMENT (SCENARIOS-1-5)
(Percentage Change from Baseline)*
1977 1985
Scenarios .1 3 4 5- 2 3 4 5,

Total Non-residential 8.8 3.5 9.2 3.4 4.4 -5.4 -4..5 -4.7 0 -2. 5-
Investment
Agriculture 4.3 1.4 4.4 1.6 2. 1' 2 ; 3 1.9 3.4 1. 5 1j.2
Mining 46.9 12.7 46,.9 15.6 23;. 1; -3.8 -2.8 -2.6 -3.2 -1i. 5
Durable Goods
Iron and Steel 36.0 10.5 36.6 13.2 17.8 -5.9 -5.2 -5.3 4.4 -2.8
Nonferrous Metals 5.0 1.4 5. 3 1.8 2.5 -2.8 -2.6 -2.3 _2_3 -1. 3
Electrical Machinery 26.0 12.4 26.0 10. 5 12..8 -3.4 -4.3 -3.2 -3_3 -3. 5
Non-electrical Machinery 88.8 40.6 90. 5 34.-0 44.@ 1 -7.7 -6.,q -6.r7 -6.6 -3.6
Motor Vehicles 22.8 9.4 -23.0 .7.5 11.3 -2.0 -1.6 -1.4 -1.4 - 1 0
Non-auto Transportation
Stone, Clay, Glass 3.1 .9 3.2- 1.0 1.6 2, 5 -2.0@ -1.0 -1.9 -1. 1
Fabricated Metals 102.1 51.3 102.4, 49.7 50.1 3.2 3.9 4.1 4.7 1.7
Lumbe r .9
Furniture 13.0 -11.4 -11.9 -9...4 -6_4
Instruments 22.5 12.0 23.1 10.6 11.2 .5 1.1
Miscellaneous, 6..2 Z68 6.2 2.4 3.1
Non-Durable Goods
Foodand Beverages 7.3 3..0 7.4 2.7 3_6 1.5 -
Textiles 20.4-. 7.8 21.0 8 * 0 .10.2 .7 .7 l..2 .9 -5
Paper 39.4 12.0 40.0' -14.5 -19.5 .8 .9 1.8 ..6 .5
Chemicals 46.5 19.1 47.8 18.2. 23.2 .5 .6 1.5 2.3 .5-
Petroleum 3.6 2.1 3.7 1.3 1.8 -2.8 _z.6 -2.5 -1.'6 1.- 2
R ubbe r 7.5 2.Z 8.3 Z.8 3.9 -2.8 -2.2 -2.0 -2.Z -1.4
Tobacco -4.9 -4.7 -5.2 -3'. 8 -2. 5,
Apparel 1.0 .7 1.9 .7 .7 -19.6 @17.4 -19.2 -13.7 -9.2
Le athe r M2 3.6 10.7 3.6 5.2 -3.6 -2.1 -Z.5 -2. 1 -1. 5
Printing and Publishing -1 .1 -.7 -1.1 -.6 -.5 - 1. 1 -1.2 -.8
Transportation 2.0 2.2 .5 1.0 -4.3 -3.9 -3.9. -3.1 -2.0
utilities 8.2 2.7 8.3 3.1 4.2 -8.3 -6.6 -8.0 -6.6 -3.8
Communications 1.8 1.7, 2.4 1.4 1.1
Commercial and Other 1.1 .7 1.9 .7 .8 -4.9 -8.3 8 -7.1 -4.8

*Note < . 5%
Source: NCWQ. From CONSAD Research Corporation, "Macroeconomic Impacts of P.L. 92-500", 1976.

TABLE III.F.18; Alternative "Low Growth" Baseline Summary Tables

ITEM 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985

GNP (Current $) 1464.27 1615.98 1813-72 1993.10 21G3.71 23/11G. 15 2578.41 2821.29 3073.17 3332.28 36111.23

Change 4.83 10.36 12.24 9.89 8.56 8.45 9.87 9.42 8.93 8.43 8.46

GNP 58$ 788.00 824.00 879-82 914.04 923.38 935.57 980.19 1025.55 1058.43 1087.56 1119-66

% Change -4.07 4.57 6.77 3.89 1.02 1.32 4.77 4.63 3.21 2.75 2.95

Consumption Expenditure (58$) 526.49 539.81 576.20 600.12 609-62 614.55 635.70 661.12 682.19 701.10 720.32

Fixed Investment.. 104.23 112.33 122.67 126-75 120-34 121.18 136.50 149.47 154.87 160.15 166.34

Residential 20.21 26.42 25-68 26.28 19.34 16.93 22.62 27.63 29.48 33.56 35.95

Non-residential 84.02 85.92 96.99 100.48 101.00 104.25 113.88 121.84 125-39 126.59 130.39

Governmental-,Purchase. 149.20 154.30 160.10 166.00 171.90 177.80 183-70 189.60 195.50 201.40 207-30

GNP Deflator 185.82 196.12 206.15 218.05 234.32 250.80 263-05 275.10 290.35 306.40 322.80
CO
Change 9.27 5.54 5.12 5.78 7.46 7.03 4.88 4.58 5.54 5.56 5.35

Consumer Price Deflator 177.01 187.76 197.18 207.60 221.24 236.07 247.82 259.08 M.85 287.16 301-84

% Change 8.83 6.08 5.02 5.28 6.57 6.70 4.98 4.54 5.31 5.24 5.11

Money Supply 77M9 821.78 846.14 892.74 965.55 1056.75 1149.76 1248.81 1358.89 1452.60 1541-27

% Change 10.26 6.62 2.96 5.51 8.16 9.45 8.80 8.61 8.81 6.90 6.10

Bond Rate 9.17 8.88 8.86 9.04 9.73 10.59 11.04 11.16 11.13 11.12 11.21

Short Rate 6.16 7.03 7.98 8.95 9.77 9.73 9.52 9.55 9.60 9.86 10-06

Corporate Profit 122.26 155.13 184.08 193.43 213.20 231.20 250-41 266.18 284.22 305.49 341-39

Unemployment Rate 8.80 8.55 B..70 8.10 7.96 8.11 7.48 6@ 4.6 5.70 5.89 6.13

Government Surplus @-79.33 -87.60 -74.63 -66.08 -65.57 -65.53 -54.93 -38.15 -31.43 -26.63 -26..22

Source: NCWQ. From CONSAD Research Corporation, "Macroeconomic Impacts of P.L. 92-500", 1976.

TABLE III.F.19
Comparison of Baselines: Control Versus Alternative Low Growth

Real GNP (75$) 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985

Control 1464.3 1532.3 1650.5 1754.0 1823.1 1870.1 1941.8 2002.0 2056.2 2100.3 2182.8

Alternative .00 -.95 -3.17 -5.89 -7.04 -6.21 -4.82 -4-36 .-3-79 -4.70
% Difference

Price Index (GNP Deflator)

Control 185.8 191.6 205.4 215.3 229.0 244.4 258.2 272.3 287.3 302.0 314.3

Alternative --- .03 .35 1.29 2.33 2.62 1.90 1.02 .97 1.45 2.70
% Difference

Unemployment Rate

Control 8.8 8.5 8.4 6.9 5.3 4.6 4.0 3.8 4.0 5.1 5.5

Alternative 8.8 8.6 8.7 8.1 8.0 8.1 7.5. 6.5 5.7 5.9 6.1
% Difference

Personal Consumption
Expenditures (75$)

00
Control 931.9 956.0 1027.0 1091.4 1140.1 1165.5 1195.5 1219.0 1240.4 1260.6* 1300.1 OD

Alternative --- -.06 -.69 -2..67 -5.35 -6.68 -5.88 -4.01 -2.65 -1.55 -1.94
% Difference

Residential Investment (75$)

Control 41.9 55.4 59.1 69.9 63.7 57.9 59.1 55.6 47.7 50.6 @54.1

Alternative --- -1.05 -9..76 -21.95 -37.09 -39.41 -20.55 3.21 27.91 37-29 37.95
Difference

Nonresidential Investment (75$)

Control 149.4 153.0 175.8 191.2 206.0 224.4 252.4 278.0 302.0 310.6 338.8_
Alternative -- -.17 -1.88 -6.55 -12.85 -17.42 -19.77 -22.07 -26.18 -27.55 -30.56
% Difference

Source: NCWQ- From CONSAD Research Corporation, "Macroeconomic Impacts of P.L. 92-50011, 1976.

111-189

Real GNP grows at an average rate of 3.2 percent as compared to
4.1 percent for the control. The distinct peak-in the housing market
is that the control solution forecast for 1978 is no longer observed..
Instead, housing starts are forecast to reach a moderate level during
1976 through 1978 with a severe decline to 1980, and an eventual
strong recovery that, in fact, predicts them reaching levelshigher
than the control solution by 1985.

The slower rate of capital accumulation keeps productivity at a
low level compared to the control solution. This,. combined with the
assumption that prices for key sectors like agricultural goods and
petroleum are identical to those in the control solution, keeps'the
rate of inflation comparable to that solution.

(2) Analysis of Scenarios 6-10

Macroeconomic Impacts (See Table III.F.20)

Scenario 6 (Compliance, Low Growth)

As with Scenario 1 real GNP rises initially with the stimulus from
increased spending, reaching a peak level above the "low growth" base-
line of 1.0 percent in 1977; there is a gradual decline in this effect,
and it drops below base by 1980.

The GNP deflator rises at a rate of 6.6 percent a year in this
scenario-,as compared to 5.7 percent for the baseline forecast indicating
an inflation rate that is higher by .9 percent due to abatement costs.
The unemployment rate drops below base immediately and stays below
base until the last years of the forecast when it rises above the
baseline. The maximum drop in the unemployment rate occurs during the
period 1979 to 1981 when it is .5 percentage points below baseline,
and the maximum increase is 1.0 percentage points in 1985.

Residential construction is barely affected until the latter years
and drops to 5.4 percent below base in 1985.

Unlike the "control" solution the "low*growth" baseline forecasts
a gradually improving trade baseline. The impact of abatement spending
is similar to that in Scenario 1 and the trade balance improves further
by 1985, the increase in surplus amounts to $30 billion.

The large deficits that are forecast for both Federal as well as
state and local governments are reduced considerably due to the effects
mentioned in the analysis of Scenario l.- That is, the.increase in
inflation operates to.significantly increase government tax revenues.
The negative effects of this on personal consumption expenditures is

TABLE III.F.20: Scenario Comparison (Scenarios 6-10) against Alternative Baseline

Real GNP
1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985,

Baseline 1464.3 1531.2 1634.9 1698.5 1715.8 1738.5* 1821.4 1905.6 1966.8 2020.9 2080.6
(75$)
Percent
Difference

Scenario #6 .27 .94 .97 .23 .13 -..03 -.24 -.64 -1.06 -2-11 -3.18

Scenario #7 .30 .45 .45 .43 .39 .29 .13 -.19 -.51 -1.53 -2.36

Scenario #8 .28 1.16 1.32 .65 .71 .74 .69 .47 .24 -.68 -1.56

Scenario #9 .27 .44 .46 .45 .40 .32 -.16 -.46 -.76 -1.34 -2.04

Scenario #10 .16 .49 .57 .23 .19 .13 .05 -.16 -.31 .84 -1.55

GNP Deflator 0

Baseline 185.8 196.5 208. 221. 238.8 257.3 272.2 287.5 307.2 328.9 352.9

Percent
Difference
Scenario #6 .03 .38 .90 1.37 2.60 3.46 4.52 5.79 7.33 9.31

Scenario #7 .01 .24 .55 .92 1.38 1.97 2.70 3--65 4.76 6.06 7.75

Scenario #8. .03 .34 .79 1.22 1.72 2.32 3.06 4.00 5.13 6.49 8.-21

Scenario #9 .03 .21 .47 .79 1.20 1.72 2.25 *2.94 3.75 4.79 6.09

Scenario #10 .01 .17 .39 .60 .84 1.15 1.53 2.02 2.57 3.25 4.11

TABLE III.F.20: Continued

'Unemployment Rate
1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985
Alternative
Baseline 8.8 8.6 8.7 8.1 7.9 8.1 7.5 6.5 5.7 5.9 6.1

Rate:
Scenario #6 .8.7 8.3 8.4 7.7 7.5 7.7 7.2 6.3 5.7 6.3 7.2

Scenario #7 8.7 8.4 8.4 7.8 7.6 7.7 7.1 6.1 5.5 6.0 6.7

Scenario #8 8.7 8.3 8.3 7.6 7.4 7.5 6.8 5.9 5.2 5.8 6.5

Scenario #9 8.7 8.4 8.5 7,.8 7.6 7.8 7.2 6.3 5.7 6.1 6.8

Scenario #10 8.8 8.4 8.5 7.9 7.7 7.9 7.3 6.3 5.6 6.0 6,6

Personal.Consumption Expenditures

Alternative
Baseline (75$.).@931.,9 955.4 -1019-9-1062.2 1079.0 1087.8 1125.2 1170.2 1207 .5 1240.9 1275.0
Percent
Difference
Scenario #6 .08 ..13 .04 -.07 -.23 -.45 -.73 -1.18 -1.69 -2.58 -3.80

Scenario #7 .12 .08 .02 -.04 -.14 -.28 -.47 -.83 -1.21 --l-.96 -2.91

.Scenario #8 .09 .14 .15 .09 .02 -.09 -.24 -.57 -.93 -1.69 -2.65

Scenario #9 ..06 .03 -.,02 -.11 -.24 -..42 -.76 -1.10 -1.73 -2.51

Scenario #10 .05 .05 .04 .01 -.05 -.14 -.25 -.49 -.68 -1.13 -1.93

TABLE III.F.20: Continued

.Residential Investment
1916 1977 1978 109 1980 1981 1982 1983 1984 1985
Alternative
-Baseline(75$) 41.9 54.8 53.3 54.5 40.0 35.1 46.9 57.2 61.0 69.5 73.8
.:Percent
.IDifference: -
:,Scenario #6 -.05 -.43 -.93 -.95 -.76 -.74 -1-06 -1.88 -3.04 -4.11 -5.45

Scenario #7 -.05 -.21 -.47 -.54 -.72 -.93 -1.22 -1.73 -2.26 -2.97 -4.00

.Scenario #8 -.05 -.28 -.82 -.87 -.46 .06 .01 .60 -1.49 -2.44 -3.53

Scenario #9 -.05 -.20 -.41 -.49 -.64 -.79 -.91 *-1.12 -1.63 -2.40 -3.51

..Scenario #10 -.02 -.14 -.40 -.43 -.29 -.17 -.27 -.62 -1.11 -1.70 -2.29

Nonresidential Investment

..Alternative
Baseline(75$) 149.4 152.7- 172.5 178.7 179.6 185.4 202.5 216.6 222.9 225.1 231.8
Percent
Difference:
Scenario #6 1.94 8.60 8.94 1.94 1.89 1.80 1.45 .72 -0.11 74.45 -7.33

Scenario #7 2.00 3.66 3.51 3.71 3.90 3.88 3.47 2.77 2.14 -2.83 -5.01

Scenario #8 1.95 8.80 9.33 2.41 2.55 2.78 2.70 2.25 1.82 -2.10 -4.31

Scenario #9 1.93 3.-60 3.50 3.68 3.84 3.83 .23 -.46 -1.18 -2.67 -4.54

Scenario #10 .98 4.23 4.49 1.08 1.08 1.10 .99 .63 .39 -1.73 -3.48

Source: NCWQ. From CONSAD Research Corporation, "Macroeconomic,Impacts of P.L. 92-500", 1976.

111-193

delayed here relative to Scenario 1; personal consumption expenditures
drop below baseline in 1978 instead of 1977 in Scenario 1.

Corporate profits rise significantly it 1976 and 1977 and continue
to stay above baseline with an average annual increase of 11.6 percent
a year compared to 10.8 percent a year in the base.

The increased abatement investment increases nonresidential invest-
ment to 9 percent over base in 1977. Thereafter the stimulus subsides
and by 1983 total nonresidential investment drops below base. The
reduction in productive investment is largestlin the later years indi-
cating the lagged effect on investment of increases in user cost and
durable goods price increases. Productive investment drops to 7.6
percent below base by 1985.

Scenario 7 (Smooth, Low Growth)

-Real GNP rises above base but the stimulus is not as marked due
to-the smoothing out of investment. The drop below baseline comes
in 1982 compared to 1980 in Scenario 6 and the decline by 1985 is
somewhat less than 2.4 percent compared to 3.2 percent for.Scenario 6.

The unemployment rate stays below base throughout most of the
period though by 1984 it rises above the baseline forecast.

The GNP deflator risesthroughout the period and in 1985 is 7.7
percent above baseline. The average annual rate of inflation is 6.4
percent compared to 5.7 percent in the baseline and 6.6 percent in
Scenario 6.

The drop in personal consumption below base occurs in 1978 as
in Scenario 6, with durables showing the most improvements over Scenario
6.

Residential construction is affected less than in Scenario 6 with
a drop of 4 percent below base in 1985. The smoothing out of investment
eliminates the significant change in total investment in 1977 that
was observed in Scenario 6. The largest impact on fixed investment
comes in 1980 even though abatement investment rises until 1983. After
1980 productive investment declines at a faster rate than the rise in
abatement investment.

When compared to the correspondingscenario (Scenario 2) this
scenario shows more sustained stimulative effects on GNP and employment.
The inflationary impacts are similar to those in Scenario 2, however.
In both scenarios the inflation rates rise about .7 percent.

III-i94

Scenario 8 (Compliance, Low-Growth, High Municipal Expenditures)

The stimulative effects of the additional municipal spending draws
GNP above baseline until near the end of the forecast period. It drops
below baseline by 1984 with a maximum decrease of 2 percent in 1985.
Despite the additional stimulus the GNP deflator does not rise faster
than in Scenario 6. The inflation rate is 6.5 percent compared to 6.6
percent for Scenario 6 and 5.7 percent for the baseline.

The unemployment rate shows a significant drop below base with
the largest impacts coming in the period 1979 through 1983. The average
unemployment rate for this period is 6.5 percent compared to 7.1 percent
for the base. It should be noted that these are primarily induced
effects of the municipal spending. Direct employment in treatment plants
is not significantly higher than in Scenario 6. The "high" municipal
case (see Table III.F.3) is primarily a change in the level of capital
spending. Operating costs (and, therefore, direct labor requirements)
are only somewhat higher than in the "low" municipal scenarios.
The difference in the rate of inflation between thlis scenario and
Scenario 6 is caused primarily by a lower rate of inflation in the last
two years oi the forecast. This can be explained.by analyzing the
cyclical patterns in the "low growth" baseline. In the baseline unem-
ployment dro@s to 5.7 percent in 1983 but rises again to 6.1 percent
p
in 1985. The high levels of municipal spending during this period
of slack demand tends to keep unit costs from rising at the same rate
as in Scenario 6.

Scenario 9 (Smooth, Low Growth, No BAT)

This scenario assumed that only BPT and new source expenditures
would be incurred. (The comparable scenario for the control baseline
was Scenario 4.) The stimulative impacts on GNP in this scenario
are milder -Lhdn in Scenario'6 (in which BAT costs were included) and
Scenario 8, with its high levels of municipal spending. Thb rate of
inflation rises to 6.3 percent compared to,5.7 percent for the baseline.
As in Scenario 6 the unemployment rate is below baseline until the final
year of the forecast when it rises slightly over baseline.-

When compared to Scenario 4, which was the comparable scenario
with the full employment baseline, this scenario shows that both the
inflationary impacts as well as the'impacts on GNP are very similar
between these 6vo scenarios. With the slack economy only the high
levels of expenditures assumed in Scenario 8 appears to have stimulative
effects that are sustained long enough to show significantly different
results than under a full employment baseline (scenario 3).

111-195

Scenario 10 (coMpliance, Low Industrial Expenditures, Low Growth)

This scenario shows results. comparable to those'of Scenario 5
with the full employment baseline,: The impact.-on GNP is mild, The
maximum increase.is in 1977, the peak year of inve;tment,,spending*
when GNP.rises,qnly .6 percent.above baseline. As inScenario 5,
GNP drops below baseline toward the end,of the period,

Sectoral Impacts (Scenarios 6-16)

Sectoral impacts for Scenarios,6 through 10.are presented in Tables
iii.]@`21,:,III.F.22, and III.F.2@3, The pk@'ce impacts under the low
growth baseline are only,marginally different in these scenarios
than under the corresponding scenarios with a full employment baseline..
The only exception is Scenario 8 with its assumption of high levels
of municipal spending;., Here the@GNP-deflator increases by 8.2 percent
in 198@ compared to 9.5 percent for Scenario 3. This may'at first
glance seem contrary to expectations.. One would expect that a depressed
4 economy can be stimulated without price increase. While this is generally
true-for certain kinds of stimuli, it is not the case for industrial
pollution abatement costs. Since these costs (BPT and BAT particularly)
are unlikely.to change significantly in the presence of a depressed
economy, costs per unit-of industrial output tend to be higher. Thus,
we see the greater pres!iuke on price. With the additional "demand-pull"
stimulus from municipal spending industrial outputs tend to increase
without corresponding increases in costs. The pressure on prices is
thereby lower. Theimpact is strongest in the food sector which.shows
an increase of 9 percent above baseline compared to 11.3 percent in
Scenario 3.

Analysis of impacts.on total industry investment indicates results
comparable to the full employment scenarios through 1977; beyond that
date the.depr@essive effect of the abatement costs on regular investment
tend,to reduce total investment to levels lower than in Scenario 1
through 5. The industries with the largest dtop in investment include
the utilities, apparel, furniture,'and nonelecirical machinery industries.

With the lower costs the price impacts are considerably smaller;
the inflation rate rises to,aboUt 6.1 percent, an increase of .4.percent
over baseline. This too is comparable to Scenario 5 and once Again
indicates that with lower industrial costs and a low municipal scenario
the assumption of a "low growth" economy tends_to show impacts very
similar to those in. the full employment baseline.

TABLE III.F.21: Impacts on Prices - (Scenarios 6 - 10)
(Percentage Change From Baseline)*

1977 1985
Scenarios 6 7 8 9 10 6 7 8 9 10

All Industries .9 .6 .8 .5 .4 9. 3 7.8 8. z 6.1 4.1
Agriculture .8 .6 .8 .5 - 5.9 5. 1 5.3 3.9 2.7
Mining 1.8 .8 1.7 .8 .8 10.1 9.0 9.6 7.0 4.6
Manufacturing 1.5 .9 1.3 .7 .6 9.4 8.1 8.6 6. 1 4.0
Durable Goods 1.5 .9 1.4 .8 .7 9.5 8.1 8.6 6. 3 4.0
Primary Metals 1. 3 .7 1.2 .7 .6 10.1 8.6 8.9 6.8 4.5
Electrical Machinery 1. 6 1. 2 1.6 .9 .7 8.1 6.8 7.7 5.1 3.6
Non-Electrical Machinery 1.7 .9 1.4 .8 .7 9. 5 8.6 9.0 6.6 3.6
Motor Vehicles .9 .6 .,8 .5 - 8.9 7.4 7.9 5.7 3. 8
Non-Auto Transportation 1.9 1. 1 1.6 .9 .8 9.8 8.6 8.9 6. 3 4.0
Stone, Clay, and Glass 1.2 .7 1.0 .6 5 8.5 7.2 7.7 5.6 3. 3
Fabricated Metals 2.5 1.5 2.2 1.4 1 12.4 11.0 11.4 8.6 5. 2
Lumber
.9 .5 .7 - 8.6 7.3 7.8 5.6 3.4
Furniture .8 - .6 - 12.4 9.5 9. 5 7.6 4.7
Instruments
1.9 1. 1 1. 6 1.0 .8 10.8 9.3 9.7 7. 1 4.3
Non-Durable Goods 1.4 1.0 1.3 .7 .6 9.3 8.1 8.7 6.o 4.1
Food and Beverages 1.0 . 5 .8 .5 - 9.5 8.2 9.0 6.4 4.1
Textiles 1. 1 .6 1.0 .6 .5 9.0 7.6 8.o 5.9 3.9
Paper 1.6 .8 1. 6 .8 .7 8.0 7.8 8. 1 6.1 3.7
Chemicals 3.0 2.4 3.0 1.5 1.4 11.8 11.0 11. 3 7.0 5.4
Petroleum 1.5 1. 1 1.4 .7 .7 9.6 8.2 8.7 5.8 4.3
Rubber 1. z .9 1.3 .7 5 7.2 6.o 6.9 4.6 3. 1
Tobacco .6 - .5 - 6.8 5.6 5.9 4.5 2.9
Apparel .8 .5 .6 - 9.2 7.6 8.1 6.o 3.9
Leather .9 .5 .7 - 8.8 7.3 7.7 5.7 3.8
Printing and Publishing .7 - .5 - 8.1 6.6 7.0 5.3 3.4
Transportation .8 .5 .7 - 8.9 7.4 8.0 5.9 3.9
Communication .5 - - - 5.8 4.7 5.1 3.8 2.5
Utilities 2.0 1.5 1.8 1.4 .9 8.7 7.7 7.8 6.2 4.0
Commercial and Other - - - - - 10.1 8.z 8.5 6.5 4.5
Government

*Note < 5 U/0

Source: NCWQ. From CONSAD Research Corporation, "Macroeconomic Impacts of P.L. 92.500-1, 1976.

TABLE III.F.22: Impacts on Output (Scenarios 6 - 10)
(Percentage Changes From Baseline)*

1977 1985
Scenarios 6 7 8 9 10 6 7 8 9 10

All Industries 1.0 .5 1.3 .5 .6 -3,2 -Z.4 -1.6 _Z. 0 -1.6
Agriculture - - - - 3.2 z. 6 3.4 2.0 1.0
Mining -.8 -.6 -3.7 -3.3 -3.1 -3.1 -1.9
Manufacturing - - -3.0 -2.3 -1.9 -1.9 -1.3
Durable Goods - -3.8 -2.8 -2.4 -2.5 -1. 6
Primary Metals -.7 -5.5 -4.3 -3.6 -3.8 -Z. 7
Electrical Machinery - -1.4 -.8 -.7 -.8 -.7
Non-Electrical Machinery -3.5 -2.6 -2.1 -2.4 -1.2
Motor Vehicles -2.4 -1.6 -1.4 -1.5 -1.2
Non-Auto Transportation - -1.4 -1. 1 -1.0 -.9 -.6
Stone, Clay, Glass - - .8 -3.3 -2.2 -1.4 -2.1 -1.3
Fabricated Metals -1.0 -.6 -.5 -..6 -9.1 -7.9 -7.3 -6.7 -4.0
Lumber - - .6 _Z. 2 -1.3 -.6 -1.4
Furniture 1.0 -19.8 -13.4 -11.4 -11.8 -7.9
Instruments - - -3.0 -2. 3 -1.5 -1.9 -1. z
Miscellaneous Manufacturing -.7 -5.4 -4.4 -4.0 -3.5 -2.5
Non-Durable Goods - -1.9 -1.6 -1.3 -1. 1 -.9
Food & Beverages -1.5 -1.7 -2.3 -1.3 -.5
Textiles. -1.3 -1.0 @.7 -1.0 -.8
Paper - - .5 - -
Chemicals - - -2.5 -2.5 -1.8 -1. 1 -1.3
Petroleum ".6 -.6 -3.2 -2.9 -2.8 -.7 -1.7
Rubber - - -.7
Tobacco - z1.6 2.5 2.9 1 6 1.0
Apparel - .7 -8.8 -6.5 -6. z -5:7 -3.9
Leather - - .5 -2.9 -1.8 -1.6 -1.9 -1.4
Printing & Publishing - - .8 -2.0 -1.1 - -1.2 -.9
Transportation - - .6 -1.6 -.9 -.6 -1.0 -.8
Communications - - - 1.7 1.6 2.0 1.3 .8
Utilities - - - -7.4 -7.4 -6.3 -7.3 -3.9
Commercial & Other .5 - .8 -4.6 -3.1 -2.5 -2.9 _Z. z
Government .8 .9 Z.3 .8 .8 1.6 1.4 5.0 1.3 1.1

*Note < 5%

source: NCWQ. From CONSAD Research Corporation, "Macroeconomic ImPacts of P.L..92-500", 1976.

TABLE III.F.23: Impacts on Total Industry Investment (Scenarios 6 10)
(Percentage Change From Baseline)*

1977 1985
Scenarios 6 7 8 9 10 6 7 8 9 10

Total Non-Residential Investment 8.9 3.5 9.3 3.5 4.5 -7.3 -5.0 -4. 3 -4.5 -3. 5
Agriculture 4.4 1.4 4.4 1. 6 2.1 2.9 2.0 3.5 1.8 1.3
Mining 46.9 12.7 47.0 15.7 23.1 -5.7 -3.9 -3.7 -4.2 -2.2
Durable Goods
Iron & Steel 37.0 10.8 37.5 13.6 18.3 -8.4 -6.3 -5.2 -5.3 -3.8
Non-Ferrous Metals 5.2 1.4 5.4 1.9 z.6 -3.3 -2.6 -1.7 -2.2 -1.4
Electrical Machinery 26.0 12.4 26.0 10. 5 12.8 -1.2 -.6 .5 -1. 1 -
Non-Electrical Machinery 99.5 45.9 102.5 38.5 49.9 -10.3 -8.4 -6.9 -8.0 -4.0
Motor Vehicles 22.9 9.5 23.1 7.6 11.3 -1.9 -1.1 -.5 -1.0 -.8
Non-Auto Transportation
Stone, Clay, & Glass 3.2 .9 3.2 1.0 1.6 -2.1 -.9 1.2 -1.0 5
Fabricated Metals 105.6 53.2 106.0 51.6 51.8 3.9 5.7 6.6 6.7 2.5
Lumber - - - - - .5 .9 Z.3 .8 .6
Furniture, - - - - -23.1 -16. 8 -14.3 -14.3 -9.9
Instruments 22.7 12.2 23.3 10.7 11.3 - .8 2.0 1.3 -
Miscellineous 6. z 2.8 6.2 2.4 3.1 - - - - co
Non-Durable Goods
Food & Beverages 7.3 3.0 7.4 2.7 3.6 - .6 2.9 .8 .7
Textile s 21.0 8.1 21.6 8.3 10.5 -.7 - - - -1.4
Paper 39.5 12.0 40.2 14.5 19.5 1. 1 1. 5 2.9 1.1 .8
Chemicals 47.8 19.6 48.9 18.7 .23.8 - - 1.0 2.1 -.6
Petroleum 3.6 2.0 3.7 1.3 1.8 -3.5 -3.0 -2.5 -1.3 -1.4
Rubber 7.9 Z.3 8.6 2.9 4. 1 -2.8 -1.5 -1. 1 -1.8 -1.8
Tobacco - - - - - -5.9 .-5.2 -5.0 -4.1 -2.7
Apparel .9 .7 2.0 .7 .8 -25.2 -19.9 -19.7 -16.8 -11.3
Leather 10.5 3.8 11. 1 3.7 5.3 -4.5 -1.6 -.9 -2.1 -1.4
Printing & Publishing -1.1 -.7 -1.1 -.6 -.5 -1.0 -.5 1.8 - -
Transportation 2.0 - 2. 3 .6 1. 1 -5.0 -4.0 -3.5 -3.2 -2.1
Utilities 8.2 z.6 8.3 3.8 4.1 -22.6 -14.5 -15.4 -15.0 -8.9
Communications - - - - - 2.0 1.8 2.4 1.6 1.0
Commercial & Other 1.3 .7 2.0 .7 .8 -13.3 -9.6 -8.8 -8.5 -7.4.

*Note: .5%

Sourcez NCWQ. From CONSAD Research Corporation, "Macroeconomic Impacts of P.L. 92-500", 1976.

111-199

d. Scenarios 11-13

(1) 'Analysis of Scenarios 11 and 12 (Twentytfive and'fifty .2ercent
j2roductive abatement investm8nt)..

in these runs, it was assumed that 25 and 50 percent of the abatement
investment was 'roductive, respectively. These scenarios simulate
p - z
situations where pollution control would not be all of the "end-of-pipe"
variety, but would also involve changes of process and product mix which
can increase efficiendy by reducing waste. cost data for both scenarios
is the same as in,Sdenario 1. Scenario comparisons are presented in
Table III.F.24.

In Scenario 11 the pressure on prices is less, as the GNP deflator
rises to 7.3 percent over base in 1985, giving an average rate of inflation
of 6.1 percent a year compared to 6.3 percent for Scenario 1. while
real GNP does dip below baselinei the difference in 1985 is 1.5 percent
below base c"ompared to 2.9 percent for Scenario 1. The exogenously
imposed increase in productive capital tends to substitute for the
endogenously generated productive investment. Total investment in the
later period is higher than in Scenario 1,,however, reflecting.the
stronger overall economy., This is reflected in the impact on the housing
market. Whilelt still displays,a cyclic pattern, it is far stronger,
due to the better economic conditions.

Scenario 12 (50 percent productive) shows results comparable to
those in the previous scenario, although price increases are somewhat
smaller. The inflation rate is only slightly smaller. The surge in
productive investment'ke6ps fixed investment levels above the baseline
throughout the forecast period. While GNP does drop below baseline
the difference is smaller than in Scenario 11 (A percent compared to
1.5 percent).

Sectoral results'are presented in Tables III.F.25, I�I.F.26, and
III.F.27 for prices, output and total investment (including abatement).
The most significant patterns are Observed in the output impacts. While
almost all sectors showed declines in output levels (in,1985) for
Scenario 11, the results-of.Scenario 12 show increases in outputs of
several industries. Results for total investment indicate that peak
levels of'1977 investment-for Scenario 1 are observed-in Scenario 11
and 12 aiso...For a few industries like fabricated metals, the shocks
are milder.: The more ;; significant.changes are observed in 1985 For
several industries'the stimulus to productive investments tends to keep,
investment.levels abovelbaseline values despite some'depressive effects
through increases in.the user cost of capital.

(2) Analysis of Scenario 13 (Air and..Water Pollution)..

In-this run, the incremental impact of water pollution@control
is examined under the assumption that-';air.,pollution ab Iatement will be
undertaken. The water pollution cost*s,@are the same as in Scenario.l.

TABLE III.F.24: Scenario Comparison (Scenarios 11-13) Against Control Baseline

Real GNP
1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985
Control
Baseline(75$) 1464 1532 1650 1754 1823 1870 1942 2002 2056 2100 2183
Percent
Difference:
Scenario #11 .27 .87 .89 .17 .24 .26 .10 -.25 -.53 -1.07 -1.49

Scenario #12 .28 .86 .83 .10 .35 .57 .48 .17 -.02 -.36 -.40

Scenario #13 .52 1.12 1.29 .53 .15 -.22 -.62 -1.22 -1.81 -2.88 -4.21

GNP Deflator

Control
Baseline 185.8 196.1 205.4 215.3 229.0 244.4 258.2 272.3 287.6 302.0 314.3
Percent
Difference:
Scenario #11 0.01 .28 .66 1.02 1.44 2.04 2.90 3.91 4.90 5.96 7.33 0

Scenario #12 0.00 .23 .56 .88 1.18 1.67 2.51 3.54 4.50 5.39 6.43

Scenario #13 0.05 .50 1.13 1.79 2.67 3.81 5.15 6.62 8.22 10.20 13.04

Unepployment Rate

Control
Baseline 8.8 8.5 8.4 6.9 5.3 4.6 4.0 3.8. 4.0 5.1 5.5
Rate:
Scenario #11 8.7 8.3- 8.1 6.6 5.0 4.1 3.6 3.6 4.0 5.4 5.9

Scenario #12 8.7 8.4 8.2 6.6 5.0 4.1 3.5 3.5 3.9 5.2 5 .'6

Scenario #13 8.7 8.2 7.9 6.3 4.7 4.1 3.7 3.9 4.4 6.0 6.8

TABLE III.F.24: Continued

Personal Consumption Expenditures
1975 1977 1978 1979 1980 1981 1982 1983 1984 1985
Control
.Baseline(75$) 931.9 956 1027 1091 1140 1166 1195 1219 1240 1261 13W
Percent
Difference:
Scenario #11 0.09 0.05 -.-01 -.08 -.11 -.20 -.45 -.92 -1.36 -1.80 -2.34

Scenario #12 0.09 0.05 -.04 -.12 -.04 -.01 -.21 -.69 -i.09 -1.39 -1.63

Scenario #13 0.12 0.05 0.00 -.11 -.36 -.75 -1.25 -1-96 -2.68 -3.61 -5.03

Residential Investment

Control
Baseline(75$) 41.9 55.4 59.1 69.9 63.7 57.9 59.1 55.6 47.7 50.6 54.1
Percent
Difference:
Scenario #11 -.04 -.22 -.66 -.70 -.65 -.74 -1.05 -1.76 -2.67 -3.75 -5.27 0

Scenario #12. .03 -.17 -.55 -.61 -.59 -.63 -.93 -1.57 -2-10 -2.72 -3.88

Scenario #13 -.08 -.44 -1.09 -1.23 -1.30 -1-61 -2-16 -3-39 -5.40 -7.77 -10.61

Nonresidential Investment.

Control
j3aseline(75$) 149.4 153.0 175.8 191.2,.@ '206'.*0 `22CA 252.4 278.0 302.0 310.6 333.8
Percent
Difference:
Scenario #11 1.95 8.37 8.27 1.32 2.08 2.72 2.63 2.27 2.00 0.00 -.50

Scenario #12 1.95 8.28 7.79 .83 2.60 4.15 4.41 4.34 4.44 3.21 3.86

Scenario #13 4.32 11.17 12.36 5.26 3.16 1.97 1.16 -.02 -1.15 -4-62 -7.37

Source: NCWQ- From CONSAD Research Corporation, "Macroeconomic Impacts of P.L. 92-500", 1976.

TABLE III. F.25: Price Impacts (Scenarios 11 and 12)
(Percentage Changes From Baseline)*

1977 1985
Scenarios 1 11 lz 1 11 12

All Industries, .8 .7 - 9.0 7.3 -
Agriculture .@8 .6 .6 5.8 4.6 4.1
Mining 1.7 1.1 .5 10.2. 8.9 8.4
Manufacturing 1.3 1.1 .9 9.1, 7.3 6.3
Durable Goods 1.3 1.0 .9 9.1 7.3 6.z
Primary Metals 1.2 1.0 .7 9.6 7.8 6.7
Electrical Machinery 1.5 1.3 1.3 7.4, 6.3 6.1
Non-Electrical Machinery 1.4 1.0 .7 9.6 6.5 4.3
Motor Vehicles .8 .7 .5 8.5 7.o 6.1
Non-Auto Transportation 1.6 1.3 1.0 9.4 7.8 6.9
Stone, Clay, and Glass .9 .8 .7 8.3 7.0 6.3
Fabricated Metals 2.2 1.7 1.3 11.6 9.6 8.4
Lumber .7 .6 .5 8.5 7.1 6.4
Furniture .6 .5 .5 10.6 8.2 6.9
Instruments 1.6 1.3 1. 1 10.2 8.4 7.3
Non Durable Goods 1.3 1.2 1.0 9.z 7.5 6.5
Food .8 .8 .8 10.1 7.6 6.1
Textiles .9 .7 .6 8.7 7.1 6.3
Paper 1.4 1.2 .9 8.6 6.9 5.9
Chemicals 2.9 2.5 2.2 11.3 9.6 8.6
Petroleum 1.4 1.2 1. 1 9.2 7.6 6.9
Rubber 1.1 1.0 1.0 6.9 5.7 5.6
Tobacco .5 - - 6.8 5.6 5.0
Apparel .6 .6 .5 8.9 7.3 6.6
Leather .8 .6 .5 8.5 6.8 5.9
Printing and Publishing .5 .5 - 7.8 6.4 5.7
Transportation .7 .6 .5 8.6 7.3 6.3
Communication - - - 5.7 4.7 4.1
Utilities Z. 1 2.0 2.Z 8.4 7.4 7.8
Commercial and Other .5 - 9.5 7.8 6.9
Government - - - -

*Note: <.5%

Source: NCWQ. From CONSAD Research Corporation, Macroeconomic Impacts
of P.L. 92-50011, 1976.

TABLE III. F. 26: Output Impacts (Scenarios 11 and 12)
(Percentage Changes From Baseline)*
1977 1985 12
Scenarios I I 1 12- 11

All Industries 1.0 .9 .8 -3.2 -1.5 -
Agriculture - - - 3.2 3.5 3.4
Mining -.8 5 - -3.7 -1.7 -
Manufacturing - - -3.0 -1. 1 .5
Durable Goods - - -3.8 -1.0 .8
Primary Metals- -.7 -.8 -.9 -5.5 -1.7 .6
Electrical Machinery - - - -1.4 -2.3 1.9
Non-Electrical -Machinery - - '-.7 -3.5 -.6 2.8
Motor Vehicles - - -2.4 -1.0 -
Non-Auto Transportation - - -1.4 -.7
Stone, Clay, and Glass - - - -3.3 -.6 1.6
Fabricated Metals -1.0 -.7 -.7 -9.1 -4.4 -1.7
Lumber - - - .-2.2 - 1.9
Vurniture - -19.8 -7.6 4.1
Instruments - - - -3.0 -1.1 -
Miscellaneous Manufacturing- -.7 -.5 - -5.4 -3.1 -1.7
Non-Durable Goods. -1.9 -1.1
Food
-1.5 -2.4
Textiles -1.3
Paper
- .9 1.7
Chemicals -2.5 -1.3
Petroleum -.6 -.5 -.6 -3.2 -1.8 -1.3
Rubber. .9
Tobacco 2.6 2.5 2.6.
Apparel -8.8 -6.o -4.8.
Leather
-2.9., -1.2
Printing and Publishing -2.0 -.6 -
Transportation -1.6 .5
Communication 1.7 2.0 2.5
Utilitie s - -,5 -7.4 -9.0 -12.8
Commercial and Other .5 - -4.6. -2.2 -.9
Government .8 .8 .8 1. & 1.5 1.5

*Note: < .5%

Source: NCWQ. From CONSAD Research Corporation,,"Macroeconomic Impacts of P.L..92-50011, 1976.

TABLE III.F.27: IMPACTS ON TOTAL INVESTMENT (SCENARIOS 11 AND 12)
(PERCENTAGE DIFFERENCE FROM BASELINE)*

1977 1985

Scenarios 12

Total Non-Residential Investment 8.8 8.3 7.8 -5.4 -.5 3.9
Agriculture 4.3 4.2 4.0 2.3 2.9 3.0
Mining 46.9 45.1 43.2 -3.8 1.0 6.o
Durables*
Iron and Steel 36.0 31.6 Z7.3 -5.9 -2.4 .7
Non-Ferrous Metals 5.0 4.8 4.5 -2.8 -.5 1.6
Electrical Machinery 26.0 25.5 25.0 -3.4 -z.6 -1.2
Non-Electrical Machinery 88.8 -91.8 94.7 -7.7 6.9 20.9
Motor Vehicles 22.8 20.8 18.7 -2.0 -3.8 -5.9
Non-Auto Transportation
Stone, Clay and Glass 3.1 3.0 2.8 -2.5 .5 1.4
Fabricated Metals 10Z.1 81.1 60.2 3.2 5.3 7.1
Lumber - - - 1.0 2. 1
0
Furniture - - - -13.0 -9.1 -6.4
Instruments 22.5 19.6 16.6 - 1.9 3.5
Miscellaneous 6.2 6.6 7.1 1.6 3.1
Non-Durables
Food and Beverages 7.3 7.8 8.3 - -4.4 -8.7
Textiles 20.4 21.5 22.4 .7 1.6 2. 1
Paper 39.4 37.0 34.7 .8 1.8 2.7
Chemicals 46.5 41.2 35.8 .5 .6 .5
Petroleum 3.6 3.2 2.9 -2.8 -2.0 -1.5
Rubber 7.5 7.4 7.1 -2.8 -.6 .9
Tobacco - - - -4.9 -3.9 -3.2
Apparel 1.0 .9 .7 -19.6 -14.4 -11.2
Leather 10.2 11.5 12.7 -3.6 .9 4.8
Printing -1. 1 -.9 -.8 -1. 1 - .7
Transportation 2.0 2.1 2. 1 -4.3 -2.9 -1.9
Utilities 8.2 9.1 10.2 -8.3 z.6 12.9
Communication - - - 1.8 2.0 2.5
Commercial and Other 1. 1 .9 .6 -9.9 -5.8 -2.7

*Note: < .5%

Source: NCWQ. From CONSAD Research Corporation, "Macroeconomic Impacts of P.L, 92-500"f 1976.

111-205

The pressure on prices is greater, as expected. The GNP deflator
rises to 13 percent above base by 1985 compared to 9 percent in Scenario
1 (Table III.F.24). Since 4.7 percent of the rise comes from the air
abatement costs, the incremental rise is 8.3 percent, or.slightly lower
than the impact of water abatement alone. (Table III.F.28)

Real GNP rises more in the-early years under the added stimulus
but with the higher prices, the slide is steeper, falling below base
by 1980 and reaching 4.2 percent below base in 1985. Again, 1.8 percent
of this drop is caused by the air standards, so that the additional
drop in output due to the water standards is 2.4 percent by 1985.

Unemployment, as before, drops at first and then rises as the
economy weakens. Here it shows a maximum decrement of .6 percentage
points in 1979, and a maximum increment of 1.3 percentage points in 1985.
The incremental effects of the water pollution costs on the unemployment
rate are .3 and .7 percentage points in 1979 and 1985 respectively.,

5. Impacts upon the Capital Markets of Water Pollution Control Investment

a. Background

The New York Stock Exchange in a 1974 study (9) compared their
estimates of the total investment demands for business, housing, energy,
pollution control, Federal government deficits, etc., with probable
savings determined as a percent of probable GNP. The result was an
estimated "capital gap" over the period 1974-1985 of approximately
$650 billion.

Another study, published by the Brookings Institution (2), adopted
a similar approach, but came to much different conclusions, at least for
theseventies. Bosworth, et. al.'s estimates of capital requirements,
economic growth, and probable savings yielded an estimated surplus of
savings or "unallocated resources" amounting to $43.5 billion in 1980.
Their estimate is bas@d upon higher rates of savings than the NYSE study,
and includes Federal government surpluses amounting to $30.7 billion in
1977 and $81.8 billion ih 1980. "The estimates'.' they explain, "indicate
that with normal growth and without unusual sacrifices the economy-will
be able to meet the capital demands that can reasonably be projected
for the remainder of the decade. At the same time, very careful
fiscal management will be required to avoid a capital market crunch or
a renewal of inflationary demand pressures..." (2)

There are many uncertainties in projecting capital demands in a
complex economy. For.example, increased energy costs might be expected
to lead to higher prices which would dampen demand for energy and reduce
investment requiremehts. This appears to be happening to some extent,

TABLE III.F.28

Comparison Air Pollution Abatement with Control Baseline

Real GNP 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985

Control 1464.3 1532.3 1650.5 1754.0 1823.1 1870.1 1941.8 2002.0 2056.2 2100.3 2182.8

Air Only Percentage .24 .35 .47 .49 .22 -.05 -.27 -.61 -.93 -1.27 -1.81
Difference

Price Index
(GNP Deflator)

Control 185.8 191.6 205.4 215.3 229.0 244.4 258.2 272.3 287.3 302.0 314.3

Air Only Percentage .03 .17 .37 .66 1.05 1.50 2.00 2.54 3.07 3.75 4.73
Difference

Unemployment Rate

Control 8.8 &5 8.4 6.9 5.3 4.6 4.0 3.8 4.0 5.1 5.5

Air Only Percentage 8.8 8.4 8.2 6.6 5.1 4.4 3.9 3.9- 4.3 5.5 6.1
Difference

PersonaliConsumption
0
Expenditures (75$)

Control 931.9 956.0 1027.0 1091.4 1140.1 1165.5 1195.5 1219.0 1240.4, 1260.6 1300.1

Air Only Percentage .04 .03 .02 -.01 -.12 -.30 -.51 -.86 -1-20 -1.54 -2.07
Difference

Residential-Investment (75$)

Control 41.9 55.4 59.1 69.9 63.7 57.9 59.1 55..6 47.7 50.6 54.1

Air Only Percentage -.04 -.17 -.35 -.44 -.59 -.69 -.80 -1.16 -1.94 -3.09, -4.51
Difference

Nonresidential Investment (75$)
Control 149.4 153.0 175..8 191.2 206.0 224.4 252.4 278.0- 302.0 310.6 338.8

Air Only Percentage 1.95 2.80 3.47. 3.75 1.96 .40 -.35 -1.22 -2.01, -2.93 -4.17
Difference

Source: NCWQ. From CONSAD Research Corporation, "Macroeconomic-Impacts of
P.L. 92-500", 1976.

111-207

at least in the electric utility industry, and is central to the debate
over deregulation of nattikal gas. A more complex'study of the capital
markets, there: Eore, must be done in the context of the entire economy.

Such a study has recently been published by Allen Sinai and Roger
Brinner of Data Resources, Inc. (6). The authors have provided a useful'
definition of a capital shortage; namely, "... an economy in which the
financial system fails to provide the necessary flow-of-funds to finance
the economy's expenditures at reasonably stable rates of interest or
where capital expenditures are insufficient to generate enough capacity
to meet the demands of the economy at reasonably stable prices." (6)..
Their study uses the DRI macroeconomic model of the U.S. economy, and
examines the question of capital availability under two different
scenarios: the first, "Control - Long 5/75" in which the economy
gradually grows out of the current recession to full employment in about
1981; and second, "Accelerated Recovery 7/75" in which very aggressive
fiscal and accommodative monetary policy is used to achieve near full-
employment in 1978,-resulting in a very unstable economy with frequent
recessionary cycles beyond 1978.

.Sinai and Brinner's conclusion is that "...no.capital shortage
will, appear during the next five years if the economic recovery is
moderately paced and marked by relatively stable monetary and fiscal
policies. Beyond 1980, however, the outlook is more clouded." (6).
That is, when the-economy reaches full employment in 1981, the demands
on resources build up so that the rate of inflation increases and
pressures begin to appear on the capital markets.

DRV.s "Accelerated Recovery 7/7511 scenario represents somewhat
of an extreme over-reaction of fiscal policy. A recent study for the
Senate Budget Committee used the DRI model to simulate a more successful
"accelerated recovery". Assuming a $20 billion cut in personal income
taxes for calendar years 1976, 1977, and 1978, and a ten percent growth
in the money supply, this study found that a.stable, but more rapid,
growth to full employment would be possible without unduly straining.
the economy or impairing capital marketsi*,

In light of these recent studies and the continuing concern over
these issues, it is appropriate to examine the possible range of impacts
upon the capital markets resulting from government mandated investm ents
in water pollution control.

Working memorandum prepared for the Senate Budget Committee by
Donald A., Nichols; September ll,.1975.

111-208

b. Capital Requirements-of P.L. 92-500

The engineering and economic studies conducted by the Commission
and presented elsewhere in this report have defined the investment and
operating costs 'associated.with the implementation of P.;L. 92-500. A
investment of $60-$200 billion is estimated for the period 1975-1985.
Of this total, $40-$80 billion would be for industrial water pollution
control equipment and $20-$120 billion would be for municipal sewers
and water treatment systems.

These investments will amount to approximately 0.4 percent to 1.3
percent of total GNP, 1975-1985. The industrial investment of $40-$80.
billion will represent about 1.9 percent to 3.8 percent of total non-
residential fixed investment. The municipal investment of $20-$120
billion will amount to approximately 0.7 percent to-4.1 percent of
total government purchases of goods and services.

Given estimated levels of investments of approximately $60-$200
billion, what will be the net amount of additional securities that
will be brought to the capital markets? The answer depends upon
government policy, the extent to which water pollution control costs
are passed on to consumers in the form of higher prices, and the general
state of the economy.

First, the Federal government's share of these investments will
come out of general Federal receipts, so that Federal bonds will be
issued only if pollution control expenditures affect overall fiscal
policy. Thus, the water pollution control program will not necessarily
be responsible for bringing any Federal government securities to the
marketplace.

A study prepared for the Commission by Data Resources, Inc. estimates
that approximately 75 percent of state and local share will be financed
through the sale of tax-exempt bonds (7). The remainder will be
financed directly through government receipts. 'Thus, if state and local
governments assumed 25 percent of the total investment in municipal
sewers and water treatment systems, and 75 percent of this 25.percent
were'financed through municipal bonds, the total amount of bonds brought
to the marketplace would be $3.75 - $22.5 billion... ($20b to 120b x' .75.
x .25)* The Federal share of all.eligible expenditures for sewer systems
is increased under P.L. 92-500. Thus, the state and local share is not

See Section III.E., Table III.E.5 and surrounding text.

111-209

simply 25 percent of the expenditures caused by P.L. 92-500. (State and
local governments will pay a smaller percentage share of projects which
would have taken place without P.L. 92-500.)

The net demand for funds would be somewhat less than this,-however,
for after the first year funds accumulate to retire.the existing bonds.
If the bonds are amortized over an average period of twenty years, an
amount equal to approximately one-fourth of the total would have been
accumulated. Thus, the net demand on the capital markets would be $2.8-
$16.9 billion.

The DRI study cited above made the extreme assumption that 75 percent
of the industrial investment expenditures would be financed through
the bond markets. Of these, 50 percent would be financed by tax-exempt
pollution control bonds. Thus, the gross .value of securities issued
by industry would be $30-$60 billion, with $15-$30 billion in the form
of tax-exempt securities.

The net volume of funds required from the capital markets for
industrial investment in water pollution control facilities will depend
upon the extent to which pollution control costs are passed along to
customers in the form.of higher prices.

A realistic assumption is that prices will increase at least to
cover depreciation and interest on the pollution control investments.
This depreciation represents additional savings, with the only offset
being less@saving by consumers due to the increase in prices (the mar-
ginal saving rate from the disposable income of consumers being six to
eight percent). In this casei assuming a ten year "pay back" period
for corporate investments, the net demand on the capital markets would
be about 43 percent less than the gross (50 percent less six to eight
percent), or about $13-$26 billion.

The total net demand for funds from the capital markets to finance
water pollution control investments, therefore, will amount to approxi-
mately $16-$43 billion. If total net funds raised for all purposes
maintains its historical ratio to GNP (.15), the total funds raised
in the financial markets over the next decade will be 3 trillion dollars.
Thus, the high estimate of net funds raised for water pollution control
would be 1.4 percent of this total. Year to year fluctuations ih.total
funds raised are as large as 35 percent. These estimates assume no
change in Federal fiscal policy, 75 percent bond financing with a 20
year amortization period for state and local governments, and 75 percent
bond financing with a ten year pay back period for industry.

These estimates do not take into account the "third order" effects
produced by the general economy's reaction to the increased taxes,
prices, and expenditures associated with the pollution control investments.

111-210

Increased prices and taxes, for example, will reduce real income and
personal savings, thus increasing the pressure on the capital markets;
but will also lead to less growth in product demand, hence reducing
other investments. These third order effects are best considered with
the help of a complete macroeconomic model of the U.S. economy.

c. Two Econometric Studies

To assess the impact of water pollution control investments
empirically, the Commission has taken two approaches. fir 'st, a study
specifically of the impacts on interest rates has been performed by
Data Resources, Inc. (DRI); and second, the Wharton'Long Term Econometric
Model has been used to examine the impacts on the entire eco'nomy.@ -

The DRI study (7) looks specifically at the impacts of P.L. 92-500
upon the level of interest rates. An econometric model of the capital
markets was developed and used to obtain forecasts of the changes in
the general level of interest rates on corporate and municipal b onds
which might be induced by the Act, and to test the sensitivity of these
forecasts to the volume of expenditures and the proportion @inanced,
by government grants.

The econometric model of the capital markets developed by@DRI is
a relatively simple supply = demand model of two non-Federal long-term
securities markets, one for taxable securities, and one for tax-exempt
bonds. Taxable securities include mortgages and corporate and foreign
bonds. Tax-exempt bonds include all municipal securities, pollution
control bonds, etc. Investors are separated into two categories:
households/commercial banks, and "other". The total amount of bonds
to be purchased by each sector is entered into the system as an
exogenous variable, but the desired proportion of the stock of tax-
exempt securities to the stock of total bonds is computed as a function
of.the differences between the yields on tax-exempt and taxable'b6nds.
The supply of tax-exempt securities brought to the market each quarter
is basically a function of (1) total predicted new construction expen-
ditures by state and local governments, and (2) of interest rates.
The supply of taxable securities brought to the market each quarter
is a function of (1) total gross. private domestic fixed investment,
and (2) of interest rates.

With this model DRI used forecasts of the exogenous variable!@
obtained from their model of the U.S. economy, and estimates of water
pollution control financing requirements of approximately $71.6 billion
for industry and $19-$34 billion for the state and local portion of
,abatement expenditures. This is the share based on total public spending

111-211

for'water pollution control not just the increase in spending due to-
P.L. 92@@500. They also assume that 75 percent of both.industrial
and state and local expenditures would be borrowed, and that 50 percent
of corporate borrowing would be in the form of tax-exempt pollution
control bonds.

The.DRI study found an average change in interest rates over the
1975-1983 period of 1.07 percentage points for tax-exempt securities@
and 0.56 percentage points for taxable securities assuming their lower
estimates of municipal expenditures. The corresponding figures.assuming
the high level of municipal expenditures are 1.31 percentage points and
0.65 percentage points. Almost half of the increase in interest rates
in the tax-exempt market is dueto the use of tax-exempt pollution
control bonds by industry (see Section d below).

The changes in'inter6st rates are determined without consideration
of the simultaneous developments within the rest of the economy. Hence,
they do not allow for any compensating fiscal or monetary policy, nor
do they take into account the decrease in investmeht demand created
by higher prices or the increase in savings brought about by higher
interest rates. Nor do they take into account the reduction in net
demand resulting from amortization. Finally, they assume-no flow
of funds to or from foreign countries. In light of the above and
DRI's high investment expenditure estimates, it is reasonable to conclude
that the interest rate increases predictedby DRI represent a significant
overestimate of impact of P.L. �2-500.

As a means of analyzing the impacts of P.L. 92-500 in the context
of the entire economy, the Commission used the Wharton Long-Term Econo-
metric model to simulate the U.S. economy under a variety of assumptions
(5), The results of this study have been summarized in Sections III.F.1-4
above. The effects upon investment are negative. However, the magnitudes
are considerably smaller than other studies, particularly' the DRI study
sunmiarized above, have suggested. Interest rates rise, but only 0.1
percentag,e points. Housing startsdecline-gradually, reaching An annual
.level about five percent below the baseline in 1985.

Water Pollution,control expenditures have a slight but increasingly
negative impact on "productive" corporate investment in the Wharton
results. Virtually all of this impact is due to the increased prices
and subsequent reductions in demand in affected industries rather than
through effects of increased interest rates or "capital shortages".

Interest rates in the Wharton Model are determined primarily by
changes in the Federal Reserve discount rate. Since this remains constant,
the Wharton scenarios assume that monetary policy is adjusted to accommo-
date the increased investment so that there is little pressure on interest

111-212

rates. The fact that an increase in money supply of less than one percent
by 1985 is required to achieve this accommodation indicates that the
financial impact of the pollution control investments.is r1ot large.

In summary, these empirical studies of water pollution control
investments provide a range of possible impacts upon the capital markets.-
Under the most stringent assumptions interest rates increase 0.5 to 1.3
percentage points. When analyzed in the context of the entire economy
with accommodating monetary policy, the potential increases are much
smaller - approximately 0.1 percentage points. Critical to an under-
standing of these differences is a comment by Roger W. Strassburg, Ph.D.,
Director of Environmental Affairs for the B.F. Goodrich Companyp who
states in a communication to the Commission that "one of the most note-
worthy omissions of the report (November draft) is its virtual silence
on the question of whether capital expenditures for pollution control
are made in addition to, instead of, or partly in addition to other
("baseline") capital expenditures"(11). In fact, the.DRI results assume
all financing to be "in addition to", whereas the Wharton analysis
reflects the full range of complementary and substitute capital invest-
ments and associated reactions that will likely occur.

.d. Industrial Pollution Control Bonds

The Revenue and Expenditure Control Act of 1968 severely curtailed
the increasingly popular use of tax-exempt "municipal" bonds to finance
corporate capital expenditures. However, such financing was not elim-
inated for a few special purposes, one of which was corporate.pollution
control expenditures. Thusf state and local government bodies were
allowed to issue tax-exempt bonds, the proceeds of which would go toward
the construction ofpollution control facilities for local industry.
The bonds, although tax-exempt, would be backed by the credit of the
individual industrial corporations rather than the issuing governmental
unit. For example, The Brazos ort Facts of January 8, 1976, reports that
the Brazos River Harbor Navigation District Board of Commissioners will
consider authority to issue additional pollution control bonds pursuant
to a lease-pur6hase agreement with Dow Chemical Company. $60 million
of such bonds were issued in 1974 for this district and the Texas Water
Quality Board has approved a list of $59 million in additional projects
(3).

The use of tax-exempt bonds to finance industrial pollution control
investment expenditures began in 1971. That year $86 million of pollution
control bonds (PCB's) were issued. Because this financing vehicle
enables private corporations to borrow at the lower interest rates
that prevail for tax-exempt municipal bonds, PCB's have become increasingly
popular. In 1974 the annual volume of PCB's, had increased to $1.65

111-213

billion, accounting for approximately 7.8 percent of the total tax-exempt
market. By the end of 1974 approximately $4.1 billion of PCB's had
been issued. Table III.F.29 summarizes the statistics relating to
the growth of the industrial pollution control bond market over the
1971-1974 period.

The increasing volume of PCB's-.hds caused som e concern about the
effect of these bonds upon the capital markets, the, relative efficiency
of the subsddy that they provide, and hence, about the desirability of
using these bonds as a financing vehicle for industrial pollution control
investments. These questions have been investigated as a part of the
DRI study mentioned above and are summarized in the following section.

Using their model of the tax-exempt and taxable bond markets, DRI
simulated the impact of PCB's upon interest rates. The results, pre-
sented in Table III.F.30, indicate that the use of PCB's throughout the
period resulted in tax-exempt yields being 0.3 percentage points higher
and taxable bond yields 0.1 percentage points lower than they would
-have been during 1974 if industrial borrowing for pollution control had
occurred in the taxable bond market. Thus, the use of PCB's induced
a shift in income distribution from Federal and state-local governments
(or taxpayers) to private borrowers and investors.'

TABLE III.F.30: IMPACT OF POLLUTION CONTROL BONDS ON INTEREST RATES
1971-1974

Volume of Pollution Estimated Change in Interest Rates
Year Control Bonds Tax-Exempt Bonds Taxable Bonds

1971 $O.l billion (current dollars) +.Ol% -.01%
1972 0.5 billion +.07% -.02%
1973 1.8 billion +.24% -.07%
1974 1.6.'billion +.30% -.10%

Source: NCWQ. From Data Resources, Inc., Financing P.L. 92-500- The
Impact of the Federal Water Pollution Control Act of 1972 on
@the Municipal Bond Market. 1975.

TABLE III.F.29

Industrial Pollution Control Expenditures and Pollution Control Bonds
1971-1974

Industrial Volume.of Tax-Exempt
Year Pollution Control Pollution Control Pollution Control Gross Tax-Exempt Market Share
Expenditures(l)(3) Bonds(2)(3) Borrowing Ratio Bonds I-ssued(2)(3) of PCB's

1971 $ 2.9 $0.086 .3% $24.4 0.4%

1972 3.7 0.548 15% 22.9 2.2%

1973 4.9 1.796 37% 23.0 7.8%

1974 5.3 1.648 31V 22.7 7.0%

1971-1974 $16.8 $4.078 24% $93.0 4.4%

(1).DRI edtimates based upon McGrawrHill Annual Surveys.

(2) From the Federal Reserve System's Flow-of-Funds accounts.

(3) Billions of current dollars.

Source: NCWQ. From Data Resources, Inc., "Financing P.L. 92-500-The Impact of-the Federal
Water Pollution Control Act of 1972 on the,Municipal Bond Market", 1975.

111-215

These shifts in income distribution have been roughly quantified by
DRI-and are presented for the year 1974 in Table III.F.31. Using DRI's
assumption, the shift in bond yields led to an estimated $95 million
cost in 1974 for governments, with a $29.7 million loss in Federal tax
revenues and a $65.4 million loss to state and local governments in the
form of lost tax revenues and higher interest payments. This $95
million loss to the public sector, that is to taxpayers, resulted in equal
income increases for the private sector. The main beneficiaries
were private borrowers; who paid $123.3 million less interest. Of this
$123 million interest savings about $76 million accrued to mortgage
borrowers and the remaining $47 million to businesses. Private investors,
however, were net losers, having sustained a $28.3 million loss in
after-tax income. Although the, rise in tax-exempt bond yields provided
investors with an additional $63.3 million income, the decline in taxable
yields cost investors in corporate securities $91.6 million in lost
income.

in summary then, the use of tax-exempt PCB's created a shift in income
from taxpayers and users of conventional municipal services to private
borrowers while at the same time providing a benefit to investors in
tax-exempt securities but reduced income for investors in taxable securi-
ties.

To test the iinpact of PCB's,over the 1975-1983 period DRI pekfomed
the same simulation as was summaiized in the preceding section assuming
that no PCB's would be issued, as opposed to 50 percent PCB's for indus-
trial borrowing. The results without PCB's show a-much lower increase in
interest rates for tax-exempt issues and an almost insignificant addition
to the increase.in interest rates for taxable securities ' The average
differentials were 0.59 - 0.84 percentage points for tax-exempt bonds
as opposed to 1.07 --@ 1.31 percentage points with PCBIs? and 0.58 - 0.67
percentage points for taxable securities as opposed to 0.56 - 0.65 per-
centage points with PCB's.

Performing a series of calculations similar to those in Table III.F.31,
DRI used three interest rate changes with and without PCB's to determine
the net impact of PCB@s on the private and public sectors over the
1975-1983 period. The results, using the low level of municipal water
pollution control expenditures, indicate that the use of PCBIs would
cost the' public sector approximately $12.8 billion over the period
and provide a corresponding subsidy to the private sector. Federal
income taxes are reduced by $2.98 billion and state and localincome
taxes by $0.19 billion. State and local interest payments are increased
by $9.65 billion. The gain to the private sector is not made up so much
by reduced interest payments on PCB's, which amount to only $3.25 billion,
as by a net increase of $9.57 billion in investor income from the higher
municipal interest rates. Thus, industrial establishments which invest

111-216

TABLE III.F.31
Effect of Pollution Control Bonds on Annual Expenditures and
Receipts of Public and Private Sectors Arising from
Gross Bond Issues in 1974

Public Sector

Federal Government
.Decline in investor Tax Payments -$84.1
Increase in Borrower Tax Payments + 54.4

Net Loss to Federal Government -29.7

State and Local Government
Increase in Interest Paid on
Tax-Exempt Bonds - 63.3
Decline in Investor Tax Payments - 5.6
Increase in Borrower Tax Payments 3.6

Net Loss to State & Local Governments -65.3

Total Loss to Public Sector -95.0

Private Sector

Reduction in Private Interest Payments +123.3
.Increase in Investor Income From
Tax-Exempt Bonds + 63.3
Loss in Investor,Income from Private
Ta xable Bonds 91.6

Net Gain To Private Sector +95.0

Assumptions: Marginal Federal income tax rate 30%
Marginal State and Local income tax rate = 2%
Volume of private borrowing =.$45,000 million
Volume of tax-exempt bonds without PCB's = $21,000 million
Volume of PCB's = $1,600 million.
Taxable bond yield.,t: without PCb's 8.5%; with PCB's = 8.46%
Tax-exempt bond yilds: without PCB's 5.89%; with PCB's 6.19%

Source: NCWQ. From Data Resources, Inc., "Financing P.L. 92-500-
The Impact of the Perqeral Fater TIollution Control Act of
1972 on the Municipal Bond Market", 1975.

111-217

in pollution control receive a $3 1/4 billion subsid@ over the period,
but at a cost of approximately four times that amount to the public
sector.

Even considering the hypothetical nature of these simulations,
the study is useful in pointing out the possible magnitude and direction
of the income distributions produced by PCB'@s. Over the 1975-1984
period, private investors in pollution control equipment receive a
significant subsidy, but the cost to. the public sector is much greater.

e. Microeconomic Problems

Economic analysis which is directed at the level of the entire
economy often overlooks problems which might arise at more localized
levels. For example, small business has problems in raising capital
in times of higher interest rates. This problem has already been
recognized by Congress, which has provided in the Water Pollution Control
Act of 1972 for special Small Business Administration loans for pollution
control expenditures.

Although the amount of investment for water pollution.control is
relatively low when placed in the context of the whole economy, it is
very high for some industrial sectors. The capital expenditures of
eight industries - chemicals, steam electric power, iron and steel,
pulp and paper, mining, petroleum refining, metal finishing, and
machinery and mechanical products - constitute over 90 percent of the
total industrial water pollution abatement capital expenditures. Although
theoretically the capital markets should allocate funds to any industry
with sufficient profit potential, the inefficiencies and lags in the
system might create short-term financing problems for those industries
with particularly large water pollution control investment requirements.
Individual companies with particularly weak balance sheets may find
that they cannot raise sufficient funds to meet-all of their investment
goals. Whether this will actually be the case will depend both upon
the general health of the economy and upon the financial conditions of
individual corporations. Because the dimensions, or even the likely
occurrence, of such financial constraints cannot be determined without
a careful examination of the individual corporations' balance sheets
.and investment plans, we can only comment on the possibility of these
localized problems. In general, current economic projections imply
that such financing problems will not occur on a large scale.

f. Conference on Capital Markets and water Quality Needs

In June 1975 the Commission and The Conference Board jointly
sponsored a conference of business, governmental and academic repre-
sentatives to discuss the capital markets impacts of P.L. 92-500. A

111-218

summary and partial transcript of this conference has been published by
The Conference Board (4), The participants of the conference were
in fairly general agreement on four major points: (1) that the perceived
need for capital investment over the next decade may be larger than it
has been in the past relative to the expected supply of saving; (2) that
this need is unlikely to be fully met if the present economic environment
persists and if public policy toward capital markets does not change;
(3) that the investment needs can be more easily met if the water pollution
abatement expenditures are financed at the expense of consumption or other
government programs rather than savings, and (4) that the use of tax-
exempt Pollution Control Bonds to finance industrial pollution control
was a very inefficient means of subsidization.

There was less general agreement over (5) the kinds of policies
which should be pursued in order to increase savings; (6) the extent
to which water quality needs can be met by employing idle resources
rather than displacing other expenditures, and (7) what are likely to be
the impacts on the financial markets and investment if water pollution
control expenditures are met without any policy changes.

Business leaders, in particular, expressed concern over the financial
problems of the American economy and argued that pollution abatement
requirements will divert capital from capacity modernization and expansion,
causing shortages and greater inflation. They suggested policy changes
including the reduction in the 1983 BAT requirements for industry and
various tax measures intended to redistribute income toward corporations
-and stockholders.

some participants suggested that pollution control expenditures
could serve as a countercyclical economic policy tool during recessions
by stimulating employment and production. It was also argued that
some forecasts of capital needs were overestimated because effects such
as that of higher energy prices reducing energy demands were not being
accounted for. One economist suggested that full employment and growth
could be maintained with lower than forecasted.investment if technology
were slightly less capital-intensive.

As an exercise, Conference attendees, without prior notice, were
split into groups to di scuss the potential impacts of $100, $200, and $300
billion water pollution expenditure-levels. From these four discussion
groups and the reports of the group leader, a Conference Board editor
has taken the final step of prepari'ng a grand summary. This statement
concludes that the $100 billion expenditure level would be accommodated,
but with some difficultyand disruption. This disruption would.occur
mostly in the tax-exempt market, due mostly to its historically low level
of utilization. Capacity growth problems in steam electric power
generation and energy extraction and production industries, areas of

111-219

major concern without the additional burden of pollution control expendi-
tures would be exacerbated. Impacts at $200 and $300 billion levels would
obviously be more extensive. No.;formal consideration of external factors
throughout the economy, such as the role of prices and profits, extra-
national money flows and national monetary and fiscal.policy,-were
included in these discussions. Discussion of impacts:upon the-tax-exempt
bond market led once again to the conclusion that this served to highlight
the many weaknesses of that market and the near unanimous conclusion
that this mechanism should be eliminated. It should be noted that the
severe disruptions associated with $100 and $200 billion levels of abate-
ment refer to the tax-exempt market primarily. The disruptions take the
form of removing the differential between taxables and tax-exempts.
While this disruption would be viewed as a negative by those-who are pro
tax-exempts it would be viewed as a positive by the majority who were
anti tax-exempts as this disruption would virtually eliminate that market.

6. Point Source Pollution Abatement

a. Introduction

One nagging, fundamental question that has plagued analysis and
policy-makers alike is the role of the passage of1time and the dynamic.
forces of economics upo .n the progress of pollution control efforts.
Most studies of the impacts of these efforts are found in a,totally
static framework, using data sets from specific past-time periods. Thus,
all data:Qn.costs, industry, environmental and regional are.essentially
1973 based with most analysis based upon "what-if" exercises wherein
@these data sets are altered by the imposition ofthe relevant quantifi-
cations of parameters directly relating to the implementation of P.L.
92-500. Only'in the economic analysis, particularly marcoeconomic, is
emphasis placed upon capturing the dynamics of activities throughout
the study period. Thus,.we are not just super-imposing a 1983 BAT
related set of statistics upon another set from 1973- we are actually
attempting to depict the year 1983 and the relevant economic activities
with and without the Act leading up to that period.

While the economic dimensions of that'analysis are reported above,
one additional set of information has not been reported -- the generation
and control of selected residuals throughout this time period. Furthermore,
it is also possible to link these dynamic adjustments to the important,
matter of'energy use.. Using thesesame general techniques it is possible
to derive estimates of changing energy use patterns throughout the
compliance period.

To conduct this analysis the Commission cooperated with the Environ-
mental Protection Agency in the development of the Strategic Environmental
Assessment System (SEAS). SEAS is a system of integrated computer modules

111-220

designed to make detailed forecasts of poll ution levels, energy use and
abatement costs. The forecasts are based upon economic projections of
the INFORUM 185 Sector input-output model developed by Clopper Almon of
the University of Maryland (1). The industrial output projections of
INFORM were further disaggregated and refined in SEAS focusing on those
industries where particular products and technologies are associated with
air and water pollution. The Commission's industry studies were the
primary source of information.on water pollution ("residual generation")
and abatement cost by industry subcategory. EPA effluent guidelines were
used as the basis of BPT and BAT removal efficiencies by subcategory.*

Subcategories defined by product and technology have distinct co-
efficients of residual generation (unit of residual/unit of economic out-
put) and abatement req,#rements. Since the rates of growth of output
vary substantially between subcategories, growth projections of total
residuals generated are considerab@ly_refined by the disaggregated .approach.

The following presentes the resul ts of the SEAS projections at both
the national and industry level. The estimates of residuals discharged
by publicly owned treatment works are based upon Commission studies and
SEAS.

b. Summary

It is axiomatic that environmental pollution tends to increase with
economic growth. Thus, increasing stringent controls are necessary in
many are as simply to prevent increased pollution. Over the 1971-1985
period the annual growth rates for industrial discharge of four categories.
,of water pollutants in the absence of the Act are projected ast

TABLE III.F.32: PROJECTED GROWTH RATES, INDUSTRIAL POLLUTION BASELINE
1971-1985

Average Annual Growth Rates
1971-1985
Biochemical Oxygen Demand 3.6%
Suspended Solids 2.5%
Chemical Oxygen Demand 3.2%
Dissolved Solids 0%

Source: NCWQ. From U.S. Environmental Protection Agency, Strategic
Environmental Assessment System.(SEAS). 1975. (Based upon an
average 3.5% annual growth in GNP.)

Resultant estimates of residuals generation should not be read for
their precisezccuracy but rather for their indication of. general,
relative magnitudes.

111-221

At these growth rateerindustrial discharges would double every 19 years
for BOD, 29 years for Suspended Solids, and 22-years for COD.

A summary of the projections of industrial pollution levels is
presented in Table III.F.33. Levels for BOD, SS, COD, and DS are shown
for 1977 and 1985 given different assumptions of compliance with BPT
and BAT standards. Baseline projections are based on the assumption
of no improvement in abatement practices after 1971. The lower half of
the@_ta7ble presents the discharge levels in terms of an index where 1971
level = 100 for each category of residual. Discharge levels in 1977
range from 21% - 97% of the 1971 levels given compliance with BPT and
79% -102% given a delayed compliance (BPT by 1980). Discharge levels
in 1985 range from 5% - 62% of 1971 levels given compliance with BAT
in 1983 and 20% - 83% of 1971 levels given no compliance with BAT
(and delayed BPT compliance).

Table III.F.34 presents the comparison of BOD and SS levels for
public facilities and industry. Comparing the reductions in public versus
industrial discharges in,1985, a rough measure of the relative importance
of private and public abatement under P.L. 92-500 can be made.

TABLE III.F.34: PROJECTIONS OF POLLUTION LEVELS: INDUSTRY AND PUBLIC
(Annual Levels-Million Tong)

1985
1971 Baseline Compliance with Reduced
P.L. 92-500a Discharge
BOD
Industrial 2.27 3.70 .54 3.16
Municipal 1.70 1.73 .51 1.22
SS
Industrial 7.70 10.80 .44 10.36
Municipal 1.54 1.59 .53 1.06
DS
Industrial 11.77 11.90 7.26 4.64
Municipal 9.14 12.53 11.82 .71

a. Scenarios #1, 2, 3 and 5 for industrial, Scenario #5 for municipal

Source: NCWQ- From U.S. Environmental Protection Agency, Strategic
'Environmental Assessment System.(SEAS.). 1975.

TABLE III.F.33- PROJECTIONS OF INDUSTRIAL POLLUTION, 1971 and 1985

1977 1985
Level in* BPT-1980 4
1 2 3
1971 Baseline BPT-1977 BPT-1980 Baseline BAT-1983 No 13AT

BOD 2.27 3.00 .94 1.98 3.70 .55 1.00
Ss 7.70 9.55 1.69 6.08 10.80 44 1.62
COD 3.68 4.89 .2.57 3.73 5.73 1 54 2.67
DS 11.77 12.56 11.41 11.99 11.89 7.25 9.81

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

BOD 100** 132 41 87 163 24 44
Ss 100 124 21 79 140 5 20
COD 100 132 70 101 156 42 73
DS 100 107 97 102 101 62 83

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
tj

Annual Level-Millions Tons
Index: 1971 level = 100
Note: Baseline assumes 1971 treatment levels for all plants. All other scenarios assume
New Source Performance Standards are met for all hew plants.

1 Scenarios number 1, 3 and 5.
2 Scenarios number 2, and 4.
3 Scenarios number 1, 2, 3 and 5.
4 Scenario number 4.

Source: NCWQ. From U.S. Environmental Protection Agency,
Strategic Environmental Assessrhent System (SEAS), 1975.

111-223

Estimated reductions-in discharges in 1985 due to P.L. 92,500 are
significantly greater for industrial than for public facilities. Indus-
trial reductions of Biochemical Oxygen Demand are 2.6 times public reduc-
tions; Suspended Solids 9.8 times public, and Dissolved Solids 6.5
times public. This greater cost effectiveness in reducing industrial
discharge is probably due to.economies of scale since the average public
treatment system is smaller than the average industrial,one. There are
also more technological options open to the average industrial discharger.
Remaining levels of discharge projected for 1985 are remarkably similar
for industry and public sources.

c. Baseline Description

The starting point for our analysis is a baseline run in which we
postulate a future in which P.L. 92-500 does not exist; that the removal
,efficiency of each pollutant in each industry subcategory through the
entire forecast stays constant at base year 1971 value, The levels of
discharge of any pollutant in any sector is simply the difference between
gross levels, and amounts removed. Gross levels are derived by multiplying
a "gross"..coefficient expressed as tons of pollutant per unit 'of output
-times the relevant output levels. The amount removed is the removal
efficiency (say, 90-percent) times gross level. Fixing removal efficien-
cies at their 1971 level thus has the effect of.gradually increasing
the forecast level of all pollutants over time since output levels
generally increase over time. However, the growth rate will vary across
pollutants because of differential growth across industries.

Table III.F.35 was compiled to give some idea of the scope and coverage
of the RE$GEN module.* Only point sources of pollution are considered.
The forecasts are made at ihe subcategory level. These subsectors
were-grouped to the NCWQ industry level.

For each pollutant the table notes the"Industries for which pollution
coefficientsare specified. As indidated in the table, for several
industries no pollutant data are available in-SEAS at the present time.
This was due partly to lack of necessary background information in the
Commission and EPA documents. In most cases, these industries are
judged tb be minorsources of the pollutants being covered. In two
cases, however, the level of-pollutants involved are likely to be signi-
ficant. These are the mining (bothore And coal) and the machineKy and
mechanical products industries. This is reflected in the associated
cost levels for these industries as well.

RESGEN is the Residuals Generation Model in SEAS.

CHO LEVEL
TABLE III.F.35: RESIDUAL GENERATION MODULE AT N

Sus- Dis- Oil
pended solved Nutri- and
Indepth: BOD 'COD Solids Solids ents Greases Bases Acids-

Fruits and Vegetables X X X
Chemicals X X X X X X X X
Iron and Steel X X X X X X
Metals Finishing - Job X X X
Petroleum Refining X X X X
Plastics (included in Chemicals)
Pulp and Paper X X
Steam Electric X X
Textiles X X X X X

General:

Ore Mining No Data Specified
Coal Mining No D -at-a 4ec'ified
Petroleum & Gas Extraction X
Mineral Mining 96-ijifa, Spec ifie d
Meat Products X X X X
Dairy Products X X
Grain Mills X X
Cane Sugar X X
Beet Sugar X X
Canned and Preserved Seafood X X X X
Misc. Foods and Beverages X X
Timber Products No Data Specified
Furniture and Fixtures No Data pecified
Builder's Paper (included inPulp ahd Paper)
Paint and Ink No Data pecified
Soap and Dete.;gents X X X X

*Industries for which particular pollution coefficients are specified (for at least one subcategory)
are indicated by an X. COD data is incomplete.

TABLE III.F.35 (continued)

Sus- Dis- Oil
pended solved Nutri- and
General: BOD GOD Solids Solids ents Greases Bases Acids

Phosphate Manufactures (include in Chen6icals)
Fertilizer Manufactures No Data Specified
Paving and Roofing x
Rubber x x x x
Leather x x x x x
Glass x x x x x
C ement x .X x
Concrete (include I in Cem,-nt)
Asbestos x x x x x
Insulation Fiberglass (included in Glass)
Ferroally (included in Iron and Steel)
Nonferrous Metals x x x x x
Machinery and Mechanical Ln
Products L4o ,Data Specified
Transportation
qo Data Specified
Water Supply No Data Specifie@
Auto and other Laundries No Data Specifie(
Foundries (included in Iron and Steel)
Structural Clay No Data Spec le
Pottery No Data pecifie
Nonferrous Mills (include in Nonferrous Metals)
Feedlots x x x x

Others:

Forestry and Fisheries x x x x

source:. NCWQ. From U.S. Environmental Protection Agency,
Strategic Environmental Assessment System (SEAS), 1975.

111-226

Relevant data from the baseline scenario is given in Table,III.F.36.
The table lists, for each pollutant, the amount of pollutant in tons
for each industry, together with each industry's share of the national
totals for 1977 and 1985. An analysis of this table indicates that a
few industries account for a major share of the total discharge for any
given pollutant. Table III.F.37 emphasizes this fact for four of the
pollutants concerned: Biochemical Oxygen Demand, Chemical Oxygen Demande
Suspended Solids, and Dissolved Solids. The relative share of each indus-
try in the overall picture does not change significantly from 1977 to
1985, indicating that the effect of differential growth of sectors has
a negligible effect on the importance of individual industries as
dischargers.*

d. Scenario Analysis

The major results for Scenario 1 in which BPT and BAT standards
are assumed met on schedule are given in Table III.F.38. This table
presents impacts on levels of four pollutantst Biological Oxygen Demand,
Chemical Oxygen Demand, Suspended Solids, and Dissolved.Solids. Four
sets of statistics are presented for each pollutant for 1977 and 1985.
They are, in order of column:

� The level, in tons, of each pollutant for each industry.**

� The share of each industry in the total discharge of each
pollutant that remains after compliance.

� For each industry, the difference (in percentage terms)
in the level of each pollutant between the baseline and
compliance scenarios.

� Foreach industry, its relative share of the total reduction
in discharge of each pollutant at the nationaTlevel.

The industries that arethe largest dischargers of these pollutants
in the baseline are generally the most important in contributing to
the overall reduction in levels below baseline. For example, five

New Source Performance Standards equal to BAT requirements are assumed
for.all new plants in all cases other than the baseline, and tend to
offset the effects of the growth factor.

The numbers in this and other scenarios have been rounded to thousands
of tons.

A M

TABLE III.F.36: FORECASTS OF POLLUTANT LEVELS BY NCWQ INDUSTRY GROUP
(1977 and11985) FOR BASELINE SCENARIO*

BOD GOD Suspended Solids Dissolved. Solids
1977 1985 1977 1985 1977 1985 1977 1985
% of o/o o f % of .* of % of % of % of % of
Indepth-. Tons Total Tons Total Tons Total Tons Total Tons Tota ns Total Tons Total Tons Total
@ T, Zo
Fruits and Vegetables 51,000 1.7 67,000 1.8 0 0 70,000 7 91,000 .8 - 0 10,132,000 -
Chemicals 777,000 26.o 1951,000 25.7 1,967,000 40.5 2, 389, 000 41. 8 353,000 3.7 384,000 3.6 9, 932,000 79.1 0 85.2
Iron and Steel 35,000 1. z Z8. 000 .8 0 0 1,777,000 19.6 1,782,000 16.5 0 1. z 199,000
'Metals Finishing (Job) 0 0 0 0 0 0 163,000 0 1.7
Petroleum Refining 24,000 8 30,000 - 8 107,000 2.2 136,000 2.4 11,000 - 13.000 - 0 0
Pulp and Paper 1, 154,000 38.4 1,500,000 40.6 0 0 11099,000 11.5 1,596, ooo 14.8 0 0
Steam Electric 0 0 0 0 68,000 .7 40,000 - 2,260,000 18.0 1, 334, 000 11. 2
Textiles 210,000 7.0 255,000 6. 9 1. 126.000 23. Z 1,374,000 Z4.0 Z47, 000 2.6 0 0 0

General:
Petroleum and Gas@Extraction 0 0 0 0 0 0 0 0
Meat.Products Z06, 000 6. 9 258,000
7.0 78,000 1. 6 95, 000 1. 7 121,000 1.3 151,000 1,4 0 0
zo, 000 .7 23.000, 6 o 0 5,
Dairy Products
000 - 6.ooo - 0 0
.-Grain Mills 17,000 .6 zi. 000 .6 0 a la 000 - 15. UOU - 0 0
Sugar 46,000 1. 5 54.000 1. 5 0 0 180: 000 1.9 ZI 1. 000 2.0 0 0
Canned and Preserved Seafood 34.000 1. 1 45,000 .1.2 0 0 26,000 - 34,000 - 0 0
Miscellaneous Food and Beverage zo, 000 .7 ZZ, 000 .6 0 0 8,000 - 9,000 - 0 0
Paving and Roofing 0 0 0 0 1.2,260,000 23.7 2,347,000 21.7 0 0
Rubber 5,000 - 5,000 - 0 0 12,000 - L4, 000 0 0
Leather Z6,000 .9 23,000 .6 0 0 49,000 .5 4Z, 1500 - 13 a
Glass 4,000 - 4,000 - 51,000 1.0 59,000 1.0 4,000 - 4,000 - 11,000 13,000 -
Cement 0 0 0 0 38,000
Asbestos 0 1 i . 45,000 - 84,000 .7 98,000 .8
0 0 0 0 0 1,000 - 1,000 -
Nonferrous Metals 0 0 0 0 25.4 2,857,000 26.4 99 ,000 117,000 1.0
-Feedlots 151.000 5 176,000 4.8 522,000 10.7 608,000 lo.6 367,00o 3.8 427,000 4.0 0

Other-
Forestry and Fishery Products 223,000 7.4 233,000 6,3 1,010,000 .20.8 1,055,000 18.5 415,000 4.3 433,000 4.0 0 0
Total 3,004,1900 3,696,000 100.0 4,861. ..000.1 100,0 5.,7L8,000 100.0 F9516,000 100.01 10,804 56,000 000 i0o

-c. 5 percentNumber of tons have been rounded to nearest thousand and elements may not add
to totals because of rounding, GOD data is incomplete.
Chemical Oxygen Demand is incomplete. See text.

Source: NCWQ. From U.S. Environmental Protection Agency, Strategic Environmental Assessment System (SEAS), 1975.

TABLE III.F.37:- LIST OF MAJOR INDUSTRY SOURCE BY POLLUTANT CATEGORY, 1985, BASELINE

Biochemical Oxygen Demand Suspended Solids

Rank Industry % of Total Rank Industry % of Total

1 Pulp and Paper 40.6 1 Nonferrous Metals 26.4
2 Chemicals 25.7 2 Paving and Roofing 21.7
3 Meat Products 7.0 3 Iron and Steel 16.5
4 Textiles 6.9 4 Pulp and Paper 14.8
5 Forestry and Fishery products 6.3 5 Forestry & Fishery Products 4.0
86.5% 83.4%
----------------------------------------------- ----------------------------------------------------

Chemical Oxygen Demand Dissolved Solids

Rank Industry .% of Total Rank
CD

1 Chemicals 41.8 1 Chemicals 85.2
2 Textiles 24.0 2 Steam Electric 11.2
3 Forestry and Fishery Products 18.5 .3 Metals Finishing (Job) 1.7
4 Feedlots 10.6
5 Petroleum Refining 2.4 98.1%
97.3%

Source: NCWQ. From U.S.Environmental Protection Agency,
Strategic Environmental Assessment:;System (SEAS), L975.

[email protected]: FORECAST OF POLLUTANT LEVELS FOR 1977 and 1985

1977 1985
Biochemical Oxygen Demand
Percent Percent Percent Percent Percent Pe rcent
Net of Below of Total Net of Below of Total
Indepth: Tons Total Baseline Reduction Tons Total Baseline Reduction
Fruits and Vegetables 32,000 3.4 38.0 9 30,000 5.6 54.8 1.2
Chemicals 182,OOU 19.4 76.6 Z8.8 54,000 9.8 94.4 28.5
Iron and Steel 5,000 .5 85.0 1.4 2.000 - 91.5 .8
Metals Finishing (Job) 0 - - - 0 83.6 .8
Petroleum Refineries 17,000 1.8 29.1 - 5,000 .9
Pulp and Paper .334.000 35.6 71..l 39.7 165,000 30.2 89.0 42.4
Steam Electric 0 - - 0
Textiles 54,000 5.7 74.5 7.6 41,000 7.6 83.4 6.8

General:

Petroleum and Gas Extraction
Meat Products 15,000 1.6 92.8 9.3 7,000 1.4 97.1 7.9
Dairy Products 4,000 - 80.4 .8 2,000 - 93.1 .7
Grain Mills 8,000 .9 51.8 - 4,000 .8 80.4 .5
Sugar 41,000 4.4 11.8 0
99.1 1.7
Canned and Preserved Seafood 27.000 2.9 20.5 -- 15,000 2.7 67.4 1.0
Miscellaneous Food and Beverage 10,000 1.0 49.8 .5 6,000 1.0 74.9 .5
Paving and Roofing
Rubber 1,000 - 86.3 - 1,000 - 86.5 -
Leather 4,000 86.7 1.1 1,000 95.4 .7
Glass 1'.000 81.5 - 1,000 82.3 -
Cement
Asbestos 0 - - 0.0
NonFerrous Metals 0
Feedlots 0 100.0 7.3 0.0 100.0 5.6

Othe r:
Forestry and Fisheries 204,000 21.8 8.3 .9 212,000 38.8 9.0 .7
Total 937,000 100.0 100.0 545,000 100.0 100.0

Note 5 percent COD data is incomplete.

TABLE-III.F.38: Continued

2. Chemical @Cxygen Demand* 1977 19@5
Percent Percent Percent Percent Percent Percent
Net of Below of Total Net of Below ..of Total
Tons Total Baseline Reduction Tons Total i3aaeline Reduction
Indepth: i . -

Fruits and Vegetables 0
Chemicals 1,120,000 43.5 43.1 37.1 -_419,000 27.3 82.5 47.1
Iron and Steel 0
Metal Finishing (Job) 0 - Z6,000 1.7 80.9 z.6
-Petroleum Refineries 102,000 4.0 4@8
Pulp and Paper 0
Steam Electric 0 192,000 12.5 86.0 ..28.3
Textiles 481,000 18.7 _57. 3 28.2

General:

Meat Products 7,000 91.4 3.0 5,000 95.2
Dairy Products 0 0
Grain Mills 0 0
Sugar 0 0
Canned and Preserved Seafood 0 0 0
Miscellaneous Food and Beverage 0 0
Paving and Roofing 0 0
Rubber 0 0
Leather 0
Glass 1,000 98.6 2.2 1,000 1.4
Cement 0
Asbestos 0
Nonferrous Metals 0 - 0
Feedlots 0 100.0 22.8 0 100.0 14.5

Others:

Forestry and Fisheries 863,000 33.5 14.5 6.4 -895,000 58.2 15. 2 3.8
Total T Z,574,000 100.0 T19537l000 100.0 100.0 j

*Note: Chemical Oxygen Demand is incomplete. See text.

TABLE 111.F.38 Continued

1977 1985
3. Suspended Solids Percent. Percent Percent Percent Percent Percentn@
Net of Below of Total Net of Below of Total
Indepth: Tons Total Baseline Reduction Tons Total Baseline Reductio

Fruits and Vegetables 34,000 2.0 51.3 .5 18,000 4.2 80.0 .8
Chemicals 121,000 7.2 65.7 Z.9 70,000 16.2 81. 8 3.0
Iron and Steel 313,000 18.6 82.4 18.6 26,000 6.0 98.5 16.9
Metal Finishing 0 0
Petroleum Refineries 10,000 .6 3.9 - 5,000 1.1 63.2 -
Pulp and Paper 595,000 35.3 45.8 6.4 195,000 45.0 87.8 13.5
Steam Electric 49,000 Z.9 28.9 - 0 100.0 -
Textiles 129,000 7.6 47.8 1.5 Z8,000 6.5 90.7 z.6

General:

Meat Products 20,000 1.2 83.6 1.3 1,000 99.5 1.4
Dairy Products 1,000 - 77.2 0 94.4 -
Grain Mills 8;000 .5 31.9 2,000 85.4 -
Sugar 2,000 - 99.1 2.3 1,000 - 99.6 2.0
.Canned and Preserved Seafood 16,000 1.0 37.4 - 8,000 2.0 75.2 -
Miscellaneous Food and Berverage 5,000 - 37.2 - 5,000 1.0 49.8
Paving and Roofing' 0 100.0 28.8 0@ - 100.0 22.6
Rubber 2,000 - 82.2 - 3,000 .6 82.6 -
Leather 9,000 .5 82.4 .5 1,000 - 97.3 -
Glass Z,000 - 85.1 - 0 - 95.2. -
Cement 24,000 1.4 36.9 0. 100.0 -
Asbestos 0 56.8 - 0
Nonferrous Metals 7,000 - 99.7 30.8 1,000 99.9 27.5
Feedlots 0 100.0 4.7 0 100.0 4.1

Others:

.Forestry and Fisheries 1 340,000 1 20.1 18.1 1 1.0 1 1 69., 000 1 15. 9 84.1 3.
Total 11,687,000 1100.0 100.0 433,000 1100.0 V 100.0

TABLE 11I.F.38 Continued
977 .985 nt Percent
4. Dissolved Solids Percent Percent Percent Percent Perce
Net of Below of Total Net of Below of Total
Indepth- Tons Total Baseline Reduction Tons Total Baseline Reduction

Fruits and Vegetables 0 0- -
Chemicals 889690000 ?8.6 9.7 84. 3'- 1 5.762.ouu 79.5 43.1 91. 3
Iron and Steel 0 . 95.9 - 0 96.2.
Metal Finishing 85,000 .7 48.1 6.5 0 100.0 4.2
Petroleum Refineries 0 0
Pulp and Paper 0 0
Steam Electric 2,294,000 20.1 1.5 a 1,482,000 20.5 11. 1 a
Textile s 0 0

General:

0 0
Meat Products
Dairy Products 0 0
Grain Mills 0 0
Sugar 0 0
Canned and Preserved Seafood 0 0
41
Miscellaneous Food and Beverage 0 0 W
Paving and Roofing 0 0
Rubber 0 0
Leather 0 0
Glass 0 - 100.0 1.0 0 100.0 -
Cement 63,000 .6 24.7 1.4 0. 100.0 2.0
Asbestos 1,000 - 8.3 a 0 100.0 a
Nonferrous Metals 0. 100.0 8. Z 0 100.0 2.4
Feedlots

Others:

Forestry and Fisheries

Total 11 100.0 100.0 7,244,OC I qo@ 0
000 --j

Note: a = These industries were not included in the calculations for this column because of increases
in the pollutant levels above baseline in 1977.

Source: NCWQ. From U.S. Environmental Protection Agency, strategic Environmental Assessment System (SEAS), 1975.

111-233

industries (pulp and paper, chemicals, meat products, textiles, and feed@-
lots) account for over 90 percent of the reduction in levels of discharge.
Of these, four also appear in Table III.F.37 which had listed the major
dischargers,of BOD. The same result is observed for COD and Suspended
Solids and to a lesser extent for Dissolved Solids.

The industries that would be the most important dischargers in the
absence of P.L. 92-500 continue to contribute a significant portion of
the pollution that remains after compliance (Table III.F.39). However,
the ranking of industries and their relative importance change,. For
example, for BOD-the industries that will be the heaviest dischargers
are the same ones as in Table III.F.37 with one exception; fruits and
vegetables increases in relative importance). The ranking and relative
shares change.

For suspended solids, the relative importance of industries between
the baseline and compliance scenarios changes very significantly. The
two largest polluters, the nonferrous metals and paving industries,
remove close to 100 percent of suspended solids in their waste load
and no longer contribute significant amounts of this pollutant. The
ch6mi6als industry enters the list of significant polluters however.
For dissolved solids, the importance of industry groups is stable with
the chemicals and steam electric power industries contributing almost
all of the pollution.

It is interesting to ascertain whether the estimates of costs for
these industry groups bear any relationship to their effectiveness in -
reducing national levels of the major pollutants. An attempt at analysis
along these lines ispresented in Table III.F.40, where the industries
are ranked in terms of (1) their contribution to the total reduction for
the four pollutants and (2) total capital costs.

The largest capital costs are concentrated in the in-depth industry
categories. These industries also have a major share of pollutants
dis charged. However, particular industries within the "general" industry
group tend to make significant contributions to reducing the load in
specific pollutant categories. For example, the nonferrous metals cate-
gory is important in reducing discharge of suspended solids and dissolved
solids but, at eighteenth, is low in rank in terms of.capital cost. Like-
wise, the paving industry and the feedlots industry make significant
contributions at a relatively modest share of overall costi the former
for suspended solids, and the latter for both BOD and COD.

Beyond 1983 the total national discharge of these pollutants is
likely to increase if abatement remains at BAT levels. This is simply
because economic growth will encroach-upon the improvements unless
increasingly stringent standards are imposed or unless rapid improvements

TABLE III.F.39: MAJOR DISCHARGERS AFTER COMPLIANCE (SCENARIO 1) 1985

Biochemical Oxygen Demand Suspended Solids

Rank Industry % of Total Rank Industry % of Total

1 Forestry and Fishery Products @38.8 1 Pulp and Paper 45.0
2 Pulp and Paper 30.2 2 Chemicals 16.2
3 Chemicals 9.8 3 Forestry and Fishery Products 15.8
4 Textiles 7.6 4 Textiles 6.5
5 Fruits and Vegetables 5.6 5 Fruits and Vegetables 4.2,
92.0% 87.8%

Chemical Oxygen Demand Dissolved Solids % of Total

Rank Industry % of Total Rank Industry

1 Forestry:and Fishery Products 58.2 1 Chemicals 79.5
2 Chemicals 27.3- 2 Steam Electric 20.5
3 Textiles 12.5 100.0%
4 Petroleum 1.7
5 Meat Products .3
100.0%

Source: NCWQ. From U.S.-Environmental Protection Agency,.,
Strategic Environmental Assessment System (SEAS.), 1975.

TA13LE III-F.40: RANKING OF INDUSTRIES BY ANNUAL COST AND CONTRIBUTIONS
TO TOTAL REDUCTION IN NATIONAL DISCHARGES (1985)

Suspended Dissolved 'Cost- Capital
Indepth BOD COD Solids Solids Capital Cost
(Rank) (Rank) (Rank) (Rank) (Rank) AMillion $)
Fruits & Vegetables 14 263
Cherdicals 2 1 6 1 1 9497
Iron & Steel 9 - 3 - 4- 2636
Metals Finishing(Job) - 2 5 2495
Petroleum Refini
ing 9 5 6 2013
Pulp & Paper' 4 3 2945
Steam Electric - 2 5364
Textiles 4 2 7 9 661

General

Petroleum & Ga's Extra c. - -
7 1304
Meat Products 3 6- 11 346
Dairy Products 11 12 280
Grain Mills 14 8 7 19 69 Ln
Sugar 6 10 482
Canned & Preserved Seafood., 8 15 160
Misc. Foods & Beverages 14 22, 10
Paving and Roofing 2 22 10
Rubber 16 13, 268
Leather 11 16 122
Glass. 16 7 5 17 93
Cement - 4 20 43
Asbestos 18 - 21 13
.Nonfekrous Metals 8 1 3 18 71
Feedlots 5 3 701

,Gther

Forestry & Fishery Pro. 11 4 5

Source: NCWQ. From U.S. Environmental Protection
Agency, Strategic Environmental Assessment System (SEAS), 1975.

111-236

in process change are seen, For exampler if BOD levels 'grow at an annual
rate of 2.6 percent beyond 1985, then in-56 years (by 2041)',@ Biological
Oxygen Demand levels will return to 1971 levels,

Scenario 4 assumed onIX BPT standardse with compliance in 1980.
Table III.F.41 gives results for this scenario at the sector level and
Table III.F.42 gives a comparison of the baseline and Scenarios 1 and 4
for the major pollutant categoties. IBPT OnW 'represents reductions
in discharge from baseline ranging from 18 percent.for Dissolved Solids,
to 85 percent for Suspended Solids in 1985. With BAT thereductions
range from.39 percent for Dissolved Solids to 96 percent for Suspended
Solids in 1985. The desirability of the incremental standards depends
on the environmental consequences of the different levels of discharge.
A wide variety of pollutants must be analyzed (See Environmental Impacts
Section). From this analytical exercise, however, it would appear that
industrial discharges would be significant in 1985 even with full com-
pliance with P.L. 92-500.* With only BPT standards discharges would be
close to 1971 levels for Dissolved Solids ahd COD (83 percent and 73
percent of 1971 levels) and 44 percent and 20 percent of 1971 levels for
BOD and Suspended Solids.

7. Ener Use

.It is apparent that some demands for energy will increase due to
the pollution abatement program. The increased demand for energy arises
from two sources: (1) energy requirements due to the operation and
maintenance of pollution control requirements, and (2). increased energy
needs from induced production of pollution abatement goods and services.
Any decreased energy use due to negative econorhic im pacts on GNP is not
taken into account here. Therefore, the results presented here are not
projections of change in total use.**

Table iii.r.43 shows that the general'pattern of incremental energy
use follows the pollution abatement investment pattern, peaking in years
where investment is most concentrated. In the latter years, as the stock
of pollution abatement investment builds up, operating costs account
'for an increasingly significant shake of incremental energy use.

These projections could underestimate pollution levels if permits allow
less stringent control than the propulgated effluent limitations,,
or if actual efficiencies in abatement are less than design efficien-
cies.

Other factors which may influence energy use could not be estimated,
e.g., the use of sludge as fuel or re covered materials being recycled
creatingL energy savings.

TABLE III.F.41: FORECAST OF POLLUTANT LEVELS BY NCWQ INDUSTRY GROUP FOR 1977 AND 1985 (SCENARIO 4)

I . Biochemical Oxygen Demand* 1977 1985
Percent Percent Percent Percent Percent Percent
Net of Bejow of lot" Nat Of Below of Total
Indepth-. Tons Total Baseline Reduction Tons Total Baseline Reduction
Fruits and Vegetables 4Z,000 2.2 19 .9 39,000 3.8 41.5 1
Chemicals 546,000 28.4 30 21.4 209,000 ZO.1 78 28
Iron and Steel 18,000 .9 so 1.6 4,000 - 84.7 .9
Metal Finishing (Job) 0
Petroleum Refineries 20,000 1.1 14.5 - 18,000 1.7 41 -
Pulp and Paper 632,000 32.9 45 48.3 375,000 36 - 42.3
Steam Electric 0
Textiles 131,000 6.9 37.5 7.3 61,000 5.8 75 7.3

General:

Meat Products 111,000 5.8 46.3 8.8 16,000 1.5 93.7 9.1
Dairy Products 12,000 .6 40 .7 4,000 - .7
Grain Mills 13,000 .7 25.8 - 9,000 .8 57.9 -
Sugar 44,000 2.3 5.7 - 48,000 4.6 11.5 -
Canned and Preserved Seafoods 31,000 1.6 10.2 - 31,000 3 30.3 -
Miscellaneous Food and Beverages 15,000 .8 24.8 - 10,000 1 55.2 -
Paving and Roofing 0
Rubber 3,000 - 42.7 - 1,000 86.5 -
Leather 15,000 .8 43.2 10.6 3,000 88.6 .7
Glass 2,000 .1 38.5 - .1,000 82 -
Cement 0
Asbestos 0 0
Nonferrous Metals 0
Feedlots 76,000 @3. 9 so 7.0 0 100.0 6.6

Other:
Forestry -and Fisheries 213,000 11.1 4 8.6 211,000 20.3 9.2 .8

Total 1,920,000 100.0 100.0 1 1,039,000 100.0 100.0

*Note 5 percent

TABLE III.F.41 Continued
2. Chemical Oxygen Demand* Percen 1977 19 5 t Percent
t Percent Percent Percent Percen
Net of of Total, Net of Below of Total
Indepth. Tons Total Baseline Reduction Tons Total lBaseline Reduction
Fruits and Vegetables 0 0
Chemicals 1,546,000 41.6 21.4 37 1,154,000 43. 2 51.7 49.4
Iron and Steel 0 0
Metal Finishing (Job) 0 a
Petroleum Refineries 105,000 2.8 8.6 - 108,000 4.0 21.2 1.1
Pulp and Paper 0 0
Steam Electric 0 0 19.0 62.9 34.6
Textiles 804,000 21.6 2a.6 28.2 510,000

General:
Meat Products 41,000 1.1 45.6 3.0 7,000 92.2 3.5 H
Dairy Products 0 0
Grain Mills 0 0
Sugar 0 0 co
Canned and Preserved Seafood 0 0
Miscellaneous Food and Beverages 0 0
Paving and Roofing 0 0
Rubber 0 0
Leather 0 10000 98.6 2.3
Glass 27,000 .7 47.6 2.1 F
Cement 0 0
Asbestos 0 0 92 -
Nonferrous 1,000 - 43.8 - 0
Feedlots Z62,000 7.0 50 22.9 100 24.3

Other:
Forestry and Fisheries 936.000 25.2 7.3 6.5 894,000 33.4 15.3 6.5

3.721,000 100.0 100.0 2,674,000 100.0 100.0
Total

*COD data is incomplete.

TABLE III.F.41 Continued

3. Suspended Solids 1977 1985
-Percent Percent Percent Percent Percent Percent
Net of Below of Total Net of Below of Total
Indepth: Tons Totals Baseline Reduction Tons Total Baseline Reduction
Fruits and Vegetables 14,000 - @80. 3 1.5 39,000 2A 57.3 .6
Chemicals 238,000 3.9 32.5 3.1 129,000 8 66.5 2.9
Iron and Steel 1,065,000 .1.7.7 40 19.5 243,000 15 86.4 17
Metal Finishing (Job) 0 0
Petroleum Refineries 10,000 - 2 - 11,000 .7 16.7 -
Pulp and Paper 831,000 13.8 24.4 7.3 653iOOO 40.4 59.1 10.7
Steam Electric 1.0 14.2 - 24,000 1.5 40.4 -
Textiles 188,000 3.1 23.9 1.6 132,000 8.1 56. 5 1.9

-.General:

Meat Products -70,000 1.2 41.8 1.3 21"000 1.3 85. 8 1.7
Dairy Products 3,000 - 38.4 - 1,000 - 81.7 -
Grain Mills 10,000 15.9 - 8,000 .5 43.1 -
Sugar 98,000 1.6 45.8 2.2 2,000 - 99.2 2.4
Canned and Preserved Seafoods 21,000 18.7 - 19,000 1.1 45.4 -
Miscellaneous Food and Beverages 7,000 - 18.6 - 5,000 40 - %D
Paving and Roofing 1,359,000 22.6 39.9 24.7 0 100 26.7
Rubber 7,000 - 40.8 - 3,000 U.6 -
Leather Z9,000 41.1 .5 6,000 85.6 -
Glass 3,000 - 27.5 - 1,000 - 70 -
Cement 32,000 7 17. 4 - 21,000 1.3 54 -
Asbestos 0 - 0
Nonferrous Metals 289, 000 21.4 46.9 31.1 7,000 - 99.7 32.6
Feedlots 184,000 3.1 50 5 0 100 4.9

Other:
Forestry and,Fisheries __377,000 6.2 1 9 1 1 292,000 18.1 32.6 1 1.6
Total -6,.DO4,-000 1,61-7.000 100.0
100.0 100.0

TABLE III.F.41 Continued

4. Dissolved Solids 1977 1985
Percent Percent Percent Percent Percent Percent
Net of Below of Total Net of Below of Total
Indepth: Tons Total Baseline Reduction Tons Total Baseline Reduction
Fruits and Vegetables 0 0
Chemicals 9,451,000 78.8 4.9 82.7 8,250,000 84.1 18.6 86.5
Iron and Steel 0 - 46.4 - 0 96.4 -
Metal Finishing (Job) 124,000 1.0 23.8 6.6 79,000 .8 60.1 5.5
Petroleum Refineries 0 0
Pulp and Paper 0 0
Steam Electric 2,279,000 19 -.8 a 1,425,000 14.5 -6.8 a
Textiles 0 0

General:

Meat Products 0 0
Dairy Products 0 0
Grain Mills 0 0
Sugar 0 0
Canned and Preserved Seafood 0 0
Miscellaneous Food and Beverages 0 0
Paving and Roofing 0 0
Rubber 0 0
Leather 0 0
Glass 6,000 47.3 .9 0 100.0 -
Cement 74,000 .6 11.6 1.7 54,000 .7 45.1 2.0
Asbestos 1,000 - -3.8 a 1,000 - 19.5 -
Nonferrous 53,000 47.8 8.1 0 100.0 5.4
Feedlots 0 0

Others:

Forestry and Fisheries 0 0

Total 11,990,000 100.0 100.0 9,810,000 100.0 100.0

a These industries were not included in the analysis for this column because of increases in levels above baseline in 1977.

Source: NCWQ. From U.S. Environmental Protection Agency, Strategic Environmental Assessment System (SEAS), 1975.

111-241

TABLE III.F.42: COMPARISONS OF SCENARIOS 1 AND 4 WITH BASELINE
FOR FORECASTED LEVELS OF INDUSTRIAL POLLUTION
(1977 and 1985)

1977 1985
Percent of Percent of
1971 Tons Baseline Tons Baseline
BOD
Baseline (Tons) 2,265,000 3,004,000 100 3,696,000 100
Scenario 1* 2,265,000 937,000 31 545,000 15
Scenario 4** 2,265,000 1,920,000 64 1,039,000 28

COD
Baseline 3,677,000 4,861,000 100 5,718,000 100
Scenario 1* 3,677,000 2,574,000 59 1,537,000 27
Scenario 4** 3,677,000 3,721,000 .77 2,674,000 47

Suspended Solids
Suspended Solids 7,700,000 9,546,000 100 10,804,000 100
Scenario 1* 7,700,000 1,687,000 18 433,000 4
Scenario 4** 7,7001000 6,004,000 63, 1,617,000 15

Dissolved Solids
Baseline 11,770,000 12,556,000 100 11,895,000 100
Scenario 1* 11,770,000 11,413,000 81 7,244,000 61
Scenario 4** 11,770,000 11,990,000 95 9,810,000 82

Scenario 1 assumes full compliance with BPT, BAT and New Source
Performance Standards.

Scenario 4 assumes delayed compliance with BPT(1980) and no
compliance with BAT. New Source Performance Standards are
assumed met for new plants.

Source: NCWQ. From U.S. Environmental Protection Agency,
Strategic Environmental Assessment System (SEAS), 1975.

TABLE III.F.43: ENERGY USE*, SCENARIOS 1-5

1971 1975 1977 1980 1983 1985
Base (10 15 BTU) 70.5 77.0 83.0 90.5 96.3. 100.4

Scenario 1 70.5 77.3 84.9 91.6 97.7 102.3
Difference .3 119 1.1 1.4 1.9
% Difference 2.3 1.2 1.5 1.9

Scenario 2 70.5 77.3 83.7' 91.4 97.8 102.4
Difference .3 .7 .9 1-5 2.0
Difference .8 1.0 1.6 2.0

Scenario 3 70.5 77.3 85.2 92.1 98.4 103.1
Difference .3 2.2 1.6 2.1 2.7
% Difference 2.7 1.8 2.2 2.7

Scenario 4 70.5 77.3
83.8 91.8 97.3 101.6
Difference .3 .8 1.3 1.0 1.2
% Difference 1.0 1.4 1.0 1.2

Scenario 5 70.5 77.1 84.0 91.1 97.1 101.5
Difference. .1 1.0 .6 .8 1.1
% Difference 1.2 .7 .8

The increases shown do not take into account-any decreased energy use due to negative
impacts on GNP or.-energy savings resulting from material recovery or recycling.

.5 percent.

Source: NCWQ. From U.S. Environmental Protection Agency, Strategic Environmental
Assessment System (SEAS), 1975.

111-243

(a) Scenario 1 (Compliance, High Growth)

The largest increase in energy use occurs in 1977,.the BPT standard
year, when abatement investment is most concentrated. As may be expected,
supplying industries for plant and equipment construction show increased
output, and therefore, increased energy use.

Table III.F.44 compares direct versus indirect energy use by selected
sectors. Some sectors (like chemicals) have large abatement costs and
others (like steel) produce inputs to abatement investment. In 1977 a
major portion of the energy use is due to increased outputs to meet
investment requirements. By 1985, direct (operation and maintenance)
enqrgy needs accounts for the major part of the incremental energy use,
as all BPT and RAT abatement investment has been completed and only
new source abatement investment is being incurred. Some of the induced
impact is due to incie&sed regular investment that lags behind the induced
output changes in previous years.

Energy use at the,,INFORUM industry level is given in Table III.F.45.
Major impacts in 1@177 are felt in the industries that supply materials
for abatement. These include, cement and steel (for capital equipment)
as well as the chemical industry (for operating account). By 1985, the
largest percentage increases in energy use are found in the following
sectors: fertilizers (36.6%), chemicals (16.2%), plastics (5%), and
broad narrow fabrics (50.

(b) Scenarios 2-5

In Scenario 2, the abatement investment is spread out more evenly.
As a result, there are no "peaks" in incremental energy usage as in
Scenario 1. The steadily increasing energy use is *accounted for by the
increasing pattern of investment through the period, and by the increasing
operating activity as the stock of abatement equipment builds up.

Scenario 3 is the same as Scenario 1 except for a significant
increase in municipal cost. The results are similar.to those in Scenario
1, except that the level of energy use is somewhat higher.

In Scenario 4, BAT standards are dropped and the BPT compliance
date delayed to 1980. Incremental energy usage peaks in 1980 at 1.4%
over base, when the,BPT standard is met.

Scenario 5 assumes the same,investment pattern as in Scenario 1,
but at only half the cost. The pattern of incremental energy usage,
therefore, is the same as in 1, except at a lower level, reaching a
peak of only 1.2 percent over base in 1977.

111-244

TABLE-III.F.44: DIRECT AND INDUCED ENERGY USE IN SELECTED*
SECTORS (SCENARIO 1) 1977 AND 1985

.1977
Total Increase
over Baseline Direct
(Trillion BTU) (0 & M) Induced
Steel 347.6 13. 51 334.1
Chemicals 412.0 201.6 210.4
Petroleum H9.2 29.5 89.7
Concrete 110.5 3.6 115.9
A s pha It 111.2 -- 111.2

1985

Steel 161.8 105.5 56.3
Chemicals 1,296.5 1,086.0 210.5
Petroleum 255. 3 235.5 20.0
Concrete 30.3 4.4 26.0
A s phalt 22,6 -- 2z.6

Decreased energy use due to negative economic impacts on energy
savings for process change,' material recovery and recycling
are not taken into account.

Source: NCWQ. From U.S. Environmental Protection Agency,
Strategic Environmental Assessment System (SEAS), 1975.

TABLE III.F.45: ENERGY USE BY MAJOR INDUSTRIAL SECTORS*:
SCENARIOS 1-5 (Trillions of BTU's)

Scenario 1 Scenario 2 Scenario 3 Scenario 4 Scenario 5
16 Difference 76 Difference O/o Difference Ojo Difference O/o Difference
INFORUM from f rom from from from
1977 Sector. Baseline* Baseline Baseline Baseline Baseline Baseline
23 Meat Product $6.8 1 .5 .2 .2
.24 Dairy Product 57.5 .3 .2 .3 .2 .2
25 Canned and Frozen food 120.8 .4 .2 .4 .3 .2
28 Sugar 101.4 .6 ..2 .6 .3 .3
35 Broad and Narrow Fabrics 305.9 4.0 1.0 4.1. 1.6 2.0
47 Pulp Mius 1074.3 2.2 .8 2.5 .9 1.1
48 Paper & Paperboard Mills 675.-0 4.6 1.3 4.9 1.9 2.4
55 Chemicals 6285.6 6.6 1.9 7.0 2.7 3.4 En
59 Fertilizer 119. 6 22.0 5.0 22.2 8.8 11.0
62 Plastics 234.8 5.0 1.6 5.5 2.1 2.6
69 Petroleum 4054.8 .2.9 1.0 3.3 1.3 1.5
81 Cementr Concrete & Gypsun L 915.1 13.1 6.2 17.6 6.4 7.5
83 Steel 4323.4 8.0 3.1 9.3 3.5 4.2
84 Copper 42.4 12.6 5.0 14.5 5.2 6.6
151 Railroad 682.6 4. 1 1.7 4.8 1.8 2.2

Decreased energy use due to negative economic.impacts on energy savings
resulting from material recovery or recycling are not taken into account.

TABLE III.F.45 Continued

Scenario I Scenario 2 Scenario 3 Scenario 4 Scenario 5
% Difference 76 Difference % Difference % Difference %Difference
INFORUM f rom f rom f rom f rom f rom
1985 Sector Baseline* Baseline Baseline Baseline Baseline Baseline
23 Meat Product 108.4 .4 .4 .6 .3 .2
24 Dairy Product 63.0 .2 .2 .3 .2 .2
25 Can ned and Frozen Food 158.4 .4 .4 .4 .2 .2
28 Sugar 118.8 .6 . 7 .7 .4 .3
35 Broad & Narrow Fabrics 361.1 5.0 5.2 5.2 3. 8 2. 5
47 @4 Pulp MiUs 1291.8 1.6 1.6 2.2 1.0 .8
48 Paper & Paperboard Mills 821.0 4. 9 5.0 5.5 3.6 2.5
55 Chemicals 7980.9 16.2 18.5 17.2 5.2 8.1
59 Fertilizers 152.0 36.6 39. 7 36. 9 23.8, 18. 3
62 Plastics 318.8 5.0 5.1 6. 0 2. 9 2.5
69 Petroleum 5234.7 4.9 5.4 5. 7 1.7 2. 5
81 Cement, Concrete& Gypsurr 1051.3 2.9 2.7 14.5 2. 9 2.3
83 Steel 3860.7 4.2 3.5. 6.7 2.7 2.2
84 Copper 38.3 1.8 1.3 5. 5 1. 6 1.3
151 Railroad 771.3 1.4 1.3 2.9 .9 .8

source: NCWQ. From U.S. Environmental Protection Agency,
Strategic Environmental Assessment System (SEAS), 1975.

111-247

References

(1) Almon, Clopper et.@al. 1985-Interindustry Forecast of the American
Economy. 1974.

(2) Bosworth, Barry; Duesenberry, James S.,, And Carron, Andrew S.
Capital Needs in-the-Seventies. 1975.-

(3) Brazosport Facts, January 8, 1916.

(4). The Conference Board, Capital Markets and Water Quality Needs,
1975-1985.. 1975.

(5) CONSAD Research Corporation. Macroeconomic Impacts of P.L. 92-500
1976.

(6) Data Resourcesi Inc.. "The Capital Shortage-.Near-Term Outlook and
Long-Term Prospects". @The Data Resources U.S. Long-Term
Review. Summer, 1975.

(7) Data Resources, Inc. Financing P.L.92-500 - The Impact of the
Federal Water Pollution'Control Act of 1972 on the Municipal
Bond Market. Septembbr,'1975,

(8) International-Research and Technology Corporation. Use of the
Strategic Environmental Assessment System (SEAS) for Residual
Forecasting: An Analysis of Results.. By Richard-Meyer.and
Stedman*B.-Noble,.-Final Report to the NCWQ, February 1976.

.(9) New York Stock Exchange, Inc. -The Capital Needs And Savings
Potential of the U.S. Economy Projections Through 1985.
September 1974.

(10) Nichols, Donald A. Working memorandum, prepared for the Senate
Budget-Committee, September 11, 1975.

(11) Strassburg, Roger W., B.F. Goodrich, Communication to the
Commission, 1976.

.(12) U.S. Environmental Protection Agency, Strategic Environmental
Assessment-System (SEAS),'1975.

111-248

G. SUPPLY CONSTRAINTS

During 1972"1974 shortages* were pervasive. A survey by the Senate
Permanent Subcommittee on Investigations identified shortages of 63
materials from aluminum and ammonia to urea and zinc (19). Arthur D.
Little, Inc. in a study of 26 materials for the Department of Commerce,
identified governmental regulations, financial considerations, capacity.
limitations, and domestic and international demand pressures as major
factors contributing to shortages. Of the governmental regulations,
price controls, energy policy, environmental regulations, and fiscal and
monetary policies were identified as contributing most to shortages (2).

As these and other studies of shortages were being completed in late
1974 or early 1975, shortages were becoming less important as a national
issue. The economy had cooled and moved into recession. Unemployment
and inflation were the new national problems.

Shortages still occur. Shortages of materials or manpower to
construct or operate municipal, industrial or agricultural water pollution
abatement and control facilities could thwart efforts by governments and
industry to meet the goals of P.L. 92-500. Shortages can cause delays
in equipment and material deliveries. This in turn can cause delays in
construction of new facilities and repair of older ones, making it im-
possible to meet predetermined deadlines for effluent limitations.
Shortages of manpower to design, build or operate facilities can cause
inefficient plant design, construction, and operation. Inefficiency
wastes scarce pollution abatement funds. Shortages can escalate costs,
and higher costs mean less water pollution abatement per dollar.

In.light of the potential seriousness of shortages, the Commission
analyzed the material and equipment needs of the Act. Figure III.G.1
shows the percentage of 1980 baseline productipn necessary to meet the
industrial requirements of the Act. It was developed using the SEAS
macroeconomic input-output model estimates of the materials and equipment
needed to construct water pollution abatement facilities, and estimates
of the 1980 baseline level of industrial production. Municipal resource
needs are calculated using capital expenditures from municipal Scenario
E-1 (see III.E). The figure presents all sectors of the economy where
the average ahnual requirements of the Act represent 5 percent or more
of 17980 baseline production. Seventy-five sectors were examined. To
put these estimates into perspective, the percentage of sector production
normally supplied.to sewer systems and industrial construction (including
abatement expenditures) is presented-

Shortages occur when the demand for a good or service is not offset
by short term price increases that would otherwise balance supply
and demand. Market responses to shortages are excessive delays,
price increases and product allocation.

111-249

Figure I I WA
MATERIAL & EQUIPMENT NEEDS OF THE AtT P"L'92-500
(DIRECT PURCHASES ONLY)
Industrial Sectors Average Annual Equipment Needs as a Percent
above 5%* of 1980 Value of Production

lNormally supplied by industrial & sewer system construction
Pumps-compressors - I @ ENWANNEM 111 1 21.6%
and blowers U=ffiMf7M6 M
Required by Act**
Structural clay - 18.1
products 15.5

Structural metal 10.3
products
5.4

New construction 8.8

Cement-concrete 8.6
and gypsum 6.5

Pipes, va Ives
and fittings 118.1
Service industry 1.3
machinery 5.0

Industrial controls 4.9

KEY Required by Act 1975 - 19860*
Industrial Municipal
_j
75 sectors examined. The other 67 war. below 5% Levels of Treatment, BPT BAT NSPS
4 Equipment needs expenditures for pollution
abatement were averaged over 10 years 1975 -1985 BPT Best practicable technology 1977
MOMM
8.8

5.9

BAT Best available technology 1983
NSPS = Now source performance standards
Municipal = Scenario E.1 Capital Expenditures

Source: Natl commission on Water Quality. From University of Mar yland Interindus; try Forecasting
Model (INFORUM)-. 1975.
February 1976

111-250

of the eight sectors with requirements above 5 percent of 1980
production,, Only sector 100, pipes, valves, and fittings, appears to be@
placed under unusual demands. This sector also includes forged and cast
metal.pipes, valves and fittings which art heavily used by the petroleum,
chemical, and energy industries, as well as for pollution abatement.
Shortages of the castings and forgings used in the manufacture of valves
have caused increasing delivery delays in recent years (20). This
analysis of the requirements for water pollution abatement suggests that
the delays will continue. All other sectors will need to expand by less
than five percent above the production-normally supplied to sewer systems
and industrial construction, a level considered'w-,thin normal production
.fluctuations.*

Two qualifications to this general conclusion are necessary. First,
expenditures for pollution abatement were distributed evenly over the
period 197571985. Substantial concentrations of expenditures in any
year or years could make critical demands on many of the sectors. Table
III.G.1 dramatically illustrates this point. Under the strict.industrial
compliance scenario 1 (See Section III.F) thirteen sectors of the economy
would need to increase their production by more than ten percent over-
baseline levels and five by more than 15 percent. In this scenario,
pollution abatement expenditures peak sharply in 1977 as indu stry attempts
-to meet the BPT deadline. In Scenario 2f both BPT and BAT are still
achieved by 1983 but the expenditure pattern is smoothed. In this case
only pipes, valves, and fittings remain as a likely supply problem.
Second, the sectors used to analyze the resource needs are too aggregate
to identify any but the most obvious shortages or any of the problems
associAted with them.** Still, even these aggregate estimates of resource
needs will be useful should shortages similar to those in 1972-1974 reoccur.
Water pollution abatement resource needs can be combined with other
resource needs to produce an estimate of total national resource needs.
This estimate will be necessary in designing means of alleviating specific
shortages.

For example, GNP grew at more than five percent per year during
the 1961-1966 period.

For examplej chlorine is just one of hundreds of chemicals in
the industrial chemicals sector and chlorination equipment is
just one of many pieces of equipment covered in the service
industry machinery sector. DrarrtAtic growth in the required
production of phlorine can be camouflaged by the relatively
modest performance of the other chemicals in that sector.'

111-251

TABLE III.G.l: Changes in.Output Resulting from Direct and Indirect*
Purchases caused !?y P.L. 9j-500

Percentage Increase from Baseline
Outt)ut in 1977
scenario 1 2
Sector BPT - 1977 BPT & BAT -
BAT -..1983 1983

Valves, Pipes & Fittings.. 54.3 21.4
Pumps; Compressors, Blowers & Fans 20.7 8.3
Industrial Controls 18.1 7.6
Structural Clay Products 17.6 9.2
Structural Metal Products 15.8
Cement, Concrete, Gypsum 12."7 6.1
Copper 12;6 5.0
Otheir Stone & Clay Products 12.4 5.1
Special Industrial Machinery' 12.2 4o7
Engineering & Scientific Instruments 12.1 4.6
Power Transmission Equipment 11.5 4.2
New Construction 10.4 4.6
Industrial Patterns 10.0 4.2

*The direct requirements for materials and equipment by abating sectors
in turn lead to indirect requirements since these sectors will require
additional inputs in order for them to meet the higher level of output.
These second round impacts in turn cause further indirect effects and
so on.

Source: NCWQ..' From CONSAD Research Corporation, "Macroeconomic
Impacts of P.L. 92-500", 1�76

111-252

Five other more detailed study subjects directly affected by P.L. 92-500
were selected for analysis. The five arel

1. Design engineers and scientists
2. Construction labor
3. water pollution control equipment
4. Municipal sewage treatment plant operators,
supervisors, and technicians
5. Sewage treatment chemicals

The first three areas include the labor and special equipment used
in the design and construction of water pollution abatement facilities.
The last two are operating needs of the facilities. Materials and
machinery used in constructing pollution abatement facilities are not
included in this list because the materials and machinery are likely to
be identical to that used.in all types of contract construction, and
pollution abatement construction is likely to be less than 10 percent
of total contract construction. (See Figure III.G.1)

1. Engineers and Scientists

Engineers and scientists are needed to design municipal and indus-
trial wastewater treatment plants, and a shortage-in these professions
could cause delayed, defective or inefficient plant design. Further,
because of the extensive training needed, there is a substantial time
lag for increasing the supply. A recent study by the Bureau of Labor
Statistics addressed the adequacy of the supply of engineers and scien-
tists (22). The study indicates that 1.6 man-years of civil engineer
effort are used per million (1971) dollars spent on the design and
construction of municipal sewage treatment plants. A survey of 941
consulting engineering firms indicates that over 50 percent of the pro-
fessional staff engaged in water pollution control are sanitary engineers
(16). The survey indicated that roughly 75 percent of the civil engineers
are sanitary engineers and that roughly 90 peroent of the sanitary
engineers' time is spent on design and construction and treatment
plant sta-rt-up. So, roughly 1.33 = (1.6 x .75) sanitary engineers are
.90 T
needed'per million (1971) dollars of expenditure annually.

Roughly, the same employment rate of sanitary engineers will be
required for industry. This assumption and an estimate-of total annual
expenditures on water pollution control allow an estimate of the number
of sanitary engineers required by consultiAg firms and industry to design
and build-pollution abatement facilities.e Figure III.G.2-presents
estimates of these requirements under two alternative compliance schedules
along with an estimate of the supply of sanitary engineers.

111-253

Figure I I I.G.2
SANITARY ENGINEERS REQUIRED FOR THE DESIGN & CONSTRUCTION
OF-WATER POLLUTION 'CONTROL FACILITIES

Thousands of sanitary
engineers required annually
20 .@2 1.0
Strict industrial compliance with
1977-BPT; 1983-BAT (Scenario F-1)

Smoothed industrial expenditures
16 (Scenario F-2) 13.9

12 Present 0000
1975 Trend
supply
8.6..... 9.2

7.6
7.1

5.5
4

New MS students*
I-r-1 I I I I I I @ I I I 1 1
1972 74 76 78 80 82 84

Now MS students in water pollution control engineering
Footnote: Estimates of the supply of sanitary engineers are based on the following formula:
SEt = SEVII (11-DR) + Mst - i (PC + Pl)/100
SE 1972 @ C (I + P1 /Pd
Where SEt = the number of sanitary engineers engaged in consulting and industry in year t.
DR = the death and retirement rate for civil engineers. (Reported by Dillon Hall of BILS to I
be 0.0187).
Mst = the number of new MS students in environmental engineering in year -t. Data reported
Vey.
by Paul H. King in 1974-1975 AEEP Graduate Enr 11 emuSun - -
P = the percentage of new MS graduates in environmental engineering who are employed by
C consulting firms = 30.1
P1 = The percentage of new MS graduation environmental engineering who are employed by
industry .1
C = The number of sanitary engineers employed by consulting firms in 1972. Data reported
in "Manpower needs of consulting engineering firms", E.J. Middlebrook, at. al, Journal.Water
Water Pollution Control Federation, October, 1972.
Source: Nati. Commission on Water Quality. From University of Maryland Interindustry Forecasting
Model ONFORUM). 1975.
February 1976
@6

111-254

Under a strict industrial compliance schedule, (Scenario 1)*, a
large shortage of sanitary engineers would occur in 1976-1977. This
would be followed by a likely surplus between 1978 and 1980. The
shortage probably could cause delays in the design of water pollution
control facilities.

Even a smoothed industrial expenditure schedule (Scenario 2)* appears
to require more sanitary ehgineers than are estimated to be available.
The shortage is small in 1976 but appears to be growing as the number
of new Master's students in environmental engineering continues to
decline.

Table III.G.2 presents the pros and cons of a number of possible
.options to reduce or eliminate this potential shortage. The options
include-z (1) EPA support of students, either through university
research of a revival of the EPA traineeship program; (2) prescription
of accepted treatment plant designs and the circumstances in which
each is most cost-effective; (3) development of a professional retrain-
ing course for engineers with related skills; and (4) reliance on existing
market mechanisms.

Thereare several factors which could make the estimated shortage
erroneous or less-severe. First,,the estimate of total water pollution
control costs could be significantly overestimated. If the costs are
more than 20 percent overstated and we superimpose a smooth industrial,
expenditure schedule, there does not appear to be a shortage. second,
since design precedes construction and the design phase makes the
heaviest demands on sanitary engineers, much of the design associated
with planned pollution abatement expenditures may be already completed.
Third, the estimates of the number of sanitary engineers required per
million dollars of pollution abatement expenditures are admittedly
inexact. If the above calculations were more than 20 percent too high,
no shortage would occur. Fourth, part-time students may partially fill
the gap.** Finally, consulting firms and industry may be able to
attract substantially more than their historic share of new graduates.

in conclusion, there appears to be an impending shortage of sanitary
engineers for the design and construction of water pollution control
facilities if the BPT and BAT deadlines of 1977 and 1983 are to be met.

For a more complete description of these scenarios see Section III.F.

Paul King reports 1,362 part-time students in his 1974-1975 AEEP
Graduate Enrollment Survey. (11)

111-255

Table III.G.2: Options for Reducing the Potential Shortage
of Sanitary Engineers

OPTION PROS CONS

1. EPA Student 1. Could provide added 1. Not in the "market";
Support 'incentive to expand incentives may not
supply reflect the true
market conditions.

2. Probably the earliest
impact would be
1978.

2. Publish accepted 1. Would reduce require- 1. Would not encourage
I
design ments for sanitary innovation in
guidelines engineers design

2. Would reduce design 2. Would not be
costs applicable to
'Industry
3. Could have impact by
1976-1977

3. EPA Short 1. Could expand the 1. May not provide
Retraining supply in six adequate depth of
Course months to a year training

2. Could employ 2. Retrained personnel
surplus engineers may not seek a long
from other fields term career in
sanitary engiheering

4. Rely on market 1. Sensitive to 1. May require increased
mechanisms chan4ing market design cost
situation

2. Requires no adminis- 2. May take too long
trative action to provide extra
manpower.

Source: NCWQ. 1975.

111-256

If the deadlines are relaxed or slipped by even a few years the shortage
would bdo substantially diminished and perhaps even eliminated.

2. Construction Manpower

The current recession and high unemployment levels have led to talk
of using the Act's municipal construction grants program to stimulate
the economy and provide needed public works jobs. Estimates of the
number of jobs* generated directly by publicly owned treatment works
construction vary between 10,400 and 15,000 per billion 1975 dollars
spent annually (15) (23).

As Figure III.G.3 illustrates, spending between $7 and $10 billion
(1975) per year on publicly owned treatment works would increase overall
construction employment, but would not restore it to the peak 1974 level.
The employment generated would represent roughly 1.9 to 3.8 percent of
the persons employed in contract construction.

Despite the current unemployment levels, there is some concern
that the needed skills within the construction labor force for publicly
owned treatment works might be different from the skills of the available
manpower. The BLS study indicated that relatively more operating engineers,
ironworkers, and cement finishers are used in publicly owned treatment
works construction than in.the construction industry in general. But
the study concluded that apprenticeship training probably can expand
sufficiently to supply the needs in these trades. Plumbing and pipe-
fitting trades, although not heavily used in publicly owned treatment
works construction, were identified as possible bottlenecks. This
conclusion probably depends on an assumed 3 or 4 percent unemployment
rate, a level which may not be reached until the late 19801s.

To summarize, tlie evidence presented in the BLS study indicates
that skilled construction labor will not present an obstacle to municipal
publicly owned treatment works construction in the current era of
underemployment. This conclusion is further supported by another study
done for EPA (5) indicating that the supply of plumbers, electricians,
masons, and metal workers is quite elastic.** Thus for a modest increase

A job equals one 2080 hour man-year.

Specifically, a 1 percent increase in wages would result in a
3 percent increase in the number of plumbers, a 1.8 percent increase
in the number of electricians, a 3.3 percent increase in'the number
of masons, and a 1.8 percent increase in the number of metal workers.

111-257

Figure I I I.G.3
EFFECT OF INCREASED SPENDING
FOR MUNICIPAL SEWAGE FACILITIES (STPS)
ON CONSTRUCTION LABOR EMPLOYMENT

Persons Employed in
Contract Construction
(Millions)
4.2 -

Total construction labor
4.13 million

4.1

If $7-$10 billion were
spent on STPs, it would'
4.0 add bwtween 37,000 and
98,000 additional persons
3.95
37,000 amounting to
to
3.9
90,000 19-38%
additional of* tota*l construction
labor Dec. 1974
36,000
to
3.8 52,500

1974 the $3.5 billion spent on
unicipal facilities (STP's)
nerated construction work for
3.7 tween 36,000 and 52,500 persons

3.6

0.2

0.1

0
0 N 0 J F M A M J J A S .0 N D
1M 1974

Source: Actual employment- Federal Reserve Bulletin, Dec. 1974. STP construction in 1974: Nati.
Commission on Water Quality. Employment in $billion 1975$. From Metcalf and Eddy Inc.,
"Assessment of Technologies and Costs for Publicly Owned Treatment Works under P.L.
92-500", 1975.
Natl. Commission on Water Quality
February 1976

111-258

in construction wages, a significant increase in manpower availability
can be expected. (The labor for a $5.7 billion increase in construction
could be supplied by a 1 percent increase in wages.)

3. Water Pollution Control Equipment

A study for EPA (1) included a section on water pollution control
equipment. In the discussion of the water pollution control equipment
industry the study indicated there is relatively free entry into the
industry but currently there is little incentive to do so. Table III.G.3
presents selected financial ratios for companies with varying degrees
of involvement in the manufacture of water pollution control equipment.
The companies for whom expanded activity would be the easiest, those with
minor business in water pollution control equipment, would have little
incentive to expand their activities.since the income ratios of those
companies with a major share of their business in water pollution control
equipment is smaller.

The financial ratios should improve somewhat for all of the companies
as water pollution control equipment demand increases, since the industry
was operating at only about half its capacity in 1970 (12). This improve-
ment should be more dramatic for the "major" companies and should
encourage other companies to expand their business in water pollution
control equipment. Thus, based on the evidence available there should
be an adequate supply of water pollution control equipment.

Increased production will increase industry's demands for materials,
labor and capital, and, to attract the added supplies the industry will
have to pay higher prices for them. Industry will, in turn, have to'
pass these costs on to their purchasers if their income is to be main-
tained. The EPA contractor developed a method to assess the impact of
increased demand for water pollution control equipment on the price of,
the equipment; this method accounts for the increased costs of materials,
labor and capital.

These methods are used with data developed by the Commission* to
produce Figure III.G.4 which shows the ratio of inflat6d to constant
dollar expenditures on water pollution abatement equipment under three
alternative assumptions. The "baseline" scenario represents the-situation

NCWQ developed estimates of expenditures for water pollution abatement
equipment using the historic trend in the-percentage of municipal
sewage treatment plant and industrial pollution abatement cost which
is spent on pollution abatement equipment. This trend is extrapolated
and combined with annual expenditure streams to produce estimated
demand for water pollution abatement equipment.

111-259

TABLE III.G.3 COMPARISON OF FINANCIAL RATIOS FOR THE WPC
EQUIPMENT INDUSTRY

Net Income Net Income' Total Debt
Net Sales Total Assets Stockholders
Percent ..Percent Equity
MAJOR
Year
Selected companies'with
a major part of their 1971 3.71 4.86 .680
business in water 1970 3.14 4.31 .862
pollution control 1969 3.67 4.65 .755
equipment
(6 )a,

MINOR

Selected companies with
a minor part of their 1971 4.92 7.85 1.09
business in water 1970 4.55 7.37 1.11
pollution control 1969 5.17 8.05 1.05
equipment
(10) a

a. Number of companies inthe sample

Source: NCWQ. From Arthur D. Little, Inc.@, "Econ omic impact Study
of the Pollution Abatement Equipment Industry", 1972.

111-260

Figure I I LGA

INFLATIONARY IMPACT OF EXPENOITURES
ON WATER POLLUTION ABATEMENT EQUIPMENT.

Ratio of Inflated Cost to Constant Dollar Cost
1.10

1.09

1.08 1.077

1.07 Strict Industrial Compliance
(Scenario 1) 1.068
1.066

1.06

1.055

1,050
1.05 - Smoothed Industrial Expenditures
(Scenario 2)

1.04 - 1,042

1.03

1.02

1.016

1.01
g;seline Without the Act

1.00 1
1974 75 77 79 81 83 85

Source: Nati. Commission on Water Quality. From University of Maryland Interindustry Forecasting
Model ONFORUM). 1975.
February 1976

111-261

as it might have taken place without the Act. The "strict compliance"
.scenario (Scenario 1) shows how the expenditures might be made to achieve
requirements by the Act's deadlines. The "smoothed" scenario (Scenario 2
from III.F) shows how the expenditures could be made to reduce the
inflationary impact while still achieving BPT,BAT by 1983 and secondary
treatment for publicy owned treatment works by 1986.

This figure shows the ratio between the expenditures in constant
dollars and the expenditures which would be necessary to purchase the
same amount of equipment in inflated dollars.* The "strict compliance"
scenario required 5.6 percent more to be spent; the "smoothed" scenario
4.0 percent; and the "baseline" requires less than 1 percent more than
the constant dollar expenditures between 1970 and 1985.

Although the "smoothed" scenario causes less inflation of water
pollution abatement equipment prices, total expenditures for water*
pollution abatement equipment probably could be mihimized-under a
scenario somewhere between the "smoothed",and the "strict compliance"
scenarios because prices have been rising fairly rapidly in the economy,
and under the "strict compliance" scenario more purchases are made
earlier At lower prices.

4. Sewage Treatment Chemicals

In the,last half of 1973, municipalities experienced shortages or
outages of water and wastewater treatment chemicals. A survey by EPA
identkfied four chemicals in short supply. chlorine, soda ash, lime,
and caustic soda (25). Chlorine is used as a biocidal.agent to control
the bacteria count in activated sludge and secondary sewage effluent.
Caustic soda and soda ash are strong bases used to increase the pH in
order to improve coagulation and flocculation. Lime is used to maintain
the proper pH in the biological oxidation of sewage,. as a coagulant
aid, and in phosphorus removal. Inadequate supplies of any of these
chedicals will reduce the efficiency of a secondary treatment plant.

Table III.G. 4 provides estimates of wastewater treatment usage of
these chemicals in relation to production and to.the major user of each
chemical. In all cases, wastewater treatment usage-accounts.for less
than 5 percent of total production and less than 11 percent of;'the major

Inflated dollars do.not include the inflation of labor capital and
materials caused by anything but.the,demand for those goods and
services from the water pollution control equipment industry. Thus,
these rates should be added to the rates from other causes if an
estimate of the total inflated expenditures is desired.

111-262

Table III. G. 4: USE AND PRODUCTION OF SELECTED WASTE WATER TREATMENT
CHEMICALS

a
WTT Major User Total
Demand as Percent Percent of Production
Chemical' of Production Production (Tho usand of Tons)

Caustic Soda
1 b Chemical Processing
19742 5 C 46 11,350
1964 1.1 45 6,267

Chlorine
19743 b Organic Chemicals
2 5 c 66 11,088
1964 3.5 54 6,096

Lime
4 Steel
19725 2.6 37 20,330
1958 1.2 32 9,211

Soda Ash
6 Glass
19722 3 c 47 7,528
1964 0.6 39 5,502

a. Municipal and Industrial Waste Water.Treatment.

b. Included in miscellaneous uses, percentage is smallest
percentage listed.

c. Water treatment which includes water supply:

Sources:

.1 "Chemic al Profile, Caustic Soda", Chemical Marketing Reporter,
August 12, 1974.

2. "Commodity Notes", Chemicals and Rubber IndystKy Repol:t, June 1967,,
Bureau of Domestic Commerce, Deptof Commerce.

3. "Chemical Profile, Chlorine", Chem ical 14arketing Reporter,
August 5, 1974.

4. Petition to.the Cost of Living Council for the Decontrol of Lime
from Price Control Under Phase IV",, Robert S. Boynton, Executiv e
Directoi@, National Lime AssociatiQn.

S. "Lime",,R6bert S.Boynton and Kenneth A. Gutschick, from 1,ndustrial,
minerals.and Rock
.0

111-263

user's share. Wastewater treatment use of these chemicals appears to have
grown over the past io years, although the available data is inadequate
to permit an estimate of this growth. P.L. 92-500 can be expected to
cause growth in the wastewater treatment use in the next'ten-years, but
even major changes in use of these chemicals can be easily counteracted
by minor changes by the major users. For example, a 20 percent increase
.in wastewater treatment demand for lime could be completely counteracted
by a 2 percent decrease in the steel demand for lime. Further, since
the municipal demand-for these chemicals does not depend on the general
conditions of-the economy the way the needs of the major users do, aggre-
gate annual municipal demand should be more stable than the demand by
other users. this evidence suggests that municipal wastewater treatment
is not likely to cause any shortage in these chemicals.

Still, further shortages can occur. Rapid economic growth in any
of the major using industries, combined with low investment in capacity
because of low or irregular profitability, can cause a shortfall. And,
publicly owned treatment works are vulnerable in shortage situations
because they are.not preferred customers. Short-term contracts, small
volume, strict reliance on low fixed-price bid, and delayed payment have
all made producers less willing to serve municipalities. To correct
t@ese problems the American Water Works Association has drafted a model
contract which would allow prices to rise and fall according to market
conditions and extend the term of the contract to more than one year.
Widespread use of this contract and a general awareness of potential
supply problems should make chemical shortage a minor problem for
municipalities in the future.

5. Sewage Treatment Plant Personnel

Two potential problems are commonly identified in discussions of
municipal sewage treatment plant personnel: (1) an adequate.quantity
of personnel in light of the substantial increase in the complexity of
municipal treatment plants; and (2) adequate skills of personnel in light
of the same change.*

See for example, Study of Municipal Wastewater Treatment'Plant Manpower
and Training Needs and Resources, EPA, August, 1974 (26). Comments
from EPA (6) focus on the matter of inadequate operator-training
while comments to the Commission from the Georgia Conservancy (February
6, 1976) stress that, "The elimination of EPA's traineeship program
contributes to a shortage of professionally trained specialists at the
post-graduate level in water quality management and facility design."
(10).

111-264

An adequate number of personnel at publicly owned treatment plants
depends on three basic factors; the number of new operators needed
because of the increasing complexity of secondary treatment and the
increased flow; the net losses of municipal sewage treatment plant
operators due to death, retirement, promotion, and losses to other
occupations or industrial treatment facilities, and the number of
new operators being trainqd.

Tab16 III.G.5 presents estimates of the number of new operators
required because of increasing flow (those with existing secondary
treatment) and because of increased flow and complexity (those with
existing primary or less stringent treatment). Over half of the new
operators needs occur in small facilities without existing secondary
treatment.

The net attrition rate of publicly owned treatment plant operators
is uncertain. Reported U.S. average turn-over rates for individual
municipal treatment plant operators have varied from 8 percent to 11
percent (per/year) (24, 25). Further, at least part of thos 'e operators
would likely be rehired by other municipal treatment plants. The rehire
rate is heavily infl uenced by the salary paid by municipalities in
relation to.that paid to workers with comparable skills by other employers.
Table III-G.6 makes this salary comparison. Publicly employed wastewater
treatment plant operators receive substantially less than privately
employed operators. They also receive less money than the average for
workers engaged in production and non-supervisory activities. privately
employed operators, on the other hand, receive substantially more. Because
private and industrial treatment plants represent attractive employment
alternatives to municipal treatment plant operators, the municipal
rehire rate suffers accordingly.

Table III.G.7 presents a range of estimates of the municipal sewage
treatment plant operator net attrition rates under alternative assump-
tions about the turn-over rate and the rehire rate. Net attrition rates
of 5 percent and 9 percent seem to provide lower and upper bounds on
the actual municipal attrition rates.

The impact of this range of attrition rates on the operator replace-
ment needs and on total operator needs between now and 1985 is presented
in Figure III.G.5. At 5 percent, attrition losses cause an operator need
which is at least as large as that from increased flow and treatment
plant complexity.* At 9 percent, replacement needs are almost twice
as severe.

Estimates of aggregate operator needs presented in Table III.G.5
are distributed between*now and 1985 in the same way as projections
of treatment plant expenditures.

111-265

TABLE III.G.5: NEW OPERATORS NEEDED BY 1985 FOR EXISTING FACILITIES
THAT ARE UPGRADED OR EXPANDED

Flow Range a
Existing Treatment O-lMGD 1-5MGD 5-20MGD Total
(1974)

Primary or Less 8879 4110 2538 15,527

Secondary 194 827 738 1,753

Total 9073 4937 3270 17,280

a- The 369 treatment plants with greater than 20 MGD flow have not
been included because they generally provide their own operator
training.

Source: NCWQ. From Dr. Loren Solnick, "Municipal Wastewater Treatment
Plant Manpower; An Analysis and Forecast for 1985". 1975.

111-266

Table III.G.6: Water Treatment Plant Operators Monthly
Salary Comparison, 1972

Wastewatera Mean Public Private Industrial

All Plants 556 534 717 751'

Secondary Treatment 567 - - -

Small Communities 486

Beginning Operators 483

Watera 547

Water, Steam, and Sanitary
Systems 739

U.S. Average Production
and NonsuperVisoryb 603

a- Source: "1972 Certified Water Utilities Operator Salary Survey-
Report of Findings", Texas Water Quality Board

b- Source: "Employment and Earnings", U.S. Bureau of Labor Statistics,
March, 1975 (Refers to December, 1972 the month in which
the Texas Survey was conducted).

111-267

Table III.G.7: Ne t Attrition Ratea As A Function of Rehire and
Turn-Over Rates

Turn-over Rehire Rate-
Rate 20% 35% 50%

8% 7% 5% 4.8%

7.5% 6.4% 5.3%

11% 9.1% 7.7% 6.3%

a. NAR (TR DR) (1 RR) + DR

Where

NAR = Net Attrition Rate

TR = Turn-over ra te

DR = Death and Retirement Rate (1.5%)

RR = Rehire Rate

Source: NCWQ., 1975.

111-268

Figure III.G.5
PLANT OPERATORS NEEDED
FOR MUNICIPAL SEWAGE TREATMENT PLANTS (STPs)
1975-1985

Number of STP operators needed to be trained in U.S.*
ANNUAL 5850

Level of 5000 00 CUMULATIVE
operator 11 year need
training 9%@ 17,280 New
Operatorstt
4400
. . . . . . . . . .

4150
..........
3972 .........
CD
CD X- 53%-:-:-:-
35 0 ... ....
C14 : Operators:::
: for plants:::
5% :0- 1 MGD::
::::: f low ::*-*-
X_
2950
..........
Annual replacement',
need due to'
normal attritlo;@n
5-9%
..........

1625
....... ......... ::Operator %
................................................
........ .........
.... ...... ......... for:-*.-*-*
.......... ..........
....................... X-:-:-:;X-X-X-X-X-, * .................
............................................ ..........
.................................. %* .............
=.,.,.,.*X::NEW OPERATORS needed because of increased.-X'X
----------
:::::::::::::flow anojQl: mpomm matwt t,x-x-x-:::`:-..
...... ..... .....
.....................................................
.................................
%1.1.%%1.%* ........ ::bperators:.:
...............
....... for
1973 75 77 79 80 81 83-* ........ 1975-85 incl.

Projections based on estimated 29,700 operators in plants With flows of less than 20 MGD in 1974.
See Table I I I.G.7
t Assumes secondary treatment by 1985
tt See Table 111.43.5. This does not include the cumulative total of operators needed due to normal attrition.
Source: Natl. Commission on Water Guality
February 1976

111-269

The level of state operator training in 1973 also is presented in
Figure III.G.5. This level of training appears to be adequate to meet
operator needs at the present, but by 1976 it would be inadequate if
the net attrition rate is 9 percent or higher. A program to increase
operator salaries to reduce the attrition rate would appear advisable.
Further, since the bulk of new operators needed because of added flow
and secondary treatment will occur in small facilities which are likely
to be in smaller, more isolated communities,.the location of training
courses relative to this need should be carefully considered.

The other aspect of the municipal sewage treatment plant personnel
problem involves the level of skills in the existing work force.
Another EPA report presents evidence that training can produce improve-
ments in effluent in plants which are operating at high as well as at
low efficiency (14). The report points out that while not all operating,
problems can be traced directly to inadequate operator skills, success-
ful plant operation seems to be correlated with operator training.

These conclusions can be drawn from this evidence: first, the
construction grants program should be augmented with a program to
guarantee that adequately trained opera tors are employed to run new
and expanded municipal treatment plants; second, operator training
should be prescribed for treatment plants operating at below effluent
standards, unless adequate operator skills can be proven; and thirdt
unless municipal treatment plant operator salaries are made more
comparable to salaries obtained in private employment, it will be
difficult to attract and retain operators with adequate skills.

111-270

References

(1) Arthur D. Little, Inc. 1972, EconoMic.Impact Study of the
Pollution Abatement Equipment Industa.

(2) 1974. "Material Shortages Study: An Analysis
of Selected Commodities and Identification of Causal Factors
Contributing to Supply Shortfalls"

(3) Boynton, Robert S. and Gutshick, Kenneth A. "Lime" from Industrial
Mineralsznd Rocks.

(4) Boynton, Robert S., Petition to the Cost of Living Council for
the Decontrol of Lime from Price Control Under Phase IV.

(5) Brown, George F. and Jacobson, Louis. 1973. "A Study of the
Economic Impact of Environmental Demands on the Construction
Industry", for U.S. Environmental Protection Agency.

(6) Cahill, Harold P. Environmental Protection Agency, Internal
Memorandum to John T. Rhett, January 14, 1976.

(7) Chemical Marketing Reporter August 5, 1974. "Chemical Profile,
Chlorine".

(8) August 12, 1974. "Chemical Profile, Caustic
Soda".

(9) CONSAD Research Corporation. 1976. Macroeconomic Impacts of P.L.
92-500.

(10) Georgia Conservancy, comments to the Commission, February 6, 1976.

(11) King, Paul H. 1974-1975 AEEP Graduate Enrollment Study

(12) Kollar, L.K. and Youngwirth, W.C. 1971. "The Market for Water
and Wastewater Equipment", Construction Review, October/
November, 1971.

(13) Klingman, Charles L. 1972. "Sodium and Sodium Compounds", Bureau
of Mines, Minerals Yearbook 1972.

(14) McCanahan, and Tefft. 1972. Effectiveness Evaluation of Operator
Training Conducted Under the FSP Program.

(15) Metcalf and Eddy. Water Pollution Abatement Technology: Cap-
abilities and Costs; Publicly Owned Treatment Works. 1975.

111-271

(16) Middlebrookst E.J.f Ettlestein,.M,S,,'Snidert R.G,,,and Spiller,.
L.M., 1972, "Manpower Needs of Consulting Engineering Firms".
Journal of the Water Pollution Control FederaLiLono October, 1972.

(17) Solnick, Loren M. 1975.. "Municipal Wastewater Treatment Plant
Manpower: An Analysis and Forecast for 1985". Report
.prepared for NCWQ.

(18) Texas Water Quality Board, "1972 Certified Water Utilities
Operators Salary-Survey-Report df Findings".

(19) U.S. Congress, Senate. Permanent Subcommittee on Investigations
-of The Committee on Government Operations. 1974. "Materials
Shortages, Industry Perceptions of Shortages".

(20) U.S.,Department of Commerce. 1974. "Availabilities, Requirements,
and Constraints on Materials, Equipment, and Construction".
Project Independence.

(21) Bureau of Domestic Commerce. 1967. "Commodity
Notes", Chemicals and Rubber Industry Report.

(22) U.S. Department of Labor, Bureau,of Labor Statistics. 1975.
Impact of Federal Pollution Control and Abatement
Expenditures on Manpower Requirements.

(23) 1973. Manpower Implications of Alternative
Levels of Sewer Works Construction.

(24) U.S. -Department of Labor, Manpower Administration. 1972. MH-EPA
Joint Survey of municipal Waste Treatment Plants.

(25) U-S. Environmental Protection Agency. 1974. Summary Report...
The Extent of@Shortages for Chlorine and Other Water Sanitation
Chemicals.

(26) 1974. "Study of Municipal Wastewater Treatment
Plant Manpower and Training Needs and Resources"..

111-272

H. BENEFITS'

The various possible rates and levels of achievementof the goals
and requirements of the Act will bring changes in the quality of the
nation's waters and water-related environment. The Commission's findings
with respect to these consequences appear elsewhere in Section IV.
While these consequences can be quantified in various ways According to
the traditional measures of water quality and environmental change, they
.cannot, of themselves, express the full value to society of the accomp-
lishments of the Act.

Full implementation of the Act will require the expenditure of
significant sums of money, both public and private. Much of the Commis-
sion's effort has been directed to determining the extent and incidence
of these costs. Such information naturally gives rise to questions re-
garding the benefits to be derived -- what relationship do they bear to
the costs? To whom do they accrue? Unfortunately the present state of
the economic science permits only partial answers.

Benefits consist of increases in the net satisfaction experienced
by individuals. Improvements in water quality can increase individual
satisfaction in many ways -- some directly related to measurable
variables, some indirectly related to measurable variables, and some
which currently are not amenable to measurement. Those:-benefits which
can be identified are expressed in terms of changes in willingness-to-
pay, permitting, in principle, both quantitative estimates based on
measured changes in market variables and the aggregation of those
estimates for many individuals. Benefits which cannot be observed or
identified also produce changes in individual willi.ngness-to-pay, but
since these changes are never manifested in any market,.their magnitude
or significance is uncertain.

Benefits can be categorized in terms of their impact on market
variables:

1. Use-related benefits. Increases in individual satisfaction
resulting from the use of water-related goods or services
'which have been impacted by water quality improvements in
one of the following ways.:

a. the supply of the goods or service has been increased, or
b. the demand for the goods or service has been increased.

2. Non-use-related benefits. Increasesin individual satis-
faction associated with improved water quality, but not with
the use of marketable water-related goods or services.

111-273

Consider, for example, a.prospective increase in fish populations.
from improved water quality. Commercial fish harvests would then be
larger for a given fishing effort, and retailers would find themselves
able to offer a given quantity of fish at a lower price an increase
in the supply of fish. Consumers would realize a benefit from a lower
price.

At the@same time,. sport fishermen would react to.the increased fish
population by obtaining greater satisfaction for each.dollar spent in
pursuing this' activity, assuming that the relevant indicator is the time
spent fishing, not the pounds of fish caught. Increased satisfaction
means that the sport fisherman is willing to spend more time fishing at
a given cost, an increase in the demand for sport fishing.

Finally, more individuals derive increased satisfaction from the
knowledge of an increased fish population even though they do not engage
in sport fishing and are infrequent consumers. When the individual
considers the possibility of becoming a user at a future time, the poten-
tialvalue to future generations, or irreversible changes in th6 environ-
ment if improvements are not madesuch benefits can b e attributed to
option values. Other individuals may get satisfaction from the mere -
existence of enhanced'environmental quality, without.consideration of%
possible.use, or may desire to bequeath an improved environment to
future generations.

Whatever the motivation, non-use7related benefits share certain
characteristics. No satisfactory.empirical methods now exist to obtain
quantitative measures of their magnitude, and it.is often difficult to
identify them. Still, there is evidence that individuals do place
values on aspects of the environment without considering possible use.
Contributions to "Save the,Whale" campaigns come from persons who will
never see a whale; reports of pollution of Lake Baikal deep in the
U.S.S.R. brought protests from all over the world, etc. For these
reasons, estimates.of the benefits of water quality improvement must
remain conspicuously incomplete, confined to those use-related benefits
which can be measured with the aid of market variables.

To learn something of the magnitude of specific classes of measur-
able benefits expected to follow achievement of the Act, the Commission
conducted studies of selected activities in which the levels may change
as a result of changing-water quality. No attempt is made to go beyond
existing analytical methods or data bases, or to quantify all beneficial
changes in dollars. Rather, the studies, using available tools, illus-
trate some of-the linkages between water quality and individual satis-
faction and provide a partial estimate of aggregate benefits.

111-274

Timing of the Commission's studies required that the examination
of benefits proceed simultaneously with environmental assessment analyses
and, therefore, both were concluded at about the same time. Assumptions
were necessary to enable the benefits studies to be completed within
available time. Generally, benefits from the Act were assumed to be zero
in 1972 and to increase yearly thereafter as the several requirements
of the Act were achieved, with the maximum annual benefits occurring in
1985. Increased annual ben@fits thereafter reflect only population
growth.

"Study Plans", February 1974, outlined the Commission's study
design. For its economic impact studies, "As a first step, cost esti-
mates for industrial and municipal requirements for 1977 will be used.
Secondly, cost and benefit figures associated with the achievement of
the 1983 requirements for industry and municipalities will be used to
evaluate the effects on the economy, nationally, regionally and by
various industrial sectors." (Emphasis added.) Discussing proposed
social impact studies, the Commission stated, "Amo 'ng the social factors
to be considered are . . . available leisure and recreational opportuni-
ties . . . and the general quality of life resulting from achieving or
.not achieving the goals of the Act." The benefits studies are consistent
with this announced intent to concentrate on the "benefit(s)
associated with the achievement of the 1983 requirements."

Delays in implementing the Act's requirements would shift this 1985
maximum annual benefit level to a later year by whatever number of years
the implementation was delayed. Using the 1985 figure for a late'r year
would result in an understatement of the benefits for that and subsequent
years since population demands would have increased during the delay.
Using the estimates in this manner would also assume no effect from
lesser degrees of achievementof the Act's goals, such as irreversible
losses caused by the delay.-

As Commission study results havb become known there has been in-
creased interest in allocating costs, benefits and other effects between
achievement of the 1977 requirements and achieving those-for 1983
While the benefits studies were not designed to produce.a distinc@
delineation, a rough, arbitrary estimate can be made by applying to
the annual quantifiable benefits totals a percentage for each of the
two deadline dates.

Unquantifiable intangible benefits are not so easily assignable.
Since these reflect individual perception or subjective responses, they
do not depend upon distinctions between results of the 1977 and 1983
requirements. For example, individu als may conclude that while the 1977
requirements will protect the quality of an adequate quantity of water
for the present generation, only achieving the 1983 requirements will

111-275

assure this end for future generations. The Commission's studies did
not address this intangible dimension.

Aside from separate assessments of benefits appearing in some of the
regional studies, four major national studies were conducted:

1. Marine commercial and sports harvesting of shellfish and
finfish(2),

2. Reopening beaches presently closed to swimming for water
quality-reasons (1),

'3. Freshwater recreational activities(4),. and,

4. Selected types of water-oriented residential property(3).

Marine Fisheries

The study of marine fisheries reviewed both commercial and sports
fishing activities in the estuary, bay, and ocean waters contiguous to
the 23 coastal states. The first step was a review of h .istorical impacts
of deteriorated water quality on fishing activity and fish harvests,
including consideration of both harvestability and productivity. Begin-
ning with information contained in the 1971 National Shellfish Register,
published by EPA, a survey was conducted of all 23 states to obtain an
estimate of shellfish areas closed to fishing in 1975, primarily because
of bacterial contamination (5). Other data, including records of ob-
served fish kills, catch statistics and survey responses, were used to
explore the effect of water quality on fishery productivity.

The study of shellfish bed closings indicate that the.potential
1975 catch from the closed areas would have been in excess of 700 million
pounds (round weight) with a market value of more than $100 million.
About one-third of this estimated value consists of species specifically
named by the state contacted; the remaining two-thirds.is comprised of
mobile species, such as crabs and lobsters, unharvestable by reason of
their temporary presence in a closed area. In other study results,
fish kills in marine waters were found apparently not correlated with
water quality, instead they displayed a basically random occurrence
pattern. Cases of extinc@ion of species due to water quality changes
were investigated and found to be few in number and minor in significance.

Achievement of the Act is expected to affect marine fishery resources
in two ways. It will permit the use of many presently unused shellfish
areas, and it will increase the productivity of existing fisheries
through improved water quality. The rates of reopening of shellfish
beds in various states were estimated based on assumed patterns of com-

111-276

pliance with the Act. The expected changes in water quality are ex-
pressed by means of a marine Water Quality Index (WQI), defined to
reflect the relative importance of specific water quality parameters
for fishery productivity. The current value of the marine WQI was cal-
culated for 130 specified sectors of coastal water, based on available
measurements of water quality parameters. These indices ranged from a
low value of slightly more than 8.0 to a high of 100.0 (ideal conditions).
Compliance with the Act was then expressed in terms of resulting higher
levels of marine WQI for each of the 130 sectors.

Estimates were made of quantitative changes in the productivity and
harvestability for each of 10 separate fisheries with significant economic
value, and future harvests and fishing activity with and without the
water quality changes expected to result from compliance with the Act.
The results indicate estimates of total biomass and species distribution
for future harvests, and, in the case of sports fishing, estimates of the
number of participants and the number of recreation days.

commercial harvests of all 10 species studied will increase as a
result of achieving the goals and requirements of the Act. These in-
creased harvests will bring lower prices, hence benefits to consumers in
the form of increased consumer purchasing p6wer.associated with commercial
marine fisheries rises to more than $575 million per year by 1985,
assuming that implementation of the Act proceeds on schedule.* Of this
total, about $42 million in annual benefits or less than 8 percent, is
attributable to increased harvestability through shellfish bed openings.
The remaining benefits derive from water quality-induced productivity
increases. These estimates are based on projected price reductions
ranging from 10 percent (for lobsters) to more than 50 percent (for clams).

An increase in the value of sports fishing activity following a
water quality improvement can be explained either as a change in the
value a fisherman places on each day of fishing, therefore, he fishes
more often, or as more recreational opportunities being available at
the same cost, hence, increased participation. Observed relationships
between participation rates and water quality.are not uniform, since
each fisherman perceives a different cost for any given day of recreation.
In this study, consistent with the commercial fishery analysis, it has
been assumed that increased participation in sports fishing results

t The nature of these calculations is such that a five-year delay in
implementation would shift this number to 1990. This would result
in an understatement of the 1990 benefits, as populations and
demands in that year would be higher than in 1985. Also, this
five-year shift would assume no lesser degree of achievement of
the Act's goals, such as irreversible losses in the interim period.

111-277

entirely because,more recreational opportunities are available at the
same cost. Under this assumption, the increased activity of a given
fisherman is explained in terms of.a wider range of recreational oppor-
tunities,available to him at any given cost.

Achieving the 1983 goals and.requirements of the Act is expected to
result in almost 237 million additional days of sport fishing per year
by 1985, an increase equal to 76 percent of the total 1974 participation.
The increased economic values associated with this trend is forecast to
reach $3,300 million per year by 1985, assuming that implementation
proceeds on schedule. Annual benefits from both commercial and marine
sport fishing for 1985 total some $3.8 billion per year.

Both commercial and recreationaltishing activities produce steadily
rising benefits in succeeding years since the various provisions of the
Act are assumed to produce.changes. Since the water quality in 1995 and
in succeeding years is assumed to be significantly better than it would
have been,without the Act, the 1985 benefit level can be assumed to con-
tinue as a fixed differential above benefits that would have been realized
without the Act, with increased dollar values in future years resulting
from population growth, rising incomes, etc.

Beach Reopenings

The second study investigated the impact of the Act on swimming
activity. Although the safety and desirability of swimming are affected
by a number of water quality parameters, the study was confined to
examining changes in the supply of beaches meeting public health criteria,
principally those related to coliform bacteria concentrations. The
Commission surveyed 38 states containing themajority of water bodies
available for swimming in the United States. Survey activities were
confined to public and private swimming areas specifically identified
as public beaches and, subject to public health regulations. Systema-
tically excluded were all areas or water bodies which could potentially
support swimming but which were not designated "beaches".

This study identified the magnitude of increased participation
which would result if all beaches which now have to be closed when water
quality poses a hazard for swimmers, were opened.*- The objective was to
determine how much swimming would be regained as improvements in water

Cause of closings were identified and beaches closed due to urban
runoff were not assumed to reopen as a result of 1977 and 1983
compliance.

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quality enable beaches to reopen. The first step was to survey the
preponderance of water bodies in the country With designated public
beaches and establish the magnitude of beach supply to be regained if
all beaches reopened. Any new area designated as a beach, and approved,
for swimming by virtue of having been made acceptable for that use
through implementing P.L. 92-500, is not included in these estimates.

Excluding private 'beaches and other areas where shoreline was not
formally designated public beach, it is estimated that nationally
1,128 miles and 7,165 acres of public beaches currently are affected by
water quality problems (Figure Hi.H.1).' These estimates suggest that
as much as 13 percent of.both national beach miles and acreage are
affected by poor water quality for varying durations of time. Closures
averaged one month in duration.

The Commission's study uncovered two separate effects upon partici-
pation. The increase in swimming activity expected at reopened beaches
is seen to result from a net increase in participation (new activity)
and from a redistribution of pre-e*i9ting participation levels among
the expanded inventory'of beaches;(dive'rted activity). The level of new
activity is expected to be between 7.8 and 17.2 million activity days
in 1985.* Diverted activity-'is forecast between 39.7 and 156.7 million
activity days in 1985.

Assuming that the mean net benefit deriving from the addition of a
new activity day is $7.50, and.that the diversion of an activity day
adds $2.50 in benefits (diversion resultsfrom the reopening of more
attractive or more accessible beaches) total benefits can be calculated
for future years. These estimates, combining benefits from new and
diverted activity days, range from almost $158 million to more than
$520 million for 1985.,

Consistent with the other examinations of benefits, these gains are
expected to persi,,:@,t'into the future. By the year 2000, the low estimate
of total benefits is $?12 million for that year, and the high estimate
more than $70b million. This continued growth in benefits is consistent
with the presumption that swimming participation continues to exhibit
a growth trend similar to that,of total population.

The geographic distribution of reopening of beaches appears to be
concentrated in particulai,sections of the country. The greatest number
of beaches currently affected by water quality problems occurs in New

Low and high estimates reflect alternate methods of estimating,
the fraction of national beach capacity now affected by wate r
quality problems.

Figure I I I.H.1

NCWO SURVEY & ESTIMATES* OF BEACHES" CLOSED DUE TO POLLUTION

100% Beach miles affected by pollution

OSED
fected by
pollution
1, 128 miles
OPEN
92% Surveyed in NCWO. study ....... 308

TOTAL U.S.
BEACH MILES - 13,426 %D
Beach areas affected by pollution
100%

CLOSED
Affected by
pollution
7,165 acres
OPEN
...........
3,234
91.4% Surveyed in NCWO. study R.

Minimum estimates. Maximum estimates are 57% over low for miles and 54% for acres.
TOTAL U.S. Lake, river and ocean beaches.
BEACH ACRES - 83,315 Source:, Nad. -Commission an Water Quality. From Battelle Memorial Institute, "Assessment of
-'the Economic and Social Implications of Water Quality Improvements on Public Swim-
ming", 1975.
February 1976

111-280

England, the Mid-Atlantic region, and the Great Lakes states. Since
these Areas contain significant portions of population, the reopening of
beaches there will offer the *greatest opportunity for participants to
increase swimming as a recreation activity.

Recreation Activities

The third study reviewed the impacts of the Act upon recreational
activities associated with freshwater, such as fishing, boating, water
skiing, canoeing, sailing, swimming, etc. Early in the investigation it
was determined that activities most clearly water quality-related are
swimming (examined'in the study described above), freshwater fishing,
and boating (as.distinguished from sailing, canoeing, etc.). This third
study was designed to develop quantitative estimates of the expected
impacts of the Act on freshwater fishing and boating.

Three distinct types of data are required to delineate the necessary
relationships. The first and most fundamental data include historical
surveys of recreation activities necessary to establish existing patterns
of participation in the recreational activities. Another set of historical
data is.required to delineate observed relationships between water .quality
and recreation participation levels for the subject activities. These
relati6nships@'arp used to project the probable impact of the Act on
future recreation participation levels. Finally, the basic dimensions
of socio-demographic influence on recreation participation must be deter-
mined to develop forecasts of future participation both with and without
the Act. Superimposed on these data sets are certain institutional con-
siderations which relate to the availability of the.resource for specific
activities. Figure"III.H.2 characterizes the analytical steps in this
study.,

Both freshwater fishing and boating will increase substantially as
a result of the Act. This increase is particularly striking for boating,
which is estimated to grow by At least 50 million activity days, and
perhaps as much as 115 million activity days by 1985.* "Assuming that
net benefits obtained from boating average $10 per activity day, these-.
forecasts suggest 1985 benefits in the range of $500 million to $1,155
million. Continued growth in recreation participation after 1985 results
in estimates of benefits ranging from $528 million to $1.7 billion for
the year 2000.

Low'and high estimates for freshwater fishing and boating reflect
alternate assumptions regarding future changes in the socio-demographic
characteristics of the population, as well as variations in other
assumptions.

Figure I I I.H.2

INFLUENTIAL FACTORS USED TO STUDY RECREATION PARTICIPATION
N FRESH-WATER FISHING & BOATING

WATER OUALITY
CHARACTERISTICS RECREATIONIST
Algal scums Odors BEHAVIORAL
Scarcity of Dark and PATTERN
f ish murky waters

NATIONAL
RECREATION
ECONOMIC ACTIVITY SOCIO- DEMOGRAPHIC
EFFLU NTS ACTIVITY co
Industrial CHARACTERISTICS LEVELS
Agricultural
Age
Mining
Income
X", -1:
NN'..
Urban
t Race
Sex

Background
Water Cluality Previous
Conditions recreational

experience

Source: Natl. Commission on Water Quality. From National Planning Association, "Water Related
Recreation Benefits Resulting from P.L. 92-500", 1975.
February 1976

111-282

Freshwater recreational fishing is also responsible for substantial
gains. Activity levels are estimated from more than 26 million activity
days to about 67 million days in 1985. Average daily benefits are
estimated at $81.30,-measured in 1975 dollars, based on a 1970 measurement
of $6.00 per activity day (1970 dollars). This assumption! leads to
benefit forecasts of $220 million to almost $560 million for 1985, and
$216 million to almost $800 million for the year @000. These estimates
do not include any benefits.to be derived from increased participation
or increased satisfaction associated with other water-related activities.

Water skiing, canoeing, sailing, and many other water-related activi-
ties depend in some way on water quality, but historical data was
insufficient to clearly establish these dependencies for the purpose-of
this study. Benefits obtained from increased swimming have been estimated
in the separate study already described. The benefit projections given
above, then, represent only a portion of the use-related benefits to be
realized from achieving the Act for the nation's freshwater resources.

Property Values

The three studies -- marine fisheries, swi.mming, and freshwater
recreation -- all have examined primarily a single subcategory of ..
benefit the use-related one which appears when the supply of some
water resource service is increased. The fourth national study has
been designed to investigate another type of use-related benefit
those which appear as a result of changes in values attached to certain
amenities provided to the owners and occupants of residential property
near water bodies. The generally high prices associated with shorefront
properties tend to support.this assertion. -Accordingly, an improvement
in water quality, to the degree it can be perceived by present and pro--@
spective residents, can be expected to increase the satisfaction obtained
from the use of shorefront property. This added benefit is explained
by an increase in buyers' willingness-to-pay for any specified quantity
of residential property.

Although the beneficial impact of the Act on residential property
is manifested by increased willingness-to-pay,'such increases cannot
be directly measured with market data. Since real property is normally
exchanged following negotiation between buyer and se 'lle'r, market price
can assume any level between a maximum determined by the buyer's full
willingness-to-pay and a minimum determined by the seller. The exact
price selected depends upon negotiated skills and other factors unrelated
to the'respective valuations of the p2operty. Accordingly, no market
demand curve for real property exists, except in the most general sense,
and increases in market price are not necessarily indicative of increased
willingnoss-to-pay. Still, if market prices for water-oriented residential
property can be shown to be positively correlated with increases in water

111-283

quality, a strong presumption exists that benefits have occurred, although
little can be said of their magnitude.

The purpose of this fourth study has been to determine whether ob-
jective changes in water quality bring about increases in the market
value. of nearby residential property, and to predict the magnitude of'
such increases following implementation of the Act. Since market values
would be expected to respond to perceived, rather than objective, changes
in water quality, the first step was to explore the relationship between
water quality and perceptions of water quality.

Survey research was used to develop a Perceived Water Quality Index
(PWQI), a weighted average of separate evaluations of wildlife support
capacity, recreational opportunities and five different categories of
aesthetic considerations. Seventeen study sites which had experienced
recent improvements in objective water quality were selected. They are
shown in Figure III.H.3. For each of these sitesi a sample of residents
was selected, and individuals were asked to quantify their perceptions
of water quality before and after the change.

A second-survey was conducted Of water quality experts having
objective knowledge of changes in water quality conditions at each site,
and their perceptions were measured on the same PWQI scale. The per-
ceptions of water quality experts, when suitably modified for the
effect of public accessibility and water body type, were closely
correlated with perceptions of residents.

Data was obtained on market prices or representative properties in
each of the study areas both before and after the water quality change.
Statistical methods were used to explore the relationships between
price changes, perceived water quality changes and other potential
determinants of property value., Residents' PWQI was indeed influential
in explaining increases in market price, and methods were developed to
determine the portion of the increase attributable to this effect.

Based on the established relationship between objective water
quality and residents' perceptions of water quality, national estimates
of changes to be expected following achievement of the Act were developed
in the PWQI. Based on data obtained from U.S. Geological Survey and
Census maps and reports, regional and national estimates were obtained
of the increases in residential property value likely to follow imple-
mentation of the Act.

The procedure yields an estimate of the aggregate increase in market
value of residential property of $770 million, following achievement of
the goals and requirements of the Act. Assuming that private land owners
capitalize rents at an annual rate of 12 percent, this increase represents

111-284

Figure I I I.H.3
SITE LOCATIONS FOR PROPERTY VALUE CHANGE STUDY

3 2
94

11 6 7 8
13
10 12
14

17 16

WEST NORTHEAST
1 . Lake Washington, Wash. 12. Mystic River, Conn.
2. Lake Washington, Wash. 13. Rockaway River, N.J.
3.. Green Lake, Wash. 14. Navesink/Shrewsbury R., N.J.
4. Willamette River, Ore.
5. San Diego Bay, Calif. SOUTH

MIDWEST 15 Kanawha River, W.Va.
16. St. John's River, Fla.
6. Lake Minnetonka, Minn. 17. Lake Charles, La.
7. Marion Mill Pond, Wis.
B. Hart Lake, Mich.
9. Kalamazoo giver, Mich.
10. Brown's Lake', Wis. KEY Lakes 4M
11. Big Sioux River, S.D.
Bays A

Rivers

Source: Nall. Commission on Water Quality. From David M. Dornbusch & Co., "The Impact of
Water Resource Quality Improvements on Residential Property Prices", 1975.
February 1976

111-285

an annual benefit level of almost $93 million per year by 1985. Since
property values have been shifted upward in an essentially permanent
manner, this benefit level can be assumed to persist indefinitely, As
noted above, these results describe changes in market value only, and
cannot be used as quantitative estimates of total benefits accruing
to owners of water-oriented residential property.

Summary

The results of all four national studies are summarized in Table
III.H.l. Annual gains are given for each of the use categories studied,
and.for the years 1980, 1985 and 2000. In all cases, dollar gains .
rise steadily from the base year, 1972, through 1985 when the 1977 and
1983 requirements of the Act are assumed fully implemented.' Certain
of the benefit measures remain constant after 1985, but some continue to
grow through the year 2000 because of increasing participation in the
benefited activity. The sum of quantified dollar gains for those benefit
categories specifically investigated increases from $3.1 billion per year
in 1980 to $4.8 billion per year in 1985, reaching almost $6.3 billion
per year in the year 2000, considering only the low estimates. If'the
high estimates of benefits from public swimming and freshwater recreation
are considered, the sum of all quantified gains-increases from almost
$4.2 billion per year in 1980 to $6.2 billion per year in 1985, reaching
more than $8.5 billion per year in the year 2000.

The cumulative magnitude of these benefit estimates can be repre-
sented by calculating the present value of the future time-stream of
benefits, given an appropriate discount rate and time'horizon. The
results of several such calculations are given on Tole III.H.2. The
first column contains 1975 present values for the categories of benefits
specifically investigated, considering only those benefits which occur
during,the period of implementation (1972 througl@ 1985) and discounting
at zero percent. This provide's estimates of the'cumulative dollar gains
expected during the period of implementation. These estimates are.
presented in this way so as to be comparable with estimates of cumulative
costs of implementation for the same period, although it must be remembered
that only a few categories of benefit have been considered, and that
.such an estimate does not include substantial benefits expected after
1985. The estimates of cumulative benefits for the period 1972-1965, as
shown in Table III.H.2, range from almost $34 billion to more than
$43 billion.

A preferable method for aggregating dollar amounts which occur over
a period of years is to compute a present value using a discount rate
which reflects the relevant social rate of time preference and risk
allowance. Since all future benefit estimates have been calculated on
the basis of 1975 prices, no allowance for futurL- price inflation need

TABLE III.H.l: SUMMARY OF ESTIMATED BENEFICIAL IMPACTS OF P.L. 92-500 ON SELECTED ACTIVITIES
(ALL FIGURES ARE INCREASES OVER PROJECTED BASELINE - 1972 INCREASES = O.OF
ALL DOLLAR FIGURES ARE IN MILLIONS OF 1975 DOLUkRS)

1980 1985 20001
Activity Annual Activity Annual Benefit Annual Activity Annual Benefit Annual Activity Annual Benefit
Days (Millions) 0 Million) Days (Millions) 0 Million) Days (Millions) 0 Million)-
Marine Fishing:
Recreational 144.8 2,029.3 236.6 3,299.6 318.4 4,440.9
Commercial 401.4 575.1 774.0

Public Swimming: -
New Activityz
(Low Estimate) 7.0 52.8 7.8 58.3 10.5 78.4
(High Estimate) 15.6 116.9 17.2 129.1 23.2 173.8
Diverted Activity3
(Low Estimate) 36.0 89.9 39.7 99.3 53.5 133.6
.(High Estimate) 141.9 354.8 156.7 391.8 210.9 527.3

Fresh Water Recreation:
Fishing@
.(Low Estimate) 26.3 218.3 26.5 220.0 26.1 216.6
,.(High Estimate) 63.5 527.1 67.3 558.6 96.3 799.3
OD
CA
Other Boating 5
(Low Estimate) 30.6 306.0 49.8 498.0 52.8 528.0
(High Estimate) 69.5 695.0 115.5 1,155.0 174.2 1,742.0
Property Values: 6
Recreational 61.7 92.5 92.5

I- -Population growth through 2000.assumed two percent per year.

2-- Benefits forNew Swimming Activity estimated at $7.50 per activity day.

3- Benefits for Diverting Swimming Activity estimated at $2.50 per activity day.
4- Benefits for Fresh Water Recreational.Fishing estimated at $8.30 per activity day,
based on 1970 estimate.of V6.00 per activity day (1970 dollars).

5- -Benefits for Fresh Water Boating estimated at $10.00 per activity day.

6- Property owners are assumed to discount their holdings at 12 percent per year.

Source: National Commission on Water Quality

111-287

TABLE III.H-2: AGGREGATE ESTIMATES OF BENEFICIAL IMPACTS OF P.L. 92-500
ON SELECTED ACTIVITIES (ALL FIGURES ARE 1975 PRESENT
VALUES,EXPRESSED IN MILLIONS OF 1975 DOLLARS)

Discount Period: 1972-1985 1972-2000

Discount Rate: 0%* 4% 4%

Marine Fishing 26,046 20,455 54,188

Public Swimming:
(Low Estimatej 1,581 1,306 2,678
(High Estimate) 5,226 4,317 8,852

Fresh Water Recreation:
(Low Estimate) 4,986 3,996 9,031
(High Estimate) 11,670 9,344 23,823,

Property Values 706 572 1,267

Totals
(Low Estimate) 33,319 26,329 67,164
(High Estimate) 43,649 34;688 88,130

Discounting at 0 percent produces cumulated dollar amounts during
period of implementation, regardless of time of occurrence.

Source: National-Commission on Water Quality

111-288

be included. Estimates of the level of a discount rate which incorporates
these considerations may vary, but few would suggest a rate higher than
4 percent. Calculations of present value based on a 4 percent discount
rate, then, would represent conservative estimates of the present worth
of the benefit streams under consideration. The second and third columns
of Table III.H.2 contain the results of such calculations, giving present
values of benefits expected during the implementation period (1972-1985,
column 2) and during the period 1972-2000. In the first case, the present
value ranges from less than $27 billion to more than $34 billion. The
longer period produces estimates which range from less than $68 billion
to more than $88 billion. Extending the time horizon beyond the year
2000 would produce still higher present.values, approaching $200 billion
if the indicated benefits are assumed to persist.indefinitely after full
implementation of the Act.

The Commission's studies of possible benefits from the Act fall far
short of a true measure of total benefits for several reasons.

1. The studies have considered only use-related benefits. Non-use-
related benefits exist, but economic theory and analytical techniques"
and required data currently available will not yield useful estimates
of their identity or magnitude.

2. Only selected use categories were explored. A number of addi-
tional freshwater recreational activities can be expected to produce
benefits comparable to those actually estimated, In these cases, however,
available historical data on recreation patterns and relationships.
between participation and water quality would not permit their inclusion
in the study. There are additional use categories which have not been
considered in any study, either for lack of identification or lack of
data. Benefits from abatement of human health hazards are not considered.

3. Results of the various studies may not be comparable. Each
study was deliberately designed to utilize a methodology and data sources
distinct from other studies, to the extent possible. This approach has
produced considerable information concerning the adequacy and applicability
of existing benefit estimation techniques, but it produces results which
are not necessarily comparable. The relationship between benefits
from saltwater fishing as opposed to freshwater fishing, for example,
may reflect the relative adequacy of the benefit measure chosen and
data available rather than a true ranking of the two classes of benefits.

4. Not all of the studies attempt direct measurement of benefits.
One study, for example, predicts increases in the aggregate market value
of residential properties as a result of improved water quality. As
discussed earlier, this result is strong evidence for the presence of
increases in willingness-to-pay, the proper measure of benefit, but it

111-289

does not provide a quantitative estimate of the magnitude of the benefit.
In another case, the results of the swimming study are based on a simple,
deliberately conservative, assumption regarding the relationship of
benefits of participation days.

5. The data bases and methodologies used are often less than ade-
quate for their intended purpose. Fundamental source materials for
characterizing recreational behavior, identifying the determinants of
such behavior,-arid documenting linkages between water quality and recrea-
tion frequently are incomplete, compiled on inappropriate basesf-or
out-of-date. The last usable national's urvey-of re@crea-t@ion 'activity
was conducted in 1970. The development of the relevant theoretical
considerations and empirical,procedures is in its infancy. Should there
be continued interest in,information relating to the quantification of
economic impacts of water quality changes on leisure time activity, a
basic and comprehensive data collection and analysis program needs to be
initiated. -Such a program does not now exist, and continuous data
collection and analysis have not been sustained.

The studies have shown that achievement of the goals.and requirements
of the Act will result in significant economic benefits to many groups
of recreational water users. Furthermore, owners of residential property
located near water are shown to obtain benefits. The quantitative
estimates.presented in Tables III.H.1 and III.H.2 should be reviewed as
partial measures of the magnitude of these benefits. Because many
classes of potential benefits, including those related to health effects
and all non-use-related benefits, have not been considered in these
studies, the benefit estimates presented are believed to understate the
true magnitude of economic benefits by an undetermined amount.

111-290

REFERENCES

Battelle Memorial Institute. Assessment of the Economic and
Social IMlications of Water Quality Improvements on Public
Swimming. 1975.

(2) Bell, Frederick W. and Canterbery, E. Ray. Florida State University,
Department of Economics. An Assessment of the Economic Benefits
Which Will Accrue.to Commercial and Recreational Fisheries
- from Incremental Improvements in the'Quality of'Coastal Waters.
1975

(3) David M' Dornbusch and Company, Inc. Thd Impact of Water Resource
Quality Improvements on Residential Property Prices. 1975.

(4) National Planning Association. Water-Related Recreation Benefits
Resulting from P.L. 92-500. 1975.

(5) U.S. Environmental Protection Agency. 1971 National Shellfish
Register.

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I. SOCIAL IMPACTS

1. Introduction

Any definition of "social impacts" is debatable. When cons-idering.
P.L. 92-500 the difficulty lies not in finding impacts but in selecti .ng
those areas which can be meaningfully analyzed and discussed. For
this analysis the Commission avoided qualitative and subjective approaches
and.used the primary social impacts of thedirect economic and environ-
mental consequences of the Act as the basis for analysis.

These social consequences derive from changes in levels and com-
position of employment, migration, costs of pollution control .- and
recreational activities. The analysis of social costs and benefits
consists generally of assessing how different social groups or geographical
regions are disproportionately affected by the Act's economic and environ-
mental impacts.

Social costs may occur as job losses, higher taxes: or prices of
goods resulting from pollution control requirements. Other social
11costs" may result from the failure to control municipal or industrial
discharges. Some of these costs are addressed in the analysis of the
Act's benefits. Others, such as possible impacts of an accumulation
of toxic substances in absence of the Act, are not. Since environmental
data on this hypothetical cost are incomplete, it is difficult to get
.a handle.on its specific social, impact.

For the social impact analysis, "benefit" is limited to changes
in.social behavior related to swimming, boating, sport and commercial
fishing and employment generated by the Act. The people who have
greatest access to these activities are those likely to be affected
most.

An early and still valid presumption was that large numbers of
workers may be displaced as a result of the law. The major negative
impact on employment results from industrial plants shutting down or
moving elsewhere. However, jobs created in construction and supply
industries will outnumber the losses from predicted plant closures.
While a plant closure,means,that individual workers.will lose jobs in
one area, jobs will become available in another. Thus, while a shutdown
will cause losses in certain communities, it is not expected to produce
a net loss of jobs nationally.

This does not..mean, however, that no one will be adversely affected
by the Act. Persons losing jobs or businesses because of the impact
of industrial or agricultural water pollution control expenditures may
not be qualified or geographically located so as to take advantage of
the new or increased job opportunities resulting from implementation of

III-@292

the Act. Too often individual impacts are lost in the summing of plusses
and minuses in total employment; the losses are no less real and severe
to those persons adversely affected. The fact that dislocations may be
temporary or short-range is of little comfort to the unemployed.

2. Social Impacts: Demographic and 2uantitative Analysis

a. Social Profile: The Commission focused on selected social character-
istics of the United States as a whole, the four U.S. Census regions
and selected river basins. The primary social characteristics chosen
for analysis include: sex, race, age, income and migration and growth
patterns. Variations in these characteristics (the social profile) are
defined for the major Census regions.

1. Employment changes generated by shifts in direct industrial
employment and jobs created by the Act..

2. Incidence of costs: (a) municipal taxes, (b) consumer price
changes.

3. Incidence and distribution of benefits by region and by social
group.

Economic and environmental impacts have social consequences. Those
environmental changes produced by the Act will_change recreational
and water use patterns. These changes will be distributed among dis-
tinct population groups. In addition to the aggregate assessments there
are a number of.qualitative local impacts which are addressed in a
series of case studies.

b. Population Baselines:

United States: The distribution of the U.S. population among the
four Census regions has remained fairly constant (Figure III.I.1). it
is projected to remain so into the 1990's. Both the U.S. and regional
populations will continue to increase at a decreasing rate throughout
1990. Of the four census regions, the West will experience the largest
population increase. In 1970 the U.S. population consisted of 51 percent
women and 48.5 percent men. Whites accounted for about 87 percent,
blacks about 11 percent and other minorities the remainder. Sex and
race composition for the U.S. population are assumed to remain constant
(10).

The average age will continue to shift upwards and is projected to
accelerate through the end of the century. This is due to declining
birth rates and increasing longevity. In 1970, 28 percent of the popu-
lation was under 15 years. This percentage will decline to 22

Figure I 11.1.1
U.S. POPULATION GROWTH AND REGIONAL DISTRIBUTION 1900-1970

100%
100%= 203 million
179 million
'100%
123 million North N rth
100% 1East East
76 million North West
East 15% 4%
South West 25%
West North 10% South
5 East 28% .......
..............
........... ..............
..............
.............
31% 31% ........... . 31%
28% ...............
32%
South( .............
..........
...........
.... South@
orth .... : :-:::-* North
.......... ....
North .......... North Central
Central
Contra] ........ Central
1900 1930 1960 1970

Source: Nell. Commission on Water Quality. From Human Resources Planning Institute, -The Social
Impacts of P.L. SIM&, 1975.
February 1976
asl Nort'
'a"

N
SN ........ C.
,:.n nt

111-294

percent by 2000. The 15 -24 age group will show a small decline during
that period. Age group 25-44 will show the highest increasep from 23
percent to 29 percent. By 1990, more than half of the population will
be in labor-force age categories.

The demand for recreational activities follows from the preference
patterns by age category (8). Income distribution for ,1970 shows the
median family-income to be $10,000 per year. Over 10 percent earned
more than $15,000 and over 27 percent earned between $10-15,000. At
the lower end of the scale, 8.3 percent made less than $3,000. Comparing
1970 income distributions to 1960, income distribution is narrowing
with more families having incomes in the $10,000+ categories.

Th6 Northeast and Northcentral regions have higher percentages of
families in upper income levels ($10,000+) and fewer in lower levels
(Figur e 111.1.2). The Western region has higher percentages in the
upper income groups. The Southern region shows the greatest difference
from either the U.S. average and the other regions. In this area the
income distribution is concentrated toward the lower range, with 21
percent of the famil 'ies. earning less than $3,000 per year, compared to
8percent nationally. Eleven percent earn between $3-5,000 (compared
to 11.1 percent nationally), and 13.5 percent earn between $5-7,000
(compared to 13.5 percent nationally).' 23.6 percent earn between
$10-15,000 as compared to 27.3 percent nationally, and 19.4 percent
make over $15,000 compared to nearly 30 percent nationally. The specific
impacts that the population will experience from the Act are*proportional
to the income distribution.

c. Labor Force:

In 1970, 76,554,000 people were employed. This included 26.2 percent
service industry, 25.9 percent manufacturing and 20.2 percent in whole-
sale and retail trade. Other categories transportation, communication,
public.utilities,.agriculture, forestries, and fisheries -- accounted
for 27.4 percent.

Major water-using industries accounted for 25.6 percent of total
manufacturing employment. They are food processing, textiles, lumber
and wood, pulp and paper, chemical products, petroleum refining, leather
curing and tanning, primary iron and steel, primary nonferrous metals
and electroplating.

The social characteristics of the population show differences in
distribution among types of employment. The largest concentration of
black employment, 36 percent, is in the service industries. Manufacturing
has 24.3 percent blacks, and retail trade has 13.8 percent. White
employment is more evenly distributed, with manufacturing, services, and

Figure 111.1.2
INCOME DISTRIBUTION OF POPULATION BY CENSUS REGIONS 1970
Under $3,000 to'$5,000 $5,000 to $10,000 $10,000 to over $15,000
Percent of Region's Population at each Income Level
Under $3000 $5000-$7000 $10,000-$15,000
North 6.0% 9.8% 29.6%
East 8.4. 18.2 28.1
............ - - - - - - - 38@@@
$3000-$5000 $7000-$10,000 Over $15,000
North 6.8 10.3
29.1
'Central 25.8
............ 9.2 ............. 18.8

7.0 10.2
28.1
West . . . . . . . . . . ......
9.7 18.2 .5
..........

....... 12.2 13. 23.6
South
19.7 19.4

Percent of U.S. Population at each Income Level
Under $3000 $5000-$7000 $10,000415,000
10.3 26.6
U.S.
10.0 20.6
20.6
$3000-$5000 $7000-$10,000 'Over $15,000
1 6 U.S. bars 100%
Source: Nati. Commission on Water Quality. From Human Resources Planning Institute, "The Social
Impacts of P. L. 92-500", 1975.
February.1976
MT.0
.......... .
..........

............
........... o..
.............
...........

7 7@
1171
7/77/77/

111-296

trade having 26.2 percent, 25.1 percent, and 20.7 percent respectively.
Age distribution does not appear to be a factor in employment charac-'
teristics of the water-using and norr-water-using industries.

The profiles are for the year 1970 and may undergo some changes by
the years 1977, 1983, and 1985.

Historical labor force participation rates are shown in the following
table:

TABLE III.I.l: PARTICIPATION IN THE LABOR FORCE BY
SEX AND RACE, 1955-1970

"White" Male "White" Female "Black & Other" "Black & Other"
Year Percent Percent Male Percent Female Percent

1955 85.4 34.5 85.0 46.1

1960 83.4 36.5 83.0 48.2

1965 80.5 38.1 79.6 48.6

1970 80.0 42.6 76.5 49.5

Source: NCWQ. From Human Resources Planning Institute. "The Social
Impacts of P.L. 92-500", 1975.

If trends shown in this table continue, the increase in the parti-
cipation rate for women would change the composition of the labor force
in future years. Declines in male participation rates would be reflected-
in changes in leisure time and working habits.

Some of the decline in the male rate results from the increasing
age of the population, and greater numbers of retirees.

The decline in the white male employment also reflects shifts in
the economy away from primary manufacturing to the service industries.
This decline in employment will decrease the number of workers affected
when the Act is implemented. The more rapidly growing sectors of
the economy,@ such as services, will not be directly impacted,

When demographic and employment characteristics are examined on
a census region basis, wider differences and variations occur.

111-297

(1) Northeast Census Subregion:

There were 19 million persons employed in this area in 1970 25
percent of all employment in the United States.

Table 111.1.2 shows that the Northeastern water-using industries
haverelatively fewer females'and black workers than the non-water-using
sector.

TABLE 111.1.2:' CHARACTERISTICS OF LABOR FORCE; NORTHEAST REGION

As A Percent
of Total Percent Percent
Employment Female Black

Water Using Industry 6.5 22.3 5.,9

Non-water Using Industry 93.5 39..4 8.0

Source: NCWQ. From Human Resources-Planning Institut@ "The Social
Impacts of P.L. 9@-50011, 1975.

(2) The Northcentral Census Region:

In 1970 this region had a total labor force of 21,650,000, with
1051,000 persons or 6.2 percent of the total employment. in water-
using manufacturing industries.

Intotal, including all other directly impacted industries, the
water-using industries account for 14.9 percent of the total male work
force. Iron and steel is the largest employer, accounting for 2.67 percent
of the total male work force in the region. Food processing was
second with 1.23 percent of the male work force.

Women in this region are less likley to bedirectly impacted by
the Act. Of all working women in the region, only 3.85 percent are
employed in industries likely to be affected. Concentrations of women
in the major water-using industries is in textiles.

Of the total black employment in the region, 8.1 percent was in the
water-using industries. One-half of these are in primary iron and-stedl
manufacturing. 11.2 percent of white employment occurred in industries
likely to be affected by P.L. 92-5M

111"298

(3) South:

Of the total U.S. employment 29.8 p
,fBrcent of the 22.8 million occurred
in.the South. (Figure 111.1.3) The water-using industries have a larger
relative share of employment in the South than in the remainder of the
United States. Of that employment, somewhat more is black, 18 percentf
and thus, the impact of the Act may be more significant for the black
population than for white.*

A major employer in the South is textiles. Textile employment in
the.South represents 71.6 percent of the U.S. textile industry. Southern
mining has 52.4 percent of the U.S. mining total: lumber and wood
44.1 percent; petroleum refining 40.'2 percent, and chemicals 39.2 percent.
In assessing the impact of the Act the.size of employment shares must be
balanced against vulnerability factors, such as the growth rate of the
area, re-employment opportunities, and the stimulative employment impacts
of the Act in the particular region.

(4) West:

This region has the smallest percentage of the nation's work force,
16.8 percent. Manufacturing in the West accounts for 19.2 percent of
the work force as opposed to,25.9 percent nationally. Western employment
in the water-usin4 industries represents 3.2 percent of the total.** Of
those in the water-using industries, there were more'males (24.2 percent)
than females (14.9 percent), and more whites and other (22 percent) than
blacks (17.4 percent). Any direct unemployment effects would impact
white males with greater frequency.

(5) Regional Comparison:

An examination of the relative shares, by census region, for each
major industrial sub-group shows the South and West to have larger
shares for mining, and a concentration of construction employment in the
South.

Manufacturing is still concentrated in the Northeast and Northcentral
regions. The South, however, is an area of concentration of the water-
using industries with a 37 percent share of employment in those industries.

For the U.S., black workers are 9.6 percent 'of the labor force.

This does not include irrigated agriculture.

Figure 111.1.3
EMPLOYEES IN WATER-USING.INDUSTRIES,
IN RELATION TO U.S. LABOR FORCE DISTRIBUTION

TYPE OF OCCUPATIONS I (V/O
andfacturing
253%
Ser ' e 6 .Wate
vic r.
m
Government Usin,
.............
26;2% WATER-USING
I N DUSTR I ES,
5,'077,000 employ6es
(25% of manufacturing)

Other 20.1%
(transportation, 27.%
Communications, Public
Utilities, Finance, Insurance, Wholesale
Real Estate, Agriculture, Retail Tra@de
Forestry, Fishing, Mining,
Construction, Public
Administration)
U.S. LABOR FORCE 1970 76,554,0.00

GE "M
REGIONAL DISTRIBUTION OF EMPI QVF:
$z

West. North
Central

South

100%
16.8% 25.2% 7665@_4,,00
'bm lo ees

Using 100%
24.9% 5077000
e lo ees

*Civilian labor force.
,Source: Nati. Commission an Water Quality. From Human Resources Planning Institute, "The Social
Impacts of P.L. 92-500", 1975.
February 1976

111-300

The major locations of the water-using industries are shown in
Table 111.1.3 and Figure 111.1.4.

The dependence of the South on water-using industries does not
necessarily follow from the significance of water supply in choosing
industrial locations. Other influences include the presence of raw
materials and a historic dependence on extractive industries. In addi-
tion, the region's lower wage rates have attracted industries. This
is a trend which will influence the regional impacts of the Act. Using
a baseline of 100, wages for the Northeast are 95; the South 80;
Northcentral 108; and West 99 (2).

The relative distribution of plant closings and wage rates from
region to region shows a high degree of correlation. But wage rates
are only one of the factors in plant closures. Others include age of
plants and pollution costs, as well as regional growth patterns and
their impact on industry viability.

The significance of this mix of factors influencing plant closure
can be seen by comparing the distribution of vulnerable plants to the
distribution of major water-using industry per se:

Industry Primary Region of Vulnerabi litya

Textiles Northeast, Northcentral

Iron and Steel Northeast, West

Nonferrous Metals West, South

Petroleum Refining All regions experience long-run decline
in employment.

Pulp and Paper Northeast, Northcentral

Electroplating All regions experience long-run growth

a. NCWQ. From National Bureau of Economic Research. Reports
prepared for the Commission.

Table 111.1.4 and Figure 111.1.4 show the regional distribution of
employment-for the major water-using industries. The South Census
region contains a large share of employment in this sector, and has a
lower average wage rate. wages in the most heavily impacted areas, the
Northeast and Northcentral statesare 15 percent to 28 percent higher.
This differential will accentuate the impact in these two regions, with
possible loss of employment to the South.

TABLE 111.1-3: EMPLOYMENT SHARES OF WATER USING MANUFACTURING INDUSTRIES

RANK UNITED STATES NORTHEAST NORTH CENTRAL SOUTH WEST

1 Textiles Primary Iron Primary Iron Textiles Lumber &
& Steel & Steel Wood

2 Primary Iron Textiles Food Processing Chemicals Food Pro-
& Steel cessing

3 Chemicals Chemicals Chemicals Lumber & Primary Iron
Wood and Steel

4 Food Processing Pulp & Paper Electroplating Food Pro- Primary Non-
cessing ferrous Metals

5 Lumber& Wood Food Processing Pulp & Paper Pulp & Paper Pulp & Paper

6 Pulp & Paper Electroplating Primary Nonferrous Primary Iron Chemical
Metals and Steel

7 Electroplating Primary Non- Lumber & Wood Primary Non- Electroplating 0
ferrous Metals ferrous metals

a Primary Non- -Lumber & Wood Petroleum Petroleum Petroleum
ferrous metals Refining Refining Refining

9 Petroleum Petroleum Textiles Electroplating Textiles
Refining Refining

10 Leather Leather Leather Leather Leather

Source: NCWQ. From Human Resources Planning Institute. "The Social Impacts of P.L. 92-500".
1975.

Figure 111.1.4
EMPLOYEES INVATER-USING_ INDUSTRIES
BY NUMBER, REGIONAL CONCENTRATION, & EXPECTED JOB LOSS DUE TO THE ACT

WATER-USING. NUMBER- OF EXPECTED-
INDUSTRY EMPLOYEES REGIONAL CONCENTRATION (thousands) JOB LOSS
t North Central South West Percent of Number
industry

Textiles 965,000 225- 33 69.1 17 3.5 33,900
(76.6%)
Iron& Steel (Primary) 868,000 396 13 5 55 not available
6%
Chemicals 662,000 186 166 260:(39.2%) 0 0 2,000
Food Processing 638,000 106 220 71 8.3 @9:000-1
360011

Lumber & Wood .553,000 85 244 (44.1%) not iven

PLdp & Paper 40,000 134 3 6 50 3.1 14,000

0
Electroplating 375,000 104 156 (41.6%) 69 45 30.4 113,900

Non Ferrous (Primary) 344,000 104 2 78 51 0 2,700

Pettoleum Refining 189,000 4-2 41 76,(40.2%) 30 2.3 4,500

Leather Processing 23,000 2(52.2%) 1.3 3,100

Total 5,077,000 1,252 1,351 1,885 537 228,500

KEY

Major concentration of employees in each industry (over 39%)
Job loss due to plant closures and indirect tosses attributable to Rounding of numbers accounts for difference in sum ofregional breakdowns
meeting 1983 BAT limitations. See Table 111.1.5 and Figure 111.1.5
for compensating job increases due-to the Act.,
Lessthan 1% Source: Nati. Commission on Water Quality.- From Human Resources Planning institute, "The Social
t Meal processing Impacts of P. L. 92-500", 1975.
tt Dairy processing February 1976
Northeas

57
(45.

190

138

6 4 1

111-303

TABLE'III.I.4-, 1970 PERCENT DISTRIBUTION OF WATER-USING
INDUSTRIAL EMPLOYMENT BY CENSUS REGION

Northeast Northcentral South West

Food Processing 16.6 34.5 29.8 11.1
Textiles 23.3 3.4 71.6 1.8
Lumber and Wood 10.3 15.4 44.1 30.2
Pulp and Paper 29.2 29.6 30.1 10.9
Chemical Products 28.1- 25.0 39.2 7.5
Petroleum Refining 22.2' 21.7 40.2 15.9.
Leather Tanned & Cured 52,2 26.1 17.4 4.3
Primary Iron and Steel 32.5 45.6 15.6 6.3
Primary Nonferrous 30.5 32.6 22.7 14.8
Electroplating 27.7 41.6 18.4 12.0

Total Water-Using Industries 24.7 26.6 37.1 10.6
Total Employment 25.2 .28.3 29.8 16.8
Population 24,1 27.8 310.9 17.1

Source: NCWQ. From Human Resources Planning Institute. "The Social
Impacts of P.L. 92-500", 1975.

When plants close industry Brequently migrates. to areas where labor
and raw material costs.are lower. Thus, the total impact would in these
cases cause a net decline in wages and regional,shifts in employment,
but no net decline in total national employmexit.

(6). Employment Impacts:

P.L. 92-500 can have a wide range of employment impacts. These
impacts-include increased employment in treatment plant construction
and the,supply industries, and the negative impacts of plant closings.
Overall the net effect of.the Act is to increase employment over the
decade 1975-1985. (Table 111.1.5) The major direct labor requirements
of the 'Act fall in the area of treatment plant construction, and allied
activity generated by the direct and indirect* requirements in the water
pollution control and related supply industries. The level of additional

If direct requirements or employment impacts are those which involve
the supply industry response to compliance demands, then indirect
consequences are those additional responses of all other economic
activity linked to the supply industries.

TABLE 111.1.5: P.L. 92-500: IMPACT ON EMPLOYMENT 1975-1985

Totals Job/Year in Thousands

75 76, 77 78 79 80 81 82 83 84 85

Construction Direct (1) 89 296 472 193 138 145 176 209 214 79 86
and Indirect

Other Supply Industries (2) 115 545 1051 836 363 350 506 576 593. 537 569
Direct and Indirect

operating and (3) 26 119 247 271 279 295 308 315 323 564 575
Maintenance

-@6 0 1770 990 1100 1130 1180 1230
Job Increases Total (4) 230 1300 780 790

Plant Closings (5) -91 -28

Indirect Losses. (6) -76 -34
in Related Industries

Job Losses Total (7) -167 -167 -167 -167 -167 -167 -299 -299 -299

Net
Employment Impact (4) -(7) 230 960 1603 1133 613 623 823 933 901 951 1001
Job Increases

Equilibrium Forecast 92 195 329 393 424 412 349 204. 8 -342 -888

Source: National Commission on Water Quality
From various Commission studies. February, 1976.

111-305

jobs per year in construction reaches a peak in 1977 at 472,000 (Table
111.1.5 and Figure 111.1.5) and remains in excess of 10.0,000 through
1983. Labor requirements in the supply industries show a similar pattern.
The increases in operating and maintenance employment dre projected to
grow from 26,000 in 1975 to 575,000 in 1985. The total labor demand
generated by the requirements of the Act would reach 1,770,000 in 1977.
and 1,230,000 in 1985.*

The regional distribution of the direct and-indirect labor impacts
of the direct municipal construction expenditures is shown in Table
111.1.6 and Figure 111.1.6.

The levels of employment are highest in the Northeast and Northcentral
regions, which are those areas most likely to have adverse industrial
itapacts.

TABLE III.J.6. REGIONAL DISTRIBUTION OF EMPLOYMENT GENERATED FROM THE
TOTAL EXPENDITURES FOR THE CONSTRUCTION OF MUNICIPAL
WASTEWATER TREATMENT FACILITIES 1975-1985, MAN-YEARS
(SCENARIO 1)

Region Total Percent Direct Percent Indirect Percent

Northeast 37.5 13.4 24.1

Northcentral 29.6 10.0 15.6

South 22.5 7.7 14.9

West 10.4 3.5 6.9

United States 100.0 34.0 .66.0

Source: NCWQ. From Human Resources Planning Institute. "The Social
Impacts of P.L. 92-500", 1975.

The types of skills required are shown in Table 111.1.7 and Figure
111-1.6. The building of sewage treatment facilities will increase the
need for construction workers and nonprofessional labor. This is in

SEAS and Wharton Macroecnomic Models, Scenario 1. They assume BPT
in 1977 and BAT in 1983, and a low level of municipal expenditure:
$23 billion.

111-306

Figure 111.1.5
IMPACT OF THE CLEAN WATER ACT PL92-500
ON EMPLOYMENT (MUNICIPAL & INDUSTRIAL)
1975-85

Annual Increase*
Thousands of jobs/year
1800 1770

1600

1400
Average
1230 Annual
1200 Increase

1042
1000 LO
Operations & r,
LO Operations &
- - - maintenance
Maintenance
800

600 - - - - - - - - - - - -
- - - - - - - - - - - -
- - - - - - - - - - - - -- - - - - -
- - - - - - - - - - - - -
-472- - - - - - - - - - - - - - Other supply
- - - - - - - - - - - - - - - - - - - - - - - - industries
- - - - - - - - - - - ---
- - - - Other supply industries
400
- - - - - - - - - - -
- - - - - - - - - - - - Net average
Direct & indirect'--
- - - - - - -- - - - - - - - - - - - annua increase
230 - - - - - - - - - - - - - - - - - ---
200 855,000 jobs/yr
Construction Construction
0 00
1975 '77 '79 181 '83 '85

----- - ---------
0 0 [4-1- =11 1104ia@@nlt cD Plant closures
A el w4d i 6d 6 sirl Iroire-s
-200 - -167 Related
-187 industry
-229 indirect
losses
-400
Annual decrease
-6001

*Increase of employment due to the Act.
Source: Plant closings derived from various Commission contract studies. All other data derived from
nt System, U.S. E
nm
Strategic Environmental Assessme nvi ro ental Protection Agency. 1975.
NMI-
t rz
00

Nati. Commission on Water Quality
February 1976

111-307

Figure 111.1.6
EMPLOYMENT GENERATED FROM TOTAL EXPENDITURES
FOR CONSTRUCTION OF WASTEWATER TREATMENT FACILITIES
1975-1985

REGIONAL DISTRIBUTION OF EMPLOYMENT INCREASE
Average increase of jobs per year
+1,042,000 jobs

Northeast
+391,000 66% Indirect
North Employment
West Central
108,000 +308,000

Direct
Employment

U.S. Average annual
increase 1975-1985

SKILLS REOUIRED FOR CONSTRUCTION DUE TO THE ACT Non Professional
(Direct & In direct Employment) 892,000 jobs

R df'@ 981f ONAL
11114,,TECHNICALI@illjlll@!1111111111111111
Indirect
Employment
NON ........
1
PROFESSIONAL e
Services
LABOR ............... 20,000 Professional
& ................ . ..................
& Technical
CONSTRUCTION 150,000 0 irect
Employment
WORKERS I @du"s't'r'i Farms
.................. j54JI60
1 '000 U.S. average
............... annuat increase
84,0061 1975-1985

Increase -additional employment due to the Clean Water Act, PL92-500.
Direct employment = Construction and planning I @t
Indirect employment,= In related supply industries and for operation & maintenance of completed facilities
JE
34%
E

Source: NatI. Commission on Water Quality from Strategic Environmentar Assessment System, U.S.
Environmental Protection Agency, 1975.
February 1976

111-308

TABLE 111.1.7

Types of Jobs Generated by POTW Construction,
Total, Direct and Indirect Employment

Occupation Total Direct Indirect

Total 100% 100% 100%

Professional-Technical 14.5 22.0 10.5

(Engineers) (4.5) (8.0) (2.6)

(Natural Scientists) .2) .3)

(Technicians) (5.4) (11.2) (2.3)

(Other Professionals) (4.1) (2.1) (5.2)

Construction and All Others 85.5 78.0 89.2

Managers 9.2%

Sales.Workers 2.8

Clerical 12.5

Craftsmen 25.5

Industrial and 24.4
Transport

Services 1.9

Farm .6

Labor 8.0

Source: NCWQ. From Human Resources Planning Institute.
"The Social Impacts of P.L. 92-500", 1975.

111-309

contrast to other pollution control areas * such as air and nuclear
safety, which require relatively more professional skills. The demand
for construction labor is significant today, when these trades are
experiencing 20 percent unemployment. One of the positive consequences
of treatment plant construction expenditures in a period of high unemploy-
ment is that in addition to removing workers from unemployment rolls,
it can save money in the long run. A study of public spending.,and unem-
ployment shows that when persons who would have been collecting unemploy-
ment compensation are put to workr the cost to the Federal treasury
is reduced by $3,250 per worker (3).

Some plants will be 'unable to meet the effluent guideline costs
and will close. The most affected industries are textiles, pulp and
paper and electroplating. Impacts by industry are listed in Table III.I.B.
Plant closings are projected to be higher for BPT than BAT, the direct
employment losses for BPT and BAT are 91,000 and 28,000 respectively.
Production shifts in the water-using industries will cause job losses
in related industries. For BPT this is 76,000 and BAT 34,000. At current
levels of unemployment (June 1975 = 9 percent), the average length of
unemployment would be 15.4 weeks (Table III.I.@9). At a lower rate
(June 1974 = 5 percent) it would be 10 weeks (5).

TABLE 111.1.9: AVERAGE DURATION OF UNEMPLOYMENT
JUNE 1974 - JUNE 1975

June Dec. June
1974 1975 1975
Total Unemployed 4,769,000 6,601,000 7,896,000

Length of Unemployment 419.5% 47.6% 33.3%
less than 5 weeks

5-14 weeks 31.0% 33.9% 30.9%

15-20 weeks 11.8% 12.1% 16.4%

More than 27 weeks 7.7%, 8.3% 16.4%

Average Duration in Weeks 9.8 10.8 15.4

Source: NCWQ. From Klein, Deborah, "Unemployment in the First Quarter
of 1975", Monthly Labor Review, August, 1975.

TABLE 111.1.8: Jobs Lost Due to Potential Plant Closings

Plant Closings, Direct Inpacts Plant Closings, Indirect Impacts

1977 1983 1977 1983

Dairy Processing 981 504 1,427 784

Meat Processing 7,990 11,515 12,427 17,906

a
Textiles. 26,107 none 7,832 none

Pulp and Paper 9,405 none 4,702 none

Chemical Products 750 none 1,263 none

Petroleum Refining 780 none. 3,747 none

Leather Processing 950 905 6.66 634

Iron and Steel N.A. N.A. N.A.' N.A.

Nonferrous 685 411 1,010 606

Fertilizer Manufacture. 236.- none 398 none

Electroplating 42,712 14,238 42,712 14,238
Job & Captive Shops

Total Job Losseg 90,596 27,573 76,184 34,168

Total direct, BPT and BAT 118,149 Total indirect, BPT and BAT 110,352

a. Maximum impact analysis assumes pretreatment requirements approximately equivalent to
BPT effluent standards.

Source: NCWQ- From Human.Resources Planning Institute. "Social Impacts of P.L. 92-500", 1975.

111-311

The majority of the job losses will Occur in the Northeast and
Northcentral states. Closures in textiles will affect women relatively
more than in other industries. Women are 50 percent of the labor force
in textiles. Electroplating closures will be concentrated in the North-
central region. Pulp and paper closures will also affect the North-
central region as well as the Northeastern region. In both industries,
closures will primarily affect white males who are 80 percent of the
labor force. (See FigureIII.I.7).

Looking at the net direct and indirect impact of the jobs created
and the jobs lost through plant closures*, the result is a positive
increase to a peak of 1,153,000 jobs in 1977, and 933,000 in 1982,
remaining over 900,000 through 1985. (See Table 111.1.5 and Figure
Table 111.1.5.)

in addition to these employment impacts, there are a series of
other macroeconomic effects which change the ultimate job totals. These
include effects on'income, price increases and changes in the interest
rate. The resultant general impact of P.L. 92-500 on economic activity
offsets the increased employment totals generated in construction, the
supply industries and the major water-using industries. The result is
positive overall but smaller. The effect is a net peak in 1979 of
424,000 which declines to minus 342,000 in 1984, and minus 888,000
in 1985. (See Figure 111.1.8 and Table 111.1.5.)

4. Incidence of the Direct Costs of P.L. 92-500

In earlier sections of this chapter, the costs have been expressed
in billions of dollars And related to such large aggregate figures as
GNP, total state and local spending, or total investment. The purpose
of this section is to present the direct costs and their distribution
as annual costs for families of various incomes, as a percentage of income
for various income groups, and to compare the distribution of these
costs to those of other taxes. "Direct-cost" is used here to refer
to either the Federal, state and local tax.increases necessary to sponsor
the publicly owned treatment works program or price increases brought
about through requirements placed upon industry. In both cases, these
represent annual costs a's a result of the programs. Such effects as
losses in GNP due to unemployment, reduced economic growth, loss of
corporate profits due to inability to pass on costs, or increases in
interest rates are not reflected here. Similarly, possible offsets
such as the stimulative effect of the program also are not considered.

Some problems exist in the relationship of threatened closures to
actual closures. EPA's Economic Analysis Division.observed closures
from January 1971 through March 1975. 33,850 job losses were threatened
and 12,557 occurred, a ratio of approximately three potential losses
to one actual.

111-312

Figure 111.1.7
JOB LOSS DUE TO PLANT CLOSINGS IN MAJOR WATER USING INDUSTRIES
AS RESULT OF CLEAN WATER ACT REOUIREMENTS FOR 1977,1983

Industry Job Loss (in thousands)
Addtl. requirements
1977 BPT requirements for 1983 BAT level
Electroplating 28.51113.9
Meat Processing /20.4 29.4149.8

Textiles 33.9

Pulp and Paper 14.1

Petroleum Refining 4.5

Dairy Processing 3.6

Leather Processing 3.1

Non Ferrous 2.7

Chemical Products 2.0

Fertilizer Mfgr. 0.6

Iron & Steel not available

Job Loss 44@1@4167 B T 1983 BAT 6
01 .167
A44 4
ater using - . . . . . . . . . .
ndust i s 91 n i:r* c*t*:::::::*.*,*,
.......... .
thou s

... ...... .....

Job loss = loss of employment due to the act.
Direct impact = Job loss due to plant closures within industry category.
Indirect impact = Loss of jobs by supplier industries to that industry.
BPT = Best Practical Technology 1977; BAT = Best Available Technology 1983
Source: Nati. Commission on Water Quali'ty. From Human Resources Planning Institute, "The Social
Impacts of P. L. 92-500", 1975.
February 1976

111-313

Figure 111.1.8
NET IMPACT OF THE CLEAN WATER ACT ON EMPLOYMENT
COMPARED TO NATIONAL NET ESTIMATE
OF EMPLOYMENT INCREASE/DECREASE

Net Annual Increase/Decrease Employment
Jobs/yr in thousands
1600 1603 INCREASE

1400 - Net
Increase
Due to the Act
1200 - (A)*

1001
1000 - 960 933
.Net average annual 855
800 - increase due to Art

600 613

424 412
400 329
,00o, Net National Emp,70y :>,1\204
230 (Equilibrium Forecast)
200 :000e (B)" Net national average
0000, 107
92 annual increase
1975 '77 '79 '80 '81 '8 3'@_ 8 '85

-200 DECREASE,

-400 -342
Not Increases in employment due to construction and re-
lated industry impacts minus decreases in employment
-606 due to plant closures and other related indirect losses.
Curve A derived from Strategic Environmental Assess-
ment System, U.S. Environmental Protection Agency.

-800 **Curve 8 from CONSAD Research Corporation,
;
Macrosconomics of P.L. 92-500", 1976. See Section
II F; this represents a culmination of all interactions -888
(price, inflation, interest rate, income, etc.)
-1000

Nati. commission on Water Quality
February 1976

111-314

Table III.I.10 and Figures 111.1.9 and III.I.10 show the annual
costs per family for the various elements of P.L. 92-500, and the total
annual costs. The average annual cost per family for categories I, II
and IVB (treatment plant and interceptor sewer needs) and industrial
requirements other than RAT is $306 while for all needs except urban
runoff and all industrial requirements the cost is $522 per family. Costs
to the median family are below these average costs, with lower costs
to low-income groups and higher costs to higher income groups. It will
be noted that the costs borne through industrial price increases are
significantly higher than those caused by tax increases from the publicly
owned treatment works program. This may come as startling given the
much higher capital costs given elsewhere in the report for POTW's as
against industry. The reasons for this are threefold: (1) the POTW
program costs used for this estimate are about 12 percent lower*than the
final Commission estimate, (2) the costs shown are annual costs; as a
result, the fact that operating costs for industrial pollution abatement
facilities are five to six times those for POTW's plays a very important
role, and (3) the interest and depreciation costs for industry are much
higher, due to the differences in interest costs of industry versus govern-
ment borrowing and the shorter time horizon normally used for depreciating
industrial equipment.

The costs are, however, averages for the nation and will be signifi-
cantly different depending on the treatment needs of the community in
which one resides. Thus, the tax increase for an average family in a
community of under 5,000 with no treatment plant would be over $90 com-
pared to the $68 shown as the nationalaverage for treatment plant and
interceptor needs (6). Families in small communities have particularly
high costs per family, both because of economies of scale in treatment
and because a larger portion presently*lacks adequate treatment facilities.
Combined sewer overflow control needs, which form over half of the
costs for all categories except urban runoff, are also highly concen-
trated in a small number of states and communities, particularly in
older cities in Northeast and Northce@tral regions. For a resident of
-a community with major combined sewer overflow needs, the annual costs.
per family would be closer to $300 compared to the national average of
$145. One offsetting factor, however, is that the tax increases shown
here were computed using the 1975 population. By 1985 they will have
reduced by about 10 percent due to population growth.

Table III.I.11 and Figures III.I.11 and 111.1.12 show the costs
of Table III.I.10 as a percent of-income. In all cases, the lowest
income groups pay the highest percentage of their income for pollution
abatement. For tax increases, the cost as a percent of income is
generally decreasing. For price increases the upper middle income groups
also pay a higher percentage of income than other groups. The net

TABLE III.I.10: COSTS PER FAMILY BY INCOME GROUPS IN THE YEAR 1985 (1975 dollars)a

Taxc Increases Necessary for: Total Direct Costs Due To:
Income Categories I, II, Price IncreasesdCaused By: All Categories and
Class and IVB (Treatment All Categories BPT and New All BPT & BAT and
(1975 Total Plant and Inter- Except Urban Source BAT @Industrial Categories.I, II, Industrial
Income)b ceptor Sewer Needs) Runoff Requirements Requirements Requirements And IVB, BPT Requirements

D-6,700 $27 45 84 so 134 ill 180

6,700-9,500 40 74 86 so 136 126 210

9,500-13,100 48 94 91 53 143 139 238

13,100-17,200 57 117 132 77 210 189 326

17,200-20,700 62 133 306 179 484 368 617
(Median Class)

20,700-29,000 81 177 350 205 555 431 732

29,000-37,500 126 287 525 309 834 651 1122

37,500-58,900 84 185 526 309 835 610 1020

58,900-152,700 214 485 532 312 844 746 1330

152,700+ 1007 2392 532 312 844 1539 3237 Ul

Aver:xge Cost
Per Family 68 145 238 139 377 306 522

a. Costs were converted from the current dollar indicated in the urban Systems report to 1975 dollars using
GNP deflator for tax increases, and a weighted average of University of Virginia price deflators
for consu r durable, consumer nondurable and services, Weights were based on weighting of
goods examined by Urban Systems.

b. Income used here is total income, a concept developed by Brookings Institute. It differs from the normal
census definition.of income by including unreported income, fringe benefits, undistributed corporate
profits,_and imputed rent on owned occupied housing.

C. Tax increased derived from Needs Survey estimates of costs by category and Metcalf and Ed@aY estimates of
operating costs. The annualized costs were then distributed to the Federal, state and local level
assuming a 75 percent Federal grant, and current state grant programs. Costs were then distributed
among states using the allotment formula based on EPA corrected estimates of Needs. Price increases
due to industrial cost recovery and user charges are not accounted for.

d. Price increases are derived from macroeconomic Scenario 4 for BPT and new source requirements and from
macroeconomic Scenario 1, all industrial requirements. BAT requirements computed as the
difference between these two results. Price increases are those developed by the University of
Virginia price model which were then apportioned to income classes according to consumption
pattern by income class.

Source: Urban Systems Research and Engineering, Inc. Economic impacts of Water Pollution Control Act of 1972;
Incidence of costs. 1975.

Figure 111.1.9
ANNUAL COST PER FAMILY 1975.1985 BY INCOME LEVEL
TO CONTROL WATER POLLUTION FROM MUNICIPAL & INDUSTRIAL DISCHARGES
(1st PHASE COST)
$1255 billion of the U.S. annual "family income"" Each family will pay the cost of the Clean Water Act
is earned by 64.8 million families by annual tax and price increases

INCOME 100% 100% ANNUAL ANNUALCOST PERCENTOF
LEVEL INCOME FAMILIES DIRECT.COST' PER FAMILY ANNUAL
10(r/o $13.5 billion INCOME
Over $152,700 80/0- 0.8% "'4% $1,405
121/o
37,500 - 152,70 0 23% 414-570 0.79-0.54
32% 45% of families
(upper income)
20,700 - 37,500 39% will pay 70% of the
1st Phase Cost of the Act 43% 212-259 1.0-1.2
2

------------
13,100 - 20,700 23% 17% 55% of families 20% $ 87-117 .77-1.1
(lower income) S
6,700 - 13,100 11% will pay 30% of the 6% 70
Under $6,700 4% 1st Phase Cost of the Act 62 1-8
$ S Ist Phase Cost*

Ist phase costs include industrial treatment at 1977 BPT level and municipal treatment of categories 1,11,IVB,BPT. In 1975 dollars.
See footnote on Figure for description of family income. Total income is estimated for 1975.
t Direct cost is that passed along to the consumer in terms of tax increases for municipal wastewater control and price increases for industrial wastewater control.
Since the tax increases for municipal wastewater treatment are based on the annualized costs of the POTW program, and the price increases for industry
treatment do not include costs borne through reduced profits or output, - the total of these increases is not comparable to the average annual costs (or percents)
as shown in Chapter 1.
Source: Nati. Commission on Water Quality. From Urban Systems Research and Engineering,--Eco@
nomic Impacts of Water Pollution Control Act of 1972; Incidence of Costs", 1975.
February 1976
0

201a 6
4,

Figure I 11.1.10
ANNUAL COST PER FAMILY 1975-85 BY INCOME LEVEL
TO CONTROL WATER POLLUTION FROM MUNICIPAL & INDUSTRIAL DISCHARGES
(2nd PHASE COST*)
$1255 billion of the U.S. annual "family income" Each family will pay the cost of the Clean Water Act
is earned by 64.8 million' families by annual tax and price increases
INCOME 100% 1005(o ANNUAL ANNUAL COST PERCENT OF
LEVEL INCOME FAMILIES DIRECT COW PER FAMILY ANNUAL
100% $30.3 billion INCOME
0.8%
Over $152,700 12 D/O '1% 4498
37,500-152,700 459/c Of families 22% 809-1394 1.7-1.3
32% (upper incomO
will pay 70% of the 2nd
Phase Cost of the Act
20,700-37,500 39% --
42% 585-947 2.3-2.8

2 Vlo

55% of families -- ---------- ---
13,100-20,700 23%
17% (lower income) 20% $ 299-472 1.97-2.2
,6,700-13,100 11% will pay 30% of the cost 16% S 171-233 -2.
Under 6,700 4% 12% 4% S 145 4.3
2nd Phase Cost*

2nd phase costs include industrial treatment at 1983 BAT level and municipal-treatment of all categories IN. In 1975 dollars.
See footnote on Figure 111.1.11 for description of family income. Total income is estimated for 1975.
t Direct cost is that passed along to the consumer in terms of tax increases for municipal wastewater control and price increases for industrial wastewater control.
Since the tax increases for municipal wastewater treatment are based on the annualized costs of the POTW program, and the price increases for industry
treatment do not include costs borne through reduced profit or output, - the total of these increases is not comparable to the average annual costs (or percentsi
as shown in Chapter 1.
Source: Natt. commission on Water Cluality. From Urban Systems Research and Engineering, "Eco.
nomic Impacts of Water Pollution Control Act of 1972; Incidence of Costs", 1975.
February 1976
0

@21

TABLE III.I.11-. COSTS AS PFRCENTAGE OF INCOME BY INCOME GROUP (1985)a

Taxo Increases Necessary for: d Total Direct costs Due
Income Categories I, II Price Increases Caused By: All ca
class and IVB (Treatment All Categories BPT and New All BPT &
(1975 Total Plant and Inter- Except urban Source BAT Industrial Categories 1, 11, Indust
Income)b ceptor Sewer Needs) Runoff Requirements Requirements Requirements and IVB, BPT Requir

0-6,700 .62 1.05 1.93 1.12 3.05 2.55 3.

6,700-9,500 .38 .70 .82 .46 1.28 1.20 1.

9,500-13,100 .33 .63 .62 .35 .97 .95 1.

13,100-17,200 .29 .60 .66 .40 1.06 .95 1.

17,200-20,700 .25 .52 1.23 .71 1.94 1.48 1.
(Median Class)

20,700-29,000 .25 .55 1.08 .62 1.69 1.33 1.

29,000-37,500 .16 .364 1.20 .71 1.91 1.36 1.

37,500-58,900 .13 .28 .83 .49 1.32 .96 1.

58,900-152,700 .16 .36 .39 .22 .60 .55

152,700+ .19 .45 .11 .06 .17 .30

a. 1975 dollar prices over constant dollar income for the year 1985.

b. Income used here is total income, a concept developed by Brookings Institute. It differs from the normal census defin
of income by including unreported income, fringe benefits, undistributed corporate profits, and imputed rent on
owner occupied housing.

c. Tax increases derived from Needs Survey estimates of costs by category and Metcalf and Eddy estimates of operating
costs. The annualized costs were then distributed to the Federal, state and local level assuming a 75 percent
Federal grant, and current state grant programs. Costs were then distributed among states using the allotment
formula based on EPA corrected estimates of Needs. Price increases due to industrial cost recovery and
user charges are not accounted for.

d. Price increases are derived from macroeconomic Scenario 4 for BPT and new source requirements and from
macroeconomic Scenario 1, all industrial requirements. BAT requirements computed as the
difference between these two results.* Price increases are those developed by the University of
Virginia price model which were then aportioned to income classes according to consumption pattern by income clas

SOUrce: NCWQ. From Urban Systems Research and Engineering, Inc. Economic Impacts of Water Pollution Control Act of 197
Incidence of Costs. 1975.

Figure I 11.1.11
DIRECT COST 'IN TAX & PRICE INCREASES FOR EACH FAMILY INCOME LEVEL
TO CONTROL MUNICIPAL & INDUSTRIAL WATER POLLUTION
(11 st Phase Cost *. Estimate for 11 Year Period, 1975-1985)

INCOME LEVEL WHO PAYS? (Annual.cost per family)
Over $152,700 39@ $1,040
58,900 - 152,700 211 365

37,500 - 58,900 300
Tax increases (Federal, State, Local)
121 to control municipal wastewater
29,000 - 37,500 293
Price increases to pay for controlling
20,700 - 29,000 industrial wastewater pollution
t
e@(an income class
17,200 - 20,700 will pay $212/yr. in
157
tax and price increases
----------
13,100 - 17,200 66

2 Ist Phase Cost Municipal categories 1, 11, IV8 and Industry 1977 BPT Level. in 1975 dollars.
9,500 - 13,100 5 Income used here is total family income, a concept developed by Brookings Institute. It differs from
the normal U.S. Census definition of income by including unreported income, fringe benefits,
30 undistributed corporate profits and imputed rent on owned occupied housing.
6,700 - 9,500 t Median income = 50% families earn more, 50% earn less.
Source: Nati. Commission on Water Quality. From Urban Systems Research and Engineering, "Eco-
Under 6,700 nomic Impacts of Water Pollution Control Act of 1972; Incidence of Costs", 1975.
February 1976
83

4
4

23
29

Figure 111.1.12
DIRECT COST IN TAX AND PRICE INCREASES FOR EACH FAMILY INCOME LEVEL
TO CONTROL MUNICIPAL & INDUSTRIAL WATER POLLUTION
(2nd Phase Cost . Estimate for 11 Year Period, 1975-1985)
INCOME LEVEL" WHO PAYS? (Annual cost per tamily)
Over $152,700 642 0- 0 $3,856
58,900 - 152,700 642 52

37,500 - 58,900 528
Tax increases (Federal, State, Local)
431
29,000 - 37,500 to control municipal wastewater
516
Price increases to pay for controlling
261 industrial wastewater
20,700 -.29,000 324
-------------- edian income class
17,700 _ 2!,70, 116
274 will pay $472/yr. in
--------- ----- ___,@a@2nd price increases
13,100 - 17,200 183
6
2nd Phase Total Cost Total of Ist & 2nd Phases: Municipal categories IN and Industry 1977
154 and 1983 Levels.
9,500 - 13,100 Income used here is total family income, a concept developed by Brookings Institute. It differs from
the norma I.U.S. Census definition of income by including unreported income, fringe benefits,
101 undistributed corporate profits and imputed rent on owned occupied housing.
6,700 - 9,500 0 t Median income - 50% families earn more, 50% earn less,
Source: Nati. Commission on Water Quality. From Urban Systems Research and Engineering, "Eco-
76 nomic Impacts of Water Pollution Control Act of 1972; Incidence of Costs", 1975.
Under 6,700 69 February 1976
281

111-321

effect is to require the highest costs as a percent of income from the
lowest income groups and from upper middle income families. With respect
to tax increases, these results are slightly misleading because they
assume there would have been no spending on sewer systems in the absence
of the Act. If this factor were taken into account, the effect would
be to lower the costs'as a percentage of income to the lowest income.
classes because of the shift to the more progressive Federal taxes.

Table-III.I.12 and Figures III.I.,11 and 111.1.12 show the relative
burden of both the publicly owned treatment works program and of price
increases due to industrial cospliance, and compares them to the burden
of various types of taxes. The burden is defined as the percentage of
the costs of each tax or set of price increases borne by a given income
class. The'overall impact of the*tax increases puts a greater burden on
low income families than the Federal income tax, but low income groups
beara smaller share of costs than they do of all Federal, state and
local taxes.

The key determinants of the burden of publicly owned treatment works
programs are the Federal income tax and the user charge system. While
the Federal income tax is progressive (it places the greatest burden,on
higher income groupsi, user charges are among the most regressive of-all
taxes. This is because of the small effect of income upon water use.
The property tax, the most commonly proposed alternative to user charges,
places a considerably lighter burden on low income families than user
charges. Price increases show no consistent pattern when compared to
other taxes. For the lowest income group, the share is much greater
than the Federal income tax, but lower than for the total tax package.
For the highest income group, the share is lower than under either tax.

Given the regional distribution of income in the United States for
impact of user-charges would be heaviest in the South, where average
incomes are lower. In contrast, the more progressive distribution of
costs based on Federal taxes would shift more of the burden away from
lower income families generally and away from the South specifically.

5. Community Case Studies: Local Social Impacts

.Turning to the impact of the Act on local social groups, as opposed
to the distribution of impacts across large scale demographic profiles, a
.range of groups are involved as well as a geographically distributed.
series of issue-specific sites. Nine communities* were selected from

These nine include: Ketchikan, Alaska; Loveland-Greeley, Colorado;
Muskegon County, Michigan; the Maumee River in Ohio; the Merrimack
Valley in New Hampshire; Block Island, Rhode Island; Fairfax County,
Virginia; Escambia Bay, Florida; and Lake Washington in Seattle,
Washington.

TABLE 111.1.12: R.EIATIVE BURDEN OF TAX AND PRICE INCREASES IN COMPARISON TO OTHER TAXESa,b

Income Total Burdens Total Burdens BPT Percent Of Percent Of
Class BPT Price Increase & BAT Price Increase @PersQnal Total Taxes all House- All income
(1975 Total Tax Price and I, II and IVB & All Categories Income (Federal, State User Property holds in to income
Income)c Increased Increasee Tax Increase Except Urban Runoff Tax Local) Chargers Tax income group group

0-6,700 3.3 3.7 3.6 3.6 .8 5.2 10.9 6.9 12.3 4

6,700-9,500 3.1 2.2 2.3 2.5 1.2 6.5 6.3 7.0 4.3

9,500-13,100 5.4 3.2 3.5 3.8 3.9 7.5 9.2 7.9 9.8 6.5

13,100-17,200 8.6 5.9 6.3 6.7 7.2 11.3 11.7 11.1 12.0 10.0

17,200-20, 700 11.3 15.8 15.2 14.5 10.1 13.7 14.1 13.1 14.3 12.7
(Median Class)

20,700-29,000 25.6 30.9 30.2 29.4 26.3 26.7 25.0 24.7 24.5 25.8

29,000-37,500 13.3 14.8 14.6 14.4 14.7 12.9 8.4 11.7 7.8 13.7

37, 500-58,900 9.3 16.2 15.2 14.3 10.3 7.1 9.4 6.2 8.5 13.0
H
H
58,900-152,700 8.6 5.8 6.2 6.6 10.5 4.8 3.8 5.2 3.0 7.0

152,700+ 11.4 1.5 2.9 4.3 15.0 5.5 1.1 .6.8 .8 8.0

a. Burden: Percentage of column heading supported by each income group.

b. Columns may not sum to-100 percent due.to rounding error.

c. Income used here is total income., a concept developed byBrookings Institute. It differs from the normal census
definitions of income by including unreported income, fringe benefits, undistributed corporate profits,
and imputed rent on owner occupied housing.

d. Tax increases are derived from Needs Survey estimates of costs by category and Metcalf and Eddy estimates of operating
costs. The annualized costs were then distributed to the Federal, state and local level assuming a 75 percent
Federal grant, and current state grant"programs.. Costs were distributed among states using the allotment
formula based on EPA corrected estimates of needs. Price increases due to industrial cost recovery and user
charges are not accounted for.

e. Price increases are derived from macroeconomic scenario 4 for EPT and new source requirements and from
macroeconomic Scenatio 1 all industrial requirements. BAT requirements computed as the difference
between these two results. Price increases are those developed by the University of Virginia
price model which were then aportioned to income classes according to consumption pattern by income
class.

Source: NCWQ. From Urban Systems Research and Engineering, Inc. Economic Impacts of Water Pollution Control Act of 1972;
Incidence of Costs. 1975.

111-323

among 122 candidate sites, out of a possible total of 16,000 communities.

The nine selected sites were compared to census data population as
a whole. The demographic indicators surveyed included: mobility, ethnic
composition, family structure, educational attainment, employment struc-
ture, economic structure, income indicators, income structure, and other
general demographic indicators. of these factors, the only significant
variations of the sites chosen from the national average were@ ethnicity
and income levels. The communities chosen were on the average slightly
more, culturally cohesive and slightly less representative of low income
population. Thus, the communities chosen were fairly typical of the dis-
tribution of characteristics for the population as a whole.

The impacts on social groupp.were.assessed for each of the sites
shown in Figure 111.1.13. Some of these.groups were specific to single
issues and varied from site to site.

Figure 111.1.13
CHARACTERISTICS OF 8 SITES

SOCIAL IMPACT STUDY

1. KETCHIKAN A sulfite pulp company town in Alaska faced with closure of it
one industry be@ause of the Water Pol:ution Act
02 3N
2. LOVE LAND-GREELEY New treatment plan being built in a fast growing water
7 scarce Colorado community
8 3. MUSKEGON COUNTY Site of a sophisticated water management system in
Michigan with zero-discharge technulogy, profit making
orientation, using reclaimed water
4. MAUMEE RIVER BASIN Citizen participation and cleanup of the highly polluted industrial river in Toledo area, which
discharges into Lake Erie. Agricultural as well as municipal and industrial interests compromise
5. MERRIMACK VALLEY Two industrial N.H. cities an a historically pol!uted river reflect contrasts of long standing
negative attitudes with new city. planning approaches
6. BLOCK ISLAND Effect of a proposed sewer system an this isolated, rural, mostly summer Long Island Sound
community with competing citizen and tourist interests
7. FAIRFAX COUNTY Rapidly growing, densely populated Virginia suburban area adjacent to D.C., which adoj;.ted a
sewer moratorium
8. ESCAMBIA BAY Commercial fishing suffered severe losses because of chemical and power plant pollution of @his
recreational Florida bay

Natf. Commission on Water Ouality
February 1976

111-324

The impact of the Act on social groups can be summarized under the
following headings;

Occupational groups

Special groups

Demographic groups

Occupation groups-are impacted as follows:

a. Occupational Groups (See Figure 111.1.14)

One: Those occupations which will incur social benefits as a
result of the Act.

� Sanitary Engineering Professionals, Planning Professionals
and Private Economic Engineering, and Environmental Consultants.
Under all conditions the Act increases demand for the services
of these occupational groups and provides them opportunities
for involvement in the political decision-making and planning
process.

� Employees of water-related leisure goods and services
industries will be positively affected.

� Employees of waterfront industries and water-related service
industries. From fishing tackle suppliers to recreational
.area food vendors, employees in these'industries will receive
benefits as the quality of the water increases.

� Commercial Fishermen. The fishing industry obviously will
benefit from cleaner water and more plentiful fish.

� Lawyers. The litigation and permit process resulting from the
Act has and will continue to increase the need for lawyers'
services.

Two: Those occupations which will receive a mix of social benefits
and costs as a result of Act-initiated events.

o Waterfront residential and industrial property developers.
The developers of such properties benefit from the increased
desirability of their property, but also incur the costs
associated with the general construction impacts of the Act.

Figure 111.1.14
IMPACT OF THE'CLEAN WATER ACT ON SOCIAL GROUPS

SOCIAL BENEFITS SOCIAL COSTS
Occupational Groups Occupational Groups
Sanitary engineers, planning Construction workers on local
professionals, economic engi- residential housing
neering & environmental GROUPS EXPERIENCING
consultants
Employees of water-related or BENEFITS & COSTS
waterfront industries
Commercial fisherman Occupational Groups
Lawyers
Waterfront developers
Farmers Special Groups
Special Groups
Boaters W
Conservationists Special Groups Property taxpayers Ln
Waterfront residents Consumers in under $30,000
(Above groups are mostly middle No growth or slow growth pro- housing market
& upper income groups) ponents
Lower income groups benefit from
public access to improved water
sites
'J
0 0 0

ju
1,

*Social benefits in this study are limited to changes in social behavior related to swimming, boating, sport and commercial fishing, and employment generated by
the Act. Excluded from this chart is the portrayal of the unquantifiable aesthetic benefits accruing to all groups from the availability of cleaner water, and the
benefit from stopping the acceleration of mans'degrading of the water. See pages 1-68,111-239, 274, 276-278.
Source: Nati. Commission on Water Cluality. From Human Resources Planning Institute, "The Social
Impacts of P. L. 92-500", 1975.
February 1976
"low,

111-326

o Farmers. The unique properties of the sites involved in this
study demonstrate particularly complex cost-benefit polarities.
The reader is referred to the Loveland-Greeley and Maumee case
studies for examinations of land value and reductions in the
nutrient content of the water as they impact farmers.

Three: Those occupations which will primarily incur social costs
as a consequence of the Act.

o Local residential housing construction workers. The short@term
effect of the Act is to slow down the level of housing construc-
tion activity. This has@a negative impact on local housing
construction workers. On the other hand, long-term benefits
accrue to workers in the building trades because of increased
potential for waterfront and newly sewere.d land, and requirements
for treatment plant construction.

b. Special Groas

The special groups category includes a range of interest areas,
with the following distribution of impacts:

One: Special groups that will benefit from Act-related events.

� Boaters. With the exception of some problems associated with
increased tourism in fishing areds, the social impacts on
boaters will be positive.

� Conservationists. Although these are largely intangible
benefits, conservationists will receive considerable'social
benefits from theimplementation of the Act.

� Waterfront Residents. Decreases in odor and increases in
property values make this special group one that is particularly
benefited by the Act.

Two: Groups that will ieceive both social costs and benefits
from TC-t-related events.

o No or Slow-Growth Pr22onents. The short-term effects of the
Act may parallel the interests of'politically organized no/slow-
gr6wthproponents.@ However'; in @he long run, as more sewage
treatment capaci is created and sewer moratoria are lifted,
growth in all sectors may be encouraged, contrary to the wishes
6f,controlled growth advocates.

111-327

Three. Groups that will incur primarily social costs resulting
from Act-initiated events.

o Potential Consumers in the under $30,000 housing market.
Increases in costs associated with sewering and other compliance
measures undoubtedly will contribute, along with inflation,
to the decline of supply to this market.

c. Demographic Groups

Some nonqua@ntified findings were available for demographic (social
profile) groups. These can be compared to the.demographic analysis of
impacts at the regional and national level,

� Sex. Perhaps as a reflection of the dominance of males in the
occupatio nal and economic ownership groups, males seem to
experience more of the social impac ts m9re directly than females.

� Age. Clearly, the middle-age groups, those 31 to 60, will be
involved in the majority of the social impacts noted in this
study. Those in the younger age group were, however, also not
far behind in terms of feeling the impacts of the Act.

� Minority Status. Minorities were underrepresented in case-study
sites. However, the impacts of the Act in the housing area,
on the construction industry, will have a significant negative
effect on certain minority groups.

� Income Level. Moderate income individuals will be involved in
almost all social beneifts and costs associated with the Act.
High income individuals appear to be in a position to bear less
relative and absolute cost than in the moderate and low income
groups, particularly if they are in the property ownership
groups. In contrast, the low income groups will receive
relatively little benefit, outside of those who will partake
of urban water recreational improvements; and this group will
bear an especially large share of the costs due, in part, to
the shift from property taxes to user charges.

d. Economic Ownership Groups

o Ownership of desirable waterfront residential property is con-
centrated among middle and upper income groups. The benefits
of cleaner water accrue largely to these groups. The provision
of public access to bodies of water improved as a result of
P.L. 92-500 serves to distribute some of the benefits to lower
income groups (4).

111-328

References

(1) Abt Associates, Inc. Economic Impacts of Water Pollution Control
Act of 1972; Socialimpact8t Eight Cage'Studies. 1975.

(2) The Bureau of Labor Statistics. 1974 Handbook of Labor Statistics.

(3) Congressional Budget Office. Tempararymeasures to Stimulate
Employment: An Evaluation of Some Alternatives. 1975.

(4) Human Resources Planning Institute. The Social Impacts of P.L. 92-500,
1975.

(5) Klein, Deborah. "Unemployment in the First Quarter of 1975".
Monthly Labor Review. August, 1975.

(6) Meta Systems, Inc. Evaluation of Alternative Methods for Financing
Municipal Waste Treatment Works. 1975.

V) National Bureau of Economic Research. Economic Impacts of Water
Pollution Control Act of 1972; Regional Analysis of Industry
Vulnerability, Iron and Steel, Nonferrous Metals, and Other
Industries. 1975.

(8) U.S. Department of the Interior, Bureau of Outdoor Recreation.
The 1970 Survey of Outdoor Recreation Activities. 1�75.

(9) U.S. Environmental Protection Agency. Cost Estimates for Construction
of Publicly Owned Wastewater Treatment Facilities, 1974 "Needs"
Survey. 1975.

(10) U.S. Water Resources Council. OBERS Projections. 1972.

(11) Urban Systems Research and Engineering, Inc. Economic IMpact of
Water Pollution Control Act of 1972;-Incidence of Costs,.
1975.

IV. WATER QUALITY ANALYSIS

AND ENVIRONMENTAL IMPACT ASSESSMENT

IV-i

IV. WATER QUALITY ANALYSIS AND
ENVIRONMENTAL IMPACT ASSESSMENT

Table of Contents

Page

A. INTRODUCTION . . . . . . . . . . . . . . . . . IV-1.

1. The Concept of Chemical, Physical and
Biological Integrity . . . . . . . . . . . . . . . IV-2
2. Interpretation of the 1983 Interim
National Goal . . . . . . . . . . . . . . . . . . IV-6
a. Fish . . . . . . . . . . . . . . . ... . . . . . . IV-6
b. Shellfish . . . . . . . . . . . . . . . . . . . . IV-7
C. Wildlife . . . . . . . . . . . . . . . . . . . . . IV-8
.d. Potential for Recreation in
and on the Water . . . . . .... . . . . . . . IV-8

B. METHODOLOGY . . . . . . . . . . . . . . . . . . . . . . . . IV-9

C. THE WATER: ITS QUANTITY AND QUALITY . . . . . . . ..... . . IV-13

1. Hydrology . . . . . . . . . . . . . . . . . . . . . . .. IV-13
2. Measuring Present Water Quality . . .. . . . . . . . . . IV-16
a. Oxygen Depletion . . . . . . . . . . . . . . ... . IV-18
b. Eutrophication Potential . . . . . . . . . . . . . IV-20
C. Physical Characteristics . . . . . . . . . . . . . IV-21
d. Salinity and Acidity . . . . . . . . . . . . . . . IV-22
e-. Health Hazards and Toxic Substances . . . . . . . IV-23
3. Pollutant Loadings . . . . . . . . . . . . . . . . . . IV-25
a. Point Sources . . . . . . . . . . . . . . . . . . IV-25
(1) Biological Oxygen Demand (BOD5) . . . . . . . IV-26
(2) Suspended Solids . . . . . . . . . . . . . . IV-26
(3) Nutrients . . . . . . . . ; . . . . . . . . . IV-26
(4) Total Dissolved Solids . . . . . . . . . . . IV-26
(5) Coliform Bacteria . . . . . . . . . . . . . . IV-26
b. Nonpoint Sources . . . . . . . . . . . . . . . . . IV-27
(1) Urban Land . . . . . . . . . . . . . . . . . IV-27
(2) Agricultural Land . . . . . . . . . . . . . . IV-27
(3) Forested Land . . . . . . . . . . . . . . . . IV-27
(4) Mining Land . . . . . . . . . . . . . . . . . IV-27
4. Predicting Future Water Quality . . . . . . . . . . . . IV-30
a. Dissolved Oxygen . . . . . . . . . . . . . . . . . IV-33
b. Eutrophication Potential . . . . . . . . . . . . . IV-37
C. Physical Characteristics . . . . . . . . . . . . . IV-38
d. Salinity . . . . . . . . . . . . . . . . . . . . . IV-39
e. Health Hazards and Toxic Substances . . . . . . . IV-39
f. Thermal Effluents . . . . . . . . . . . . . . . . IV-41

IV-ii

Page

D. BIOLOGICAL, ECOLOGICAL AND ENVIRONMENTAL IMPACTS . . . . . . IV-44

1. Fish . . . . . . . . . . . . . . . . . . . . . . . . .IV-45
a. Fish Distribution . . . . . . . . . . . . . . . . IV-45
b. Fish Kills . . . . . . . . . . . . . . . . . . . . IV-50
2. Shellfish . . . . . . . . . . . . . . . . . . . . . . . IV-52
3. Wildlife . . . . . . . . . . . . . . . . . . . . . . . iV-54
4. Recovery Time . . . . . . . . . . . . . . . . . . . . . IV-60
5. Effects of Delayed Implementation . . . . . . . . . . . IV-61
6. Environmental Impacts of Waste Residuals Disposal . . . IV-63
a. Rationale . . . . . . . . . . . . . . . . . . . . IV-63
b. The Residuals and Disposal Methods . . . . . . . . IV-63
co Environmental Impacts . . . . . . . . . . . . . . IV-66

E. SPECIAL ASSESSMENT STUDIES . . . . . . . . . . . . .. . . . . IV-71

1. Standing Waters . . . . . . . . . . . . . . . . . . . .. IV-71
2. Marine Studies . . . . . . . . . . . . . . . . . . . . IV-74

F. ENVIRONMENTAL FINDINGS, CONCLUSIONS, AND OBSERVATIONS . . .IV-77

1. Study Design . . . . . . . . . . . . . . . . . . . . . IV-77
2. Water Quality and Quantity . . . . . . . . . . . . . . IV-79
3. Pollutant Loads . . . . . . . . . . . . . . . . . . . . IV-84
4. Residuals Disposal . . . . . . . . . . . . . . . . . . IV-85
5. Environmental Impacts . . . . . . . . . . . . . . . . . IV-86

IV. WATER QUALITY ANALYSIS
AND ENVIRONMENTAL IMPACT ASSESSMENT

A. INTRODUCTION

Assessing environmental impacts associated with achieving or not
achieving the requirements of the Act,presented the Commission with a
dilemma. Since many of the requirements will not take*effect until some
time after the Commission's work is finished, the task ofassessing
environmental changes was, by necessity, predictive. The.state-of-the-
art of predicting changes in environmental systems is limited. only in
the past few decades has concentrated scientific effort been applied to
measuring and documenting changes caused by introducing specific amounts
and types of pollutants' into aquatic systems. Most of this research has
been extremely limited in scale and geographic scope, and essentially
devoid of analy ses of long-term,effects of substantial levels.

As the art advances, there is a time lag between initial develop-
ment and w-ide-scale application of water quality measurement techniques.
As a consequence, the body of long-term water quality data currently
available is limited to a small group of traditionally measured char-
acteristics including temperature, dissolved oxygen, turbidity; sus-
pended solids, total dissolved solids, pH, biochemical oxygen-demand,
and, to a lesser extent, nutrients, coliform bacteria and toxics, such
as heavy metals and pesticides. Measuring and predicting thb environ-
mental impacts of introducing certain pollutants into a,controlled
aquatic system is possible. However, relating that information to
entire drainage systems, and accurately predicting effects resulting
from introducing pollutants into or removing them from complex aquatic
environments, usually stretches the application of ecosystem analysis
beyond the present state-of-the-art and beyond the existing data base..
Thus, the Commission's environmental assessment program is a unique'and
original attempt. Not only is,information on which to base environ-
mental predictions scarce, but also there is neither precedent nok
established methodology for a study like this.

Recognizing these limitations, the Commission attempted to develop
a methodology based on existing water quality data and judgmental analy-
sis by experienced professional ecologists. Together with the guidance
and advice from two selected panels organized by the National Academy of
Sciences/National Academy of Engineering and the Institute of Ecology,*
the Commission designed a methodology for predicting nationwide environ-
mental impacts of.achieving or not achieving the goals and requirements
of the Act. The results represent a preliminary assessment, establish a

*See Appendix for list of TIE and NAS-NAE Committee Members.

IV-2

successful precedent for future large-scale environmental assessments
and provide generalized pictures of what the nation may expect in the
way of environmental changes from its efforts at water pollution control.

The study results estimate where some of these improvements will be
experienced, the degree of improvement for different areas, reductions
in point-sources controls and the environmental implications of dispos-
ing of residual pollutants extracted from the treated wastewaters. Just
as significant as these general findings, the methodology also lays a
sound basis for applying more sophisticated analytical methods of envi-
ronmental assessment to public policy. The results identify the need
for continued refinement of the "state-of-the-art" for projecting en-
vironmental change, and concentrated research on the continuing re-
sponses of ecological systems to water quality changes.

1. The Concept of Chemical, Physical and Biological Integrity

A major objective of P.L. 92-500, as stated in Section 101(a), is
"To restore and maintain the chemical, physical, and biological integ-
rity of the Nation's water." Hence, the new concept of "chemical,
physical, and biological integrity" of water requires understanding by
the Commission in its various studies.

of key importance to understanding this objective, however, is a
precise interpretation of the word "integrity." While the House Com-
mittee on Public Works did not explicitly define the word in its report,
it stated that "the word integrity as used is intended to convey a
concept that refers to a condition to which the natural structure and
function of ecosystems is maintained." The report further'said that
11natural is generally defined as that condition in existence before the
activities of man invoked perturbations which prevented the system from
returning to its original state of equilibrium" (H.R., p.763). The
Senate Committee made reference to sources which could be used to come
to a definition of integrity for specific waters. They said, "The
inatural...integrityl of the waters may be determined partially by
consultation of historical records on species composition; partially
from ecological studies of the area or comparable habitats; partially
from modelling studies which makes estimations of the balanced natural
ecosystems'based on the information available" (S.R., p. 1468).

Even with this guidance, the integrity concept is still difficult
to define, primarily because few professional ecologists or environ-
mentalists agree to a precise definition. The Commission, with assis-
tance from the Institute of Ecology's Advisory Committee on Water Eco-
systems, has examined differing opinions and philosophical approaches to
defining the phrase, but is uncertain which viewpoint or philosophical
approach most closely reflects the intent of Congress, as stated in the
Act.

IV-3

A simplistic application of this integrity concept could mean that
quality of water which would exist in a "natural" physical and chemical
state without any man-made contribution or disturbance, and "biological
integrity" that water-related biomass which existed prior to any
alteration or influence from man's technology. Even with so simple an
approach, there are definitional difficulties. Did man's technology
originate when he first took up a club, when he began using metal tools,
when he began to produce his own food and congregate in permanent towns
and villages, or only with the coming of the "industrial revolution"?

Obviously, man began to dominate, alter and manage his environment
long before the twentieth century. To "maintain" a level of "chemical,
physical, and biological integrity" requires, first, a choice of that
level to which the nation's waters are to be "restored." Data to de-
scribe the present chemical, physical and biological condition of the
nation's water is woefully inadequate. Any attempt to characterize the
historical "integrity" of the nation's waters at historical intervals
with any degree of accuracy from the fragmentary available information
is impossible.

Although it has physical, biological and chemical components,
ecosystem integrity as a single concept is preferable to dissection into
11component integrities" for purposes of definition. The concept of
ecosystem integrity relates to regulation of the-structure and function
of all components. To understand this concept requires understanding of
several basic characteristics of ecosystems:

1) Interrelationships among species and their physical-chemical
environments are results of long-term continuing evolutionary
processes.

2) Due to interactions among species and with the environment,
ecosystems tend toward short-term stability of biomass, and maintain
characteristic rates of energy flow.

3) Ecosystems evolve toward a steady-state condition through
species succession following short-term environmental disturbance.

4) Occasional natural disturbances (e.g. floods) are essential
to maintain diversity in ecosystems.

5) Maintenance of life on earth depends upon the continued
functioning of evolutionary ecosystem processes.

.Although man is part of ecosystems and a product 'of evolution, his
complex and sophisticated technology has given him an unprecedented
capability to radically alter ecosystems. man-induced changes occur at
much faster rates than do natural ecosystem changes because of the

IV-4

technology he is constantly perfecting. With some exceptions, man's
disturbances of ecosystems often abruptly alter environments developed
over long periods of time. Some consequences of these changes are
disappearance of useful species, appearances of nuisance species,
noxious conditions and human health hazards. Because of the difference
between rates of natural and human-induced ecosystem changes, the
concept of ecosystem integrity must account for mechanisms that regu-
lated ecosystem structure and function prior to modification by man.

If natural ecosystem integrity is viewed as a phenomenon that
should be "restored and maintained," difficulties arise when attempting
to apply this concept as a measure of success for a water pollution
control program. Is ecosystem integrity achieved when an Aquatic en-
vironment provides optimum services required by man, or does the achieve-
ment of ecosystem integrity require restoring conditions existing prior
to human impact? The fundamental question, then, is to what extent
should man restrain or adapt his technology to limit his environmental
impact more nearly to what would occur naturally, i.e., without his
technology?

Those who interpret ecosystems integrity to mean "conditions prior
to technological perturbations of man" feel the definition to be philo-
sophically correct for several reasons. They say our knowledge of
ecosystems is very incomplete, and that we may be changing and modifying
ecosystems in ways we do not fully understand. Ecosystems are impor-
tant, these proponents say, because someday we may need them for very
different purposes than we do today. If ecosystems are managed only for
current purposes, their capacity to meet unforeseen future uses may be
destroyed. Certain "minority", groups wish to use ecosystems in ways
quite different from conventional uses. Management of ecosystems for
only conventional uses will deprive these "minority users." Persons
arguing for restoration and maintenance of ecosystems as they were
."prior to man's technological perturbations" believe the condition
provides a maximum range of possible future human,uses.

On the other hand, others believe using the environment and main-
taining environmental quality at a level no higher than is required for
current use is philosophically acceptable. They feel that it is im-
possible, and in fact undesirable, to achieve an environmental quality
that existed prior to human technological impact without drastically
reducing man's numbers. In short, they feel that man has been, and
should continue to be, an integral component of the ecosystem in which
he lives. Upgrading general environmental quality above a level needed
for survival is an unnecessary expense which society can ill afford.
Since our understanding of ecosystem conditions prior to human impact is
incomplete and will remain so, it is foolish to strive for an environ-
mental condition which remains undefinable.

iv-5

Each of these philosophies can be supported by valid arguments.
Thus, the dilemma facing the nation is how to incorporate into a water
quality program a concept of chemical, physical, and biological integ-
rity, or ecosystem integrity, that satisfies the full range of view-
points. The resultant regulatory process should avoid unacceptable
costs of unrealistically stringent environmental regulation, yet also
destruction of our water environment. Those who formulate and direct
the regulatory process inevitably face difficult questions of balance
between environmental quality and economic consequences in controlling
this nation's water pollution. Neither of the extreme philosophies
summarized here, if applied exclusively as a basis of a pollution con-
trol program, will likely yield environmentally sound and economically
reasonable results. Thus, the questions posed here must be answered
using best sources of information available at a given time, rather than
through a philosophically dogmatic approach.

Contractors performing 41 site-specific water quality and environ,--
mental.studies, the primary focus of the Commission's national environ-
mental impact assessment, were instructed to compare existing conditions
and projected changes within each sit'e to physical, chemical, biological
and ecological characteristics of an "undisturbed setting" within or
adjacent to the site. However, in a number of.site-specific studies,
environmental contractors found it impossible to document these char-
acteristics for the "undisturbed setting." Often, there were insufficie 'nt
data, historical or present. In some instances, contractors were only
able to use a "hypothesized" set of environmental conditions representing
some "undisturbed" level for comparison. For nearlyall study sites,
except in extreme headwater regions, there have been important changes
in physical, chemical, and biological characteristics over time. Even
where an "undisturbed setting" is described, there are pollutant dis-
charges from upstream that prevent accurate characterization of such a
setting.

Thus, the Commission cannot claim that its studies, even in a
limited sense, have identified a "chemical, physical and biological
integrity" to which the water there should-be restored at these loca-
tions. These studies do, however, utilize all available information for
the respective sites to analyze progress toward a water quality better
,than that existing today and one that will provide "for the protection
and propagation of fish, shellfish and wildlife.`

IV-6

2. Interpretation of the 1983 Interim National Goal

Section 101(a)(2) of the Act states:

"It is the national goal that wherever attainable, an interim,
goal of water quality which provides for the protection and prop-
agation of fish, shellfish, and wildlife and provides for rec-
reation in and on the water be achieved by July 1, 1983."

Similar language appears in another section of the statute.
Sectioh.302(a) authorizes special "effluent limitations (including
alternative effluent control strategies)" for point-source discharges
into "d specific portion of the navigable water" when, in the EPA Admin-
istrator's judgment, regular effluent limitations for 1983 "would inter-
fere with the attainment or maintenance of that water quality . . .
which.shall.assure protection of public water supplies, agricultural and
industrial uses, and protection and propagation of a balanced population
of shellfish, fish and wildlife, and allow recreational activities in
and on the water

in interpieting this language the Senate Report (Report of the
Committee on Public Works, U.S. Senate, October 28, 1971).states that
"intAngible social benefits . . . more difficult to calculate such as
long-term improvement,of water quality and reduction of estuarine and
ocean pollution should not be ignored" (p.47). The Committee also
acknowledges the "recreational and aesthetic values of maintaining a
balanced population of shellfish, fish and wildlife in the particular
waterway" (p.48).

To evaluate achievement or non-achievement of the 1983 interim goal
within the context of the Commission's environmental assessment,,a
practical ifiterpretati6n of the goal is required. Several,interpreta-
tions of th6 goal are.possibl6, and each interpretation entails a differ-
ent approach for assessing achievement or non-achievement. The under-
lying asgumption inherent in the Commi8sion's,interpretati6n has been
that the goal is an ecological and environmental one and therefore must
be stated in ecological and environmental parameters. For example, the
goal specifies that there shall be "wherever attainable" a water quality
which "provides for the protection and propagation of fish, shellfish,
and wildlife

a. Fish

To the extent that some fish species are found in nearly all of the
environmental study sites, that part of the interim goal is presently
being achieved at these locations. Considering the type of fish present
and that existing populations are low or restricted within a small
habitat, the overriding and controlling factor may be the ability of

IV-7

some species of fish to tolerate, or exist in, low to moderate levels of
pollution. Stated another way, some fish can tolerate certain pollution
levels for brief periods of time. Thus, depending upon the geographical
location, type and levels of pollutants, and native species, some fish
would be present.

Interpreting the goal becomes more complicated if a "h 'igh quality"
game fish previously existed within the site, or presently exists within
the "undi�turbed" part of the site. The question of achievement then
requires a totally different perspective, one for which an assessment is
made of (1) historical species composition within the site, and (2) whether
the species would likely return if physical, chemical, and biological
support were to become-available through reduction of point-source
discharges. If this approach is selected, the next step is to evaluate
possible management strategies for introducing or reintroducing those
species. To complicate matters even further, for many parts of the
country, data are not available to document historically existing
species-composition. In many areas, native fish species have been
replaced by decades of stocking, introduction and reintroduction of new
species. Thus, for many sites, the concept of indigenous species and
the condition to 'Which the sys@em might revert when point sources are
curtailed or eliminated becomes a matter of preference.

In order to obviate these and related problems, the following
ihf6rmation was sought,in studies at specific assessment sites: (1) what
types and amounts,of,fish presently exist within the site? (2),Are the
types and kinds of fish present similar to or different from those
existing historicaliy within the site? Within the "undisturbed setting"?
(3) In view of the projected water quality and possible habitat changes
within the site, will fish undergo marked changes in biomass or species
composiLon?, Answers to the last question were not evaluated from the
standpoint of potential to support a sports fishery, since the analysis
would have required studies to determine species adaptable to the site,
perception by local fishermen and access to the site.

b. Shellfish

Achievement of the interim goal@relative to shellfish is even more
difficult to assess when considering shellfish. But it can be partially
evaluated from answers to ieveral questions asked of environmental con-
tractorst (1) Do-shellfish presently exist within the assessment site?
If so, in what types and quantities? (2) Have they changed in biomass
or range of habitat over recent time because of pollution? (3) Has
their availability been limited because of accumulation of toxic sub-
stances or because they are a hazard to human health? (4) What are some
of the,projected changes in shellfish if point-source discharges are
reduced or eliminated within the site? Within the limits of historical
information for several sites, future changes have been predicted. But

IV-8

on the basis of site assessments alone, too few data were available to
form meaningful conclusions for the nation as a whole.

C. Wildlife

Achievement of the interim goal relative to wildlife is most
difficult to assess. Few reports have been published describing the
linkage between water pollution levels and wildlife populations, or the
effects on wildlife. The movement of pollutants through the environ-
ment, including accumulation in specific wildlife populations, is poorly
documented. Waterfowl, the most closely related to aquatic environments
because of food sources and habitat requirements, do accumulate specific
pollutants to the point of reproductive failure, physiological stress
and, in some cases, death. However, two general problems emerge when
trying to assess achievement of the interim goal for waterfowl: (1) they
are generally migratory, which makes it difficult to document when and
where damaging pollutants were assimilated; and (2) the food chain
dynamics in many aquatic systems where waterfowl are found have not been
well described. Hence, it is difficult to document site-specific relation-
ships between potentially damaging pollutants and impacts on wildlife.
Knowledge of such relationships would necessarily be an important pre-
requisite to any analytical procedure to evaluate the effects of reducing
or eliminating pollutants from point or nonpoint sources.

A final observation relating to achievement or non-achievement of
the interim goal for fish, shellfish, and wildlife is that while it may
be possible to substantially reduce point-source pollutants by achieving
the requirements for July 1, 1983, a recovery of the physical habitat
that would support various fish, shellfish, and wildlife undoubtedly
will take considerably longer to occur. Ultimate beneficial effects on
fish, shellfish, and wildlife populations could take as long as 2-5
years, and possibly longer.

d. Potential for Recreation in and on the Water

The second part of the interim national goal requires a wat6r.,
quality that "provides for recreation in and on the water." To a marked
extent, achievement or non-achievement of this part of the goal can be
evaluated from the standpoint of meeting specific water quality stan-
dards for water-based recreational activities by achieving the require-
m6nts for July 1, 1983. This is not difficult to assess, since pro-
jected changes in water quality can be compared against Federal, state
or local standards for water-based recreation. However, the most fre-
quently used parameters depend upon levels of total coliform or fecal
coliform bacteria present. Ideally, achievement should be based on
compliance with a number of water quality criteria, in addition to
bacterial standards. Such a standard set of parameters is not always

-1

IV-9

feasible because of natural variations in parent water quality char-
acteristics which occur regionally and geographically. For example, to
select a specific level of turbidity against which existing and pro-
jected water quality changes could be compared to determine achievement
would be difficult, since in some parts of the country high turbidity
levels occur naturally. Hence, for practical purposes, the evaluation
depends upon health-related standards. It is feasible to select and
record a number of water quality criteria which would be valid for
future comparisons within a given geographic region, say within a MGR,*
in addition to bacterial standards.

In addition to improved water quality, many types of water-related
recreation would require restored and improved aesthetic conditions and
changes in various physical features. The'se assessments are more
difficult to make. For example, benthic deposits may take several years
to oxidize, or they may be removed quickly by flooding or flushing of
the water course and deposited downstream or in reservoirs. To the
extent that relationships between water quality characteristics and
permissible recreational use are understood and documented, primarily
from those few case studies where improved water quality has resulted in
recreational benefits and where deterioration has resulted in their
loss, the Commission has been able to judge potential recreational
benefits at the various environmental sites. Few data were available
from the sites to support a comprehensive assessment of the degree of
national achievement of this part of the interim goal.

For nearly all site assessments, prediction of the time frame
within which changes that would support changes in water-based recrea-
tional opportunities might occur has been impossible.

B. METHODOLOGY

Recognizing the constraints placed on the commission's assessment
by both limited time and available funds, a study strategy was designed
to optimize use of available data to provide a summary of the nation's
geographic, hydrologic, demographic, meteorologic and environmental
characteristics, and to demonstrate the range of water pollution problems
experienced throughout the U.S.

on the.basis of ecological characteristics, the contiguous U.S. was
divided into thirteen "minimum geographic regions," (MGR's). These
regions, shown in Figure IV-1. were defined using three primary criteria:
(1) dominant geologic characteristics; (2) distribution of principal
types of soils; and (3) potential natural vegetation patterns. Other
characteristics used to distinguish regions were precipitation patterns,
demography, water hardness, periods of major low-stream flow, industrial
water use, sediment concentration and other water quality factors.

*See below for explanation of MGR.

E
-, - WeWO!,- '0
Me OR
;-1�111 -igure "N
I NO, I'VE
0.1 1k

...... M*@X04
N
W
NE
IS
N
NO,. rsl
MINIMUM GEOGRAPHIC REGIONS (MGRs
.0.
Th e basis for specified
Selection C
....................... M
ALA5KAX.,**:
K@-
W@'
0'0
0 Dominant geolog
0 Major soil types*
-@PACI
00
zo@.
::.-X:::fflORTHWES R"s
J ..F-VV
0 Natural potential
.000MV
ENGLAND
COLUMBI NORTHERN PLAINS
PLATEAU e Precipitation patt
b
-g
D
UPPER
GREAT 9 Water hardness
GREAT BASIN OHIO
I MAL & LAKES
...... ......
VALLEY SOUTHWEST H It
Stream sediment
DESERT
COLORADO MIDWEST
K PLATEAU *Seasonal low flov
G
-f@ SO CALIF.
B I G H'I SOUTHERN C
PLAINS 0 Demographic cha
MIDDLE ATLANTIC,
SOUTH, & GULF
9 Industrial water u
@M:
0
H
XXX
Other water quali
...... ........ ..
rut: H 10:;::0:::
................

Major cri

. . . ............... ...................... ........... . ....
X
X
'@ ...
February 1!37b @-K

IV-11

The strategy was to select specific locations on rivers, lakes and
coastal estuaries within each MGR for intensive analysis. These "sites"
provide a representative coverage of the environmental and water quality
characteristics typical of each MGR, as well as Alaska, Hawaii, and
Puerto Rico.

In addition to geographic coverage, the most important criteria
considered in site selection were: (1) availability and applicability
of a verified mathematic model for relating point-source discharges to
resulting water quality within a particular water body; (2) existence of
sufficient historical and baseline water quality and environmental data
to support an impact assessment,and projections of change; and (3),avail-
ability of professional ecological expertise for relating physical and
chemical water'quality changes to potential environmental changes at
different sites. An attempt was also made to find sites where there
were data specifically on fish, shellfish and wildlife, as well as
recreation and aesthetic situations. Using these criteria, a total of
41 sites were selected for specific analysis (see map for location,
Figure IV-2).

A consequence of this selection process is that sites where water
quality problems are pronounced are dominant because these are the
places for which water quality m6dels have been developed. Areas without
recognized problems are, in'most cases, not places where historic or on-
going data collection and research are underway. There is an undeniable
tendency to study problem areas and,'to some extent, the emphasis of the
analysis is on problem areas. Even so, a number of Commission sites
were located in areas not severely polluted, and are considered "effluent
limited" for the purposes of the NPDES program.

The 41 sites provide an assessment of nearly 6,600 river and
stream miles, 10,600 miles of coastline, 5,900 square miles of estuaries
and 5,300 square miles of lakes, reservoirs and impoundments. Counting
the total surface of the watersheds where each of the sites is located,
the studies collectively encompass-a total of about 730,000 square miles
of the U.S., or about 20 percent of the nation's land surface, containing
an aggregate population exceeding 104 million.*

Additional sites might have provided a clearer, more accurate
picture of potential environmental impacts for the nation. Indeed the
Commission would have liked to have extended the number of site assess-
ments to gain more coverage. Within'the limits of the funds available
for this portion of the study, the Commission believes that the coverage
obtained through the regional strategy properly characterizes the major
impacts which will be felt by implementing the Act. Additional study
sites probably would not have improved this regional perspective
appreciably.

*Based on 1970 U.S. Bureau of Census data.

41 S

..-30
Puget Sound & Merri
Lake W REGIONAL SITES - - ------

elaw-
Q
...juenanna
Yellowst n

Colul Upper
Mississippi

Snake 'New Y
Iowa B a Y 0";,
S.Platte Cedar toma
He POtOma Delaw-
Jordan
L.Utah
Bay & Chosapea
Upper X., Illinois Kanawh
I Valley Colorado Lower Ohio
Missouri YaQKin
J.P Priest Res.
I x
.ower
Colorado
Trinity Chatt Sante
int
Apal *W
pper war FI Johr
..........
........ Rio Grande Mississippi

Hous on
oni -'hannel &
ua lup 3alveston Bay

Commission on We or ua i y
ary 1976

IV-13

C. THE WATER: ITS QUANTITY AND QUALITY

integral @o the assessment of the quality of any watier body" is a
familiarity with its basic hydrological characteristics.. Understanding
critical flow and volume conditions of a hydrological s@stem is essen-
tial to accurately predicting the response of the water's ecological
system to pollutant discharge or their removal.

1. Hydrology

Flow and volume of water in both space and time Ake subject to
natural variations due to climate and,physical and geologic properties
of the drainage'basin. In many water systems, the natural hydrologic
regime has been altered extensively by man through reservoirs and UP-
stream water withdrawals, stormwaterrunoff, and intensive land develop-
ment.

surface water runoff varies widely across the nation' (Figure IV-3).
High runoff regions generally coincide with regions of high precipita-
tion. The Pacific Northwest and Southern Alaska exhibit.some of the
highest runoff in the country. The Northeastern U.S. and portions of
the Western Appalachian rank below'thePacific Northwest, but still are
regarded as high runoff areas on an annual basis. Lowest runoff occurs
in the arid Southwest and the semi-arid Northern and Southern Great
Plains, even though some of the nation's largest rivers are in these
areas.

Variations in stream flow from year to year result mainly from
cyclical variations in precipitation. Lower than average precipitation
in the Northeastern U.S. for several years in the mid-19601s,resulted in
lower than average stream flows, reduced water supplies and increased
pollutant concentrations.

Measurement of hydrological occurrences in a water body is a
critical element of an environmental assessment. L6w stream-flow periods
Are well recognized by pollution control authorities as being most
critical to the stream system receiving wastewater discharges. Low
flows mean low dilution capacity and, when coinciding with high water
temperatures, constitute a period when the ecosystem is most susceptible
to damage. The seven-day/ten-year low flow condition (7QlO flow) is
commonly used by state regulatory authorities to assess critical water
quality conditions. This measurement is determined through frequency
analysis of recorded stream flows. It is defined as the lowest Average
flow for seven consecutive days, which could be expected once every ten
.years. In the arid Southwest, the seven-day/ten-year low flow is often
zero. In these cases, a higher flow level such as the 7Q2 flow is used
to assess water quality relative to established standards.

Figure I V - 3
SURFACEMATER RUN-OFF

..........
.......... ...

....... ......
........ ................
...................
.. ......... ...
........ ....-.. ...
........ .... ... ...
....... ...... ...
...... ....

...........

.......... ...
............ ...........
............... ....... ..... ...
........ ...... ....
...............

....... .............
...... ........... .............
.... .... .....
..........
..... ......
..............
_ ..........
.............
.............
........ .... .............
......... .....
........ ...... ....
........ ..... ..........
..........
.......... . ....... .... ...........
........... ....... .... ...........
.......... . ......I...... .............
.... ........ ......... .........
......... . ....... ...... ............. .
............. .
......... ........ ..... "***'* ......
. ....... .......... .............
.... .............

......... ....... .......... ............
.......... ........ ........... ............
.... ........ ...........
..... ...... ...........
...........
..........
AVER-AGE ANNUAL RUNOFF ...............
............

... ........
C@ 0-10inches
10 - 20 inches
20 - 30 inches
Over 30 inches

Source; Natl. Commission o
Source: Water Atlas of U.S. 1973 February 1976

IV-15

For the purpose of relating biological and reckeational benefits to
water quality improvements, seas8nal low-flow conditions were used by
the Commission. 'Seasonal low flow means a monthly average flow selected
from the lower quartile year, based on total annual discharge. This
flow is higher than the 7Q10 flow and is more representative of normal
hydrologic bonditions.

selection of this "steady-state" low floi4....,reqime as the basis for
analysis-'e'liminates,the conditions (high raihfall, high runoff, high
flow) under,which the consequences of nonpoiht-source pollutant con-
tributions are likely t6@be most severe. Therefore, the Commission
addressed nonpoint-source pollution problems separately.

-In situations where the natural hydrologic regime'@has been altered
by reservoirs or other flow control,measures, the critical condition
often wab chosen to,coincide with periods of minimum flow resulting from
operation of the flow 1. control system. Low flows at 18 of the study
sites (46 percent) are regulated by dams for power production, irri-
gation, navigation, Water .supply,@or fish and wildlife enhancement
purposes. The Missouri River basin (Regioh.F),, fpr_,exarr6le@, is domi-
nated by seven reservoirs. Flow is maintained above@' natural levels
during,the summer season for navigation,putposesl@ This increases dilu-
tion capacity. Maintenance of stream flow'Anto estuaries via reservoir
regulation can prevent salt water intrusion into fresh water intake
zones.

Examples also could be cited where flowtregulations have negative
impacts. Irrigation diversions c&n ddplete str@am,,,floiw, although de-
layed percolation of irrigated water.from grourid st6rage can sustain
flows during later dry weatho r periodg.

Physical modification-,ok a stream course.dah alter flow character-
istics and aquatic habitats. Channelization for navigation and other
purposes alte Irs flow and circuiatioh characteristics. Dams induce slow
d 6ften@allowing,benthic deposits to
velocity, reducing.reaeratioh an
accumulate. This is especially chdracteristic of some New England
rivers c@ntrolled by mill dams.. A+- the same time, dams in some areas
may improve conditions downstream by increasing dissolved oxygen levels,
reducing turbidity and controlling salinity intfu@ion in estuaries.

Estuaries, 'where critical,pollutant concentration conditions often
coincide with periods of.mihimum fresh water inflow and high temperature,
also are influenced by tides and winds. C.ircula-Ei6n'characteristics of
estuaries tend to be unique and result from complex interactions of
their p6gical dimensions. Commission estuarine sites ranged from the
relatively shallow Biscayne Bay to Puget Sound, which,is several hundred
meters deep. Magnitude.,of tidal range provides a general indication of

IV-16

the size of tidally induced water velocities, and wind mixing is related
to the extent of open water areas and depth. Tidal ranges for the outer
coastal zone along the Gulf of Mexico and South Atlantic Coast-are about
one-half (0.5) meter. The tidal range increases along the North Atlantic
and Pacific Coasts to about three to four meters in Boston Harbor and
Puget Sound. Cook Inlet in Alaska exhibits a tidal range of about ten
meters.

2. Measuring Present Water Quality

The environmental site studies reveal insight into the nature and
regional distribution of national water quality problems. To provide a
practical basis for assessing the general quality of water bodies studied,
problems were grouped as follows:

oxygen depletion
Eutrophication potential
Physical characteristics and aesthetics
Salinity
Health hazards and toxics

Five commonly observed variables--dissolved oxygen, nutrients
(nitrogen and phosphorous), turbidity and suspended solids, total dissolved
solids, and coliform bacteria are used to characterize problem categories
nationwide. These variables present a very limited picture of the total
physical, chemical and biological characteristics of the study sites,
but because they have been routinely collected for some time, they
provide a practical basis for comparing between sites and regions.
Other important variables--including temperature and toxic heavy metals
and pesticides, for which data were insufficient for a regional characteri-
zation--are discussed later. Better definition of occurrence, sources
and impacts of toxic substances is needed in view of the synergistic and
longer-term effects of these pollutants.

To provide a general picture of conditions throughout the nation,
an assessment of water quality problems related to the five variables
for sites within each MGR was made using the ranking criteria summarized
in Table IV-1. Numerical water quality levels used for ranking the
significance of problems are based upon established criteria for main-
taining aquatic life, recreational potential and other beneficial uses.
Where possible, detailed data on the percentage of river miles exceeding
the criteria were used to support the ranking. In some instances,
judgment was exercised as to the areal extent of the particular water
quality problem by using data collected at different points within the
site. These assessments are based on seasonable low flow conditions.

The relative significance of water quality problems for sites
within each MGR for the five water quality variables are summarized in

IV-17

TABLE IV-1

SIGNIFICANCE OF WATER QUALITY PROBLEMS

Variable Significance Criteria

Significant Large segments of site have DO less
Dissolved oxygen than 4 mg/l; some reaches anoxic.
.(DO) Depletion Moderate Some reaches of site (local) have
Do less than 4 mg/l.
Minor DO generally greater than 4 mg/l.
Significant Large segments of site have high
nutrients I and eutrophication
Nutrients (N.P) problems.2
Moderate Some segments have high nutrient
levels and eutrophication problems.
Minor Nutrient levels generally low,
eutrophication problems minor.
Significant Large segments of site have SS
greater.than 80 mg/l,* turbidity
Turbidity (Th) greater than 50 JTU./
Suspended Solids Moderate SS levels greater than 25'mg/l* but
(SS) generally less than 80 mg/l.
Low SS generally less than 25 mg/l.
Significant Large segments of site have TDS
Total Dissolved greater than 500 mg/l.*
Solids (TDS) Moderate TDS levels greater than 200 mg/1
but less than 500 mg/l.
LOW TDS levels less than 200 mg/l.
Significant Large seWents of'site have high
coliforms (total greater than
1000 col./100 ml; fecal greater
Coliform than 200 col./100 ml).#
Bacteria Moderate Coliform reference levels only
exceeded intermittently.
Low Coliform levels generally below
reference level.
iNitrate (as N) greater than 0.9 mg/1,6 total phosphorous greater -.han
0.1 mg/l.*
2The occurrence of eutrophicatio@ problems is related to turbidity and
low flow velocity.reaches (e.g., reservoirs) as well as nutrient levels.

*Water Quality Criteria, 1972 ("Blue Book"), NAS-NAE, 1972
Dissolved Oxygen (p. 134), rurbidity/Suspended Solids (p. 129),
Total Dissolved Solids (p. 90). -

/Criteria for Water Quality, EPA, 1973 (Secti on 304(a)(1) guideline).

Nater Quality Standards Digest, A Compilation of Federal/State
Criteria on Bacteria, EPA, 1972.

�Biological Associated Problems in Freshwater Environments,
FWPCA, 1966, pp. 132-3.

Source: National Commission on Water Quality
February 1976

IV-18

Figure IV-4. These data suggest that a number of problems occur nation-
wide, while others are peculiarto different regions of the country.
All 41 sites suffer to varying degrees from man-made pollution. Dis-
solved oxygen depletion problems are evident throughout the country in
river and estuarine reaches below points of major wastewater discharges.
Turbidity levels vary regionally according to natural background levels,
although wastewater discharges, construction and-agricultural activities
add to the volume of suspended solids. Turbidity is highest in the West
and Midwest. High nutrient levels occur throughout many study sites,
but consequent production is inhibited where there are high turbidities
which reduce light penetration. High total dissolved solids levels are
associated with regions of high natural contributions, especially in the
western states. Irrigation ac@ivities add to the totals in these regions.
High TDS levels associated with marine waters are not considered except
in instances where salt water is impacting fresh water supplies. High
bacterial densities, originating from inadequately disinfected municipal
discharges and urban and agricultural land runoff are common throughout
the study sites. Problems with toxic subsiances were difficult to
assess accurately. High concentrations of heavy metals are generally
associated with industrialized and urban areas Although mined linds were
identified in several instances. High concentrations of pesticides are
most commonly associated with runoff from agricultural areas.

a. Oxygen Depletion

Dissolved oxygen significantly influences nearly all components of
aquatic systems. Acute, chronic and sublethal concentrations are in-
fluenced by many factors (i.e., temperature, life stages), making precise
minimum "safe" levels difficul@_ to define. Lethal dissolved oxygen
levels for most fish species are in the range of 1-3 mg/l. Severe (and
more subtle) growth and reproduction inhibition may.occur at levels up
to 5-6 mg/l. The 4 mg/l level in Table IV-1 represents a level of pro-
tection which:

Should permit the persistence of sizable populations
of tolerant species and successful passage of most migrants.
Much reduced production or elimination of sensitive fish is
lik e ly.

This level obviously does not allow for "protection and propaga-
tion" of a "balanced and indigenous population," as stated in the goals
of the Act. In actuality, this goal can only be achieved by maintaining
the natural seasonal ranges (especially minimums) within which specific
fish populations have evolved.

*Water Quality Criteria, 1972, NAS-NAE

Figure IVA
ALASKA

E
PACIFIC NORTHWEST COLUMBIAPLATEAU NORTHERN PLAINS MIDWEST GREA LAKES

PRESENT WATER QUALIT Y PROBLEMS

GULF OF ALASK A NEW EN
F

B
L
E 0
K

CENTRAL VALLEY M H UPPER
G C

OAHU, HAWAI I MID ATL..

.... .... ....
... .... ....
.... .... ....
OAHU,
HAWAII SO. CALIF. BIGHT GREAT BASIN COLORADO PLATEAU SOUTHERN PLAINS PUERTO RICO
S.W. DESERT

KEY Dissolved Oxygen . Note: Assessment studies were conducted an specific river reaches or w.
--I@Nitrosen & Phosphorus (Nutrients) each shaded area.
]@@Turbidity-
d& Study Area EETotat Dissolved Solids Source: Nati, Commission
A-m Geographic Regions MColiform Bacteria February 1976
EA 61 &A

IV-20

In addition to direct effects on fish, low DO can exaggerate other
physiological effects (such as heavy metal toxicity), cause changes in
invertebrate numbers and diversity, produce malodorous conditions due to
anaerobic decomposition, and encourage conditions suitable for nuisance
organisms, including bacteria.

Dissolved oxygen depletion in reaches of rivers and estuaries below
major wastewater discharges is evident throughout the country. Levels
are further reduced in regions of low stream flow, such as in the Southern
Plains and Midwest regions. In the highly populated Northeast, a region
of high runoff, DO depletions still occur, although improvements are
evident in recent years as treatment systems are implemented. In many
urban areas, the problem is complicated by combined sewer overflows and
urban storm runoff which deliver pulse loadings of oxygen-demanding
materials (i.e., BOD) to receiving waters.

Detailed data presented for 21 sites covering 4,600 river
miles show that dissolved oxygen is currently depleted below
4 mg/l for 384 river miles (8 percent) in 13 sites during low
seasonal flow conditions. This length increases to about
20 percent during critical low flow conditions .(19 sites).

On a site-by-site basis, 20 of.41 sites (49 percent) were
reported to have significant oxygen depletion problems during
low flow periods. These sites are distributed throughout the
country and are generally associated with major population
centers. Eleven sites (27 percent).were reported to have DO
levels generally above 4 mg/1 for all seasons.

Oxyg en depletions are primarily related to municipal and
industrial point-source discharges of concentrated oxygen-
demanding materials. Urban runoff and combined sewer over-
flows were noted as aggravating the problem at 15 sites (37
percent). Six sites (15 percent) had problems with oxygen
depletion from benthic deposits.

Supersaturated gases below dams at the Columbia and
Snake River sites cause physiological damage to migratory
salmon and related species.

b. Eutrophication Potential

High nutrient levels can stimulate excessive aquatic plant growth
causing oxygen depletion, odors, and aesthetic degradation. Often, very
turbid water high in suspended solids will limit light penetration and
inhibit plant growth. Municipal discharges, urban storm runoff, and

IV-21

combined storm and sewer overflows account for much of the nutrient
loadings in the Northeast. Land runoff is a large contributor in the
agricultural areas of the Southeast, Midwest, and West.

Eighteen of 41 sites (44 percent) were reported to have
high nutrient levels and eutrophication problems. An addi-
tional six (15 percent) were reported to have high nutrient
levels, but eutrophication problems were limited by high
turbidity.

A major identified nutrient source is municipal waste-
water discharges (17 sites or 41 percent). Agricultural
nonpoint sources were cited as significant nutrient contributors
at 13 sites (31 percent). Urban stormwater runoff and combined
sewer overflows were cited as additional sources of nutrients
at five of the sites with eutrophication problems.

C. Physical Characteristics

The physical chracteristics of water, including temperature, tur-
bidity and suspended solids, have strong influences on aquatic organisms
and beneficial uses for man. The importance of temperature to aquatic
organisms is well known, and the composition of aquatic communities
depends largely on the temperature characteristics of their environment.
The temperature regime of rivers and estuaries varies naturally in
response to regional variations in climate. Cooling waters for steam
electric power stations contain large quantities of heat, which causes
or threatens to cause, either a warming of rivers, lakes, and coastal
waters, or a rapid cooling when the artificial sources of heat are
abruptly halted. Although site-specific data are required for detailed
assessment of thermal discharge impacts, indications are (cf. III.D.6)
that once-through cooling systems on estuaries currently create the most
serious conditions. The thermal regime of a river also can be altered
by large reservoirs in which the water stratifies. The upper layers
become warmer than seasonal norms and lower layers become colder than
normal. Depending upon the amount of water withdrawn and the level of
withdrawal, the downstream thermal regime can be altered greatly.

Almost all of the study sites received cooling water
from power plants and industries, but detailed data on the
magnitude of the temperature influence was not definitive.
Reservoir releases influenced river water temperature
at six sites.

Excessive turbidity reduces light penetration necessary for many
aquatic plant species and.for sight feeding activities of predatory game
fish. If the volume of suspended solids is reduced and the level of
nutrients is neglected, problems associated with eutrophication can be

IV-22

expected to be more widespread. Deposition of-suspended materials
eliminates substrate necessary for fish spawning and for bottom organisms.
Aesthetic degradation also may occur. In addition, sediment can act as
a transporting agent for other pollutants, such as nutrients, pesticides,
organic matter and pathogens which are absorbed onto soil particles.
Natural turbidity varies regionally and wastewater discharges, construc-
tion activities and man-induced erosion through various land uses can
add to natural turbidity levels. In general, turbidity levels are
highest in the "soft-rock" and arid areas of the country, including the
Southwest, the Great Plains and Midwest. High natural color and tur-
bidity levels also are associated with swamp drainage in the South
Atlantic and Gulf Coast regions.

Any characterization of sediment as a pollutant requires recog-
nition that flowing waters have fixed minimum sediment carrying capa-
cities. If control of discharges reduces suspended solids to below
these minimum levels, the flowing water will attempt to restore the
minimums by scouring the beds and banks of the watercourse until the
minimum carrying capacity is satisfied. Thus, all the nation's waters
cannot be made crystal clear.

Twenty-two of 41 sites (54 percent) were identified as having
significant turbidity or suspended solids problems. Of these,
at 11 sites (27 percent) the high levels were attributed, at
least in part, to point-source wastewater discharges.
Nonpoint sources, including agricultural, urban and mined land
runoff, dominated at 17 sites (41 percent). Point-source
influences were most evident in the clear water regions (e.g.,
New England) while nonpoint sources dominated in the Great
Plains, Midwest and Southwest.

Aesthetic degradation of water bodies often occurs as a result of
excessive turbidity, algae growths, scum, floating solids and odors.
Many of these problems are associated with other indicators of pollution,
such as anaerobic waste decomposition where dissolved oxygen is depleted.
Gross discharges of floatables are being reduced, although oil spills
and urban runoff continue to be problems in many areas.

Oil spills were reported at five sites (12 percent) as a
significant source of aesthetic degradation. Each of these
sites included major harbors as part of the study area.

d. Salinity and Acidity

High total dissolved solids in inland waters are objectionable
because of possible physiological effects, mineral taste, and economic
consequences such as for irrigation, municipalities and certain industrial
uses. Generally, rapid changes in TDS levels are detrimental to aquatic
life. TDS problems are associated with regions of high natural background

IV-23

concentrations--the Southwest and Northern and southern Great Plains.
However, man's activities, particularly intensive agricultural practices
involving irrigation, contribute to the loads in each of these regions.
Other activities, including industrial and domestic water uses, cause
increases in TDS levels in all regions, particularly near major popu-
lation and industrial centers.

Freshwater segments of six of 29 sites (20 percent) were
reported to have TDS problems at the significant level (i.e.,
above 500 mg/1). All of these are associated with natural
conditions and irrigation projects in western states.

At the mouths of rivers discharging into estuaries, salt water
intrusion, caused by channelization or the withdrawal of
inflowing fresh water, was noted at four sites. Salt water
intrusion into fresh groundwater supplies,. due to groundwater
withdrawals, is also a concern in coastal areas.

Chloride levels in Lake Erie, although not a severe problem,
are trending steadily upwards and have been related to road
deicing salts and other domestic and industrial water uses.

Acid mine drainage is evident primarily at sites in the Appalachian
coal mine regions drained by the Ohio, Delaware, Susquehanna and Potomac
Rivers.

e. Health Hazards and Toxic Substances

Bacterial densities in water, expressed as coliform concentrations,
are a standard measure of danger to human health. Coliform bacteria are
used as a surrogate for indicating the presence of pathogens because of
their relative ease of detection. The validity of coliform. bacteria
levels as an indicator of pathogens is often questioned, since many
common and innocuous bacteria show up as positive in the standard test.
High coliform bacterial densities, originating primarily from inadequately
disinfected municipal discharges, urban storm runoff and combined sewer
overflows are common throughout the country. Agricultural practices,
such as stockgrazing and feedlots, and malfunctioning septic tanks also
result in high-bacterial level discharges. These storm runoff related
sources correlate with rainfall frequency and intensity. Discharges
occur often enough to cause public beach closings, particularly near
urban areas.

Almost all of the study sites reportedly have bacterial
problems at one time or another through the year. Thirty-two
of 41 sites (78 percent) were recorded as-having significant
coliform bacteria problems.

IV-24

At 19 sites (46 percent) significant coliform bacteria
levels were attributed to municipal point-source discharges.

At 19 sites (46 percent), urban storm runoff and combined
sewer overflows aggravated the problem. At 10 sites (24
percent) substantial contributions were attributed to agri-
cultural land runoff. Many sites receive substantial con-
tributions from both point and nonpoint source loadings.

Toxic substances and their effects are difficult to detect in the
environment, yet represent great potential for ecological damage, even
at very low concentrations. Concentrations of any substance exceeding
an organism's normal tolerance range may be considered "toxic." Of all
biological effects, this area is perhaps the least understood and poten-
tially one of the most important. Acute tolerance limits have been
established for many pesticides, some heavy metals and certain organic
and inorganic compounds. Chronic effects are less well documented.
Sublethal effects, such as possible alteration in reproductive or
feeding behaviors, are virtually unstudied. Complex interations with
other water quality constituents, such as synergistic effects, accumu-
lations in organisms and magnifications through food chains make defi-
nition of "critical" toxics levels very difficult and continued research
in this area is needed.

The Commission's environmental studies illustrate a wide range of
toxic sources and problems in the nation as well as data limitations.
Two major categories of recognized toxics--heavy metals, including
mercury and cadmium, and pesticides--were the most commonly observed.

Concentrations of one or more of the heavy metals commonly
exceeded suggested safe limits (Water Quality Criteria, NAS-
NAE, 1972) in the water column or in fish tissue at 13 of 35
sites (37 percent). At an additional 9 sites, heavy metal
concentrations sometimes exceeded safe limits or were evident
in high concentrations in bottom sediments. Thirteen of 35
sites (37 percent) were found to have little problem with
heavy metals, while detailed data were not presented for six
sites. The most commonly.cited heavy metals were mercury,
zinc, lead, manganese, and iron. Major sources of heavy
metals cited included industrial point sources, urban runoff
and mine drainage.

Pesticide concentrations commonly exceeded suggested safe
limits or were-linked with fish kills at 13 of 26 sites (50
percent) in recent years where data were available. Presence
of pesticides at an additional seven sites were noted as being
sometimes above safe levels. Low concentrations of pesticides

IV-25

appearedat six sites (15 percent). Detailed data were not
available for the remaining 15 sites. The most commonly cited
pesticides were DDT, Dieldrin, and Heptachlor. Runoff from
agricultural land was cited as the major pesticide source at
eight of the problem sites. Forested and urban land runoff
was noted as a contributing source at a number of sites.

Other toxic substances were detected at a number of sites. Poly-
chlorinated biphenylt (PCB's) were noted as exceeding safe concentra-
tions in fish tissue and sediments at four site-s--all associated with
industrialized areas. Phenols linked with industrial discharges were
citedas possible toxics at ten sites.

3. Pollutant Loadings

While a generalized picture of the present'quality of the-nation's
waters is essential for perspective as a baseline profile, it is not a
sufficient basis for developing environmental predictions. Also ne-ces-
sary is detailed information on the pollutants being discharged into the
waters--including sources, characteristics, magnitude-and timing of the
discharge. Without.these data for "pollutant loadings" there is no
precise means to assess improvements expected to result from implemen-
tation of increasingly stringent limitations.

a. Point Sources

Since the Act's requirements concentrate on point-source control, a
primary objective has been to relate quantity and quality of point-
source discharges to receiving water quality at the 41 study sites.
Point-source pollutant discharges are categorized into four major groups:

0 Municipal treatment facilities
e Industries
* Irrigation return flows
e Feedlots

,information on the magnitude and character of point-source dis-
charges comes mainly from National Pollutant Discharge Elimination
System (NPDES) permits issued by the state agencies or EPA regional
offices. In most cases, permits define point-source pollutant dis-
charges using only a few routinely measured parameters (e.g., BOD5,
suspended solids, pH, and temperature) reflecting the more obvious water
quality-problems -in the receiving stream. Supplementary data, obtained
from any previous surveys, also were used to define seasonal variations
in effluent quantities and qualities at a number of assessment sites.

Reported pollutant loadings at the study sites provide the relative
contributions from the various point sources.

IV-26

(1) Biological Oxygen Demand (BODc;) (Based on information from 38 sites)

Municipal BOD5 loadings far exceeded other point-source BOD5
contributions at 18 sites (47 percent). Industrial BOD
loadings exceeded other point-source BOD5 loadings at 2 sites
(29 percent). Municipal and industrial BOD5 loads were about
equal at the remaining nine sites. Data on the magnitude of
industrial contributions to the municipal system were scarce,
but the few sites for which data were reported indicated a
wide range.

Irrigation return flows contributed small amounts of BOD5 at
only a few sites--primarily in the Northern and southern Great
Plains.

(2) Suspended Solids (Based on information from 26 sites)

Municipal suspended solids loadingg exceeded other point-
source suspended solids loadings at 1S sites (50 percent).
Industrial suspended solids loadings exceeded other point-
source suspended solids loadings at seven sites (27 percent).
Municipal and industrial suspended solids loadings were about
equal in magnitude at four sites.

Irrigation return flows contributed suspended solids in
amounts equal to or greater than other point sources at two
sites located in the Northern and Southern Great Plains.

(3) Nutrients (Based on information from 18-sites)

Municipal nutrient (N and P) loadings exceeded other point
sources of nutrient loads at 15 sites (83 percent).

(4) Total Dissolved Solids (Based on information from 4 sites)

Agricultural return flows contributed significantly to total
dissolved solids loadings.at two sites. Separation of TDS
loadings between point, nonpoint, and natural sources was
difficult in agricultural areas.

(5) Coliform Bacteria

municipal discharges were maj'4or sources of coliform bacteria
at virtually all assessment sites. Cattle feedlot operations
were suspected of contributing substantial amounts of coliform
bacteria at several.sites in the western and southeastern
agricultural states..

IV-27

(b) NonPoint Sources

In many locales nonpoint-source pollution controls mu@t complement
point-source-contrdls in order to achieve the 1983 interim water quality
goal of the Act.. They are diffuse by nature and are generally flow-
dependent and intermittent. Storm runoff is a major transport mechanism,
although groundwater contributions, especially in irrigated areas,
occasionally can constitute a major pollutant source during low-flow
periods. Nonpoint sources generally coincide with land-use activities
and can.be categorized as follows:

(1) Urban: land: Urban runoff contributes wastes to receiving water
bodies through storm sewers, overland flow, seepage and minor
tributaries*- Large quantities of suspended solids, organic matter,
aig'al nutrients, coliform bacteria, heavy metals and pesticides
often are associated with urban runoff. The "first flush" of storm
runoff is typically highly contaminated. For the purposes of this
assessment, urban land runoff includes that flowing from combined
sewers and storm sewer drains although EPA has defined these as
point sources.

(2) Agricultural land: Runoff from agricultural lands used for
crops, animal production and pasture can contribute a wide
variety of pollutants to receiving waters. The major pollutants
are sediment, nutrients, dissolved solids, bacteria and pesticides.

(3) Forested land: Forested lands have relatively high watet reten-
tion capacities, hence minimal amounts of surface runoff and
accompanying soil erosion. Forest management and harvesting
practices, such as clear-cutting, roadway development and usage,
and application of herbicides and pesticides, however, can
contribute to pollution.

(4) Mining land: Disruption of the earth's surface from mining
activities causes physical and chemical modifications of
associated aquatic environments. Major problems are sedimen-
tation from surface mined areas, and acid discharge from both
exposed surface and underground mines.

Natural characteristics of a drainage basin sometimes will combine
to generate relatively large pollution loads when compared to man-
induced pollution sources for the same area. Examples include high
salinity (TDS) in the Colorado River Basin, low dissolved oxygen and
high color of waters draining from swamps in South Carolina, and high
stream sediment concentrations in sections of streams in the Midwest and
West.

IV-28

Ecological impacts of nonpoint sources depend upon the magnitude of
their contribution, as well as their seasonal distributions. Unlike
point sources, nonpoint-source pollutant contributions are highly
variable. Therefore, their impacts are hard to predict. Urban runoff
contributes to dissolved oxygen depletions in rivers, especially after
storms. Organic solids carried in storm runoff can settle to channel
bottoms, causing longer term DO depletion and aquatic habitat destruc-
tion. Nutrient contributions from nonpoint sources are normally highest
during hig@-flow periods. The resulting eutrophication potential can be
related to hydrologic storage capacities of reservoirs and lakes.

To assess potential gains from point-source controls, the magnitude
of nonpoint source loadings must be known. Data developed to provide a
national overview of relative waste loads from point and nonpoint
sources are illustrated in Table IV-2. Total point-source pollutant
loads were estimated assuming secondary treatment (including disin-
fection) for a national sewered population of 150,000,000 for the
municipal sector, and uniform application of BPT for industries (six SIC
categories). Nonpoint-source pollutant loads were estimated using
relationships between population density and area runoff loading factors
for three land-use categories (i.e., urban-suburban, agricultural, and
forest).*

Data presented in the table do not include present (1973) point-
source loadings which will be greatly reduced by the 1977 requirements.
To illustrate, the NAS Study Committee on Water Quality Policy, using a
methodology similar to Hydroscience, estimates that 1973 munici@al and
industrial BOD discharges constitute about 50 percent of the national
total from both point and nonpoint sources. Achievement of BPT for
industries and secondary treatment for municipalities would decrease the
BOD load from these point sources to about one-fourth of the 1973 level.
Nonpoint sources then become more significant relative to point sources.

Although these estimates were developed independently of the site
studies, they do correspond with limited data developed for some of the
sites and from other Commission sources.

*See Technical Environmental V'alume for more detailed explanation
of.data base used to develop load estimates.

IV-29

TABLE IV-2

NATIONAL SUMMARY OF WASTE LOADS
REMAINING AFTER THE 1977 REQUIREMENTS ARE ACHIEVED

Point Nonpoint Total Point % Remaining
Variable Source (1) Source* and Nonpoint at EOD
IBOD ult. (2) 24.0 13.9- .37.9 37
ISus. Sol. (2) 11.9 145.6 157.5 92

@T. Nit. (2) 7.4 28.3 35.7 79

@T. Phos. (2) 1.7 1.93 3.63 53

Pecal Col. (3) 1.95 87.85 89.8 98

jTotal Col. (3) 15.0 1368.0 1383.0 99

il/Grease (2) 3.9 0.5 4.4 11

cadmium (4) 6.4 1.5 7.9 19

Zinc (4), 67.6 51.4. 119.0 43

*Includes combined sewer overflows and urban runoff.

(1) Estimated Loads remaining after achievement of the 1977 requirement.
(2) In million pounds per day 15
(3) In number of bacteria - 10 /day
(4) In thousand pounds per day

Source: Hydroscience, Inc., August 1975; "An Overview of Waste Loads and
Urban-Suburban Stream Quality Response."

Several points can be noted concerning the relative magnitude.of
point- and nonpoint-source pollutant.loads remaining even aftersecondary
treatment for municipalities and BPT for industries is achieved. Large
amounts of suspended solids, nutrients (N and P) and fecal and total
coliform. bacteria emanate from nonpoint sources. Although substantial
reductions of these pollutants will be realized through achievement of
point-source controls via 1977 requirements, nonpoint sources could
obscure further gains if left uncontrolled. At the other extreme,
additional point-source controls in oil, grease and cadmium would
be highly effective in reducing discharges of these substances because
of the low percentage contribution from nonpoint sources.

IV-30

Data for precise determinations of relative magnitudes of nonpoint
sources at the assessment sites is sketchy. Notwithstanding the gener-
alized estimates presented above, it is evident that more detailed
analysis for any given site within a region will be required.*

Accurate definition of nonpoint source loads probably will require
additional data collection to determine exact sources, magnitudes and
timing of pollutant loadings and impacts. A number of the site study
reports did include estimates of nonpoint source loadings, however. And
those estimates provide a partial basis for identifying regional trends.

Urban runoff and combined sewer overflows are a major source
of BOD, nutrients, suspended solids and coliform, bacteria and
some toxics (e.g., heavy metals). This problem is prominent
at sites in the northeastern states, but appears in every
major metropolitan area receiving regular storm rainfall.

Agricultural land use is linked with major contributions of
nutrients, suspended solids, dissolved solids, and pesticides,
particularly in the Great Plains, Midwest, Southwest, Columbia
Plateau and San Joaquin Valley (California) regions. In
significant portions of those regions, agricultural activities
only intensify naturally occurring problems especially with
regard to suspended and dis.@olved solids levels. Farmlands in
the West, Midwest and Southeast have been identified as
sources of coliform. bacteria.

Forestry practices which disturb the land surface have caused
increased turbidity in streams of the Pacific Northwest and
Appalachian regions. Pesticides have also been associated
with insect control practices in forests in New England and
elsewhere.

Mining activities cause sedimentation problems in the Ap-
palachian and Rocky Mountains.

4. Predicting Future Water Quality

An ability to quantify probable cause-effect relationships between
wastewater discharges and resultant water quality was basic,to the
Commission's site-specific studies. mathematical water quality models
were used to project changes associated with reductions in point-source
loadings. These models simulate cause-effect relationships in natural
hydrological systems, primarily under steady-state conditions. A common
basis of the majority of these models is the principle of continuity or
mass balance, which takes into account three factors:

*Requisite to EPA approval of a Section 208 areawide waste treat-
ment management plan is the identification of nonpoint sources of
pollution within the area and procedures and methods to control them.

IV-31

Inputs to the system.
Transport through the system
e Reactions within the system

The validity of the modelling approach depends upon scientific
knowledge of the physical, chemical and biological phenomena occurring
in the various systems. Ideally, the state-of-the-art of modelling
pollutant transport mechanisms and commonly measured pollutant variables
is moderately advanced. Variables in this category include dissolved
oxygen, nutrients, dissolved solids and bacteria. Modelling approaches
for other variables--metals, synthetic chemicals and the eutrophication
process--are not as advanced, and additional research is needed.
Practically, the validity of-any model depends upon the degree to which
computed water quality agrees with observed data and patterns., For the
site studies only commonly measured variables, such as dissolved oxygen
and BOD, were modelled. Even for these variables many of the analyses
were limited by availability of data for verification.*

In general, the predictions of future water quality are for seasonal
low flows, where the effects of the abatement of continuous point-source
discharges can be obtained from mathematical models. Generally speaking,
future water quality will not be consistently as good as these predictions
because the steady-state conditions selected for modelling eliminated
storm-related loadings.

Using this modelling approach, projections of water quality were
conducted for four effluent abatement levels at each site (see Table IV-3).
The two-pronged effort for 1977 is an attempt to describe expected
conditions in 1977 as well as theoretical water quality improvements
that could be achieved assuming all permit limitations were met.
Information on anticipated delays in operation of treatment or control
facilities required by the Act at the 1977 actual level was developed
for a number of sites through interviews with federal and state pollu-
tion control.officials.**

*See Technical Environmental Volume for a detailed explanation of
the model simulations and verification processes.

"The delays result from delays in facilities planning, design
construction and.funding. In some instances, NPDES permits for waste-
water discharge have been written for present discharge conditions
once a step-by-step schedule for compliance has been agreed upon.

IV-32

TABLE IV-3

ABATEMENT LEVEL DESCRIPTIONS

Level Description

Use NPDES permit conditions for both industrial
1977 and municipal point sources. If major municipal
Actual facilities obviously will not'attain permit con-
ditions, use actual expected levels.

On effluent limited stretches:
Industrial: Use EPA effluent guideline condi-
tions; SIC code and production
data from permit application.
1977 municipal: Assume secondary treatment standards
Theoretical (EPA) unless stricter state water
quality standards exist.
on water quality limited stretches:
This level would be equivalent to "Actual"
above unless all load applications have been
completed.

Industrial: Limitations from EPA effluent
guidelines; SIC code and pro-
duction data from permits and/or
1983 permit applications.
'Municipal: Assume EPA's secondary treatment
standards unless stricter state
water quality requirements apply.

Elimination Elimination of all pollutants from point-source
of Discharge discharges. Return flow to be maintained.

Instructions to Commission Contractors.

IV-33

a. Dissolved oxygen

Predicted increases in DO contentrations are illustrated in Figures
IV-5 and IV-6. The aggregated DO improvement curves (Figure IV-5) are
based on projected DO changes at 21 sites covering about 4,600 river
miles. Anticipated improvements at 15 of the sites are portrayed in
Figure IV-6. These curves illustrate the variability of response at
different sites. All of the curves are based onprojections for low
seasonal flow conditions, which in most cases occur during summer. To
illustrate the improvement at the present level, about 380 miles (8
percent) presently have DO less than 4 mg/l. This decreases to 36 miles
(.8 percent) through achievement of the 1977 requirements (theoretical)
and to 23 miles (.5 percent) for the 1983 requirements.

These projections do not include the effects of pollutants from
nonpoint sources and, consequently, overestimate the actual improvement
at many sites. Additionally, many streams exhibit diurnal fluctuations
in DO due to algal photosynthesis and respiration. Dissolved oxygen
levels often are naturally lowest at night and highest during daylight
hours. Few of the site-specific analyses were able to define the
effects of nonpoint-source pollutant loadings on biological processes.

Anticipated delays in completing wastewater treatment facilities
are reflected by the 1977 "actual" level. Implementation of the 1977
"theoretical" level of treatment would bring substantial improvements
over both present and 1977 "actual" DO conditions. The 1983 level adds
only marginal overall DO improvements relative to the 1977 (theoretical)
level, although certain river segments with low DO would be improved.
Regionally, the greatest DO improvements are anticipated in New England
(Region A), Upper Ohio (Region B), middle Atlantic and South Gulf
(Region C), and Great Lakes (Region D).

There was a wide variability between and within the study sites in
achieving in-stream water quality standards for DO. Achievement of
water quality standards is based on assessment at the critical low-flow
level, which in most cases is the seven day/ten year low flow. Some
state standards allow DO levels for select stretches to be below 4 mg/l
at the critical low-flow level (7Q10). The basis for the variability
relates to the dilution capacity of the receiving water body and the
abatement level conditions used in the projections, and is important for
interpreting the results. Generally, projected DO levels improved
enough to meet the standards at sites where detailed load allocation
studies provided the basis for the NPDES permits. The Trinity River in
Texas is an example where relatively stringent load allocations have
been developed by the State. For other sites, where EPA effluent guide-
line limitations were used, stream responses vary. For some reaches, DO
improvement will be minimal over present conditions because DO currently

IV-34

Figure IV -5
DISSOLVED OXYGEN IMPROVEMENT
UNDER 4 LEVELS OF POLLUTION CONTROL ABATEMENT

DO Level
Milligrams per liter
10

EOD

R 00
tip

Minimum.criterion during
4
seasonal low flow

anaerobic.
0 10% 20% 30% 40% 50%
Percent of area with DO equal to or less than level shown
I I I 1 1
0 500 1000 1500 2000 2300
River miles with 00 equal to or less than level shown

*Based on projected improvements at 21 sites covering KEY ABATEMENT LEVELS
a total of 4600 river miles during seasonal low flow EOD See Table IV-3
conditions. 1983 for explanation
Source: Nati. Commission on Water Quality compiled 1977 T ................. of abatement
from environmental contractor reports. 1977 A levels
February 1976 Present --E)

IV-35

Figure I V - 6
DISSOLVED OXYGEN IMPROVEMENTS
AT SELECTED SITES (REGIONS A-D)

00 Level, Milligrams/liter

..... 1977
8 EOD
own ..........
resent
?Iplsp
6

4
2 ST. JOHN RIVER CONNECTICUT R. HOUSATONIC R..
Region A
Region A Region A

0 40 80 120 40 80 120 20 40 60 70
River miles with DO equal to or less than level shown

Present
--Present
6 ......
1977, 1983 7-
4

2 HUDSON RIVER SUSQUEHANNA R. KANAWHA R.
Region A Region B Region B
0 60 120 180 10 30 40 10 20 30 40

6
Present .1977' e-.--

2 CHATTAHOOCHEER. OHIO RIVER UPPER MISSISSIPPI
Region C Region D Region D

80 160 240 80 160 240 320 40 80 120 160
River miles with 00 equal to of less than level shown

KEY ABATEMENT LEVELS
EOD -I See Table IV-3
Based on seasonal low flow conditions 1983
Source: NatL Commission on Water Quality 1977 T ................ for explanation
compiled from environmental contractor reports 1977 A of abatement
February 1976 Present levels

IV-36

Figure I V - 6 cont.
DISSOLVED OXYGEN IMPROVEMENTS
AT SELECTED SITES (REGIONS G-K)

DO Level, Milligrams/liter
8 1911,T 1983 ............. A911
-Pr_esenk`t@
6- ............... ........ s

SAN ANTONIO-
-?, -ev @"
2 TRINITY RIVER GUADELUPE R. SNAKE RIVER
Region G Region G Region J
0 120 240 360 160 320 480 600 160 320 480 560
River miles with 0 0 equal to or less than level shown

8 1977. 1983
_P@ _rl @@jr
1977T, 1983, E00
-------------- @i. -
6 Present
1977
4

2- SOUTH PLATTE R. LOWER MISSOURI R. UPPER RIO GRANDE
Region G Region G Region K

120 240 360 40 80 120 150 40 80 100
River miles with DO equal to or less than level shown

KEY ABATEMENT LEVELS
Based on seasonal low flow conditions EOD . See Table IV-3
1983 - - - - -
Source: Nati. Commission on Water Quality 1977 T ................ forexplanation
compiled from environmental contractor reports 1977 A of abatement
February 1976 Present ----I levels

iv-37

is not severely depleted. In other reaches, effluent guideline limita-
tions will not be adequate to achieve water quality standards, although
the extent of violation will be reduced. For portiqns,'of'15 of 38 study
sites (36 percent), projections indicated that more stringent treatment
than for 1977 and 1983 limitations would be required.

A number of potential residual DO depletion problems would remain
following achievement of 1983 requirements. Most important of these is
the impact of nonpoint sources. Projections,made for the Chattahoochee
River below Atlanta indicated that DO periodically would drop to zero
for an extended period of time in response to pulse loadings from urban
runoff and combined sewer overflow. For very few of the site studies
were contractors able*to model this pulse-loading phenomena. Sludge
blankets on stream bottoms in-some locations can continue to cause DO
deficits (e.g., Houston Ship Channel). with time, however, these
'deposits can be expected either to be decomposed, flushed out of the
river by high flows, sealed over with naturally occurring sediment
deposits, or, as in the case of the Channel, be partially removed as
dredge spoil. Excessive algal productivity which causes oxygen de-
pletions upon decay have been cited as a potential problem at several
sites, even though point-source oxygen demanding pollutant loadings will
be greatly reduced.

b. Eutrophication Potential

.Higher point-source pollutant removal to meet in-stream dissolved
oxygen standards does not necessarily reduce nutrient levels in re-
ceiving waters. Although there will be a noticeable decrease from
present levels in total phosphorous if the 1977 and 1983 limits are met
at many sites, the decrease will not significantly reduce the eutro-
phication now occurring at assessment sites. The reasons for this are
twofold:-

Secondary treatment of municipal wastewaters, a major point
source of nutrients, is only marginally effective in removing
phosphorous and, in many instances, can result in an actual
increase in the soluble nitrogen concentrations in effluents.

At many sites, particularly in urban areas-and in regions
where agriculture is intensively practiced, nonpoint sources
will continue to contribute large amounts of nutrients to
receiving waters.

Review of the site study reports reveals potential continuing
nutrient enrichment problems.

At the 1977 level, nutrient concentrations at 17 of 39 assess-
ment sites (44 percent) will remain high enough to support
nuisance plant growths. Only minor reductions will occur at

IV-38

the 1983 treatment level, except for a few sites where advanced
wastewater treatment or point-source relocations were evaluated.
Although a number of other sites will continue to have high
nutrient levels, high turbidity may limit eutrophication, as
it does presently.

Municipal point-source discharges will remain as significant
nutrient sources at 13 of the 17 sites where eutrophication
problems are expected to continue. These problems are signif-
icant particularly in the Northeast. Nonpoint sources are
potential continuing nutrient sources at 13 of the 17 problem
sites. Agricultural nonpoint sources were cited at 12 sites
as significant nutrient sources, particularly in the Midwest,
Southern Plains, South Atlantic Coast, and the Central Valley
regions. Urban stormwater runoff and combined sewer overflows
were cited as continuing nutrient sources at five sites with
continuing eutrophication problems.

C. Physical Characteristics

on a nationwide basis, high suspended solids and turbidity levels
in streams are'more commonly associated with natural and other nonpoint
pollution sources. This is true for the Midwest and Great Plains where
agriculture is a major land use and the soil is naturally erodable.
Substantial improvements in suspended solids and turbidity levels at the
1977 level will occur at assessment sites in New England, for example,
where natural turbidity levels are low. Improvements in those areas
will result from reductions in loadings from municipalities and indus-
trial point sources. In one case, the Nashua River in Massachusetts,
continuing suspended sediment problems were projected for several years
from fine-rgrained particulates accumulated in streams from industrial
discharg(@s over the years. In several instances reductions in turbidity
and resulting increased light penetration are projected as factors
allowing for increased plant growth and eutrophication problems.
Another possible effect is more rapid dieoff of coliform bacteria
resulting from increased exposure to sunlight.

For 13 of 38 sites (34 percent) significant reductions were
reported in suspended solids and turbidity at the 1977 level.
These changes resulted from reductions in pollutant discharges
from'industr-,al and municipal point sources. Seven sites were
cited as having severe turbidity problems under present
loadings.

Suspended sediment controls were assessed for irrigated lands along
Clarks Fork in the Yellowstone River basin study. Calculations show
that increased irrigation efficiency and sediment removal by treatment

IV-39

would produce negligible reductions in the sediment concentration of the
Clark's Fork. No environmental improvements are likely to occur from
these abatement-efforts because natural (including channel erosion) and
other nonpoint sources are large. In the Maumee River basin, studies
indicated that by applying proper conservation practices, tillage
practices and crop rotation a one-third reduction in soil loss could
result. Soil loss reduction leads to a corresponding decrease in
nutrient (N and P) and BOD loadings, which are transported with the
sediment.

Aesthetic degradation of water bodies by float ing debris, oil,
grease, scum and other materials attributable to pbint-source discharges
will be reduced at the BPT level. Aesthetic problems associated with
high turbidity and nuisance aquatic plant growths will be reduced only
to the extent that pollutants causing the problems are controlled.
Urban storm runoff and combined sewer overflows will continue to create
aesthetic problems.

d. Salinity

Total dissolved solids levels are not projected to be greatly
reduced by implementing point-source controls at the assessment sites.
TDS problems in fresh waters occur primarily with irrigation projects
and natural sources in the western states. Industrial and municipal
wastewater discharges are known to influence dissolved solids levels in
many areas, but the magnitude of the effects are not nearly as great as
the effects from irrigation on an areawide basis.

Improved irrigation control practices would decrease total salt
loads in the Colorado and Yellowstone River basins. There would be
little apparent environmental benefit, however. The combined salt loads
from natural sources and irrigation will still be high enough to pose
problems for water users. Improved irrigati6n practices for TDS control
in the Tongue River of the Yellowstone basin would have pronounced
effects on the seasonal distribution of stream flow. Increasing ef-
ficiency means decreasing the diversion rates during the high-flow
months. This has the@eftec't of reducing stream flows during the late
summer months, since these late season flows historically have come from
irrigation return flows percolating through the soil.

e. Health-Hazards and Toxic Substances

Assessment of changes in coliform bacterial contamination problems
is summarized in Figure IV-7. Widespread, continuous violation of
coliform criteria levels is reduced significantly at the 1977 level when

IV-40

Figure IV -7

COLIFORM BACTERIA ASSESSMENT SUMMARY
FOR 41 SITES

Percent of site studies
............
................
...........
................
.... .........
...........
.......... .................... .......
.............. .....................
X
...............
.............
.............X
20%
................
................
Minor
...............
.............
.............
problem
...............
0% -55% -65% 65%
Intermittent

Continuous,
extensive

15%
5% -5%

Present 1977 1983 1985
Condition BPT Level BAT Level EOD

Criteria set at 200 col/100 ml (fecal) or 1000 col/100 ml (total)
BPT = Best practicable technology; BAT = Best available technology; EOD Elimination of discharge
Source: Natl. Commission on Water Quality
compiled from environmental contractor reports
February 1976

disinfection is practiced on all municipal treatment facilities.
Control of combined sewer overflows at the 1983 level would reduce sewer
bacterial loadings at-several sites. Seventy percent of the sites will
continue to experience periodic coliform. bacterial contamination pro-
blems even if point-source discharges are eliminated because of nonpoint
sources. Agricultural and urban land runoff are the major sources
causing the problems.

Concentrations of many known harmful toxic substances, such as some
of the heavy metals, will be reduced through effluent limits reflected
in NPDES permits. Treatment to remove oxygen demanding wastes removes
some heavy metals and toxic organics as well, although data for predict-
ing the magnitude of this reduction and consequent reductions of toxic
problems are sparse. An important aspect of the problem is that the
toxic, sub-lethal, and synegistic effects of many substances discharged
into the water are not known and consequently not listed in effluent
permits. C hlorination of wastewaters can have detrimental effects.
Excess chlorine residuals can be toxic to aquatic life. Also chlorina-
tion has recently been linked to generation of potential cancer-causing

IV-41

substances in some drinking water and is being intensively studied.
Nonpoint sources, such as urban and agricultural runoff, contribute
significant amounts of toxic substances to receiving waters, however,
and these undoubtedly will continue until nonpoint sources are controlled.
Detailed investigations of the relative magnitude"of contributions from
these sources and resulting impacts are needed.

f. Thermal Effluents

Generation of electricity by burning fuels (fossil or nuclear) to
drive steam turbines entails release of large quantities of heat to the
environment. The amount of heat released generally amounts to 60-70
percent of the energy content of -the fuel. Nuclear plants have about 50
percent greater heat release than an equivalent-sized fossil fuelplant..
Traditionally, most of this waste heat has been removed from the gen-
erating station by cooling water drawn from natural or man-made water-
courses. This massive transfer of heat energy raises the temperature of
the water and dissipates the heat into the atmosphere. Since tempera-
ture is a physical environmental factor to which most aquatic life is
very responsive, some changes in aquatic communities invariably ensue.
Where the changes are noticeable, and either detrimental to the varied
interests of man, or presumed to be detrimental to the overall func-
tioning of the ecosystem, the waste heat has been called "thermal
pollution." Indirect, but"potentially important, environmental effects
result from moving large quantities of natural water through the gen-
erating plant. This includes impingement of organisms at intakes and
damage to small organisms drawn through the generating system with the
cooling water (entrainment).

A necessary.part of the Commission's study has been to predict the
number of existing and planned steam electric power plants that by 1983
would be required by the EPA to use alternative cooling methods instead
of the traditional "once-through" systems. These predictions have been
necessary becaus4@. the law describes heat as a pollutant, but allows
exemption from thermal controls if an electric utility can show that
such controls are unnecessary to protect a balanced, indigenous com-
munity of organisms (Section 316(a)). The law also provides that, in
any event, the best technology shall be used to*protect aquatic life at
the intake structures (Section 316(b)). To undertake this estimate of
thermal exemptions, the Commission developed independent criteria
representing a combination of accumulated scientific knowledge and/or
expert judgment regarding thermal ecological impacts.

Protection of a desirable, balanced community of organisms within
the area influenced by a power plant depends on complex interactions
among three groups of factors:

IV-42

1) Design and operating characteristics of the power plant,
particularly its cooling system.

2) Physical characteristics of the water bodies supplying
cooling water and receiving the effluent.

3) Characteristics of the communities of aquatic biota
indigenous to such waters, and particularly their
susceptibility to heat-induced 6hanges.

These factors were listed and assigned a numerical scoring system
to allow independent quantification of the environmental consequences of
each factor at a selected power plant site. The sum of the independent
scores for a given plant was the basis for estimating the need for other
than once-through cooling. A panel of three experts in aquatic ecology
independently judged the acceptability of representative power plants.
This was done for each of several types of water bodies: ocean, estuary,
natural lake, river, impounded river, impoundments flooding originally
terrestrial environments, and man-made lakes which have been an integral
part of existing streams. A'scoring system and criteria were estab-
lished on the basis of detailed and reasonably complete data contained
in Environmental Impact Statements for 27 nuclear steam electric power
plants. A larger sample using all fuel types was then scored on the
basis of available data (often ificomplete) and similarity in specific
features of cooling systems with the first sample. Numerical informa-
tion thus obtained was then extrapolated to all once-through power
plants greater than 300 megawatts capacity either existing or antici-
pated between 1960 and 1983. The analysis was applied to every steam
electric power plant covered by EPA's thermal limitations currently
using, or planning to use, once-through coqling. The results have been
aggregated by region.

The findings vary from expectations of control needs and provide
important implications for scientific and analytical aquatic ecology.
On the basis of several different scenarios, it was determined that:

1) The need for alternative cooling systems is much less than had
been estimated in many analyses. The percentage Of plants which
could continue once-through cooling without damage to indigenous
populations are estimated to be: Oceans - 80 percent; Estuaries
38 percent; Rivers - 80 percent; Lakes -90 percent; River/Impoundments
zero percent; Impoundments - 100 percent; Man-;nadp Lakes - 100
percent. By comparison, the EPA in its analysis of the economic
impact of thermal limitations estimated: Oceans - 100 percent;
Estuaries -, 50 percpnt;'Rivers - 74 percent; Lakes - 50 percent.

2) It is possible that in many instances detailed and extensive
field studies accumulating a massive 13o of documented findingp
I.. iY
for eachisite will be necessary to support the need for closed-
cycle cooling.

IV-43

3) Review of extensive, detailed, site-specific information by
regulatory agencies charged with final determinations will be a
major undertaking.

4) Implementation of Section 316(a) exemption procedures does not
eliminate the need for further research on thermal and other water
effects from steam electric power plants. Any generalized scientific
findings resulting from individual case studies will be difficult
to formulate. However, continued efforts, on such topics as the
ecological effects associated with coastal siting, can provide
valuable consistency in findings and-elimination of duplication.

5) For any meaningful evaluation of the effects of power plants on
populations of aquatic organisms the entire range of effects--
thermal (as in Section 316(a)), intake related entrainment and
impingement (as in Section 316(b)), and chemical (if present)
must be considered together. Biological effects of intake structures
and entrainment often constitute a greater impact on aquatic popula-
tians, than the discharge of heated water. But alternative cooling
systems often reduce environmental impacts largely by reducing the
volume of cooling water required, thus reducing the number of
organisms involved. Independent analysis of the separate provisions
in Section 316(a) and 316(b) may not result in minimizing overall
impacts.

Some water bodies are clearly more suitable for power plant cooling
than others, and careful site selection could, in many cases, provide an
environmentally acceptable alternative to closed-cycle cooling. Estuaries,
with complex patterns of fresh and saline water and abundance of dependent
marine organisms, appear particularly sensitive to impacts from once-
through cooling. on the other hand, freshwater impoundments, whether
off-channel reservoirs or man-made lakes or watercourses, appear to be
either insensitive to thermal impacts or capable of adapting to them
while maintaining a balanced aquatic community.

The Commission's study reflects an accelerating demand for aquatic
research and analysis to. support or reject the application for exemp-
tions from ther mal controls, a demand which could place a heavy load on
the availability of qualified ecologists, biologists, taxonomists and
other supporting manpower.

The need for "generic" technical data, i.e., scientific findings
having broad application to many sites, appears to be critical. When-
ever information can be developed on typical responses of particular
species of organisms or of particular kinds of ecosystems, the results
will save both money and time. Present guidelines for seeking exemp-
tions from thermal discharge limits include selection of representative,
important species. Concentrated efforts to determine thermal and other

iv-44

requirements of such species would be timely. (Some such work is pre-
sently under way at the U.S. Environmental Protect 'ion Acency and the
Energy Research and Development Administration.)

How closely the estimated exemptions will approximate the actual is
difficult to predict. -There simply have not been enough determinations
by the EPA Regional Administrators to allow statistical projections
based on actual experience.

Another source of uncertainty could be the predominant use of
independent, site-specific evaluations by the Commission's contractors
without considering the combined influences of several power stations or
other nearby environmental influences on wide-ranging aquatic popu-
lations or on the total ecosystems of regional water bodies. Needs for
regional approaches to examine power plant impacts have been professed
widely, but there has been slow response by regulatory agencies. The
impact of more regionally-oriented thinking on power plant siting and
selection of cooling systems is difficult to predict.

Other uncertainties may occur from the action of individual states
applying their own thermal limitations. Some authorities believe that
exemption on the basis of Section 316(a) prevents subsequent enforcement
of water quality standards by states, but this legal issue is far from
resolved.

D. BIOLOGICAL, ECOLOGICAL, AND ENVIRONMENTAL IMPACTS

Although water quality is described and regulated by the chemical
and physical parameters already discussed, their real significance to
the aquatic environment is the effect they have on aquatic biological
systems. Many people evaluate progress toward water pollution control
not by the changes in dissolved oxygen, nutrients, or heavy metal
concentrations. It is rather the abundance and variety of fish species,
the occurrence of fish kills,. the frequency of algae blooms, water
clarity, or bacterial contamination that the public recognizes.

Changes in these and other components of the environment have a
direct influence on human health, food resources, recreation and aes-
thetics. Even more profound is the influence of these changes on the
natural processes of nutrient and energy cycling. These processes
provide for the continuous support of oxygen and carbon dioxide cycles,
plant and animal production, natural decomposition and an overal stabil-
ity of environmental systems. Ideally, a biological assessment of the
Act's impact would begin at this fundamental level, determining how
abatement would affect these key relationships and functions. The
present state of environmental science does not permit so basic an
analysis, thus the Commission has dealt with more direct effects of

IV-45

altered.water quality. Certain ecological relationships and indicators
which influence the national goals of "protection and propagation of
fish, shellfish and wildlife" and "recreation in and on the water" are
particularly emphasized.

1. Fish

,With its goal of protection and propagation of fish, the Act
reflects the public's special interest in fish populations. Fish are
also indicators of the condition of aquatic systems. Ecological rela-
tionships for fish are better understood, and more site- and species-
specific data are available than for other aquatic organisms. Fish act
as continuous monitors of water quality in contrast to standard sampling
and testing programs which may fail to identify brief episodes of
polluted conditions. The absence or death of sensitive species provides
biological evidence of such occurrence. Fishgenerally have long life
cycles, so that infrequent fish census may provide more long-term
information than more frequent counts of other organisms with shorter
life cycles. many sport or game fish are at the apex of @omplex aquatic
food webs. Important changes in aquatic systems are reflected in their
populations.

The Commission examined factors affecting fish populations and
projected how point-source pollution abatement might alter fish distri-
bution and reduce or eliminate fish kills. Figure IV-8 illustrates
relative effects of dominant influences on fish communities at the
assessed sitesi aggregated regionally. The factors are not mutually
exclusive and frequently occur together, e.g. physical modifications and
turbidity, or turbidity and toxic* substances in storm runoff. These
factors also may interact with important natural conditions such as
temperature, light penetration, and bottom substrate.

Most Midwestern, Southwestern and Southeast sites were influenced
heavily by turbidity and sedimentation. Effects of physical modifi-
cation on fish are evident nationwide and are especially obvious in the
West and Northeast. Although depressed dissolved oxygen levels are a
problem nationwide, the impact on fish appears more severe in the
Northeast. Chemical substances are known to seriously impair fish
populations in some areas, but insufficient data preclude a graphic
presentation.

a. Fish distribution

Table IV-4 summarizes. important influences on fish and general
responses expected from implementati .on of point-source pollutant con-
trol. Data were not available at most sites to quantify the responses

*Influences due to toxic substances are not included in Figure IV-8.

Figure IV-8

ALASKA

PACIFIC NORTHWEST COLUMBIA PLATEAU NORTHERN PLAINS MIDWEST GREAT LAKES

ENVIRONMENTAL INFLUENCES ON FISH

A
GULF OF ALASKA F NEW EN
B
D
L
K E
H

CENTRALdVALLEY M UPPER
G C

OAHU, HAWAII MI TL.,

... Insufficient data
OAHU,
L--j
HAWAII SO. CALIF. BIGHT GREAT BASIN & COLORADO PLATEAU SOUTHERN PLAINS PUERTO RICO
S.W. D ESE FIT
KEY [:!:[P@h
ysicall Habitat Modification
T
Turb
urbidity
Dissolved Oxygen Depletion Source: Natl. Commission on Wa
compiled from environmental co
A-M Geographic regions February 1976

IV-47

TABLE IV-4

.Dominant Man-Influenced
Factors Affecting Fish Populations

General Examples Influence of
Categories P.L..92-500

Dissolved oxygen Major improvements-in
depletion freshwater systems

Chemical Heavy metals, phenols, Major overall
substances pesticides, PCB's, etc. improvement

Turbidity and High suspended solids, Localized improvement
sedimentation siltation of benthic
habitats, benthic sludge
deposition, excessive
algal production

Physical habitat Flow modifications, dams, Insignificant
alterations channelization, dredging,
shipping activity,
temperature

Management Game fish stocking, May benefit activity
practices exotic species intro- in previously degraded
duction, habitat manage- areas
ment, rough fish removal

Source: National Commission on Water Quality
Compiled from environmental-contractor reports
February 1976-

IV-48

of entire fish communities to abatement of point-source pollutants.
Accordingly, further analysis involved the following: (1) potential
sport and game fish species native to each site were identified using
historical data and the "undisturbed site" concept; (2) current species
composition and distribution were examined relative to controlling
environmental factors; and (3) projections were made of potential
changes in game fish distributions at various abatement levels.

As a simplified, hypothetical example of the Commission's approach,
consider a 40-mile river site that, under baseline conditions, may have
10 miles (25 percent) suitable for propagation of small-mouth bass. The
rest of the reach may have non-sport fish dominated by carp. Achieving
the 1977 requirments might improve DO conditions in 20 additional miles,
so that 30 miles (75 percent) are available for the bass population.
With the 1983 requirements, turbidity which prevented spawning may be
eliminated in six more miles, so that a total of 36 miles (90 percent)
would be available for the bass.

seasonal low-flow conditions, representing annual stress conditions
which typically determine fish distribution, were used to make these
projections. The assumption was that the discharges achieved abatement
requirements for critical low-flow conditions. Precise predictions were
J.Lmpossible at individual sites; hence, the Commission projected distribu-
tions over a range of river miles.

After distributions were established at individual sites, the site
results were aggregated for each MGR to estimate the percent of the
total assessed area in each region potentially suitable for sport fish
populations.

The results of the regional aggregation are shown in Figure IV-9.
Only the percentage of the assessed areas in each region that support,
or may potentially support, populations of game fish are presented. The
number or size of catch or ease of access for fishermen are not reflected.
The changes are indicative primarily of improved DO levels. Toxic
substances, turbidity and other influences are included where documented.
Generalizing from this assessment,* abatement of point-source pollution
is projected to produce the greatest extension of game fish habitats at
sites in the Northeast, where each abatement level shows a potential
increase in species distribution. In the Midwest, the 1977 requirements

*Data from individual sites have introduced some bias, since some
sites are larger than others. Thus, region C's assessment is dominated
by the relatively long Yadkin-Pee Dee River site, which is projected to
show little extension of the range of game fish, even with elimination
of point-source pollutant discharge (EOD). Puerto Rico was not included
in this analysis because of insufficient data.

Figure I V - 9

ALASKA
..... ......

... .......

PACIFIC NORTHWEST COLUMBIA PLATEAU NORTHERN PLAINS MIDWEST GREA LAKES

AREAS ASSESSED SUITABLE FOR GAME FISH POPULA
rERCEN I OF TION
AT 3 POLLUTION CONTROL LEVELS

A
GULF OF ALASKA NEW

D
L
K E
H
CENTRAL VALLEY M LIPPE

OAHU, HAWAII MID ATL

Insufficient data
OAHU,
HAVVAll SO. CALIF. BIGHT GREAT BASIN & COLORADO PLATEAU SOUTHERN PLAINS PU ERTO RICO
S.W. DESERT

KEY :::: Baseline Condition (present)
LEVELS OF BPT 1977 (Best practicable technology)
TREATMENT BAT 1983 (Best available technologyj Source: Nati. Commission on Water
. EOD (Elimination of discharge compiled from, environmental contr
A M Geographic regions February 1976
777T777T= 1777=

P
Baseline Cond
qBPT 1971
OF
T EIA T
MEN

IV-50

are not expected to cause major change, although 1983 levels (and to a
lesser extent EOD) should increase the extent of suitable game fish
habitat. For the sites in the Northwest, Southwest, and Alaska, point-
source pollution abatement primarily will cause localized habitat improve-
ment. In other regions, BPT conditions appear to provide maximum exten-
sion of improved habitat.

The relative changes shown in each region indicate the importance
of point-source pollutants on game fish distribution. Thus, for the
sites in Regions A and B, and to a lesser extent F and G, poInt-source
influence is extensive. At the sites in other regions it is less signif-
icant, but only in the aggregate, however, because some part of almost
every site was influenced heavily by point-source discharges. Factors
other than point-source discharges, such as urban and agricultural
runoff and natural turbidity, will continue to limit game fish habitat
at some locations.

This summary does not show relative abundance or productivity of
game fish populations. Some areas that currently provide, or are
projected to provide, only marginally suitable habitat are included here
as appropriate. Thus, for Lake Erie, although very sparse popul *ations
of game fish are found in the Cleveland area under baseline conditions,
the area is classified "suitable" for game fish.populations. Point-
source abatement in the Cleveland area can significantly increase numbers
and productivity of game fish. Likewise, the St. John's River in
Florida currently supports an active sport fishery, but the productivity
of these populations has declined significantly over the last 20 years.
Point-source pollution abatement probably will increase fish productivity
considerably there.

b. Fish Kills

Fish kills occur during brief episodes of local water quality
conditions that exceed fish tolerances. Frequent causes are temporary
introduction of toxic substances, low dissolved oxygen, or rapid shifts
of temperature or salinity in estuarine waters. Kills often occur where
under "normal" conditions fish already are,stressed by low water quality,
with the kills being triggered by some episode of additional stress.
Abatement of point-source discharges can either eliminate the triggering
stress or improve water quality so other stresses will not accumulate to
cause a fish kill.

Twenty-one of the 41 assessed sites were documented as having
experienced fish kills (Table IV-5). Confining the analysis to areas
within the stressed sites with fish kills under baseline conditions, the
Commission identified those sites that would probably have fish kills
under projected conditions, and those which might show significant
reductions in size or frequency of fish kills.

TABLE IV-5

Fish Kill Analysis of the 41 Assessed Sites

Estimated number Estimated number Estimated number
Abatement Number of sites of sites with of'sites with of sites with no
Level with fish kill previous kill reductions in change in kill
problems (est.) problem eliminated kill intensity intensity or
-or frequency @frequency

Baseline 21 --- --- ---

1977
Requirements 19 2 16 3

1983
Requirements 18 1 15 3

1985 Goal 14 4 9 5

.-Source: National Commission on Water Quality
-@Compiled from,environmental -contractor reports
February 1976

IV-52

Fish kills were attributable to a number of factors, including
accidental spills and continuous discharges of toxic substances, oxygen
depletion from algal blooms, benthic oxygen demands, heavy organic
contributions from agricultural and urban runoff, point-source discharges,
pesticides in storm runoff, etc. Obviously, some of these factors would-
not be affected by point-source pollution abatement.

Although the quality of fisheries will generally improve, fish
kills might increase in frequency or intensity with abatement of point-
source discharge. A less tolerant fish community could develop in
response to abatement. Thus when accidental spills or occasional
stress conditions do occur, bass, for example, may die where the formerly
predominant carp populations would have survived.

2. Shellfish

Oysters, clams, shrimps, crabs and lobsters are the shellfish
organisms of concern. The Commission restricted its analysis to these
commercially important species because they are the ones for which more
information is available, a reflection of historical public interest.

Human influences have had a significant impact on shellfish popu-
lations at all 16 estuarine sites. As with fin fish, population num-
bers, biomass and productivity of shellfish were not predictable. The
Commission did, however, determine for each estuarine site (1) whether
shellfish and their habitat had been destroyed, damaged or improved by
various human influences, (2) whether point-source discharges had been
instrumental in-any alternation, (3) whether point-source abatement
potentially would restore any habitat,-(4) whether shellfish beds were
condemned for harvesting to protect public health, and (5) whether
point-source abatement would open any previously condemned areas.

Table IV-6 lists and evaluates a number of man-induced influences
on shellfish and their harvestability. The figures are conservative
because many reports contained no information about several of these
influences.

The category "indir ect biological impacts" includes a variety of
effects, such as alteration of food chains, or indirect destruction of
an essential biological component of the habitat. For example, in
Biscayne Bay excessive nutrients have produced heavy algal growth. This
increases turbidity which destroys turtle grass beds, important habitat
for crustacean shellfish.

At several sites growth and productivity of certain shellfish
species apparently have been stimulated by the input of dissolved and
particulate material. Dissolved materials can stimulate growth of
bacterial and algal food for shellfish and organic particles can be used

IV-53

TABLE IV-6

Human-Induced Factors Affecting Shellfish Populations
at'the Sixteen Assessed Estuarine Sites

Factor Number and % of si Ites Pat@ential impact
where the factor operates -of PL 92-500

Over-harvesting 2 13% Insignificant
improvement

Contamination by 14 88% Significant
bacteria and virus improvement

Accumulation of tainting
and contaminating 6 38% Significant
material, including improvement
metals,petrochemicals,
and pesticides

Shellfish kills by
toxic substancest 9 56% Significant
including metals, improvement
petrochemicals and
pesticides

Destruction of habitat Significant
by dredging and 6 38% improvement
filling operations (Section 404)

Accumulation of organic
sludge resulting in:
A. Low dissolved Significant
oxygen 7 44% improvement
B. Filling of beds @6 38% Significant
improvement

Siltation and turbidity Insignificant
from upland runoff 3 19% improvement

man-induced salinity 3 19% -Insignificant
changes improvement

Indirect biological 4 25% Significant
alteration improvement

Direct and indirect Significant
stimulation of the 4 25% change
growth of some species

Source: National Commission on Water Quality
Compiled from environmental contractor reports
February 1976

IV-54

directly by some shellfish. Of course, these inputs also can be harmful
if the stimulated species is less desirable as a food source. Excessive
algal and bacterial growth can be noxious or toxic, and excessive
particulate materials become habitat-altering bottom deposits. At
,--several sites, oyster and clam poptilations appear very robust, but are
not-hdrvestable because of bacterial contamination, thus allowing
populations4to-grow to natural limits. Point-source pollution abatement
at least partially should restore suitable habitat for shellfish at 13
of the estuarine site's (81 percent), with the degree of restoration
varying widely among the sites and between abatement levels. Table IV-7
shows projections of the general influence of point-source abatement.

At 14 gites (88 percent), some or all shellfish beds are closed to
harvesting because of excessive bacterial contamination. The Gulf of
Alaska is completely open,,and one other site supported no harvestable
t
benthic shellfish. At 13 sites (81 percent), point-source abatement
sh6uld open to shellfishing some areas which are now contaminated and
closed. The amount of opened area should increase further with each
level of abatement. 'The 1977 requirements will alleviate many problems
caused by bacterial contamination from treatment plants; 1983 requirements
should open still more areas if combined sewer overflows are controlled
and'disin'fected. EOD would open still more area, but the area opened
varies from site to site. For example, in San Francisco Bay there is a
projected doubling in some tributaries, while in-the Delaware River
estuary only minor increases are projected. All 14 sites with some
closed areas at baseline (1974) still will have some at EOD, primarily
from urban storm runoff and other nonpoint sources.

.At some sites secondary treatment will not eliminate completely
bacterial contamination of shellfish if publicly owned treatment work
effluents-constitute a high percentage of receiving water flow. EOD
may, in fact, be the only effective abatement level at some sites for
organic, coliform-contaminated discharges. Such effluents actually may
stimulate shellfish productivity, but the coliforms preclude harvesting.
Chlorination of the treated wastewater may decrease the bacterial
contamifiation sufficiently to allow harvesting, but chlorine and chlori-
nation by-products may be toxic to some shellfish larvae even at low
levels and thus decrease shellfish productivity.

3. Wildlife

commission site studies did not yield enough data for a compre-
hensive national analysis of the effects of pollution on waterfowl and
other birds. Lack of site-specific information generally results from the
migratory nature of the birds. Thus the effects of pollution may not always
occur where the bird is exposed. For example, a duck exposed in Florida may
exhibit the effect of the pollutant later in the year after returning to
Canada. This time lag between cause and effect is due to storage of certain
pollutants in the body fat, from which they are excreted slowly. Thus, a

IV-55

TABLE IV-7

Habitat Destruction and Harvestability of Shellfish
at Sixteen Assessed Estuarine Sites:
Current Conditions and Projected Dnpact of L 92-500

current (1974) Conditions Number and % of Sites

Sites with shellfish habitat
destroyed is 94%

Sites with shellfish areas closed
for public health reasons 14 88%

Sites at which abatement should
restore some habitat areas 13 81%

Sites at which abatement should
open previously condemned
shellfish areas 13 81%

Sites at which some shellfish
habitat will remain unsuitable 15 94%

Sites at which some shellfish areas
will remain condemned 14 88%

Source: National Commission on Water Quality
Compiled from environmental contractor reports
February 1976

IV-56

detailed assessment of the effects water pollution might have on water-
birds was not possible at the study sites. In fact, analysis at the
sites do not always contain enough detailed information to detect even
the presence of pollutants in resident species. Faced with these inade-
quacies, the Commission has relied on available information not geo-
graphically confined to its study sites. This approach provides as
complete an understanding of the subject as is possible with the present
state-of-the-art.

Three major types of information are available for analyzing the
effects of water pollution on birds. First, recent experimental re-
search has documented the effects of particular types of pollutants on
birds(l). Second, population distribution of various species of water-
birds within the continental U.S. is known(2). Third, some data exist
on the use and distribution of various polluting substances throughout
the country(3). Information from these sources was combined to produce
a national picture of water pollution effects on birds. In addition,
some case studies documenting specific pollutant effects on birds in
certain geographical areas are available(4). These studies illustrate
more specifically what has been hypothesized -for the nation as a whole.

(1) For example: White, Donald L. and Lucille F. Stickel. 1975.
impacts of Chemicals on Waterfowl Reproduction and Survival. Pp. 132-
142 in Transactions of First International Waterfowl Symposium, St.
Louis, Missouri, February 1975.

Blus, L. J., R. C. Stendell, S.N. Wiemeyer, H. M. Ohlendorf, J. A.
Kerwin, and L. F. Stickel. 19 '75. Impact of Estuarine Pollution on
Birds. Patuxent Wildlife Research Center and-Migratory Bird and Habitat
Research Laboratory, Laurel, Md. (in press)..

(2) For example: Anderson, D. R. and C. J. Henry. 1972. Population
Ecology of the Mallard: Review of Previous Studies and the Distribution
and Migration from Breeding Areas. Resource Publication 105, Bureau of
Sport Fisheries.and Wildlife, U. S. Department of Interior.

(3) Environmental Protection Agency's Computerized Informational System:
STORET (General Water Quality File).

(4) For example: Blus, L. J., A. A. Belise and R. M. Trouty. 1974.
Relation of Brown Pelican to Certain Environmental Pollutants. Pesti-
cide Monitoring Journal, Vol. VII, pp. 191-194.

Keith, J. D., L. A. Woods and E. G. Hunt. 1970. Reproductive
Failure in Brown Pelicans on Pacific Coast. Trans. 35th North American
Wildlife Conference, pp. 56-64.

Ludwig, J. P. and C. Tomoff. 1966, Reproductive Success and
Insecticide Residues in Lake Michigan Herring Gulls. Jack Pine Warbler,
Vol. 44, pp. 77-85.

IV-57

Though lacking in quantitative results, this information provides,
on a nationwide basis, a description of the relationship between pollu-
tion and birds to the maximum extent possible.

Water-borne pollutants from point and nonpoint sources is only one.
of a number of factors which account for reductions in waterfowl popula-
tions. These two sources-of water pollution are not usually the major
cause of reductions in waterfowl (duck) populations, but they can
affect other birds which are indirectly linked to the water. Water pol-
lution seems to be a particular problem for the "raptors" (birds of
prey, such as hawks, eagles, etc.) because of their relative position in
the food chain. Raptors may be affected adversely because they eat fish
or birds which may contain high pollutant concentrations. Ducks, lower
in the chain, feed largely on vegetation and invertebrates which often
@ave lower concentrations of pollutants.

The most important factor in maintaining waterfowl (duck) popu-
lations is the protection of their breeding grounds--wetlands in parts
of the northern U.S. and in Canada. However, exposure to pollution in
the waterfowl wintering grounds in the U.S. may affect these birds even
when the breeding grounds are undisturbed. This wetlands habitat pre-
sently is being lost rapidly due to dredge and fill activites, current
agricultural and irrigation practices and other types of human incur-
sions. Thus, while water pollution cleanup will have a beneficial
effect on waterfowl populations, other problems remain. The correction
of these problems might have greater impact than pollution control.

Birds are susceptible to pollution in three ways: (1) lethal
effects to adults-as a result of accumulation of high levels of pollu-
tants; (2) metabolic effects that prevent or impair reproduction;. and
(3) embryotoxic effects due to pollutant accumulation in egg yolk"
supply. These effects are, of course, variable,in regard to species
response to individual pollutants, the method of ingestion, the chemical
nature of each pollutant and the age and physical condition of the bird.

These effects occur through various physiological pathways. For
example, those pollutants most often found to be persistent in bird
tissues, i.e. aldrin-dieldrin, dichloro-dipheny-l-ethane (DDE), poly-
chlorinated biphenyl (PCB), and methyl mercury, usually are stored in
the body's fat and/or protein reserves. Under norm al conditions,
pollutants enter the blood stream at a rate related to the.amount
stored and to the rate of metabolism of the animal; a portion of the
released pollutants is excreted from the bod as part of the normal
y
bodily processes and a portion may be redeposited. The harm that may
come from a chemical depends upon this "dose." Some chemicals may
affect physiological processes at very low levels. The rate at which
the pollutant is released from the fat will increase when fat resources
are drawn upon in cold weather, when food is short, when the bird must

IV-58

fly long distances, as in migration, and in certain phases of the
reproductive cycle. Increased rate of use of fat may increase the
"dose" to the point that effects will be produced that would not have
been produced otherwise. In wintering grounds, the bird may ingest
daily quantities of pollutants far below toxic or debilitating levels
with no visible adverse effects. This intermittent dosage accumulates
and is.stored in the boay's fat reserves, however. When spring migration
occurs,'stored fat reserves are mobilized and the pollutants are released
to the bloodstream where they are carried to body organs and tissues and
damage may occur. One threat is the redistribution of these released
pollutants into the brain's fat reserves. This happens because pollutants
once released from one fat reserve will tend to reconcentrate in the
body's remaining reserves. since the fat reserve in the brain is main-
tained until most other fat stores are utilized, the pollutants tend to
accumulate in this reservoir and can affect the brain and central nervous
system and kill the adult bird.

The other major effect that pollutants may have is caused by their
excretion with fats into the developing egg yolk. The developing embryo
will then use these fats for energy. Accumulation of certain kinds of
pollutantsin the-yolk can cause embryotoxic effects. Thus, the basic
habits and physiology of many species make them especially vulnerable
during the migratory and nesting seasons. Table IV-8 presents most of
the known effects that some commonly found water pollutants may have on
birds.

An examination was made to determine possible correlation between
the distribution of various water pollutants and the distribution of
major concentrations of birds that potentially could be affected. While
this methodology did not provide definitive correlations, it did identify
areas where problems possibly exist. In some instances the case studies.
cited earlier proved to be good illustrations that correlation does
exist between pollution and damage to bird populations in certain areas.

The present state-of-the-art in predicting the national effects of
water pollution on wildlife such as reptiles, amphibians, and mammals is
not able to show the effects of pollution. There is information, however,
that shows that water-borne pollutants can have deleterious effects on
the reproduction and life processes of water-linked mammals by way of
their food chain. This suggests that there may be other as yet un-
discoveredeffects. Much more research is needed to understand the
specific links between water pollution and its effect on these forms of
wildlife.

IV-59

TABLE IV-8

Effects of Common Pollutants on Birdlife

PCB (poly-chlorinated Decreased egg production
biphenyl) Embryotoxic and/or mutagenic effects
Altered parental behavior which
reduces hatching success

Chlorinated Eggshell thinning
hydrocarbons Survival of young
DDT, DDE, DDMU Altered adult behavior which
reduces hatching success
Affects salt gland, thyroid gland,
adrenal gland

Chlorinated Survival of young and adults
hydrocarbons Altered adult behavior which
Aldrin/Dieldrin reduces hatching success

Chlorinated Although not as well researched as the
@hydrocarbons chlorinated hydrocarbons above, the
Endrin, Chlordane, effects are possibly similar
Heptachlor

Chlorinated Survival of young may be affected with
hydrocarbons very high,concentrations
Mirex

Mercury Affects the central nervous system
Survival of young
Decreased egg hatchability

Cadmium In high concentrations, can result
Lead in death

Herbicides Indirect effect when habitat is destroyed
2-4-D, 2-4-5-T Can have same effects of oil if sprayed
in an oil solution

Oil Direct effect through spills on both
birds and habitat
Affects hatching of eggs
Prevents egg production
Affects ability to survive in saline
environments

Source: See Technical Environmental Volume;
National Commission on Water Quality, March 1976.

IV-60

4. Recovery Time

Ample scientific evidence exists to show that ecosystems do recover
following a reduction in pollutant loading. Recovery in all cases is a
return to some more natural state which is constrained by the prevailing
physical, chemical, and biological regime in the drainage basin. The
rate and degree of recovery of the ecosystem depends on many factors,
however.

Rivers recover most rapidly because of their high flushing rates
and the possibility of bottom scour which removes accumulated materials.
Biological recovery is enhanced by the presence of recolonizing species
in tributaries. An example of a site with potential for rapid recovery
is the St. John's River in Maine, which could show improvement within a
year. The Trinity River in Texas, on the other hand, has very thick
bottom deposits, little current scouring action, and few tributary
repopulation sources. This type of river could require many years to
show significant improvement.

Lakes tend to have longer recovery times. Flushing rates are low,
and sediments and dissolved materials accumulate readily. Ecological
interactions slow recovery, as with continued DO depletions due to algal
growth and decomposition, even after BOD loading has stopped. Moreover,
water quality in lakes and reservoirs deteriorates natually due to
natural eutrophication. Natural eutrophication, however, generally
occurs at far slower rates than do human-induced water quality deteriora-
tions. Man-induced changes have been reversed in several lakes.
Sewage effluent diversion from Lake Washington and Lake Monona, Wisconsin,
produced evidence of eutrophication reversal in less than five years.
Similar results are indicated from an EPA demonstration project at Lake
Shagawa in Minnesota. Larger lakes, such as Lake Erie, which have been
stressed for long periods, may require many years to recover.

Recovery rates in both lakes and rivers can be accelerated by sound
management practices. Pollution stress on aquatic ecosystems, 6oupled
with introduction of exotic species, may alter fundamentally the species
composition of the ecosystem. Alterations in species composition may
persist following pollution reduction and prevent full recovery of the
system. Additional management strategies, including selective fish
stocking, physical habitat improvement, land use planning, and dredging
of bottom sediments, may be necessary to complete or accelerate the
recovery process.

Despite the apparent recovery capacity of aquatic ecosystems,
future recovery of aquatic ecosystems under the Act's pollution abate-
ment levels may be transient in the face of anticipated population and
industrial growth. Phosphorus loading reductions in Lake Erie for

IV-61

example, indicate an initial decline as each treatment phase is imple-
mented, but also indicates a resurgence of water quality problems
associated with population increase. This potential interference with
recovery was not considered fully in the 30 environmental studies.
Results of.the regional studies, however., indicate potential worsening
of the problems due to population and industrial growth.

5. Effects of Delayed implementation

In addition to the degree of delay and potential growth considera-
tions, the effect of delay depends on an environment's present condition
and rate of change. If, under present input conditions, a system is not
changing physically, chemically, or biologically, it is stable and
presumably would remain so until input contributions change. Under
these conditions, recovery times would be relatively unaffected by
delayed implementation.

If, on the-other hand, a system is being degraded, time'required
for recovery after delayed implementation is lengthened. If toxic
substances, plant nutrients or oxygen-demanding materials are accumu-
lating in sediments, delayed removal of these from discharges results in
greater accumulation. Thus the time required for flushing, burying,
decay or detoxification is lengthened. If a p6pulation (e.g. of trout
or oysters) is declining due to point-source stress, delayed removal of
that stress will cause further decline and possible local elimination of
the species, thus requiring longer recovery time to some previous
population level. Fewer remaining species populations will result in
slower recovery. Competitive species may become dominant. Once undesir-
able more tolerant species,are established, they may slow or prevent
full biological recovery through food or habitat competition.

Figure IV-10 provides@a hypothetical summary of this discussion.
The two upper bars illustrate implementation on schedule. A degrading
system,,.continuously changing under current discharge.conditions, re-
quires longer to recover. The two lower bars show the effects of de-
layed abatement. Long recovery periods result from the delay period
itself as well as from further changes developing during the delay
period. Recovery time depends greatly on the extent of ecosystem change
before recovery begins.

If growth and additional stress from more and larger discharges are
superimposed on these observations, the effects are magnified.
Biological, chemical and physical changes are accelerated, system
structure and function are further altered and potential recovery is
endangered and requisite periods are lengthened.

Figure I V.1 0
HYPOTHETICAL EFFECT OF
DELAYED POLLUTION ABATEMENT IN AQUATIC SYSTEMS

Present 1977 Time
Abatement on Schedule
. . . . . . . . . .
STABLE SYSTEM On schedul
- Not currently changing ::impleme ECOVERY
under the influence of ::::::tation
point source discharges
I "4'Achievement of 1977 requirements

...........
DEGRADING SYSTEM
Undergoing change due
..........
...... RIO!
...........
...........
to point source discharges <
........... I
........... a,

............
Delayed Abatement
...........
............
...........
Pe iod of dela
y
STABLE SYSTEM E
.... Tim

...........
............

chievement of 1977 requirements

............

...........
IM1911TVIMA
DEGRADING SYSTEM Period of dela
lall-Rdwil UVreTifli

...........

*Recovery Time = Time required for an aquatic system to return to some more natural state.
Source: Nati. Commission on Water Quality
February 1976

IV-63

6. Environmental Impacts of Waste Residuals Diiposal

a. Rationale

The Commission's residuals assessment was designed to estimate
potential environmental effects of disposing of materials removed from
wastewater onto land and into the atmosphere., Although a review of the
present understanding of'ecological effects of municipal wastes disposal
into marine waters was included, the assessment was not designed to
provide a comparative analysis of the relative. ecological merits of
placing residual materials into aquatic systems as opposed to land or
air.

The residuals assessment also was designed to.estimate total land
suitable for safe use as disposal sites in different parts of the nation,.

The estimates of land availability were based strictly on geo-
physical, hydrological and ecological c6nditions,.and ide;'ntify the total
areas of the nation actually suitable f6r land disposal practices. The
results of these analyses provide a scientifically sound basis for
evaluating institutional arrangements that.determine residuals disposal
practices in the nation. Institutional assessments werd not a part of
the environmental sciences analysis, however, nor was there any analysis
of the costs of.transporting residual.@ to'potential sites. The existence
of adequate land for disposal does not, per se, mean such disposal is
economically feasible.
b. The Residuals and bisposal @ethods

Wastewater treatment technologies applied to,municipal and indus-
trial pollution-point sources to achieve the,treatmeht required by the
Act will generate three categories of residual materials: liquid
effluents, sludges, and atmospheric emi.ssions. ,Most reiidual materials
resulting from implementat 'ion oi'the Act will be municipal and indus-
trial sludges. Estimates of national,sludge volumes associated with the
Act's requirements are presented in Table IV-9.

Roughly five million tons, dry weight, of sludge per year come from
municipal wastewater treatment plants in the nation. That amount will
increase to as much as six million.tons,per year following uniform,
national application of secondary municipal wastewater treatment, and
could rise to as much as eight-million tons per year following appli-
cation of more stringent treatment technologies.

Municipal sludges are [email protected] of organic compounds suit-
able for land disposal. They also contain large amounts (at low concen-
trations) of minerals and nutrient substances necessary to both natural
and agriculturally important plant species, thus may be valuable as a
base for fertilizers and soil conditioning' materials.

IV-64

TABLE IV-9

Potential Sludge Generation Rates*
(in 10b tons [dry weight]/year)

Wastewater Treatment Level
Industrial Category Present 1977 1983
Conditions Requirements Requirements

Inorganic Chemicals 17.07 26.02 32.00

Iron and Steel 3.47 6.85 8.03

Pulp and Paper 1.08 2.24 3.41

Meat Products 0.42 0.92 1.09

Petroleum Refining 0.69 0.85 1.02

Textiles 0.19 0.52 0.74

organic Chemicals 0.21 0.41 0.48

Plastics & Synthetics 0.24 0.32

Fruits & Vegetables 0.05 0.07 0.11

Electroplating 0.04 0.07 0.07

Total Industrial
Sludge 23.36 38.19 47.27

Total Municipal
Sludge 4.7 6.0 8.0

National Commission on Water Quality, February 1976;
compiled from environmental contractor report to the Commission.
Figures account for potential population growth.

**Of the total residuals for Inorganic Chemicals, 12.71, 19.64, and 25.68
million tons/year respectively for the present, 1977, and 1983 projections
are gypsum (CaS04) sludge produced from phosphoric acid manufacture, a
segment of the Fertilizer Industry.

IV-65

Estimated sludge volumes for current, BPT and BAT levels of indus-
trial wastewater treatment also are presented in Table IV-9 for 10 of
the industries studied in depth by the Commission. Maximum rates of
generation of industrial sludges will occur at the BAT level. Gen-
eralities about qualitative characteristics of in'dustrial-sludges as a
group are not possible, and there is insufficient existing information
to permit description of exact compositions of sludges for particular
industries. Although some industrial sludges consist primarily.of
organic materials similar to those in municipal sludges, and also suit-
able for land disposal and agricultural use, many industrial sludges
contain materials unsuitable for introduction into living systems.
Disposal of toxic and potentially harmful sludges will require long-term
storage or destruction designed to prevent escape of harmful materials
into the biosphere.

The volume of liquid effluents produced nationally and disposed of
onto land (at 1977 and 1983 levels of municipal and industrial waste
water treatment) will be minor when compared to the volumes of sludge
produced for the same treatment levels. Many treated and untreated
industrial and municipal effluents will contain dissolved and suspended
organic material suitable for either direct application to agricultural
land as a fertilizer or soil supplement, or storage and treatment in
open lagoons. Certain types of industrial effluents contain substances
extremely toxic to crops, domestic animals and wildlife, however, and
will require special handling and disposal methods, long-term storage
and permanent isolation from living systems.

Most atmospheric emissions generated through implementation of the
Act will be direct products of incineration and other high temperature
treatments of municipal and industrial sludges. Some gaseous emissions
also will result from ammonia stripping of partially treated sewage and
from sludge digestion. The major products of these technologies will be
nitrogen dioxide, ammonia, carbon dioxide and low-vapor pressure minerals.
In general only a small portion of the total amount of residual materials
produced through the Act's implementation will be released into the
atmosphere. These materials will, however, contain small amounts of
substances such as heavy metals that are potentially harmful to humans
and other organisms under certain exposure and atmospheric conditions.
For that reason, atmospheric disposal technologies should be applied
only in regions where air quality problems do not exist and are not
likely to develop.

Available post-incineration treatment technologies can remove
virtually all particulate materials from atmospheric discharges.
Although the particulates occasionally will contain substantial amounts
of harmful substances, those substances, together with ash and residues
formed during high temperature treatment processes, will generally be
suitable for controlled land disposal in areas.not used for commercial

IV-66

crop production. The solid residues in some cases will be of immediate
potential value for the recovery of materials for industrial production
processes.

Sludge digestion produces significant amounts of methane, which
will be of increasing value as a thermal energy source.

C. Environmental Impacts

The results of the Commission's site-specific environmental assess-
ments and national residuals study yield two major conclusions. First,
little information is presently available concerning the physical
characteristics of most types of residuals and the exact environmental
effects of their disposal. Second, significant ecological problems are
not likely to develop from disposal of residual materials generated by
industries and municipalities if disposal methods and sites are selected
with care.

Figure IV-11 summarizes the findings of the Commission's residuals
studies. Total areas suitable for land'disposal of sludges and effluents
are shown in Figures IV-12 and IV-13, and are summarized for each
minimum geographic region in the "Availability of Land Disposal Sites"
section of Figure IV-11. In general, most areas of the nation contain
suitable sites for controlled land residual disposal practices except
for:

State and Federal forests, parks, recreation areas,
natural areas, preserves and wildlife refuges
Wetl'ands and areas with extremely w@t soils
Flood plains
Karstlands and similar limestone areas
Areas with steep slopes
.0 Areas with high water tables

Although large areas of several MGR's are unsuitable for land dis-
posal practices, considerably less than 1 percent of the total area of
each MGR would be required for long-term use as disposal sites for the
volumes of sludges and effluents generated at the 1983 level of waste-
water treatment within that region, evenif all of it were applied to
land. Suitable sites, however, are not always located near the places
where effluents and sludges are.generated. This is particularly true
for municipal sludges in densely populated areas of MGR's A, B, C, E, I,
L, and M. Environmentally acceptable disposal of municipal sludges from
those areas could require long-distance transport to suitable sites,
with attendant costs. Densely populated areas of the East and West
Coasts and the Midwest alsohave air quality conditions restricting
local disposal of slud
, ges through incineration. The availability of
residual disposal methods and sites is particulary significant in MGR I,
the Pacific Northwest, and in densely populated coastal areas of MGR's

Figure IV-1 1 IMPACT SCALE
Severe -

High -

Moderate -
F71M Low-
_j
PACIFI NORTHWEST COLUMBIA PLATEAU NOWTHERN PLAINS MIDWEST GREAT LAKES

NATIONAL ENVIRONMENTAL IMPACTS
OF THE DISPOSAL OF RESIDUAL MATERIALS

GULF OF ALASKA EW ENGLAND

F
B
D
L
CENTRAL ALLEY K UPPER OHIO
011
M G C

OAHU HAWAII MID ATL., SO., GULF

SO. CALIF. BIGHT GREAT BASIN & COLORADO PLATEAU SOUTHERN PLAINS PUERTO RICO
S.W.DESERT

Potential Impact of Land Disposal Practices upon Groundwater
Potential Impact of Land Disposal Practices upon Regional Ecology, Vegetation, & Wildlife
Potential Environmental Impacts of Atmospheric Disposal Practices Source: Nati. Commission on Water Quality
Availability of Land Disposal Sites compiled from environmental contractor reports
A-M Geographic regions General Suitability of Region for Land Disposal Practices February 1976
IL
a

M'Potentiali.l " of"
I imp
Put m7
ti
Potential
Avai

Figure IV-1 2
AREAS SUITABLE FOR- LAND DISPOSAL OF WASTEWATER EFFLUENTS

Areas generally suitable for land disposal of, wastewater effluents

Areas only marginally suitable for land disposal of wastewater effluents

Source: Natl. Commission on Water Quality from environmental contractor reports to the commission
February 1976

Figure IV-1 3

AREAS SUITABLE FOR LAND DISPOSAL OF SLUDGE

Areas generally suitable for land disposal of sludge
won, Areas only marginally suitable for land.disposal of sludge

Source: Nati. Commission on Water Quality from environmental contractor reports to the commission
February 1976

iv-70

A, B and C, since virtually all of those regions are suitable for only
the most carefully planned land disposal practices.

Contamination of groundwater aquifers through land residuals
disposal can be avoided through judicious examination of potential
disposal sites before use, followed by careful monitoring of groundwater
quality conditions at and near the sites during and after use. Although
possible groundwater contamination will limit significantly the total
areas of all MGR's suitable for safe use as disposal sites, potential
groundwater problems generally will be prohibitive only in MGR K--the
Great Basin Region--Hawaii and Puerto Rico.

Although very little information is available concerning the short-
and long-term ecological effects of land disposal practices, available
data suggest the overall ecological effects of adequately controlled
land disposal practices to be limited and site-specific. Community
structure changes dramatically at disposal sites. The changes usually
result in a decrease in the number of plant and animal species present.
Movement of chemicals in sludges and effluents through food chains
appears to be significant only in organisms whose habitats are limited
to the disposal sites. With the exception of MGR K, where unique
climatic and geological conditions prohibit large-scale land disposal,
significant or even measurable regional ecological problems are not
likely to result from increased volumes of residuals being disposed onto
land. Effects upon vegetation will be limited to the disposal sites,
and noticeable effects on regional wil'dlife populations probably will
not occur. In many parts of the nation, particularly in forested areas
east of the Mississippi River, land disposal practices can produce
locally beneficial ecological changes, such as increased growth rates in
trees and other plants. This result argues for making carefully-selected
Federal and State lands available for use as controlled disposal sites.

The wide variety of residual materials resulting from the Act's
implementation requires that all general conclusions stated here be
reviewed carefully for each specific residual material and each poten-
tial disposal site. Safe land disposal requires judicious site and
method selection that consider carefully both the exact composition of
each type of residual and the geophysical and ecological characteristics
of the site. Residuals as a group will contain substances--including
pathogens, parasites, pesticides and heavy metals--either known or
suspected to have potentially negative effects on many species, in-
cluding man. Disposal sites must be selected so that contamination of
groundwater supplies and subsequent pollution of open waters by materials
transported in groundwaters will not occur, and so that transport and
concentration of toxic substances in terrestrial and aquatic food
chains will be prevented. In some cases, this will require long-
distance transport of residuals to safe disposal sites. Transportion of
residuals,and primarily sludges, will probably be required in highly

IV-71

urban areas and in geographic areas containing concentrations of
particular types of industry..

It is both technologically possible, and biologically and eco-
logically safe and acceptable to man and other species, to dispose of
most residual materials through land treatment, reuse and storage
techniques. Incineration disposal methods will provide environmentally
acceptable alternatives to land disposal in many areas including-many
regions having insufficient land to allow land disposal practices.
Incineration will be neither permissible nor safe, however, in areas
having local meterological characteristics that could cause development
of dangerous air quality situations. Disposal of sludges and effluents
into marine waters may be an environmentally acceptable disposal option,
but 'should not be considered categorically so at this time. Although the
limited amount of information,currently available about the ecological
effects of introducing effluents and sludges into marine waters suggests
the negative effects of doing so.are frequently minimal in some types of
coastal areas,'insuffici,ent data exist to permit definitive evaluations
of the overall short- and long-term environmental effects of placing
sludges and effluents into marine ecosystems.

major factors. limiting disposal of the residuals produced by munic-
ipal and industrial treatment technologies-are institutional and economic
rather than ecological in nature. Although sufficient land resources
seem to be generally available in the nation for environmentally safe
disposal of most residuals, existing local and national ins t'itutional
regulations and standards prohibit use of many suitable areas for land
disposal purposes. Objections arise in part because the immediate and
long-term environmental effects of land disposal practices are not fully
known. Disposal site selection requires large-scale regional and national
study programs designed to document the specific effects of sludges and
effluents, and materials contained in them, on individual plant and
animal species, and upon ecological communities in natural'situations.
This aftalysis must be coupled with rigorous examinations of each potential
disposal site to assure minimum adverse environmental impacts.

E. SPECIAL ASSESSMENT STUDIES

1. Standing Waters

The Commission evaluated the ecological effects of implementing the
Act upon lakes and res ervoirs through three.types of studies. One was
an assessment of th e J. Percy Priest Reservoir in Tennessee. A second
major element was provided by the environmental sections of the Lake
Erie and Puget Sound regional studies. The latter included a case

IV-72

history of the ecological effects of pollution abatement on Lake Wash-
ington. The third, and most extensive, element was a special assessment
of the effects of point sources upon nine other lakes. The water bodies
selected for the latter study were chosen to represent a cross-section
of both the types of lakes present in the country, and the types of
municipal and industrial pollution problems experienced by the nation's
lakes. The lakes investigated during the special study were Lake
Sebasticook, Maine; Lake Cayuga, New York; Albert Lea Lake, Minnesota;
Beaver Lake, Arkansas; Lake Delavan, Wisconsin; and West Okoboji, East
Okoboji, Spirit and Lower Gar lakes, Iowa. Eight of these are of glacial
origin, and one is an impoundment.

Location of the twelve water bodies studied is presented in Figure
IV-14. Although the study sites @;ere selected to typify the kinds of
point and nonpoint source pollution problems prevailing in lakes in the
nation, the number of lakes suffering from chronic or acute pollution
from point sources actually available for investigation was limited by
data availability@ Much historical and current physical and biological
information was required of each body of water included in this survey,
but a suitable backlog of basic information exists for only a few lakes
in the country. Data were necessary to document pollution related
trends in the hydrologic and ecologic characteristics of the lakes
likely to be altered by implementation of the Act. In spite of this
constraint, however, the Commission believes the lakes chosen provide a
reasonably accurate picture of both the general types of pollution
problems suffered by lakes across the country, and the general kinds of
changes that might occur following point-source pollution abatement.

Lakes in the U. S. are at various stages of physical, chemical and
biological change because of nonpoint and municipal and industrial
point-source pollution. Nationwide, more municipal wastewater treatment
plants than industrial plants,discharge into standing waters. Although
pollution differs from lake to lake and each lake has its own peculiar
.response pattern, there are certain basic similaritles in response. The
results of the s@anding waters studies indicate that on the basis of
amounts of soluble phosphorus and inorganic'nitrogen entering each of
the lakes investigaied, together with the current general ecological
conditions of lakes, a trend of rapid eutrophication is in progress. In
several of the lakes studied here, the accelerated eutrophic trend is
related directly to municipal and industrial point sources because their
effluents are important and, in two cases, predominant sources of nutrients
entering the water bodies. In the other lakes, however, land runoff is
the dominant contributor of nutrients. The result of these excessive
nutrient additions is frequent blooms of undesirable plants, particularly
nuisance blue-green algae. In small shallow lakes, such as Albert Lea,
nuisance algal blooms may persist from spring to fall. The blooms
substantially increase turbidity, decrease the general aesthetic appeal
of the bodies of.water, disrupt the general well-being of other plants

IV-73
Figure IV-14 Lake Sebasticook
12 STANDING WATER STUDY SITES MAINE
Lake Washington
WASHINGTON Albert Lea Lake Lake Cayuga
MINNESOTA NEW YORK
Lake West Okoboji Lake Lake Erie
Lake East Okoboji Delavan OHIO
Big Spirit Lake WISCONSIN
Lower Gar Lake
IOWA
Beaver Lake J. Percy Priest
ARKANSAS Reservoir
TENNESSEE
Key
TYPE OF STUDY
Regional Study
Areas II & Vlc study
Lake Special Study
Source: Natl. commission on Water Quality
February 1976
and animals in the aquatic communities and, in some cases, render the
waters unfit for recreational and other uses.
Secondary treatment by municipal wastewater treatment plants (20 -
30% removal of phosphorus) will not alter eutrophication potential in
these lakes significantly. More advanced treatment or relocation of
outfalls will be necessary for noticeable improvement to occur. Nutrient
removal may be requird of discharges into water quality limited
waters as a pat of the 1977 requirements. The pollution abatement
histories of Lake Erie and Lake Washington offer example of recovery
trenda likely to occur in the lakes considered in the special study
whose major pollution problems come from point sources, as well as in
other lakes suffering eutrophication predominantly from point-source
pollution. Eutrophication rates will decrease abruptly, perhaps within
a matter of weeks in the case of small, shallow lakes, and will continue
to decrease as nutrients contained in bottom sediments are utilized and
new ecological balances develop. New ecological equilibria will evolve
much slower in large, deep lakes such as Lake Cayuga. In all cases,
however, the basic changes eventually will be accompanied by a number of
obvious biological changes. Nuisance algal communities will cease to be dominated
appear, and the planktonic algal communities will cease to be dominated
by blue-green species. Turbidity generally will decrease beacus of

IV-74

decreasing algal blooms, and rooted aquatic plants will reappear in
shallower sections of the lakes. The fauna of the lakes will increase
in diversity as pollution-sensitive invertebrates such as insects, and
verterbrates such as game fish species, are introduced or reintroduced
to the communities. The net result of these general ecological changes
will be lakes of higher aesthetic value and greater recreational poten-
tial than is presently the case.

Eutrophication is a natural phenomenon. Decreasing nutrient input
to lakes through point-source pollution control will slow the process in
many lakes, but the trend will not likely be reversed permanently.
Moreover, accelerated.eutrophication in many lakes in the nation, for
example Percy Priest Reservoir, results chiefly from nutrients introduced
by nonpoint sources, rather than by point-source effluents. In such
cases, point-source control generally will have minimal effect on overall
ecological conditions.

2. Marine Studies

The Commission evaluated the environmental effects of disposing of
municipal wastes into nearshore marine waters in the vicinities of San
Juan, Puerto Rico; Honolulu, Hawaii; Puget Sound; and the Alaskan, New
York and Southern California bights. The comparative ecological and
economic feasibility of ocean disposal of municipal effluents receiving
less than secondary treatment was also analyzed for a number of those
locations, as well as for the Miami, Florida, area. Because of a
general scarcity of data about the effects of municipal wastes in marine
waters, the assessments focused principally upon the Southern California
Bight, an area for which there exists a reasonable amount of infor-
mation. The findings from that location, however, may apply to other
coastal regions physically and ecologically similar to it.

The basic findings of the marine studies are:

Most point-source pollution problems in the areas studied are
caused by municipal discharges, although certain of the munic-
ipal effluents contain industrial wastes treated in municipal
treatment plants. A major pollution problem in the New York
Bight is offshore dumping of municipal and industrial sludges
into relatively shallow waters overlying the continental
shelf. Pollution by.raw wastes from fish processing plants is
currently a local problem in certain sections of the Alaskan
Bight, but that situation probably will be remedied for the
most part by application of primary wastewater treatment. In
San Juan Bay and Pearl Harbor, both relatively shallow bays
surrounded by densely populated areas, point-source problems
are both aggravated and masked by nonpoint pollution from
maritime traffic and storm runoff.

iv-75

Disposal of parti'ally treated municipal effluents through off-
shore outfalls is presently either planned or practiced in the
Southern California Bight and in the vicinities of Honolulu,
Hawaii, and San Juan, Puerto Rico. In the Southern California
area, the water quality and environmental effects of-discharg-
ing partially,treated municipal effluents through offshore
outfalls appear to be limited to the immediate vicinities of
the outfalls when they are located in relatively deep waters
having strong currents. Ecological changes recorded from the
vicinities of the Southern California outfalls include changes
in species diversity and biomass, and concentration of organ-
isms that seem to find immediate use for substances contained
in the effluents. Several fish diseases--including a fin rot
condition and a skeletal disorder--appear at unusually high
frequencies near some outfalls, but it is unclear whether the
disorders are caused by the effluents or the unusual crowding
of fishes near the outfalls. A number of other pathological
disorders occur in fishes that occupy outfall areas in the
Southern California region, and the disorders may be directly
related to the outfalls. Fish diseases similar to those
occurring in the immediate vicinities of the Southern California
outfalls also appear at unusually high frequencies around
municipal sludge dumping beds in the New York Bight.

Marine sludge disposal in the New York Bight damages the ocean
bottom and water column as a habitat for many organisms, and
appears to have a measurably toxic effect on both larva and
adults of certain shellfish species. These effects seem to be
limited to the immediate vicinities of sludge dumping sites,
but continuing the dumping practice promises to cause more
severe problems in part because of the limited circulation
patterns in the shallow waters of the bight. Sludges dumped
into the bight tend to concentrate rather than dispersing
rapidly into the,open ocean. The effects are measurable in
bottom sediments collected in the vicinities of sludge beds.
The sediments contain certain heavy metals in concentrations
considerably higher than concentrations of the same metals in
ambient sediments. Although sludges presently deposited in
the ,New York Bight contain large amounts of metals and other
actually and potentially toxic materials, most nutrients
introduced to the bight appear to come from the Hudson River.

The major environmental problems related to discharges of
municipal wastes-into the relatively closed marine systems at
Pearl Harbor and San Juan Bay seem to center around nutrients,
coliform bacteria, turbidity and generally noxious aesthetic
conditions. Nonpoint-source pollution is a predominant contrib-
utor to many of those problems, however. The primary impact

IV-76

of P.L. 92-500 upon these bays will probably be a decrease in
coliform bacteria content.

Although data are quite limited, few if any large-scale
measurable environmental effects are apparent from releasing
untreated and partially treated sewage and organic industrial
wastes into the Alaskan Bight. Torrential currents disperse
the wastes before effects can develop, and primarily for that
reason implementation of the Act will have little or no
effect upon water quality in the Alaskan Bight.

In open, freely-circulated coastal areas with deep waters
receiving municipal effluents, maximum levels of environmental
recovery will probably be achieved with secondary treatment,
and will probably be limited to the immediate vicinities of
outfalls. Adverse environmental effects.associated with BAT
will be insignificant when compared to changes resulting from
application of secondary treatment of municipal effluents
discharged through outfalls. The effects of EOD probably
would be noticeable only in the immediate vicinities of outfalls.

There is a marked scarcity of data relating environmental -
situations to pollution for all coastal regions of the nation.
Most existing information comes from the Southern California
and New York bights, and that information is of a preliminary
nature.

Th'e assimilative capacity of deep, circulating marine systems
seems to be such that introduction of municipal sewage effluents
does not increase regional concentrations of most potential
pollutant materials beyond natural background levels.

.The Commission's marine studies indicate that large volumes of
partially treated municipal wastewaters probably can be discharged into
deep, freely-circulating coastal waters in certain areas without signif-
icant damage to local environments. Effluent limitations necessary to
provide adequate local environmental protection can be derived from
studies of metals in oceans, from an understanding of concentrations of
different substances that are toxic to marine life, and from considera-
tions of health and aesthetic factors. The marine studies indicate that
wastewaters discharged to marine systems probably could be released
safely when they meet scientifically established water quality criteria
applying to particular locations rather than the uniformly defined
national treatment levels.' Diffuser outfalls of appropriate lengths and
depths can be designed to cause maximum dispersion of effluents within
offshore disposal areas. Adequate effluent limitations yielding minimal
environmental effects in offshore receiving waters can be.achieved by a
variety of types and levels of wastewater treatment, if publicly owned
treatment plants are carefully designed and operated.

iv-77

The Commission's analyses indicate that plants treating something
less than 10 million gallons of sewage per day may find higher treatment
levels and shorter outfalls economical, without undue adverse environ-
mental consequences. Redundancy sufficient to provide continuous environ-
mental protection in case of partial failure should be included in such
plants. Plants with capacities exceeding 10 million gallons a day will
find it advantageous economically to use primary or advanced primary
treatment, and.to discharge through longer outfalls. operating energy
requirements are similar for primary, advanced primary and secondary
treatment-levels. Tertiary treatment.requires,about twice as much
energy as the other levels; it ranges from an equivalent cost for small
dischargers to about twice the cost for larger ones. The total savings
from building optimum environmentally acceptable treatment-disposal
system combinations for publicly owned treatment works discharging to
nearshore coastal waters can be substantial when compared to-the poten-
tial costs of meeting uniform national treatment levels.

The scarcity of data about the actual effects of placing municipal
.wastes into coastal waters indicates that scientific studies similar to
those currently.in progress in the New York Bight @y the National . I
Oceanic and Atmospheric Administration and the Southern California Bight
by Southern California Coastal Water Research Project.should be initated
immediately for all coastal areas where ocean waste disposal of municipal
effluents is practiced. Although the information now available suggests
that environmental impacts of marine discharge of adequately treated and
adequately dispersed effluents receiving less than secondary treatment
are minimal in the California Bight, the actual localized and universal
short- and long-term effects of such practices cannot be understood fully
until much more information is developed from other coastal areas.
Discharge of any municipal or industrial wastewaters into coastal waters
should not be allowed in any part of the nation until sufficient pre-
liminary research has been completed locally to:

1) Determine the suitability of the areA for waste disposal.

2) Determine the levels of wastewater treatment, types of out-
falls and disposal methods necessary to minimize local environmental
.effects.

F. ENVIRONMENTAL FINDINGS, CONCLUSIONS, AND OBSERVATIONS

1. Study Design

The Commission was unable to arrive at a precise definition-of
"physical, chemical, and biological integrity of the nation's waters."
The Commission examined a number.of opinions and philosophical approaches
to defining the.phrase, but was unable to determine which viewpoint most
closely reflects the intent of Congress as stated in the Act. Since the

IV- 78

central efforts of the Commission's environmental assessment studies
focused upon environmental studies at 41 sites, a practical approach
using information about the sites was used to analyze progress toward a
water quality better than that presently existing, and one'that will
provide for ". . . protection and propagation of fish, shellfish, and
wildlife" and "recreation in and on the water." To evaluate achievement
or non-achievement of the 1983 interim national goal, the Commission
determined that any given water body should have (1) a dissolved oxygen
level of at.least 4 mg/liter during seasonal low flow conditions, (2)
toxic materials present at levels not exceeding those recommended in
Water Quality Criteria (NAS-NAE, 1972), and (3) total coliform or fecal
coliform bacterial densities not exceeding those levels recommended in
the Water Quality Criteria (NAS-NAE, 1972).

.0 Study sites were selected to provide geographic coverage that
would permit the Commission to characterize regional and national
environmental changes in fresh, estuarine, marine, standing waters, and
related terrestrial environments. Criteria employed in site selection
were (1) availability and applicability of a verified mathematical model
for relating industrial and municipal point-source discharges to water
quality, (2) existence of sufficient historicaland baseline water
quality and biological data to support impact assessments and projec-
tions of change, and (3) availability of professional expertise for
relating water quality change to environmental change. In effect, meet-
ing these criteria dictated the location of most of the study sites. By
applying these criteria, the Commission's study sites are concentrated
in those parts of the country presently experiencing moderate to severe
water pollution problems. To balance the assessment, several sites also
were chosen in areas having minimal water pollution problems, but where
water pollution is expected to increase because of development. The
Commission's environmental study methodology establishes a precedent,
and provides a basis for future national environmental impact studies.

* At nearly all study sites, assessments of water quality con-
ditions were based on more sophisticated analytical methods than were
assessments of biological, ecological, and environmental changes.
Methods employed to assess environmental impacts ranged from simplified
regression techniques to mathematical simulations of ecosystem effects.
At some sites, environmental assessments were limited to professional
judgment when the supporting data were too limited to permit more sophis-
ticated analysis. A uniform approach for projecting environmental
change was not possible because the state-of-the-art is not sufficiently
advanced.

0 Biological and ecological data and supporting information were
generally less abundant than information on physical and chemical
factors. In many instances, biological information was limited to lists
ofnames of commonly observed organisms. Detailed biological information

IV-79

was available at some sites and was even extensive for a few. Nearly
all studies lacked cause-and-effect data about specific pollutants and
their effect under natural conditions. The Cormnission was able to
extrapolate only in very general terms from published case histories to
potential effects of pollutants at sites that had not been studied.

2. Water Quality and Quantity

0 The following summarizes progress that might be expected towards
achievement of the 1983 goal, based on conditions and projections from
the Commission's 41 site studies. Where data permit, incremental
improvements due to implementation of the Act's phased requirements are
distinguished for each water quality variable assessed.

Oxygen Depletion

* Achievement of BPT by industrial discharges and secondary treat-
ment by publicly owned treatment plants (as defined by EPA) will sub-
stantially increase dissolved oxygen levels in many of the nation's
waters. These improvements vary, however, depending upon s'ite-specific
receiving water characteristics and pollutant loads from controlled and
uncontrolled sources.

Approximately 60 percent of the Commission's study sites
(based on 38 sites..for which there were adequate data) could
theoretically achieve the 4 mg/liter dissolved oxygen criterion
for all seasons through implementation of secondary treatment
.and BPT. About 20 percent of the study sites currently reported
levels of dissolved oxygen generally above 4 mg/liter.
During seasonal low flow conditions, minor portions of most of
the remaining 40 percent of the sites would not meet the
minimum dissolved oxygen criterion.

Portions of about 40 peicent of the study sites indicated
that more stringent treatment than EPA limitations would be
required to meet a dissolved oxygen standard of 4 mg/liter
during seasonal low flow conditions. The majority of these
sites contain segments which are presently designated as water
qualtiy limited and would qualify for more stringent load
allocation analyses under Section 301(b)(1)(c) of the Act.

Localized dissolved oxygen depletion problems in estuarine
sites generally will be minimized by the achievement of BPT by
industrial point-source dischargers and secondary -treatment by
municipal point-source dischargers or through relocation of
outfalls.

IV-80

Improvements in dissolved oxygen are anticipated to be the
greatest in New England, the Upper Ohio region, the Middle
Atlantic and South Gulf and in the Great Lakes region.

Achievement of BAT by industrial point-source dischargers and
BPWTT by municipal point-source dischargers (as defined by EPA) is
expected to yield the following results:

Only marginal improvements in DO"will result at those sites
which currently achieve the 4 mg/liter criterion or which meet
the criterion through application of BPT for industries and
secondary treatment for municipalities during seasonal low
flow conditions.

Application of more stringent state standards which apply to
both industrial and municipal point sources and are based upon
detailed load allocation analyses are required to meet in-
stream dissolved oxygen standards for about 40 percent of the
study sites which do not meet standards when industrial BPT
and BAT requirements and municipal secondary treatment are
utilized.

e A number of potential residual dissolved oxygen problems will
persist following the achievement of BAT and BPWTT. These problems will
be the result of urban storm runoff and combined sewer overflows, two
important sources of oxygen-demanding materials at about half of the
Commission's study sites. The extent to which these intermittently
occurring DO problems are reduced or alleviated will depend in large
part on the amount of progress made in controlling and treating these
sources.

Bacteria

e More than three-fourths of the sites are expected to achieve the
total and fecal coliform bacteria criteria levels during seasonal low*
flow conditions through uniform application of point-source disinfection
practices associated with secondary treatment. These standards will,
however, continue to be exceeded periodically at some of the sites due
to (a) urban storm runoff, (b) combined*sewer overflows, and (c) runoff
from agricultral land. Based on the Commission@s study sites, the
relative importance of these three factors varies regio nally, geograph-
ically and from urban to rural settings, with storm runoff and sewer
overflows being important sources of bacterial contamination at nearly
half of all sites studied, and agricultural runoff an important source
in nearly one-fourth of the sites.

e At the individual sites there will be little improvement in
fecal and total coliform bacterial problems that are not reduced or

IV-81

eliminated through achieving secondary treatment and BPT. Some reduction
in the overall coliform. bacteria problem can be expected nationwide,
depending on the amount of progress made in controlling and treating
urban storm runoff and combined sewer overflows. A substantial problem
will persist nationally , however, since a major source of coliform
bacteria in the nation's water is attributed to nonpoint sources which
will not be.affected by achieving requirements beyond the EPA's secondary
treatment standards.

Toxic Substances

Achievement of the 1983 interim national water quality goal will
depend in large part on progress made nationally to identify toxic
problems, assess the impact of toxic substances on natural environmental
systems, evaluate methods for their control and reduce or eliminate the
amount of toxic materials presently entering the nation's waters.

0 Environmental studies by the Commission's contractors illustrate
the wide range of toxic problems and sources 'in the nation and the
severe limitation of data availability. Based on a review of the
Commission's 41 study sites, and considering that toxic leve 'ls exceed-
ing those recognized, recommended or proposed in Water Quality Criteria
(NAS-NAE, 1972) as "safe" levels would prevent the achievement of the
1983 interim national goal,.the following pattern emerges:

1) Heavy metals concentrations commonly exceed "safe" levels
in the water-column or in fish tissue in portions of 37 percent of
the Commission's assessment sites where adequate data were available.
in portions of an additional 27 percent of the sites with data,
heavy metals were found to sometimes exceed safe limits or are
evident in high concentrations in the sediments. Minor problems
were associated with heavy metals'contamination at 23 percent of
the assessment sites with data. Major sources of heavy metals
include industrial discharges, urban storm runoff and mine drain-
age.' Data on heavy metals were presented for 35 of the 41 sites
(85 percent) although in many instances these data were of limited
scope.

2) Pesticide concentrations commonly exceeded "safe" limits or
were linked with fish kills at about 50 percent of the sites with
available data. The presence of pesticides sometimes above safe
limits was noted at about one-fourth of the sites. Minor pesticide
contamination problems were reported at 23 percent of the study
sites. Pesticide data were presented for only 26 of the 41 study
sites (63 percent). Runoff from agricultural land 'was the most
commonly cited as a major pesticide source. Urban storm runoff and
runoff from forested land were noted as significant sources at a
number of sites.

IV-82

e Utilizing the three water quality criteria--dissolved oxygen,
bacteria, and toxics--as a basis for assessing achievement of the 1983
interim water quality goal, the following conclusions can be drawn:

1) Two of the three water quality criteria will be met at about
half of the 41 sites through achievement of BPT and secondary
treatment.

2) Only marginal additional progress towards meeting the 1983
interim goal would be realized with the application of RAT and
BPWTT as uniformly defined by EPA. Effective reduction or elimina-
tion of toxics may be a critical factor in full recovery of many
water bodies. More stringent state treatment standards and control
of combined sewer overflows and nonpoint sources of pollution are
required on a site-specific basis to advance significantly beyond
the BPT level.

e Other water quality criteria were used to round out the picture
of the nation's water quality problems--both present and projected.
These include the physical characteristics of water--e.g., temperature,
turbidity and suspended solids--as well as nutrient-related eutrophi-
cation problems and salinity. Results of these assessments are summar-
ized below.

Temperature

e The Commission's environmental studies evaluated the number of
thermal power stations which could be directed by the Act to use alterna-
tive cooling methods instead of the traditional "once-through" system.
The stations included both existing and.planned through 1983. The
commission evaluated possible exemptions under Section 316(a) which
requires that alternative cooling methods which protect a balanced,
indigenous community of organisms at the site be used, and Section
316(b) which requires that technologies be used which protect aquatic
life at the intake ptructures. Criteria evaluated in judging possible
environmental impacts included:

1) Design and operating characteristics of power plants, par-
ticularly their cooling systems..

2) Physical characteristics of the water bodies which.supply
cooling water and receive the effluent.

3) Characteristics of the communities of aquatic biota believed
to be indigenous to such waters, particularly their susceptibility
to known power plant-induced changes.

IV-83

The conclusions reached in this study are.:

Using criteria developed by the Commission, the.need for
alternative cooling systems is less for some categories of receiv-
ing waters, especially lakes, than had been estimated in previous
analyses. A majority of steam electric power plants are likely to
be found qualified,for exception from thermal effluent limitations
under Section 316(a). The percentage of plants which could use
once-throuqh cooling without damage to indigenous populations are
estimated to be: Oceans - 80 percent; Estuaries - 38 percent;
Rivers - 80 percent; Lakes - 90 percent; River/Impoundments - zero
percent; Impoundments 100 percent; and Man-made Lakes - 100
percent. By comparison, the EPA has estimated: Oceans - 100
percent; Estuaries - 50 percent; Rivers - 74 percent; and Lakes -
50 percent.

21) Detailed and extensive field studies which will result in a
massive body,of documented findings at each site will be required
to support a successful application for exemption from alternative
cooling.

3) Review of the extensive, detailed, site-specific body of
information by the regulatory agencies charged with final determina-
tion will be a major undertaking requiring protracted effort and
high scientific competence.
4 Implementation of'Section 316(a)*exemption procedures does not
eliminate the need for further research on thermal and other effects
of-steam electric power plants. 'Any generalized scientific finding
resulting from the individual case studies will be slow to emerge.
However, continued efforts on such topics as the ecological effects
associated with coastal siting can provide a valuable guide to
consistency in findings and to eliminating unnecessary duplication.

5) For any meaningful evaluation of the effects of power plants
on populations of aquatic organisms, the entire range of effects,
including,thermal (as highlighted in Section 316(a)), intake related
entrainment and entrapment (as highlighted in Section 316(b)), and
chemical (if present) must be considered together. Biological
effects of entrainment and intake structures often constitute a
greater impact on populations than may occur due to the discharge
of heat. Independent enforcement of the separate provisions in
Sections 316(a) and (b) could do A disservice to the goal of attain-
ing overall minimum impacts.

Turbidity

Turbidity and suspended solids problems resulting from point
sources are most evident in the "clear water regions" of the country

IV-84

(e.g., New England). In these locations, application of BPT for industries
and secondary treatment for municipalities will bring substantial
improvements. More stringent treatment required to meet DO standards at
a number of sites will further reduce turbidity toward naturally occur-
ring levels. Reduction of suspended solids levels in clean-water regions
could increase light penetration into the water and increase the poten-
tial for excessive plant growth provided nutrient levels are sufficient.

Natural and nonpoint sources of suspended solids obscure point
sources in the Midwest Great Plains, and other regions of the western
U.S. where agricultural land use practices add to naturally occurring
suspended solids loads. Point-source controls will accomplish little
towards reducing turbidity and suspended solids levels in these regions.

Eutrophication Potential

I
J Eutrophication problems were evident to some degree at most of
the sites, but were most evident in the New England, Middle Atlantic and
Southern Gulf, Great Lakes, Midwest, Great Plains and Great Basin
regions. The extent of eutrophication at many sites, particularly in
the West, was limited by high turbidity which limits light penetration
required for plant growth.

Salinity

High salinity, or total dissolved solids, levels are associated
with inland regions of high natural background salinity, particularly in
the West. Irrigation practices often add significantly to natural
salinity levels. In other regions, normally low TDS levels are trending
upwards with time through the influence of industrial and municipal
point and nonpoint sources.

e Salinity levels are not projected to be greatly reduced by
point-source controls. Improved irrigation practices would reduce salt
loads, but loads from natural sources, as well as irrigation, would
remain as problems for users, albeit at somewhat reduced intensity.
Seasonal flow conditions can be altered by changed irrigation practices
creating water allocation problems between established water users
during low-flow periods.

'0 Salinity problems associated with saltwater intrusion into
estuaries and coastal groundwaters, a threat to freshwater suppliers,
will not be improved through point-source controls. Water conservation
and flow regulation measures are required in these coastal situations.

3. Pollutant Loads

A significant proportion of publicly owned municipal wastewater
treat:ent plants within the Commission's 41 study sites will not be able

IV-85

to meet the 1977 target year for achievement of secondary treatment
because of delays in funding, planning, design and construction. Per-
mitted effluent abatement levels reflect these delays, the consequence
of which is that actual water quality improvements to be achieved by '.
1977 will bring the nation only marginally closer to the achievement of
the 1983 interim national goal.
sourc: A Commission comparison ofwaste loads.from point and nonpoint.
s suggests a number of water pollution problems will persist
following elimination of point-source pollutants. One group of constit-
uents is estimated to have at least 50 percent of the calculated BPT
load left. This group includes suspended solids, nutrients (nitrogen and
phosphorous), and fecal and total coliform bacteria. A second group of
variables, including BOD and zinc, will have 20 and 50 percent of.the'
total BPT load left after the end of point-source discharge. A third
group, including oils, greases and cadmium, has a higher degree of
controllability. These percentages indicate,.therefore, the significance
of the "non-controllable" loads.

0 The analytical capability to assess sources, magnitudes, and
impacts o,.f nonpoint sources of pollution presently exist, with the
exception of toxic substances. Basic information requirements must be
satisfied, however, including detailed sampling programs for site-
specific assessments.

Rational assessment of water quality improvements associated
with point-source control should be conducted with full recognition of
uncontrolled source influences. Although uncontrolled sources con-
tribute pollutants in a transient manner, their impacts can be long term
and can obscure gains in water quality from point-source control.

e Evaluation of nonpoint source impacts will be aided by control
of point sources, but this evaluation should not be delayed until-point
sources are controlled.

4. Residuals Disposal

Generally it will be possible to dispose of virtually all resid-
ual m:terials generated by municipalities and industries responding to
the Act's requirements in a safe and environmentally acceptable mannek.
The residuals will consist almost entirely of liquid effluents and semi-
solid sludges generated by wastewater treatment technologies. Most of
those materials will be suitable for either land disposal or econom-
ically beneficial use in land conditioning and agricultural practices.
..In many areas having insufficient land resources for residuals disposal,
sludge incineration will provide environmentally safe options to land
disposal. Residuals disposal will, however, pose a problem in highly-
populated areas with air quality problems prohibiting incineration, and

IV-86

without adequate land resources suitable for environmentally safe land
disposal methods. Insufficient data were obtained during the Commission
studies to document adequately the amount of residuals that can be
recycled or reclaimed nationally.

e Based'on Commission studies, the national rate of generation of
sludges, effluents and other residual materials will increase substan-
tially for the 1977 and 1983 levels of wastewater treatment compared to
present residuals generation rates. National residuals generation rates
will not increase significantly for the EOD level of wastewater treatment
compared to 1983 generation rates. Environmentally acceptable residuals
disposal methods are available, however, for virtually all levels of
wastewater treatment required by P.L. 92-500.

The major problems resulting from residuals disposal will
generally be institutional and economic rather than environmental in
nature. In the vicinities of industrial comp Ilexes and densely populated
sections of the nation, residual materials can be transported to safe
disposal sites, but at a cost. Moreover, many sections of the country
suitable for safe and often beneficial use as disposal areas will not be
immediately available for such use for institutional reasons.

5. Environmental Impacts

0 An overview of biological findings from the Commission's environ.;-
mental sites selected to represent a range of water body type and water
quality problems indicates the following with regard to fish, shellfish,
and wildlife:

1) Fish, of some species, are currently present and propagating
in very nearly every water body in the country.

2) Sport or game fish, most frequently considered "desirable" and
often most indicative of underlying system conditions, are often
more sensitive than rough or &ommercial species and have been
virtually eliminated in about 40-50 percent of the total area
studied by the Commission; half of this gross elimination is due
primarily to nonpoint-source contributions.

3) Although present in over half of the total area studied, fish
species, numbers, and productivity have been to some degree altered
bypoint- and nonpoint-sour,ce contributions, physical habitat changes
and management practices.. Some of these activities have benefited
certain fish communities. Most have been detrimental.

e In those areas where the fishery essentially has been eliminated,
BPT and secondary treatment potentially could restore 20-25 percent

IV-87

nationally of that area not presently suitable for protection and propaga-
tion. The value of this improvement is enhanced in view of the fact
that it occurs primarily in and downstream from large population centers.
Fishing activity, and other recreation associated with cleaner water,
potentially becomes available for more people.

Achievement of BAT and BPWTT indicates the potential for another
10-15 percent improvement nationally in suitable area due primarily to
additional dissolved oxygen improvements, and assumptions of projections
at some of the sites of toxics and/or nutrient removal.

'0 Elimination of point-source discharge may add an additonal 5-
10 percent improvement nationally in suitable areas.

Available biological measures of the structure and function of
most :cosystems' including those selected for Commission study, are
inadequate to precisely characterize all facets of these systems or all
potential reactions to point-source abatement levels.

0 " Water quality which provides for the )?rotection and propagation
of fish, shellfish, and wildlife . . ." will not be attained nationally
by 1983 or even with the national goal of elimination of point-source
discharge. Nonpoint sources and physical alteration of water bodies and
surrounding watersheds will continue to be primary deterrents in many
areas.

Impacts of point sources on biological communities are not
uniform between water body types, between geographical regions or even
between parts of the same water body. Consequently,@reduction or
elimination of those sources will not bring about uniform change.

In some areas where water quality is sufficient to meet the
stated goal, destruction of essential habitats will continue to influence
plant.and animal populations.

e The following findings generally apply to all effluent abatement
levels-

1) Problems associated with the presence of toxic materials
(i.e., fish kills, bird population declines, potential contamination
of food products) exist at nearly all sites where data were avail-
able. Documentation of existing concentrations and environmental
effects of toxics is sufficient to justify major efforts toward
limitation, and ultimate@control, as well as additional research
into specific effects.

2) Nonpoint sources contribute heavily to the condition of the
fisheries. Dominant forms and sour6es are (a) turbidity and

IV-88

sedimentation, primarily from land runoff, (b) toxic materials from
urban sources,and (c) excessive nutrients, especially in lakes,
from land runoff.

3) The impacts of previous and planned physical changes, such as
dams, channelization, and wetland drainage and fisheries management
practices, such as stocking, exotic species introductions, are very
important factors underlying all potential improvements in water
quality and are unaffected by implementation of the Act.

o The following findings apply nationally to shellfish:

1) Shellfish resources have been lost at nearly all of the
Commission's estuarine study sites due to (a) destruction of suit-
able habitat, and (b) contamination from bacteria and toxic chemicals.
Point-source control will not affect the former category signifi-
cantly since much of this loss is due to siltation of shellfish
beds. Most areas with bacterial contamination problems will improve
with achievement of secondary treatment requirements. If combined '
sewer contributions are controlled with 1983 requirements, additional
beds will open, while smaller gains could be expected with the
elimination of point-source discharges in those areas where effluents
comprise a large percentage of the stream flow.

2) Portions of nearly all estuarine sites showed potential for
continued contamination due to urban storm runoff and other nonpoint
sources, especially with anticipated human population increases.

The following findings apply nationally to wildlife:

1) Point-source abatement overall will have a small but beneficial
impact on the wildlife resources of t. he nation. The greatest
threats to wildlife stem from destruction of habitat. Point-source
controls will contribute slightly to reducing the destruction and
alteration of wildlife habitat, but control of activities, such as
dredging and filling of wetlands, would do far more to halt the
damage to wildlife.

2) Water-borne pollutants do have deleterious effects on water
related wildlife. Their effect-Ts-two-fold: toxic substances,
especially pesticides and heavy metals, interfere directly with
reproduction and migration of wildlife; pollutants such as oil or
excessive nutrients exhibit indirect effects by damaging or destroy-
ing wildlife habitat.

e Controlled ocean disposal of municipal effluents receiving
treatment less stringent than secondary probably can be practiced
without development of either short- or long-term adverse health and

IV-89

ecological effects in some coastal sections of the nation. It appears
to be generally unnecessary to go beyond secondary treatment of munic-
ipal wastewaters discharged to open coastal marine system through ade-
quately designed outfalls to maintain local and regional marine eco-
systems in a natural state. Little information exists about the environ-
mental effects of dumping municipal wastewater sludges into the ocean.
The data available suggest the practice to'be locally damaging, but
either insignificant or unmeasurable on a larger, regional basis. In
some coa-stal areas, municipal effluents receiving only primary treatment
can probably be released into nearshore coastal environments without
measurable ecological effect. For those areas, implementation of
P.L. 92-500 will have negligible environmental effects. Discharge of
municipal and industrial wastes into coastal waters should not be permit-
ted in any part of the nation, however, before sufficient preliminary
research has been completed locally to: 1) determine whether or not the
area is suitable for disposal, and 2) determine the levels of wastewater
treatment necessary to minimize local environmental effects.

e The primary effect of point-source pollution-of lakes and other
standing water bodies in the nation has been an accelerated rate of
eutrophication due to introduction of nutrients, primarily nitrogen and
phosphorus. Significant removal of nutrients from effluents will require
wastewater treatment technologies more stringent than secondary for
municipal dischargers and at least the BAT level for industrial dischargers,
but only in those areas where contributions of nutrients from nonpoint
and uncontrolled point sources are relatively minor. Advanced rates
of eutrophication in standing water bodies generally result in@ dramatic
biological changes and development of obnoxious aesthetic situations.
Application of wastewater treatment technologies that remove nutrients
eventually will end those conditions in many lakes in the country, but
will have little overall effects upon the lakes and other standing water
bodies located in highly agricultural areas, and other areas where
nutrient input comes mainly from nonpoint sources.

e The Commission's environmental studies were unable to address
adequately the question of delayed implementation of the requirements
and goals of the Act. The primary reason for this relates to the length
of time over which there have been measurements made in any single
environmental system across the country. Most ecosystems, for which
there is considerable baseline or historical information, have only been
studied for 5-10 years using modern ecological field techniques. There
are far too few of these lengthy studies available to be able to predict
in, a general sense the effects of the delayed implementation of the Act,
although data do exist to document the fact that continued pollution
inputs eventually damage ecosystems beyond a point of recovery.

Secondly, there have been few studies conducted over a long
enough time frame to where recovery from specific perturbations is well

IV-90

documented. A few case histories, however, do document the importance of
decisive action to control effluents. Where degradation has not proceeded
for a number of decades, recovery appears to be rapid, often much more .
rapid than predicted initially. Since the threshold, that point in time
when the perturbation has proceeded to where irreversible environmental
effects have occurred,.is not well documented, achievement of secondary
treatment and BPT in.those areas khere point sources predominate and
control of toxics will bring the most significant changes under this Act
and the greatest amount of progress towards achieving the 198j interim
national goal.

Control of urban storm runoff and combined sewer overflows as
soon as possible is expected to result in additional significant improve-
ments in water quality. Achievement of the 1983 interim goal may be
effectively delayed until more'adequate measures can be taken to control
pesticides and other'materials entering the nation's' waters from nonpoint
sources and agricultural land. Achievement of the secondary treatment
requirement nationally may not result in significant changes in coastal
marine Waters.

There is sufficient information available to question the
merits of establishing sec6ndary treatment for coastal municipalities
as a high priority, although it should be stressed that few data are
available and more information isrr'equired before policies can be
established that are meaningful. Eventual growth in the coastal areas
may result in pollutant loads that will require secondary treatment in
every instance.

CHAPTER V.

PUBLIC LAW 92-500

AN ASSESSMENT OF INSTITUTIONAL STRUCTURE AND RESPONSE

V_i

PUBLIC LAW 92-500
AN ASSESSMENT OF INSTITUTIONAL STRUCTURE AND RESPONSE

TABLE OF CONTENTS

Page

Introduction and Summary of Findings . . . . . . . . . . . . . . . V-1
Study Design . . . . . . . . ... . . . . . . . . . . . . . . . V-4
Regulation . . . . . . . : * * , * * * * I * * , * * * * , I * V-4
Construction Grant Financing . . . . . . . . . . . . . . . . . V-5
Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . v-5
Public Participation . . . . . ; . . . . . . . . . . . . . . .. V-6
Legal Action . . . . . . . . . . . . . .. . . . . . . . . . . . V-6

The Institutional Setting . . . . . . . . . . . . . . . . . . . . V-8

National Pollutant Discharge Elimination System . . . . . . . . . V-14
Effluent Limitations . . . . . . ... . . . . . . . . . . . . . V-14
State Designation . . . . . . . . . . . . . . ... . . . . . . V-19
Permitting Process . . . . . . . . . . . . . . . . . . . . . . V-20
Permits -- A Short Deadline . . . . . . . . . . . . . . . . . V-23
Permit Conditions . . . . . . . . . . . . . . . . . . . . . . V-25
Permits ---Limited Utility as Management Tools . . . . . . . . V-27
Compliance Monitoring -- A late Start . . . . . . . . . . . . V-28
Enforcement -- No Discernible Pattern . . . . . . . . .. . . . V-28
Administrative Variations . . . . . . . . ... . . . . . . . . V-32

Construction Grants for Publicly Owned Treatment Works .. . . . . . V-33
Off Schedule . . . . . . . . . . . . . . . . . . . . . . ... . V-34
New Requirements . . . . . . . . . . . . . . . . . . . . . . . V-35
The Grant Process: How It Works . . . . . . . . ... . . . . . V-36
Causes of Delay . . . . . . . . . . . . . . . . . . . . . . . V-39
Rules, Regfilations and Guidance . . . . . . . . . . . . . V-42
Requirements of Other Statutes . . . . . . . . . . . . . . V-46
obligations and Expenditure of Grant Funds . . .. . . . . . v-48
Distribution of Grants among Steps 1, 2 and 3 . . . . . . V-54
Size of Projects . . . . . . . . . . . . . . . . . . . . . V-58
Manpower . . . . . . . . . . . . . . . . . . . . . . . . . V-61
Certification of Construction Grants Functions
Performed by the States . . . . . . . . . . . . . . . . V-64
EPA Definitions of Secondary Treatment and "Best Practicable
.Waste Treatment Technology over the Life of the Works" V-68
Recycling, Reuse and Reclamation of Wastewater and Land
Application of Wastewater and Sludges . . . . . . . . . . . V-70
"Needs," "Costs," State Allotments, Priorities, Federal
Funding and Inflation . . . . . . . . . . . . . . . . . . . V-75
"Needs," "Costs" and State Allotments . . . . . . . . . . V-75
Priorities . . . . . . . . . . . . . . . . . . . . . . . . V-84

V_ii

Page

"Needs," "Costs," State.Allotments, Priorities,
Federal Funding and Inflation V-75
"Needs," "Costs" and State Allotments . . . . . . . . . . V-75
Priorities . . . . . . . . . . . . . . . . . . . . . . . . V-84
Federal Funding and Inflation . . . . . . . . . . . . . . V-88
Pretreatment, Industrial Cost.Recovery and User Charges . . . V-92
Pretreatment . . . . . . . . . . . . . . . . . . . . . . . V-92
Industrial Cost Recovery . . . . . . . . . . . . . . . . . V-94
User Charges . . . . . . . . . . . . . . . . . . . . . . . V-96
The Environmental Financing Authority and Providing the
Non-Federal Share . . . . . . . . . . . . . . . . . . . . . V-99
Program Management and Goal Achievement . . . . . . . . . . . V-100
Summary and Future Prospects . . . . . . . . . . . . . . . . . V-100

Government Assistance to Impacted Industrial Dischargers . . . . . V-101

Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-104
Out of Phase . . . . . . . . . . . . . . . . . . . . . . . . . V-105
Public Law 92-500 -- Four Major Planning Processes . . . . . . V-105
Coordination, Management and Nonpoint Source Control . . . . . V-108

Public Participation . . . . . . . . . . . . . . . . . . . . . . . V-112
EPA and the States: Partial Response V-112
Resources and Commitment . . . . . . . . . . . . . . . . . . . V-114
The Permit Program . . . . . . . . . . . . . . . . . . . . . . V-115
The Planning Process . . . . . . . . . . . . . . . . . . . . . V-115
Citizen Suits . . . . . . . . . . . . . . . . . . . . . . . . V-116

P.L.92-500 Litigation . . . . . . . . . . . . . . . ... . . . . . V-118
Construction Grants Program . . . . . . . . . . . . . . . . . V-118
Planning Program . . . . . . . . . . . . . . . . . . . . . . . V-119
Regulatory Program Introduction V-119
Regulatory Program Effluent Limitation Guidelines . V-120
Regulatory Program Steam Electric Power Industry . V-125
Regulatory Program New Source Performance Standards . . . . V-127
Regulatory Program NPDES . . . . . . . . . . . . . . . . . V-128
Regulatory Program Toxics Standards and Pretreatment
Requirements V-130

People, Participants and Practitioners . . . . . . . . . . . . . . V-132
Public Interest Communities . . . . . . . . . . . . . . . . . V-132
Industry V-136
Agriculture . . . . . . . . . . . . . . . . . . . . . . . . . V-140
Government . . . . . . . . . . . . . . . . . . . . . . . . . . V-141

References . . . ... . . . . . . . . . . . . . . . . . . . . . . . V-146

V-1

PUBLIC LAW 92-500
AN ASSESSMENT OF INSTITUTIONAL STRUCTURE AND RESPONSE

Introduction and Summary of Findings

Much of the progress toward national pollution control objectives
depends upon the capacity and willingness of the institutional system to
provide substance and momentum to implement the Federal law. The
responses of the institutional participants -- persons in the Federal,
state and local governments, and among the regulated municipal, indus@
trial and agricultural dischargers -- greatly influence the facility and
effectiveness with which the Act is given eventual shape in regulation,
guidelines and compliance.

P.L. 92-500 established a set of,rights, responsibilities and obli-
gations comprising an intricate web of intergovernmental relationships,
a categorical assistance grant program, a delegable regulatory scheme
applicable to all levels of government,,to industry and to agriculture,
and a public participation mandate in both governmental decision-making
and regulatory activities. This network is perhaps more complex than
any other institutional Arrangement used to pursue and accomplish a
national goal. Although the Clean Air Act of 1970 relies upon effective
coordination between the EPA'and state air pollution control agencies,
P.L. 92-500 calls for what may well be.,.the most ambitious applications
of Federal policy and program within the context and constraints of our
system of federalism. The Water Pollution Control Act of 1972 attempts
both to provide generous incentive.s,,and to wield heavy penalties through
a delegable regulatory program, coupled with grant-in-aid assistance to
publicly owned treatment works dischargers so that they may comply with
prescribed effluent limits.

Initially, many of the institutional performers were less than
enthusiastic at the prospect of implementing P.L. 92-500. EPA advised
the Congress that the Act, as-it was proposed and eventually passed,
would place undue strain on the capacity and capability of that Agency
.to effectively execute the law(l). Most of the states resisted the
essential structure of the Act, asserting -- as many of their spokesmen
had in testimony before the House and Senate Public Works Committees --
that its strong focus on centralization and control at the Federal level
constituted unwarranted infringement upon the basic sovereign authority
of the states, and would result in an insensitive and unrealistic applica-
tion of a Federal program to sta 'te and local problems. Local governments
voiced concern about the rigidity of the Act, and what many considered
to be unrealistic and unnecessary requirements for uniformity of compliance.

The application of uniform technologies, short-term compliance
deadlines andthe seemingly broad purview of the regulatory scheme were

V-2

also points of consternation and apprehension among industrial and agri-
cultural dischargers. Thus, the Commission began its analysis of the
institutional system and its response to the Act at a time when the
predominant sentiments of the players ranged from apprehension-to out-
right hostility. Unquestionably, this attitudinal posture by some of
the major participants added to the uncertainty,surrounding the Act's
implementation, and contributed to delay.

These attitudes and delays in meeting some of the statute's early
deadlines made formulation of its analysis more difficult. The study of
the institutional system, of necessity, had to be conceived and conducted
while the design and adjustment of the institutional framework were
still being developed, tested and'revised. Indeed, arrangements and
responses by which the requirements and goals of the Act are to be met
are still not universally, fully and smoothly operational. EPA has not
issued final effluent limitations for all industrial categories and
types of pollutants; a strategy for control of some agricultural point
sources is still being formulated; EPA regional offices and NPDES state
agencies have not completed the issuance of permits; and major revisions
of the planning regulations were published after the Commission completed
its studies.

Despite some formidable problems of interpretation and implementa-
tion, as well as some debilitating false starts, changed signals and
delays, the institutional participants are moving toward full implementa-
tion of the Act. Moreover, many of the early apprehensions and hostili-
ties have, or are being, overcome as the Act's processes become more
clearly defined and well understood by persons in the institutional
network. In fact, while the Commission's studies have been under way,
there has been a perceptible change in attitudes toward the Act among
the major participants. In a survey undertaken by the Commission, 94
percent of the Federal officials indicated their approval of the overall
strategy of the Act; 63 percent of the state officials responded positively
and the attitudes of those engineers, local officials and industrial
representatives questioned were predominantly positive(2). This does
not mean, of course, that many of those sampled, from every level of
.participation, still do not have major problems with some elements of
the Act or wish for some change in the law or its administrative inter-
pretations and application.

The Commission's institutional analysis examines the overall strategy
of the Act and its dependence upon the interrelationships of the several
levels of government and private wastewater dischargers to cooperatively
put the Act into effect. To the extent possible, the analysis has tried
to avoid the inclination to fix upon implemention of one part of the Act
or the performance of one level of government or one group or segment of
dischargers to the exclusion of others. Yet, since so much of the
implementation requires the initiative of EPA, it is perhaps unavoidable

V-3

that much of the Commission's attention focuses upon that agency. As a
result,' EPA's performance in implementation may be the recipient not
only of the most attention, but also of the most criticism.

The Commission recognizes that many of the-delays associated with
Federal decisions and actions were the unavoidable consequence of unreal-
istically short statutory deadlines. A recent House Subcommittee report
put it this way, "P.L. 92-500 probably can be regarded as a classical
example of two phenomena that have plagued governmental programs, and
particular Federal programs, in the past decade. These are underestimation
and overexpectation. . . The magnitude of the task set out in P.L. 92-
500 has been drastically underestimated."(3)

To some degree, tooi the delays resulted from the initial reluctance
ofthe states and localities to accept the basic structure and early-
administrative interpretations of the Act. Also, the seeming rigidity
and immediacy of the legislative changes embodied in P.L. 92-500 were
there as a deliberate conclusion by the Congress that some states and
localities, given too much latitude, could not or would not aggressively
pursue the goals ofnational environmental legislation.

Another unavoidable limitation upon the Commission's analysis is
heavy emphasis on the performance of functional elements of the program --
construction grants, permits, enforcement,_compliance monitoring, planning,
etc. These are the discrete components and,@as such, provide some
measure of the progress and problems of implementation. In the final
analysis, the results contemplated by Congress'in enacting the Federal
Water Pollution Control Act Amendments of 1972 will be measured by the
degree to which the quality of the Nation's waters improve. At this
writing, an assessment based on actual water quality improvements
resulting from the Act is not possible. Yet.performance, thus far, must
be measured against some standard, and one such standard is that estab-
lished in the Act -- accomplishment of the statutory requirements
within the specified schedules.

In examining the separate parts of the program, there is the risk
that the full scope and form of the intended implementation structure
designed by the Congress will be lost or obscured. The Act contains a
discernible implementation strategy, predicated upon the proposition
that substantial Federal financial assistance, coupled with strong
centralized initiatives for regulation and enforcement defined within a
comprehensive framework of state and local planning, will result in the
mostexpeditious, effective and sensitive application of resources and
manpower to accomplish theinational objective of a better environment
for the Nation's people.

So far, there is considerable difference between the blueprint and
the actual result. Major delays in the outlay of Federal funds for
construction grants, delays in issuing permits and variations in permit

V-4

conditions for municipal and industrial-dischargers, and the fact that
the mandated planning requirements are seriously out of synchronization
with the construction grant and permit phases, all contribute to uncer-
tainty about achievement. Experience, thus far, neither conclusively
disputes nor sustains the legislative proposition. Examination can
identify the points in the process where delays and difficulties have
been most pronounced and yield observations, based on performance thus
far, about the basic validity of the Act's structure and strategy and
the institutional interdependence and cooperation upon which its imple-
mentation is founded.

Study Design

Public Law 92-500 interweaves two complex governmental activities
through the fabric of the program -- a categorical grant-in-aid program
coupled with a Federal regulatory scheme governing all wastewater dis-
chargers. Each is interdependent upon the other and dependent, in turn,
upon the interrelationships of the several levels of government to work
.cooperatively toward accepted common purposes. The Commission's studies,
while focused primarily on the performance of the s@veral functional
elements of the program were conceived so as to examine the interrela-
tionships of programs and jurisdictions. This meant, in effect, analyzing
implementation of the program where it actually occurred -- in the'
states and with local governments. Because of limited time and resources,
however, the Commission selected a limited number,of representative
states for detailed analysis. Using detailed criteria; eight states
were chosen -- California, Georgia, Iowa, Maine, Maryland, Ohio, Texas
and Utah -- for comprehensive analysis in seven of the-eight institu-
tional studies of permits, compliance monitoring, enkorcemefitj, donstruc-
tion 4rants, planning, public participation and attitudes. A suganary
description of these studies and some of the resultii@g'findings follow.

Regulation

The National Pollutant Discharge Elimination System was designed to
require relatively uniform state-by-state and industry-by-industry
application of national effluent limitations promulgated by EPA and
incorporated in permits for each wastewater discharger. Examination of
NPDES implementation-to date reveals that:

Problems with the development, publication and implementation of
effluent limitations have slowed the entire regulatory process,4and
spawned more than 250 lawsuits by industries challenging the
promulgated "effluent limitations guiaelines."

There are significant variations between the industrial and municipal
permits. While industrial permits are being written to require
installation of appropriate technologies by 197@, many municipal
permits are4not. Roughly only 50 percent of the publicly owned
treatment plants will meet secondary treatment or water quality
effluent limitations by 1977.

V-5

Small municipalities, as well as small industries, have difficulty
interpreting and applying the numerous and complex statutory and
regulatory requirements.

Substantial duplication is indicated in some state and EPA regional
offices in permit issuance.

Beyond 1977 requirements, the future application of NPDES is
uncertain. Unsettled strategy for controlling toxics is a major
contributing cause.

There is no currently functioning central information system
designed to compare the nationwide application of effluent limita-
.tions in individual permits or to monitor permit compliance as a
measure of pollutant discharge reduction.

compliance monitoring activities, predicated primarily on a self-
reporting system, may not provide meaningful permit enforcement
information without committing substantial manpower to on-site
verification of reported discharge data.,

Constr ction Grant Financing

Congress anticipated that the construction grants program would
assist in attaining the secondary treatment requirement for publicly
owned wastewater treatment works'by July 1, 1977. Delay in the program
indicate's'that this requirement probably cannot be met until the middle
of the next decade, at the earliest, as a result of:

Actual, as opposed to scheduled, funding of the Federal share of
the construction grants program has compressed obligations of $11.3
of the $18 billion total'available funds into Fiscal Years 1976 and
1977 if full commitment is to be realized by July 1, 1977.

An overly complex and often duplicate grant application, review and
approval process.

A significant increase in the estimated funding level required to
construct all eligible categories of publicly owned-treatment
works.

Planning

The Act contemplates a comprehensive approach to state, areawide
and basin planning. The intended influence of planning activities has
had, and for the next several years will continue having, only minimal
nationwide impact because:

V-6

The key elements of the planning process facility planning and
akeawide waste treatment planning -- are seriously out of synchro-
nization with construction grants for publicly owned treatment
works and the permitting process.

The first areawide planning grant was not approved until nearly two
years following passage of the Act, and the first such plan will
not be completed until 1977, or later.

Use of continuing statewide plans generally has been limited to the
determination of water quality standards.

Careful guidance and assistance are needed to optimize the eventual
utility and acceptability of the areawide plans now being designed.

It is possible, however, that planning activitie-s now under way
will influence the second round of permits to be issued between 1978 and
1980, and future construction grants as well. Information was not
available during the Commission's study to accurately assess this aspect
and EPA has just revised its regulations to more fully coordinate the
various planning activities with the other elements of the program.

Public Participation

The clear intent of the Act was to expand access and the potential
for influence by the interested citizen on the institutional Process for
executing the water pollution control program. In practice, the pre-
1972 pattern of public participation is largely unchanged. If anything,
citizens may exert less influence upon the process than previously
because:

Opportunities for participation prior to policy and administrative
decisions are limited chiefly to public hearings.

The complex requirements of the Act and the frequent junctures for
citizen input tend to dissipate the energies and limited resources
of citizens, and reduce significant impact on the proceedings.

Effective, intelligible feed-back information management systems on
progress of the implementation process and its relationship to
water quality goals for specific bodies of water are lacking.

Legal Action

The courts have played, and will continue to play, a major role in
shaping the implementation of P.L. 92-500. To date, at least 350 law-
suits have arisen under the Act, and more than 284 are still pending in

V-7

the courts. The suits consist principally of challenges by environ-
mental groups, industry, states and local governments to EPA's implementa-
tion of the construction grants, planning and regulatory provisions of
the Act. Most of the suits -- about 320 as of June 30, 1975 -- relate
to some aspect of EPA's regulatory program. of these, approximately 15
percent deal with issues concerning navigable waters, common law nuisance
actions, civil and criminal penalties, dredge and fill, and oil spills,
and were not analyzed in the Commission's studies. The remainder --
more than 25 percent -- reflect industry challenges to EPA regulations V",
promulgating effluent limitations. Despite this extensive litigation,
it is still too early to assess th'6 court's role in implementing P.L.
92-500. Some of the most important legal issues are still pending
before the courts. One thing is certain, however -- most, if not all,
of the Act's major provisions, will be subjected to challenges in court.

V-8

The I stitutional Setting

Water,pollution control became a topic of widespread national
6oncern within the last 10,t6 15 years. From a governmental function
pekf6rmiad,by,state and local governments to a major national program the
institutional system has undergone some radical organizational changes.
Though qhangeshave,occurred at all levels of government, the impetus
for chang@ originated,. and is most noticeable, at the Federal level.
Betwbefi 1964 and 1970, the Federal administrative responsibility for
water pollution control first emerged into a position of consequence in
the Department of Healthi Education and Welfare. From HEW, the program
was moved by' Executive order as the Federal Water Pollution Control
Adminis@ration to the bepartme-nt of, the Interior. In 1970 (pursuant to
Presiden@tiai Reorganization Plan No. 3), it was combined with air pollution
control, solid,waste and pesticide control programs administered by five
separate Federal agencies and shifted to the Environmental Prot@ection
Agency(4).

Just as the organizational pattern has undergone sometimes contro-
versial ev6lutidn at the Federal level, changes have.occurred in state
patterns, too. Earlier state water pollution control functions were
usually assigned to health departments. Sixteen states (@klabama, Arizona,
Colorado, Hawaii, Idaho, Indiana, Kansas, Maryland, Montana, Nevada,,
North Dakota, Oklahoma, Rhode Island, South Carolina, Tennessee and
Utah) still retain a health department type focus(5). Twelve states
have adopted an arrangement similar to the Federal EPA (Arkansas,
Florida, Illinois, Iowa, Maizie, Minnesota, Nebraska, New Mexico, Ohio,
Oregon, South Dakota and Wyoi@ing). Fifteen states have "super agencies"
responsible for more than just-environmental programs (Alaska, Connecticut,
Delaware, Georgia, Kentucky, Massachusetts, Michigan, Missouri, New
Jersey, New York, North Carolina, Pennsylvania, Vermont, Washington and
Wisconsin). Seven states have unique water pollution control administra-
tive organizations, not readily classifiable in the three more common
patterns -- California, Louisiana, Mississippi, New Hampshire, Texas,
Virginia and West Virginia.

Organizations vary even more widely at the local level. Among them
are incorporated municipalities, townships, counties, sanitary districts
or special utility districts. Municipalities and townships may be
governed by mayor-city council (with or without an administrator), city
council-city manager or commission; counties may be governed by commis-
.sioner's court, county judge or by county manager. In some states,
regional agencies may exercise major responsibilities. The local agency
not only has a direct operating relationship with its respective state
agency, but also the EPA region may contact the applicant directly. Any
applicant for a construction grant may have an associated consulting
engineering firm and a working relationship with a state governmental

V-9

organization providing funding of the non-Federal share of the construc-
tion cost. If industries discharge to the public collection and treat-
ment system, the local agency must also work with them in the process of
constructing the treatment works.

This intergovernmental structure and the affected wastewater dis-
chargers have had to respond to major Federal water pollution control
legislation in 1961, 1965, 1966 and the considerably more complex P.L.
92-500 in 1972. The evolving organizational structures have simultaneously
had to adjust to an ever-changing legal and policy framework.

Environmental Protection Agency regional offices and their respec-
tive states are shown in Figure V-1. Manpower in the various states and
regions to perform various water pollution control functions are shown
in Table V-1.

Statutory requirements for technology-based effluent limitations to
be applied t6,individual municipal, industrial and agricultural.dis-
chargers by July 1, 1977 and July 1, 1983 have already been discussed as
have the 1983 interim and 1985 goals. These requirements and goals are
to be achieved through the following institutional devices or tools:

I. Efflueht Limitations

A. Tbchnology-based effluent limitations are prescribed for
ihdUstrial categories by EPA for 1977 and 1983,

B. Technology-based effluent limitations for publicly owned
treatment systems comparable to secondary treatment for
1.977, and best practicable treatment for the life of the
works by 1983,

C., More stringent limitations are defined to meet water
quality standards, if required,

D. New source performance standards are fixed by EPA for
new plants,

E. Te-xic standards are determined by EPA, and

F. The elimination of thedis6harge of pollutants is mandated
wherever technologically feasible.

11. National Pollutant Discharge Elimination System

A. A permit is required for any defined point source discharge
into the Nation's waters by any entity, governmental or
private,

FIGURE V-1
X

ENVIRONMENTAL PROTECTION AGENCY REGIONAI OFFICES
L ALAINA STANDARD F-EDERAL REGION&

Seattle

N- OAK
o

wisc
A- OAK

OWL, )AICH

U IOWA
iNts Chicago
1A
COL 0"10
.0
0 bAC
Denver
Sai Francisco

Kansas City
Affix
K
A4 it
14.
OKLA
Tea
A KK T I Hill

miss A LA, 0
Atl &nth
00 Q LA
71 Dallas- JUL

HAWAII
A 1. A I @11

TABLE V-1

Approximate Program Manpower
EPA and State Agencies
Fiscal Year 1976

Municipal
Region Facilities Permits Planning Monitoring Enforcement Training Other* Total
EPA 32 55 20 6 31 4 25 173
State 86 54 45 ill 32 7 137 472
EPA 48 66 16 29 37 5 48 249
State 157 125 60 103 90 4 142 681
EPA 58 74 17 27 33 1 45 255
State 151 142 166 171 113 22 260 1,025
EPA 59 62 37 35 43 5 61 302
IV State 141 185 145 292 60 33 210 1,066
EPA 72 81 33 29 81 3 58 357
V State 180 233 112 395 107 39 176 1,242
EPA 44 63 11 14 30 4 35 201
VI State 110 83 97 172 44 8 71 585
EPA 39 37 21 14 26 6 24 167
vil State 48 55 40 42 21 6 40 252 .4
EPA 25
VIII 35 16 10 22 3 18 129
State 35 30 20 36 6 6 26 159
Ix EPA 37 27 9 6 28 2 23 132
State 98 105 77 110 33 15 108 546
EPA 28 29 6 24 15 0 35 137
X State 48 48 23 67 9 0 8 203

EPA 442 529 186 194 346 33 372 2,102
TOTAL State 1,054 1,060 785 1,499 515 140 1,178 6,231

Often includes all State personnel in State regional offices who work all program areas.

SOURCE: EPA, Unpublished data; State data from State 106 Program Plans.

V-12

B. The discharge of any pollutant in violation or permitted
conditions is proscribed,

C. Permit issuance can be approved for states which meet certain
prerequisites,

D. The use of permit monitoring procedures, based upon apermittee
self-reporting system, is authorized, and

E. Violation of permit conditions can lead to enforcement action.

III. Categorical Construction Grants for Publicly Owned Treatment Works

A. Grants are made to local government applicants for the construc-
tion of publicly owned wastewater treatment plants conforming
to specific Federal criteria,

B. Federal,grants support 75 percent.of eligible construction
costs with'the-balance provided"by state or local matching
(36 states have state-local grant or loan program), and

C. A three-tiered grant application process calls for EPA
approval of Step 1 facility plans, Step 2 design and
specifications and Step 3 construction(6).*

IV. Comprehensive Planning

A. Continuing state water quality planning processes are used
to establish and update water quality standards,

B. Areawide wastewater control and treatment plans are required
for those areas with substantial water quality control problems
resulting from urban-industrial concentrations or other factors,
and such plans are required to develop solutions to nonpoint
source pollutant problems,

C. River basin planning, to be conducted by the Water Resources
Council prior to 1980, emphasizes those basins which contain,
or are located in, areas designated for areawide waste control
.or treatment planning, and

D. State program plan submissions articulate year-to-year goals.

While the Act does not specify a three-step process, EPA requires
three steps in response to what was interpreted to be Congressional
intent.

V-13

V. Public Participation

A. An opportunity for citizens to participate in all phases of
.policy, program and administrative development is mandatedf

B. EPA and NPDES state agencies must integrate participation into
all on-going activities, and

C. Any person may commence a"civil court action to enforce effluent
limitations promulgated by the Administrator or to require the
Performance of any non-discretionary duty imposed by the Act
on the Administrator.

V@-14

National Pollutant Discharge Elimination System

The National Pollutant Discharge Elimination System may be viewed
as a system-within-a-system. Effluent limitations, the NPDES, construc-
tion grants and planning comprise the basic components of P.L. 92-500,
and discharge permits, compliance monitoring and enforcement comprise
the programmatic activities of the NPDES. Permits are the heart of the
NPDES -- and therefore the heart of the Act. Permits provide the insti-
tutional mechanism by which all point-source pollutant discharges are to
be reduced and controlled, and are the yardstick against which compliance
or violation is to be determined.

Federal permits for wastewater discharge had their antecedent in
the Refuse Act of 1899. Administered as a navigation control law by the
Corps of Army Engineers, it was never employed as a Federal pollution
control device until its potential was "re-discovered" in 1970(7) by,
among others, the House Subcommittee on Conservation and Natural Resources.
In response to the creation of the*Refuse Act Permit Program (RAPP) on
December 23, 1970, by Executive Order; the Corps of Engineers issued
appropriate guidelines in Aprilf 1971.
IT@e RAPP program was never fully implemented but was, in effect,
super,6, (though not repealed) by the passage of P.L. 92-500(8), by
,,,@ded
which time the Corps of Engineers had received approximately 20,000 RAPP
permit applications, but had issued only 21 permits(9).

Section 402 of P.L. 92-500 established the NPDES process and
provides authority to permit all point source (as opposed to nonpoint
source) pollutant discharges. The'principal pollutant discharge targets
of the NPDES are discharges from municipal, commercial and industrial
wastewater treatment works and from selected agricultural sources
(Table V-2). In addition, P.L. 92-500 establishes several permit
programs other than that established in the Section 402 National Pollu-
tant Discharge Elimination System, as indicated in Table V-3, including
a Corps of Engineers' administered program regulating dredge spoil.

Effluent Limitations

Public Law 92-500 changed the enforcement mechanism by shifting the
focus from receiving water quality standards to effluent limitations.
It provides in Section 301(a) @that the discharge of any pollutant is
unlawful unless it is in compliance with conditions (effluent limita-
tions) contained in a-permit4issued under Section 402. Thus, individual
permits may be enforced by measuring pollutants discharged in the waste-
waters.

Section 301(b) states that there must be achieved effluent limita-
ti6ns for undefined "classes.and categories of point sources." Section
304 requires EPA to publish regulations, providing guidelines for effluent

TABLE V-2

Coverage of Pollution Sources
P.L. 92-500

Direct Coverage by PL-92-500 Exclusions.

Controlled by Dischargers l/ l/
Direct.Coverage Other Public Law Indirect Coverage Excluded from Uncontrolled by
2/
by NPDES 92-500 Programs by NPDES NPDES Coverage WES

--industrial --ocean dumping --storm sewer --urban runoff
dischargers (Sec. 403) discharges
--industrial --rural runoff
--municipal --marine sanita- pretreatment --small.feed- 44,
treatment tion dis- (Sec. 307) lots --groundwater
plants chargers pollutants
(Sec. 312) --sludge disposal --small pre-
--irrigation treating --non-Federally
return flows --aquaculture industries funded land
(Sec. 318) application
--large feed- --landfill or projects
lots --oil and haz- other solid
ardous wastes dis- --acid mine
--combined materials' posal.systems drainage
sewers (Sec. 311)
--dredging spoils --septic tanks,
(Sec. -404) cesspools, &
individual,
--Toxic household
substances systems.
(Sec. 307)

'/Excluded by EPA policy. Covered directly by Flannery decision currently under appeal.
2/may be covered'by Sec. 208management plans.

source: The water Pollution Control Act of'1972: Institutional Assessment, Permitsf page 104.

TABLE V-3

PERMIT RELATED REQUIRM-'ZNTS OF P.L. 92-,;-500

Public Law:92-500
makes it unlawrul to aiscnarqe pol-
lutants into navigable.waters unless.
permitted

NPDES Sludge Dredging Ocean &qRa7 Marine Oil and
Permit Discharge Permit Dumping culture Sanitation Hazardous
Section 402 Permit Sec. 404 Permit Permits Devices- Material
to Apply :-Sec. 405 (by corps Sec. 403 Sec. 318, Regulations Re ula-
of Engin- (after Sec. 312 tions
eers) promulga- (by Coast Sec. 311
tion of Guard)
403 Regs.)

Administratively <
confirmed

)PSection 301 - Technology Based Effluent Criteria
Section 302 - Water Quality Based Effluent Criteria

Section 306 - "New Source's Criteria

Section 307 - Toxic Criteria
section 308 - Inspection, Monitoring, and Entry Criteria
Section 403 - Ocean Dumping Criteria (before promulgation or 403 Regs.

Source: The Water Pollution Control Act of 1972. Institutional Assessment, Permits, page 106.

V-17
limatations, that shall specify factors to be taken into account in
determining the control measures and practices to be applicable to point
sources (other than POTWs) within the categories or classes.
The Act recognizes that a meaningful categorization of industrial
processes is essential for limitations to be applied nationwide. How-
ever, neither Section 301 nor Section 304 provides guidance as to what
constitutes "classes or categories" of point sources. Section 306, on
the other hand, does provide a list of categories of sources which the
Administrator must use as a starting point in developing new source
performance standards, These 27 categories named in Section 306 have
also been used as the starting point by EPA in the issurance of its
effluent limitations for existing sources.
EPA has designated the 27 categories in Section 306 as the Group I.
Because withinon category several different methods or processes may
be used to produce the same product, EPA further subcatergorized Group I
into Phase I and II. Additional categories not specifically mentioned
in Section 306 considered necessary by EPA were listed for purposes of
issuance as Group II categories. The division of Group-I-Phase I, Group
I-Phase II, and Group II categories refers solely to the order in which
EPA is promulgating the guidelines and is shown in Table V-4.
EPA's failure published to date, EPA has identified more than
200 categories and subcategories of industrial processes (based on plant
age ans size, manufacturing process, raw material use, etc.) which will
require discrete effluent limitations. (11).*
Along with the technology-bases limitations, the permit process
also must incorporate "water quality", "toxic", and "new source perform-
ance" standards when applicable. State adopted and EPA approved water
quality standards are translated into a format compatible with techno-
logy-bases effluent limitations through the use of stream "load alloca-
tions."(12). When technology-bases effluent limitations are inadequate
to maintain the necessary quality of receiving waters (or to meet water
quality standards established by the states and approved by the EPA
Administrator for a particular stretch of water), more stringent effluent
limitations to achieve the specified water quality must be applied.
Through the use of modelling techniques, such loads may be allocated
among dischargers situated on the same river or stream segment or water
*Many of these guidelines have been challenged in the courts.

V-18

TABLE V-4

EPA CATEGORIES

Group I, Phase I

Insulation Fiberglass Manufacturing
Beet Sugar Processing
Cement Manufacturing
Feedlots
Phosphate Manufacturing
Rubber Processing
Ferroalloy Manufacturing
Electroplating
Asbestos Manufacturing
Inorganic Chemicals Manufacturing
Meat Product and Rendering Processing
Plastic and Synthetic Materials Manufacturing
Nonferrous Metals Manufacturing
Sugar Processing
Canned and Preserved Fruits and Vegetable Processing
Grain Mills
Soap and Detergent Manufacturing
Fertilizer Manufacturing
Petroleum Refining
Dairy Product Processing
Leather Tanning and Finishing
Pulp, Paper and Paperboard Mills
Organic Chemicals manufacturing
Builders Paper and Board Mills
Canned and Preserved Seafood Processing
Timber Products Processing
Iron and Steel Manufacturing
Textile Mills
Steam Electric Power Plants

Group 1, Phase II

Rubber Processing
Electroplating
Timber Products Processing
Inorganic Chemicals Manufacturing
Plastics and Synthetic Materials Manufacturing
Ferroalloy Manufacturing
Organic Chemicals manufacturing
Nonferrous Metals Manufacturing
Phosphate Manufacturing
Fertilizer manufacturing
Asbestos Manufacturing
Meat Products and Rendering Processing
Grain Mills
Canned and Preserved Seafood Processing
Glass Manufacturing
Sugar Processing *
Iron and Steel Manufacturing
Pulp, Paper and Paperboard Mills
Builders Paper and Board Mills

Group II

Auto and Other Laundries
Paving and Roofing Materials (Tar and Asphalt)
Transportation Industries
Paint and Ink Formulation and Printing
Fish Hatcheries and Farms
Canned and Preserved Fruits and Vegetables Industry
Miscellaneous Chemicals
Miscellaneous Food and Beverages
Machinery and Mechanical Products Manufacturing
Coal Mining
Petroleum and Gas Extraction, Handling, Storage and Residues Disposal
Mineral Mining and Processing
Water Supply
Ore Mining and Dressing
Steam Supply
Structural Clay Products
Pottery and Related Products
Concrete, Gypsum and Plaster Products
Furniture and Fixtures Manufacturing

Residual Category

Point Source Discharge Categories Not otherwise Covered

V_ 19

body to determine whether or not effluent limitations more stringent
than those generally applicable are needed to achieve water quality
standards.

While EPA has not yet established national standards for any toxic
substances pursuant to Section 307, required within 90 days of October 18,
1972, some are limited on a permit-by-permit basis(13). On SeDtember 7,
1973, EPA published a'list of nine toxic substances(14) including
Aldrin, Benzidine, Cadmium, Cyanide, DDT compounds, Endrin, Mercury,
Polychlorinated Biphenyls and Toxaphene. This action has been challenged
(see discussion in legal issues) on the basis that the list is incomplete,
and to date, EPA has not promulgated effluent limitations for any toxics.

In a f ew straicfhtf orward instances, discharge constituents will
precisely match the constituent parameters contained in an applicable
effluent limitation.- But the more representative situations involve
complex industrial processes with pollutant discharges which may not
precisely match effluent limitations on a constituent-by-constituent
basis because of the variety of products produced. The most complex
permitting situations involve complicated plants, incomplete coverage of
all production processes by promulgated effluent limitations, toxic
substances and water quality limitedwaters.

As effluent limitations do not, and can not, cover every possible
situation, permits frequently reflect a composite -- produced from the
best information available to a particular permit writer including (in
addition to interim guidance documents and interim and final effluent.
limitations) "best professional judgment" based on past training and
experience and knowledge of research and technical studies.

State Designation

While'the process is technically complex, it can also be adminis-
tratively intricate. The Act provides that upon gubernatorial request,
EPA may approve a state to exercise the NPDES authority, provided it
determines the state possesses adequate authority and program support to
implement the goals and requirements of the Act [Sec. 402(b)(1)]. After
being designated, a state becomes responsible for administering the
entire NPDES process -- issuing new permits, re-issuing expired permits,
monitoring permit compliance and the first opportunity to enforce all
permit violations. As of November 1, 1975, NPDES authority had been
designated to 26 states. In time, perhaps 41 political subdivisions(15)*
may operate the NPDES. While the NPDES is intended to provide uniform
application of national effluent limitations, determination of whether
they are being applied in that manner depends upon the development and

Eleven states, the District of Columbia, and the Pacific Trust Terri-
tories have no present interest in NPDES delegation. Thirty-nine
states, Puerto Rico and the Virgin Islands have a present interest.

V-20

installation of state informa+-ion and management systems which can
produce data compatible with a similar EPA centr"al and regional system.

In EPA's judgment, nine states lack resources adequate to justify
NPDES assumption, but three of those nine have no present interest in
the program and four must overcome legal deficiencies. As a sole cause,
inadequate state-level resource,commitments bar NPDES designation to two
states -- Maine and South Dakota. Of the 23 states which must overcome
NPDES legal deficiencies, 10 are not presently interested. Thus, state
laws incompatible with the Act bar delegation in only 13 states having
an apparent-present interest in assuming the NPDES. (Table V-5.)

Within the next several years, 39 states,:.,Puerto Rico, and the
Virgin Islands probably will be responsible for the operation of the
NPDES. More than one-fifth of the states-apparently are.satisfied to
let EPA administer the NPDES; one-half the states have requested.and
received NPDES, and the rest are attempting to @pmedy present legal
deficiencies. A more meaningful assessment of t4PDES designation must
await the passage of time but statutory atthority may not be the most
important remairiing constraint. A recent EPA Task Force on Decentraliza-
tion concluded that "Progress toward decentralization in the form of
formal program delegation (e.g., NPDES) has reached a point of diminishing
returns, as there are few additional States which have the staff capacity
to assume this type of large scale delegation." (16

Permitting Process

The NPDES permit pro"cess contains 10 distinct steps beginning
with a discharger request for'.a permit aipplication and ending with
issuance of the permit (See Table V-6). After a discharger files a
permit application, it is reviewed.by EPA or.&n NPDES state agency for
completeness. During this rbview step, EPA solicits comments from A
wide range' of interested parties, 1hcluding the Corps of Engineers and
state and Federal water resource agencies. Whiie such comments are
generally advisory, in effect the Corps of Engineers can veto a permit
V/ when it concludes that the permit will damage navigation. Though not
legally obligated to meet the review objections raised by agencies other
than the Corps, negative comments are carefully considered by EPA which
has established procedures for resolving interagency conflicts(17).

After review of the permit application, EPA (or an NPDES state
agency) formulates permitted effluent limitations. If the discharger is
unable to comply fully with permitted limitations within nine months of
permit issuance, the two parties jointly formulate a compliance schedule
for installation of the required pollution control plant and equipment.
Some degree of permit formulation variation is apparent in every state
and EPA regional permit writing process; Decisions regarding when to
involve dischargers, how much data should be collected, by whom (the

V-21

TABLE V-5

STATUS OF NPDES DELEGATION
(As of November 1, 1975)

Problem Hindering Delegation
Delegation Date Legal Resources Interest

Region I

con@ecticut 9-26-73
Maine ' X
Massachusetts x X
New Hampshire x x
Rhode island X x
Vermont 3-11-74

Region 11

New Jersey x X x
New York 10-29-75
Puerto Rico x x
Virgin Islands x x

Region III

Delaware 4-1-74
Washington, D.C., X
Maryland 9-5-74
Pennsylvania X
Virginia 3-31-75
west Virginia X

Region VI

Alabama x x
Florida x x
Georgia 6-LIS-74
X
Kentucky x
Mississippi 5-1-74
North Carolina x
south Carolina 6-:0-75
Tennessee x x

Region V

Illinois x
Indiana 1-1-75
Michigan 10-10-73
Minnesota 6-30-74
Ohio 3-11-74
Wisconsin 2-4-74

P@!gion VI

Arkansas x
Louisiana x x
Ne-w Mexico x x
Oklahoma x x
Texas x

Region VII

Iowa X x
Kansas 6-28-74
Missouri 10-30-74
Nebraska G-12-74

Region VIII
Colorado 3-V-75
Montana @-10-74
North Dakota 6-13-75
South Dakota x
Utah
Wyoming 1-30-75

Region IX
Arizona x
California 5-14-73
Hawaii 11-28-74
Nevada 9-19-75
Territories

P.Agion X

Alaska X x
Idaho X
Oregon 9-26-73
Washington 11-14-73

26
?Z2

Source: The Water Pollution Control Act of 1972: Institutional
Assessment, Permits, page 65.

V-22

TABLE V-6

OUTLINE OF PERMIT ISSUANCE PROCESS
P.L. 92-500

APMACANI' M.0111'@@Ts ol,
is SINI, PI 11*11
Allpl,ICA1, I i

ArPl. I c wr F i i -v; 141 NON FILERS
PrR%IIT APPLICAIJOK

YES

OBTAIN
NEEDED INFORNLA- REXIEW BY
NO APPLIOXTION YES oDiER FEDERAL
TIaN FRal CONLPLETE?
DISGORGER INC&-NCIES

YES

FOZlUIATE DRAFT PERMIT
CONSIDER:
ADDITIONAL DATA FROI DISCHARGER
303e BASIN PL\NS
EFFLUEW GUIDELINES
[email protected] GUID-LNCE
TO@IC POLLUTA.\frS

FOZtUTE WIPLIAINCE SCHEDULE
COWDER:
TITLE 11 INFORMATION FOR
MUNICIPAL DrscHARGERS
M SIMILAR PROVISION FOR
INMMRIES)

STATE CERTIFICATION OF NO
DRAFT PERMIT*

YES

ISSUE PUBLIC
NOTICE

FoRkIfLATE FINAL
DP.*-r PEZ11T ADJUDICATORY
APPEAL
AND COLPrL

STATE CFRTT!:lCATIa.N
or. FINAL Diall'
IVLD PUBL
Y @Fs @Rl: I @FW
YE @@@Y@ES
_.CI

@
NO

YES

HEARING

mill: P@llltllll'

Source:, Federal Water Pollution Control Act of 1972:
'Insti-t-utional Assessment, Enforcement. . page 144.

V-23

permittee, EPA or an NPDES state), and how load allocations are to be
determined when water quality limited river segments or water basins are
involved represent only a few of the discretionary subjects in the
permit writing process.

The fifth step in the permit writing process relates to Federal-
state certification (approval) of the draft (formulated) permit. If the
permit is prepared prior to designation of the NPDES program to the -2
state, the EPA prepared permit must be certified-approved by the state
water pollution control agency. If the state has been designated, the
NPDES state prepared permit must be certified-approved by the EPA
Regional Administrator.

After certification-approval of the draft permit, public notice is
given of the intent to issue a permit; at least a 30-day public comment
period must follow such notice and when requested, a public hearing must
be conducted if a significant public interest issue (as determined by
the EPA Regional Administrator) is involved.

Following public notice, review of any comments and a public
hearing when required, the final permit is drafted. Final Federal-state
certification-approval is obtained, and the permit is issued unless the
discharger-applicant resorts to administrative or judicial appeal of the
permit conditions.

Permits -- A Short Deadline

Issuing permits to each industrial and municipal point source dis-
charger has proved a mammoth administrative task. Initially, issuance
of both industrial and municipal permit issuance were initially delayed
pending development of national effluent limitations, review and upgrading
of state water quality standards and completion of waste load allocations
pursuant to the Section 303(e) state basin planning process.

EPA and nine NPDES states began issuing industrial permits in April
1973 and municipal permits late that year. They concentrated on major
dischargers which represent approximately 12 percent of total estimated
permittees and account for 60 percent to 80 percent of total point-
source pollutant discharges. EPA regional offices identified major and
minor dischargers/permittees on a subjective basis -- taking into account
discharge volume, receiving water quality, discharge severity and dis-
charger compliance history. By the December, 1974 deadline, EPA and the
NPDES states had issued almost 28,000 of the estimated 47,000 permits
required by the Act. The total included 94 percent of the major industrial,
91 percent of the major municipal, and 55 percent of all minor dischargers.
To achieve even this level of performance, EPA and the NPDES states
shifted significant manpower resources from other program areas to
permit-writing activities.

V-24

TABLE V-7

NPDES Permits Issued Through 12-31-74

Issued Permits Estimated
major Minor Total Unissued

EPA 4,180 16,044 20,224 n/a
NPDES States 1,394 6,307 7,701 n/a
TOTAL 5,574 @2,351 27,925 19,296

Source': EPA Draft of Clean Water Report to Congress 1975, page 111-4-.

The permit issuance date was an inflexible statutory requirement,
and in retrospect, the Act established, and EPA and NPDES states were
compelled to meet, an exceedingly tight permit issuance schedule which
placed a heavy or even onerous burden on the Federal agency and the
states.

As of June 30, 1975, all jurisdications had issued 20,091 industrial
permits; 16,664 municipal permits, 1,548 agricultural permits and 1,988
Federal facility permits for a total of 40,291 permits issued. Of
approximately 1,600 EPA issued permits challenged through the administra-
tive hearing process, 400 have been resolved through discussions among
the interested parties, e.g., government industry and public interest
groups(18). With these totals,.98 percent of major and 59 percent of
minor industrial permits have been issued and 93 percent of major and 83
percent of minor municipal permits. Ahead, however, are an indeterminate
number of dischargers (EPA estimates anywhere from 50,000 to 100,000)
such as small feedlots, stormwater sewers, irrigation return flows,
etc., which presumably will have to be permitted and present enormous
policy and management problems for EPA and the states.

Addressing this remaining task, a recent study by the General
Accounting Office concludes that "EPA faces an almost impossible task if
it has to issue permits to the estimated 1.8 million animal feedlots,
100,000 storm water discharge point sources and indeterminate number of
agricultural and silvicultural activities."(19)

V-25

Permit Conditions

Permits for publicly owned treatment works are inextricably tied to
the construction grants program which is geared to available resources
and construction 'completion. Only an estimated 50 percent of all munici-
pal permittees will meet secondary treatment required by July 1, 1977(20)
Where funding was available, treatment requirements and compliance
schedules were fixed in the permits. If a grant that would enable con-
struction of the required treatment works by July 1, 1977 was not prob-
able, "permits have required only the progress that can realistically be
achieved by the deadline, with full compliance to be required at a
reasonable future date."(21)

Thus, responding to physical and financial constraints, EPA made an
understandable adjustment by establishing "double standard" municipal
permits. While the administrative adjustment serves its purpose (to
obviate the need to enforce permits which are clearly beyond the com-
pliance capacity of municipal permittees), the adjustment is cosmetic,
for unless the 1977 deadline is relaxed by Congress, or new permits are
issued, some 50 percent of the nation's municipalities will be in viola-
tion of P.L. 92-500 on July 1, 1977.

For industrial categories, the first effluent limitation (sugar
beet industry) was issued January 31, 1974. The process of identifying
industrial-subcategories for which effluent limitations must be promulgated,
is not yet complete.. At this writing, EPA is continuing to issue and
revise effluent limitations. Neither EPA headquarters nor the Commission
has undertaken a systematic, detailed analysis of the extent to which
permit conditions for similar discharges actually match, exceed or fall
short of effluent limitations.

The Commission's Attitudes Survey indicates differing opinions on
whether or not discharge limitations have been applied uniformly on.'a
nationwide, regionwide and statewide basis. EPA officials feel-that,'
the application of limitation guidance has been uniformly applied --` 71
percent-agree that the application has been uniform on a nationwide
basis, and 87 percent and 79 percent agree that regionwide and state-
wide application has been uniform. State and municipal officials ex .press
views opposite to those of EPA officials on the question of nationwide
uniformity, but agree that the application of limitations guidances has
been uniform on a statewide basis. Industry officials disagree with
EPA officials on each count; with 74 percent believing permit conditionsL,-
are not uniform on a nationwide basis. Industry officials are less"sure
of regionwide and statewide uniformity, as indicated in Table V-8-.

V-26

TABLE V-8

Uniformity of Permit Requirements

Respondents Nationwide I Regionwide Statewide
Agree Disagree Agree Disagree Agree Disagree

EPA officials 71% 22% 87% 8% 79% 13%

State officials 21% 61% 52% 31% 76% 19%

Municipal Officials 23% 60% 38% 42% 56% 38%

Industry officials 13% 74% 32% 45%, 43% 38%

Source: The Water Pollution Control Act of 1972: Institutional
Assessment, Attitudes Survey, Questions 35(a-c). Permit
totals do not equal 100,percent as neutral (don't know or no
opinion) responses disregarded. "There is uniformity in
the application of requirements for permits on a nation-
wide, region-wide or state-wide basis."

Differences between effluent limitations for an industrial category
or subcategory and a permit issued to a discharger within that group may
be caused by any of the following circumstances ,: 1) the permit was
issued before the current limitation; 2) the production process does not
exactly fit any outstanding limitation; 3) state water quality standards
tequire different conditions; 4) in its certification, the state requested
additional conditions or parameters; 5) an additional parameter is
required on a case-by-case basis; 6) the effluent limitation allows
variances; and 7) the applicant requests that permit conditions conform
to the provisions of Section 306(d) so that he may be assured of a
longer term (up to 10 year) permit. The inability to easily compare
,permits with promulgated effluent limitations poses a major problem.
4
V"Without such a comparison, an accurate analysis of the degree of reduction
in pollutant loads -- by pollutant discharges, by volume, by river
stretch and by population concentration -- is not possible. The measure-
/ment of progress is important in setting, or altering, program priorities
and in coordinat@ng program responses to the Act's requirements.

V-27

Permits -- Limited Utility As Management Tools

The NPDES is complex and requires constant and knowledgeable
attention to a number of interrelated activities. The Act contemplates
that discharges, into either effluent limited or water-quality limited
river stretches, by industry, agriculture and municipalities will be
regulated within the bounds of a nationally coordinated management-
regulation scheme. To accomplish that goal, EPA and NPDES states must
develop and use management information systems capable of comparing (on
a state-by-state, and EPA region-by-re@gioh basis) permitted discharge
limitations with intended statutory discharge requirements and, where
appropriate, with the quality of the water into which they discharge.
Just as important, EPA and NPDES states must be able to track progress
toward meeting compliance schedule conditions.

EPA had begun, by 1974, to.develop the basis for an effective
management information system with its General Point Source File (GPSF).
The GPSF system.was described by EPA in,the following manner:

"With the GPSF, all data elements are standardized
by title, by unit, and by description of data element
or of the analyses involved to produce the data element.
In the past, we were unable to keep multi-time records.
For instance, in examiningthe efficiency of a municipal
treatment plant, which is commonly indicated by percentage
BOD removal, our old files allowed only a single value
-to be recorded. The GPSF allows a value to be recorded
each time a plant is inspected, thereby producing a
historical trend. our separate files contained redundant
data; since the files have been combined there is a
minimum of redundancy. In the old files there was no
formal responsibility for quality control or for keeping
data current; in the GPSF every data element has an assigned
responsibility. Previously, there was very little input
editing; in the GPSF no data are admitted without a formal
input edit. In addition, EPA has established a quality
control group to check on the quality and currency of
.data. Because of the control and flexibility of the GPSF
there is more incentive for users to contribute and to
update data." (Emphasis-added)(22)

The GPSF was not fully implemented, and its formal development was
discontinued in December 1974. Pending the development of a comparable
system, the utility of municipal and industrial permits as effective
tools for managing and tracking the progress of the NPDES is limited.
An effective national water pollution control program probably should
produce (and EPA and NPDES states-should analyze and use) meaningful
information about the relationship of discharge limitations to the
progress of abatdment programs.

V-28

In the absence of a functioning information management system, some
regions and NPDES states have developed, or are developing, their own
systems. Many of these are relatively unsophisticated and employ "tick-
ler" processes which "kick out" dates of monthly discharger reports.
Manual checks are performed to determine whether reports are submitted.
EPA does provide, through National Field Investigations Centers, techni-
cal experts who consult with the regions on particular types of permits.
EPA also )aas established regional desks at headquarters to advise the
regions on the use and applicability of effluent limitations. Quality
control procedures, however, are at best informal in most states and
regions(23).

Compliance monitoring -- A Late Start

Compliance monitoring is the mechanism intended to alert EPA and
NPDES states to permit violations, thus triggering corrective.or enforce-
ment action. It produces valuable information on progress toward the
Act's goals -- information about where, how and at what pace the NPbES
is operating. Performance data also are essential for the construction
grants and planning processes. Such data should be useful in any periodic
review and revision.of effluent limitations as required every five years
under Section 301(d) of the Act.

The Act structured compliance monitoring on a self-reporting basis
with permittees having affirmative responsibilities to measure and
report discharges. This, of course, depends on the reliability-of the
discharger to honestly and accurately report and suggests the necessity
for periodic on-site compliance checks by the regulator. As an operating
goal, EPA intends physically to inspect, or audit, each major permittee
once a year. EPA will inspect minor discharge at least once during the
5-year life of their permits(24).

EPA developed, in March of 1972, a guidance document entitled
"Water Compliance Monitoring" which purport 'edly represented the consensus
of the EPA Offices of Enforcement and General Counsel, Air and water
Programs and Research and Development(25). According to the document,
the keystone of an effective compliance monitoring program is the General
Point Source File which has been terminated. Pending the development of
a comparable system, substantive review of compliance schedule and
discharge elimination reports on a permit-by-permit basis may not produce
'the kind of information needed to measure, nationwide, region-wide or
state-wide, the progress of pollution abatement efforts.

Enforcement -- No Discernible Pattern

Most permits have been in effect for less than one and one-half
years, and any judgment of the effectiveness of the enforcement process

V-29

is at best tentative. Prior to 1972, state enforcement of water pollu-
tion control laws was characterized more by negotiation and compromise
than by resort to formal legal remedies(26). State agencies most often
operated a regulatory system which required a balance among economic,
environmental and public health interests. To obtain needed cooperation,
state agencies often were reluctant to take strict and severe enforcement
action. To do so might have created problems between the agencies and
governors or legislators concerned about a particular industry's well
being, or about the general well being of the state's economy. As a
result, state Agencies often preferred to obtain compliance through
negotiations with dischargers rather than initiate formal action.

The enforcement provisions of P.L. 92-500 are mandatory -- not
discretionary. They required the EPA, or NPDES state agencies, take
specific enforcement actions which include administrative orders,
injunctions and the recovery of civil and criminal penalties. EPA
allows both NPDES states, and states that have not obtained NPDES status,
the first opportunity to initiate enforcement actions(27). If a state
does not act, EPA the.n exercises enforcement authority.

It is still too early to determine positively whether the provi-
sions of the Act will cause a major shift from discretionary to man-
datory enforcement. EPA only recently (July 1, 1975) began to shift
manpower from permit issuance to compliance monitoring and enforcement.
Many NPDES states are not expected to make such a transition until early
in FY 1977(28). ;Most permits have been in effect little more than one
year, and key compliance schedule deadlines have not yet been reached.
if the experience with permit writing is any indication, both,EPA and
the states will rely first upon negotiation with the discharger before
turning to legal proceedings. Federal and state government and industry
officials who responded to. the Commission's Attitudes Survey in eight
states agree that a process of "bargaining, negotiation and compromise"
is a significant feature of the relationship between the regulators and
the regulated. While the question did not apply exclusively to enforce-
ment, and might also apply to those elements of the permit proces's .
subject to negotiation (compliance schedules and reporting requirements),
the responses are revealing.

V- 30

TABLE V-9

How strongly would you agree or disagree with the
statement that control of water pollution is largely
a process of bargaining, negotiation and compromise
between the regulated.and regulator for enforcement
of the law?

Respondents Agree Neutral Disagree

State Water Pollution
Control Agency 69% .7% 24%

Industry 73% 6% 21%

E.P.A. 62% 2% 38%

Source: The Water Pollution Control Act of 1972: Institutional
@i-ssessment, Attitudes Survey, Question 45.

The Commission's "Attitudes Survey," as well as the economic
studies, indicate substantial uncertainty that industry will meet the
July 1, 1977 requirement of best practicable control technology currently
available by that date.

V- 31

TABLE V-10

Congress has set 1977 requirements for water pollution.
control in the nation. In your opinion, how good is the
chance that.industry in your state will be able to meet
the 1977 requirement of,best practicable control tech-
n6logy.by 1977?

Respondents Good About Even Poor

State Water Pollution
Control Agency 52% 19% 29%

.Industry 41% 27% 32%

Consulting Engineers 24% 18% 58%

municipalities 30% 19% 51%

E.P.A. 57% 13% 30%

.Source: The Water Pollution Control Act of 1972: Institutional Assess-
iWent, Attitudes Survey, Question 26.

As indicated in the above Table (V-10), although a majority of EPA and
state agency officials considered the chance of compliance "good", only
41 percent of.the industrial respondents thought so -- and almost as
many (32 percent) industry participants thought the chance "poor". The
Commission's economic studies support the possibility that not all -
industry will achieve across-the-board compliance with 177 BPT requirements
since industry does not appear to be investing capital in pollution
control facilities at a rate that will meet the estimated cost of required
treatment.

Given these uncertainties and the present status of compli ance
monitoring activities, as well as the inclinations by NPDES states (and
to a lesser extent, EPA) to continue to use negotiation-compromise
techniques, aggressive and-reasonably uniform state-by-state enforcement
will probably emerge very slowly.

V- 32

Enforcement of municipal permits issued to those publicly owned
treatment works which will not achieve required levels of treatment by
July 1, 1977, raises critical questions about the application of nationally
uniform treatment requirements to municipal dischargers. To date, these
questions have been avoided by issuing permits containing conditions
that can be met with treatment levels no more stringent than can be
accomplished by facilities completed on July 1, 1917 with available
construction grant assistance. The issue will be joined again, however,
as the 1977 deadline approaches with the prospects that a sizable per-
centage -- as much as 50 percent -- of these plants will still not have
achieved secondary treatment. As a result, the entire strategy for
permitting, compliance and enforcement with the 177 requirements needs
major adjustment or revision.

Administrative Variations

Notwithstanding national discharge requirements, some range of
state-by-state variance is implicit in the administration of the regula-
tory scheme. Nearly every element of the system requires the application
of varying degrees of professional judgment and administrative discretion.
Permit issuance and permit modification are not routine, repetitive
mechanical exercises. Achievement of compliance schedules will be
influenced in some instances by discharger inertia, funding capability,
material availability, construction delays, labor negotiations and even
recalcitrance. One hundred twenty thousand compliance monitoring reports
will receive differing levels of review. The outcome of enforcement
actions will be determined by the same kind of negotiation and settlement
decisions which characterize all legal proceedings.

The important issue here is not the element of variation in NPDES
administration, but how wide and how detectable it will be. Without a
management system designed to produce meaningful, comparable information
V/ (by states, by EPA regions, by industrial categories and subcategories,
and by river stretches), neither EPA nor any state or other regional or
local institution will be able to determine the adequacy of NPDES perform-
ance -- much less whether or not the range is acceptable. EPA has
reported a study which showed that "the industrial portion of the
permit program resulted in an estimated reduction of approximately 12
million pounds per day of BOD and 28 million pounds per day of suspended
solids. " (29)

Through all the controversy as to the validity of the effluent
limitations, disagreements as to appropriate site specific permit condi-
tions for each discharger and contention about the necessary monitoring
times and parameters, the ultimate goal of improved receiving water
quality can all too easily be obscured. In the final analysis, it is
the quality of the water that matters.

V-33

Construction Grants for Publicly Owned Treatment Works

It is the purpose of this Title to require and to assist the
development and implementation of waste treatment management
plans and practices which will achieve the goals of the Act.

The Administrator is authorized to make grants to any state,
municipality, or intermunicipal or interstate agency for the
construction of publicly owned treatment works.

Sec. 201
Public Law 92-500

The Congress first adopted a construction aid program in 1948, with the
passage of Public Law 80-845.* The Act provided for municipal waste treat-
ment. construction assistance loans, with annual authorizations of $22
million. Loans were available to a community for one-third the estimated
cost of the construction works, but could not exceed $250,000. The loan
program was extended in 1952 for an additional four years,,at the same
annual authorized level of authorization(30).

In 1956, the Congress moved from a loan program to a grant-in-aid pro-
gram with an annual authorization of $50 million. In the period from 1956
to the enactment of P.L.92-500 in October of 1972, Congress authorized a
total $9,670,000,000'f6r construction grant assistance.** With the passage
of P.L.92-500, Congress provided a three-year authorization almost twice as
large as all previous grant Assistance, committing a total of $18 billion
for waste treatment construction grants for Federal fiscal years 1973, 1974
and '1975.

The Federal Water Pollution Control Act of .1972 was a major departure
from previous Federal program in other ways, too. The Act states that the
grant program is intended to assist the achievement of the ". . . goals of
this Act," thus specifically linking, for the first time, construction
assistance with stated water pollution control goals.

Some Federal sewerage construction.assistance was provided during the
1930s by the Works Progress Administration.

Total includes P.L.92-500 authorizations of $2.75 billion to reimburse
municipalities and states which had pre-financed P.L.84-660 projects
(initiated construction in anticipation of an 84-660 grant), and total
includes P.L*93-207 authorizations of additional reimbursement funds
of $600 million. Thus, pre-1972 authorizations of $6.32 billion and
P.L.92-500 and P.L.93-207 reimbursement authorizations total $9.7
billion.

V-34

off Schedule

EPA's 1971 Survey of the estimated costs of planned wastewater treat-
ment works led to a five-year $18 billion national construction grant
authorization over a three-year period -- $5 billion for 1973, $6 billion
for 1974 and $7 billion for 1975. Though the Congress recognized that the
amount was probably inadequate to support full compliance with the 1977
requirement, the $18 billion authorization was adequate to produce con-
struction worth $24 billion on a three to one matching basis.

The pace of grant obligations and outlays has proceeded at a rate
which suggests that the full $18 billion may not be obligated by July 1,
1977, and that a large number of municipalities which might have met the
July 1, 1977 secondary treatment requirement by July 1, 1977, will not
even though funds may be obligated by that date. As of June 30, 1975, only
$1,034,389,957 had been actually expended and, based on EPA estimates, $2.3

TABLE V-11

Public Law 92-500 - Construction Grant Program
(Federal share in billions')

Fiscal 1971 EPA P.L. 92-500 P.L. 92-500 P.L. 92-500 P.L. 92-500
Year Needs Survey Authorization Allotments Obligations Outlays

1972 $ 5.3 $ - 0 - $ 0 $ - 0 $ - 0 -
1973 6.2 5.0 2.0 1.6 - 0 -
1974 3.2 6.0 3.0 1.4 0.1
1975 (3.5) 7.0 4.0 3.6 0.9
1976 - 0 - 9.0 6.42 1.52
1977 - 0 - 0 - 0 5703 n/a4
TOTAL $18.2 $18.0 $18.0 $18.0 $ 2.5

1 Reflects amount originally withheld from allotment to states.
2 EPA Estimates, fiscal year includes three extra months.
3 No EPA Estimate available. Amount represents maximum available for 1977
obligation if 1976 estimate is achieved.
4 No EPA Estimate available.

Source: June, 1975 draft copy of EPA's Clean Water Report To Congress
1975, Table VI-I adjusted with detailed information provided
to the Commission staff by the EPA Office of Grants Management
circa July 23, 1975.

V-35

billion will have been expended by the end of the 1976 fiscal year (Sep-
tember 30, 1976). The Administrator of EPA indicated, on July 14, 1975,
that ". . . the estimate o-f (the) late 1980s for full compliance (of
secondary treatment requirements) may be optimistic because compliance will
be determined by the rate at which money is made available," and that only
40 to 50 percent of municipal waste treatment plants will meet secondary
treatment requirements by July 1, 1977(31).*

New Requirements

P.L.92-500 imposes several planning, management and operating require-
ments which were not a part of the construction grant process prior to
October 18, 1972. As a matter of reality, some laws do not lend themselves
to obvious, straightforward implementation. On October 11, 1972, the then
EPA Administrator indicated P.L.92-500 might be one such law. In recom-
mending Presidential approval of P.L.92-500 to the Office of Management and
Budget, Administrator Ruckleshaus stated:

"The numerous conditions, limitations, and require-
ments with respect to treatment facility construction
grants, which must be articulated in administrative
regulations pursuant to the enrolled bill provides
a broad range of controls. Through these administra-
tive mechanisms, storm and combined sewer projects
could largely be deferred, collection system projects
could be minimized, and the phasing of commitments
and funding outlays for all projects could be E22u7
lated through the rigorous lication of string2nt
requirements." (Emphasis added)(32)

Section 203(a) requires that the "...Administrator shall (approve
grants based) upon plans, specifications, and estimates" (emphasis
added). After a review of the legislative history of the Act and of
advice from the General Accounting office, EPA established a grant
process predicated on three distinct steps -- Step 1 facility plans,
Step 2 designs and specifications and Step 3 construction. In outlining
the advantages of this procedure, the Senate sponsor of P.L. 92-500
described the process as requiring "plans, specifications, and estimates
(PS&E) for each stage (or project) of the construction of the waste
treatment facility-For instance, the applicant may file a PS&E for a
project to determine the feasibility of a treatment works, another
PS&E for a project for engineering, architectural, legal, fiscal, or
economic investigations, and another PS&E for actual building. This
way the states and communities are assured an orderly flow of Federal
payments. This should, in turn, result in substantial savings.and
efficiency." Subsequent to promulgation of the three-step grant
process, EPA attempted to combine Steps 2 and 3 to accelerate the process,
but the attempt was nullified by an adverse GAO opinion(34).

*Many such plants will, of coursef fiave been constructed with assistance
by P.L.84-660 grants.

V-36

Section 201(g)(3) of the Act requires that the approval of grants
after July 1, 1973 for the construction of publicly owned treatment
works be conditioned on a finding by the ". . . Administrator that each
sewer collection system discharging into such treatment works is not
subject to excessive infiltration" (emphasis added). By administrative
interpretation reflecting the legislative history of this concept, EPA
expanded the infiltration requirement to require an analysis of sewer
inflow after determining that potential problems of inflow and infiltra-
tion should be considered in one analysis.

Section 204(b)(1) requires that all grant ap 'plicants adopt or
will adopt a system of charges to assure that each recipient of waste
treatment services within the applicant's jurisdiction, as determined by
the Administrator, will pay its proportion te share of the costs of
operation and maintenance (including replacement) of any waste treatment
services provided by the applicant" (emphasis added). Similarly, grant
approval is conditioned upon the applicant making "provision for the
payment to such applicant by the industrial users of the treatment works,
of that portion of the cost of construction of such treatment works (as
determined by the Administrator) which is allocable to the treatment of
such industrial wastes to the extent attributable to the Federal share
of the cost of construction. . ." (Sec.204(b)(1)(B).)

The Grant Process: How It Works

Regulations and administrative practice have elaborated these statu@-
tory provisions into 27 discrete decision points in the grant process
(Figure V-2), which begin with a local determination to initiate a waste
control or treatment project, move through the three-step grant process,
and culminate in facility operation pursuant to the National Pollutant
Discharge Elimination System(35). In moving through the process, appli-
cants must comply with the requirements contained in some 30 separate EPA
regulations interpreting the provisions of P.L.92-500 and coordinating the
implementation of P.L.92-500 with requirements contained in an additional
27 Federal statutes or Executive Orders.

When a locality decide s to initiate a wastewater control or treatment
project (as a re.@u4 of being placed on the state priority list or agreeing
to an effluent limitation compliance schedule or other reason), it must
prepare a plan of study consisting of four parts: 1) A definition of the
proposed planning area; 2) An identification of the entity or entities con-
ducting the planning; 3) A description of the nature and scope of the pro-
posed Step 1 project, including a schedule for the completion of specific
tasks; and 4) An itemized description of the estimated costs for the project.
The Step 1 grant application is forwarded to the state, where it is reviewed
and certified (if the application passes the review). The Step 1 applica-
tion is then forwarded to the EPA region, where it is reviewed, approved (if

FIGuRE V-2

REVIEW/APPROVAL CYCLE FOR CONSTRUCTION GRANTS

PROCEDURE Review& =Review Approve Accept Review & Other
.KEY Certify <> 013rant <@> Approve Action
Step I Step 2 Step 3
FACILITY PLAN PLANS& SPECS CONSTRUCTION Payment, closeout,
operations & management
EPA & Initiate Allot Grant Grant Grant Bid
REGION NEEDS Funds List
SURVEY by States

<
UJ
>

Prepare
< Aggregate
M PRIORITY
c) STATE Local LIST
Surveys
< Certify

Complete Initiate Prepare Prepare Solicit Submit ubmit Monitor
LOCALITY Needs Plan of Facility 60 Plans & Bids Bids for yment Project
Survey Study Plan Specs Approval uests

AWARD
CONTRACT.

Source: Nati. commission on Water Quality, from Touche, Ross & Co. contractor report "Institutional Assessment of the Implementation of the Construction
Grants Program Under PI-92-500", July 31, 1975, p.11-8.
March 1976
E@@ E@T E@T <r- <r

V- 38

it passes the review), and a Step 1 grant is awarded to the locality. The
locality now accepts the Step 1 grant and prepares the facility plan which
must be compatible with basin plans prepared by the state pursuant to Sec-
tion 303(e) of the Act, and must include 1) a description of the contem-
plated waste treatment system; 2) an analysis of infiltration and inflow
problems; 3) a cost-effectiveness analysis; 4) an environmental impact
assessment; 5) effluent discharge limitations; 6) certification of finan-
cial resources; 7) the relationship of Section 208 areawide waste treatment
plans (when such plans exist) to the planned treatment works; and 8) an
application for a Step 2 grant.

In the preparation of the Step 1 facility plan, the infiltration/inflow
analysis, cost effectiveness study and the environmental assessment gene-
rally require the most time. The facility plan must also conform to
Section 303(e) basin plans prepared by each state, under a continuing
planning process approved by the EPA Administrator, and approved Section 208
areawide waste treatment management plans where they exist. Reformulation
of projects to comply with these evolving areawide plans provide another
possibility for delay.

The Step 2 grant application, including a facility plan, is
forwarded to the state agency, where it is reviewed and certified (if
it passes the review). At the same time, a copy of the application is
circulated under established procedures to secure appropriate review
by interested Federal, state and local agencies under Officeof Manage-
ment and Budget Circular A-95. The certified application then is forwarded
to the EPA region where it is reviewed, approved (if it passes the review)
and a Step 2 grant is awarded. The locality accepts the Step 2 grant
and prepares the construction drawings and specifications, suitable for
bidding. This step includes preparation of a Step 3 application and also
must contain an assurance that adequate provision has been made for
effective operation and maintenance of the treatment works. From the
viewpoint'of the municipalities, the requirements for Step 2 do not
present any major difficulties, primarily because plans and specifica-
tions are part of the normal preparation work done for any capital
building program.

The Step 3 grant application, which includes the engineering plans
and specifications, is forwarded to the state agency, where it is
reviewed and certified (if it passes the review). The certified Step 3
grant application is then forwarded to the EPA region where it is
reviewed, approved (if it passes the review), and a Step 3 grant is
awarded to the locality. Award,of the Step 3 grant enables the
locality to solicit bids for construction of the treatment plant. When
bids are received, they are forwarded to the state and the EPA region for
review. When the low bid has been approved by EPA, the locality awards
the contract to the low bidder. "A typical and reasonable time lag
between these (Step 3) obligations and the start of construction activity

V-39

(when the construction contractor moves on site) is about six months.
Advertising for construction bids, letting contracts, and actually moving
on site consume this time."(36) The step-by-step process and its rela-
tionship to other functions prescribed in P.L. 92-500 is shown in Figure
v- 3.

As the treatment facility is constructed, the locality disburses
funds to the contractor building the plant and then submits payment
requests to the state and EPA for reimbursement of the Federal share
of eligible costs. When the payment request is approved by EPA, a
payment check is sent to the locality,. EPA and the state review
requests for changes to the approved specifications, and EPA and the
state also conduct interim construction inspections. Before the Adminis-
trator will authorize repayment of more.than 50 percent of the grant
amount, the applicant must show "adequate evidence of timely development
of its system(s) of user charges and industrial cost recovery;" 20 percent
of the project funds are retained by EPA until these systems are approved.
In addition, EPA and the state also must approve an operations and mainte-
nance mahual prior to.disbursement of all of the construction grants.
Prior to the final payment of 10 percent of the construction grant, EPA
and the state conduct a final close-out audit. Possible misapplication
of funds has recently appeared to be a major concern of EPA; a recent
report indicates that, even though "only a few cases involving fraud
have come to light.... the potential for future irregularities is enormous,
and cannot be ignored."(37)

Considerably more complex requirements, a heavy administrative load
for EPA, the states and applicants and very short deadlines made,,,criticism
of the Act and of its implementation almost inevitable. That criticism-
was sharpened by the then Administrator's indication that stringent
requirements would be rigorously applied in the implementation of the
Act(38). and by the 1972 and 1973 Presidential decision to withhold
allotment of one-half the $18 billion authorization.

Causes of Delay

in a critique of.the first two years of its own performance in the
construction grants program, EPA concluded, "The shortcomings in EPA's
current method of managing the construction grants program revolve
around two points -- inadequate manpower in the regions and inadequate
guidance from EPA headquarters."(39) The Review Group "concluded that
.,EPA has not managed the construct@on grant program as a nationally
consistent system" but rather has "10 separate programs managed by EPA's
1,0 reqional offices."(40)

FIGURE V-3
_@OVERVIEW - PL 92-500 WATER,POLLUTION CONTROL PROGRAM

LOCALITY AREA STATE EPA

Sec. 303(e)
MPDES Permit System NPDES Basin
System Plan

-Sec. 208 State
Area Sec. 106
Plan Program
Planning Functions

- - - - - - - - - - - - - -

Plan Sec. 201
Facility State EPA
of Priority Region
Study Plan List
(Step 1)

plans
and
Construction Grants Specifications
Program (Step 2) Allocation
of
Grant Funds

Construction
(Step 3)

Needs EPA
Survey Headquarters

Source: The Water Pollution Control Act of 1972: Institutional Assessment, Construction Grants,
-FStgate
Sec 1(
Pr@
ra

e 1201
ty
S LFa P
c
P
Step 1)

EPI
_@Hea7dw

Exhibit II-1, p. 11-3.

V-41

New statutory requirements were identified as lengthening the process.
The Review Group concluded that ". . . considerably more time is required
for.facilities planning (Step 1) than has traditionally been consumed in
preliminary engineering. The most time-consuming elements of the facility
planning process are environmental assessments, infiltration/inflow ana-
lyses, public participation, and the cost-effectiveness analysis of major
alternatives"(41). Regionalization was later identified as a "major factor
. . . inhibiting application development"(42).

Environmental impact assessments have been singled out as one of the
major causes of delay in grant development and approval. However, as EPA's
review of its municipal assistance program pointed out, it is not neces-
sarily true that the application of the requirements of the National
Environmental Policy Act results in program delay@43)- only an estimated
10 percent of projects were.expected to be subject to the NEPA procedure
and, in actual-practice, fa less (about 4 percent) have required impact
statements(48). In these cases, the added.time was from four to 14 months,
60 days of which is mandatory waiting time(49).

Time to comply witb the requirements of NEPA, infiltration/inflow
and the cost effectiveness analysis were said to have added "from 2 to
12 months to project development"(46). The more detailed requirements
also lengthened review time by state and EPA offices "an average of 12
man-days,per Step 1 project" to "review plans of study and faci -lities
plans"(47); "three to four months" is necessary for states and`EPA to
review and approve projects, except where an EIS is required(48)..
Citing' ".a perception widely held by consultants and states that the EPA
review accomplishes little change" and that"'treatment facilities are
almost never changed and, interceptors very seldom," EPA says they "were
able to document'instances where funding was refused or serious errors
in the project were dorrected"(49). Of course, if applicants or their
consultants do not comply adequately with program requirements, weeks
and even months can be added to project processing-

Taking the various times reported by EPA in 1974 as necessary for
projects to move through all three steps suggests a two and one-half to
an eight'and one-half year progression.

Step 6-24 months

Step 2 6-12 months

State and EPA Review
and Approval 6 months

Step 3 1 to 5 years

TOTAL 2-1/2 to 8-1/2 years

V- 42

In a different analysis, the time range was shown as four and one-half to
eight years, with the typical time being six years. (Figure V-4.)

Staff to a Congressional Committee concluded that "The three-step con-
struction process mandated in the law ordinarily takes four or five years"
(50). A later EPA examination indicated, perhaps optimistically, that "it
takes about one year to complete the facility plan for an 'average' project
and almost another year to prepare biddable plans and specifications;"
11. . . the 'average' sized project will take about two years to plan and
design. Very large regionalized projects can take up to 12-15 years, not
counting actual construction time"(51).

Rules, Regulations and Guidance. Smooth functioning of the complex
Federal-state-regional-local interagency machinery required to achieve the
construction of publicly owned treatment works under P.L.92-500 requires
understanding of the law and its interpretation by all levels of govern-
ment, as well as those persons from the private sector who assist in
achieving the program. How this understanding is being attempted has been
characterized as utilizing several informational devices(.52):

Law -- Define goals, general requirements, procedures and administra-
tive responsibilities; authorize expenditures.

Regulations -- Interpret goals; specify requirements, procedures and
responsibilities.

Guidance Memoranda -- Precede regulations in defining policy or
clarifying specific operations.

Technical Bulletins -- Define procedures and practices for engineering
or technical subjects.

Regional Guidance -- Clarify particular problems occurring in the
regions.

Strategy Paper -- Give long-range statement of EPA's policy in
implementing P.L.92-500.

The construction grants program cannot operate independently of other provi-
sions of the statute and, therefore, its governing regulations must be
consistent with those issued pursuant to other requirements.

Perhaps the major initial delay in-launching a new level of construc-
tion grants under P.L.92-500 was "virtual inactivity for 15 of the first
19 months" because of "the absence of final Title II regulations"(53). For
the first three months, obligations were prohibited; during the next 15
months, prospective grantees apparently delayed formulating project

FIGURE V-4

TYPICAL TIME REQUIREMENTS
CONSTRUCTION GRANTS PROGRAM - PUBLICLY-OWNED TREATMENT WORKS

Years 0 1 2 3 4 5 6

STEP I FAC I LITI ES PLAN
Application Planning
Typical Time
Range of time

Preparation of Plans

STEP 2 PLANS & w
SPECIFICATIONS

Application Construction
Typical
Mo.
STEP'3 CONSTRUCTION Total
6-9 Mo. 2-3 yrs. 6 Years
(Range 4% - 8 yrs)

Source. Nati. Commission on Water Quality from "Fulfilling a Promise. An Analysis of the 1972 Clean Water Act's Construction Grants Program",
Energy & Environmental Analysis, for the Nad. Utility Contractors Assn., 1975, Table 9, p. 67.
November 1975

V-44

applications according to the new requirements until the final rules
were known, while being assured the regulations were imminent. Some
projects, proceeding under the requirements of P.L.84-660 (the prior sta-
tute)i had to be redeveloped to comply with the new Act, and there was
delay in preparing and approving priority criteria and annual state priority
lists. The EPA Deptity Aclinipistrator has reportedly "admitted that the
Agency made a great mistake in not honoring the 'in the pipeline' projects
under the old ground rules;" to have let them proceed to completion under
the prior law, however, might have precipitated a-challenge in court(54).
As late as 1975, EPA was stating that '!some percentage (of*projects) for
which funding is now being Z@ sought'was conceived and planned before various
requirements of P.L.92-500 were.applicable. In Region II, for example,
.upwards of 75 percent of the applications, expected through September of
1977 will involve such projects"(55). The lapsed time before key regula-
tions were issued is portraypd'in Figure V-5. EPA has said, "issuance of
regulations and guidance has been consistently tardy, thereby creating
confusion and delay"(56).

Late issuance of regulations was not the only cause for delay. Some-
times, multiple revisions of regulations have occurred. Changes in program
requirements have sometimes occurred so many times that EPA regional per-
sonnel are reluctant to ask applicants-for new or additional information(62).

The sheer volume of the regulations probably also has caused delay.
P.L. 92-500 states that,"it is the'national policy that to the maximum
extent possible the procedures utilized for implementing this Act shall
encourage the'drastic minimization of' paperwork. . so as to prevent
needless duplication and unnecessary'delays at all levels." [Sec. 101(f)).
All the regulations governing construction grants have been estimated to
make a stack several inches hig@,and require two weeks to read(58). Twelve
regulations'or guidance documents specify just the basic requirements(59).
of 14 items sent@to applicants for' Step 1 grants in one EPA region, only
five ar4e"regulations; .the,other'nin6 items are applications and forms to
be completed-py.the applicant.- As the applicant progresses through the
step process, other forms and applications are required(60). Because of
the manner and chronology of formulating theregulations, they are not
always organized so as to outline,clearly the sequential process for
securing approval of an application. EPA has said, "it is our judgment
that the regulations as they exiisis@ cover@littld-more than the basic
legal requirements. To the extent that our,regulations cause problems,
the problems can really be attributed to two o@he`r factors: 1) a
diminishing but persistent opposition to the legislation; and 2) the
uncertainty and delay which have a6companied the preparation of regulations
and procedures to implement tfie law."(61) , EPAis c4rr6nt preparation of
p
a construction grants manuaL.should overcome many ok@-the problem@ and
much of the confusion that has ]@robably delayed the preparation and
processing of applications to'date.

V- 45

FIGM V-5
LAPSE TIME FOR ISSUANCE OF REGULATIONS & GUIDELINES BY EPA*
PUBLICLY-OWNED TREATMENT WORKS - CONSTRUCTION GRANTS PROGRAM

Oct
1972 Days from the enactment of the Act
0 100 200 300 400 500
Regulations
Title 11 Grants for ONES133
Construction of Treatment
Works 481

60
Secondary Treatment MENE194 STATUTORY TIME
1977 Requirements PERIOD
W 303
Specified
Project Priority N 0 N N E201,254 by Law
Criteria EPA .RECORD
180 Interim
User Charge Industrial Report
MENNE0216
Cost Recovery Final
mqlls@@11307
Keport
Guidelines

Facility Planning 454

Best Practicable Waste
Treatment Technology 270
1983 Requirements EENMEMEMNENN,NNN513

Environmental Protection Agency
Source: Nati. commission on Water Quality adapted from Touche Ross & Co. contractor report -I nstitutionai
Assessment of the implementation of the Construction Grants Program under Public Law 92-500'
July 31, 1975, p.1 I I -F-3, constructed from Table Vil 1-1, p. 13, "Review of 'the Municipal Wastewater
Treatment Program", EPA, November 30, 1974
March 1976

V_ 46

Requirements of Other Statutes. Besides P.L. 92-500 and EPA
regulations and guidance documents prepared pursuant to that Act, appli-
cations must also conform to other requirements and their related regula-
tions such as:

1. The Civil Rights Act of 1964 (particularly Title VI and excluding
enforcement and compliance)(42 U.S.C. 2000e et seq.) and Executive
orders issued thereunder;

2. The Clean Air Act (42 U.SX. 1857b-1 et seq.);

3. The Coastal Zone Management Act of 1972 (16 U.S.C. 1451 et seq,);

4. The Davis-Bacon Act (excluding enforcement and compliance)(40 U.S.C.
276a);

5. The Demonstration Cities and Metropolitan Development Act and
Intergovernmental Cooperation Act of 1966.(42 U.S.C. 3311, 3374);

6. The Flood Disaster Protection Act of 1973 (12 U.S.C. 24.1709-1,
42 U.S.C. 4201 et seq.);

7. The Intergovernmental Cooperation Act of 1968 (40 U.S.C. 531 et
seq., 42 U.S.C. 4201 et seq.);

8. The Marine Protection Research and Sanctuaries Act of 1972 (16 U.S. .C.
1431 et seq., 33 U.S.C. 1401 et seq.);

9. The Safe Drinking Water Act of 1974 (42 U.S.C. 300f et seq.);

10. The Solid Waste Disposal Act (42 U.S.C. 3259);

11. The Uniform Relocation Assistance and Real Property Acquisition
Policies Act of 1970 (42 U.S.c. 1415, 2473, 3307, 4601 et seq.,
49 U.S.C. 1606);

12. The Wild and Scenic Rivers Act of 1968 (16 U.S.C. 1274 et seq.);

13. The Contract Work Hours and Safety Standards Act (40 U.S.C. 327
et seq.);

14. The Copeland (Anti-Kickback Act)J40 U.S.C. 276b, c, 41 U.S.C.
51 et seq.);

15. The Fish and Wildlife Coordination Act of 1958 (16 U.S.C. 661
et seq.);

16. The Noise Control Act of 1972 (42 U.S.C. 4901 et seq., 49 U.S.C.
1431);

V-47

17. The Water Resources Planning Act of 1965 (42 U.S.C. 1962d), all
as amended;

18. The Rivers and Harbors Act of 1899 (33 U.S.C. 401 et seq.)(parti-
cularly 403 requiring Corps of Engineers permit for dredge and
fill activity);

19. The Historic Preservation Act of 1966 (16 U.S.C. 460 et seq.)
and Executive order 11593;

20. The Archaeological and Historic Preservation Act of 1974 (16 U.S.C.
469a-1 et seq.);

21. The Endangered Species Act of 1973 (16 U.S.C. 1531 et seq.);

22. Federal Insecticide, Fungicide, and Rodenticide Act as amended
(7 U.S.C. 136 et seq.);

23. The Federal Water Pollution Control Act, as amended (33 U.S.C.
1251 et seq.);

24. The Hatch Act (5 U.S.C. 1501 et seq.);

25. Executive Order 11246, with regard to equal employment opportunities;

26. Executive Order 11296, regarding evaluation of flood hazards;

27. Executive Order 11738, prohibiting utilization of facilities on
EPA List of Violating Facilities.

Meeting these requirements can add more time to the grant process.
For example, "where it is necessary to have a special area rate deter-
mination from the Department of Labor,. . the opening of bids by a
municipality. . . (can) be delayed up to three months."(62) These rate
determinations "prior to opening of bids are effective for only 120 days
and occasionally expire before a grant can be made. The bidding cycle
then must be restarted."(63) "Equal employment opportunity requirements
have delayed the award of contracts in areas where there are not many
minorities to hire, such as Maine, or in other areas where minorities
are still outside the regular construction work force."(64) While
achieving the objectives of these various statutes and policies is
undoubtedly worthwhile, fulfilling them does take time, and delay
occasioned by coordinating compliance with them should not be justifi-
cation for undue criticism of EPA.

V- 48

obligation and Expenditure of Grant Funds Slow grant obligations and
outlays-have been a focal point for expressed dissatisfaction with the re-
quirements of the Act and the administration of the construction grants
program.

To have obligated the full $18 billion between October 18, 1972, and
June 30, 1977, would have required an average obligation rate of $320
million monthly for 56 months. To date, EPA has exceeded this rate in only
four of the 34 months ending with August 1975; the average monthly rate in
the 1975 fiscal year was $164 million for the first ten months, $658 million
for May, and $1.3 billion in June, producing a yearly average of about
$300 million. As of July 1, 1975, about $11.4 billion remained to be
obligated, making an average monthly rate of about $422 million necessary
if the balance is to be committed by the end of the 1977 fiscal year (Sep-
tember 30, 1977).

Approaching deadlines have historically accelerated the rate of obli-
gations. User charges and industrial cost recovery are required for all
grants made after March 1, 1973 (Section 204(b)(1)); there was a rush "to
beat the deadline," as illustrated in Figure v-5. Besides being the end of
the Federal fiscal year, June 30, 1973, was the last date on which grant
awards could be made without infiltration/inflow analyses; contract obliga-
tions of $890 million were made that month. Figure V-6 records the flood
of grants made near the end of each fiscal year. The peaks have always
been followed by a dramatic decline in the succeeding months. There is
some indication that these surges to meet deadlines also cause'submission
of incomplete applications(70).

Another significant factor affecting the obligation rate is the
value of construction grant applications received by EPA. As reflected
in Figure'V-7, applications averaged $236 million per month for the
first ten months in fiscal year 1975, with $906 million received in May
and $819 million in June, lending support to the observation that the
pace of construction grant obligations is determined by the timing of
local governmental unit's submissions or the rate at which they clear
state review. Awards of large numbers of Step 3 grants in May and June
"leads to the advertising for contracts on a large scale during the
middle of the construction season. This, in turn, generates higher than
average bid prices because contractors already have scheduled work.
Finally, for a large portion of these last minute grants, the contracts
are awarded in the late Fall which for many northern states means the
postponement of construction until after the winter. This seasonal,
approach . . . adds delay and additional costs. . ."(66). Yearly obliga-
tions do not necessarily represent-commitments to new projects. Of
total 1975 fiscal year obligations, 32 percent consisted of cost over-
runs and added amounts for change orders; "some projects were bid at
twice the estimated cost."(67)

FIGURE V-6
MONTHLY FEDERAL CONSTRUCTION GRANT ACTIVITY, 32 MONTHS, FY 73-76
CONTRACT AUTHORITY OBLIGATIONS FOR PUBLICLY-OWNED TREATMENT WORKS

In millions of dollars
FY 1973 Feb 284
Mar 1218 1.
Apr 0.3 :5 mo. average
May 26 1 318
Jun 1064
Jul 127
Aug 2
Sep 8
Oct 11 EPA GRANTACTIVITY RECORD
Nov -7 FY 1974 (since the start of PL92-500 grants, Feb. 1973)
Dec :331 !monthly average 31 months = $229 million
Jan ]16 115 average monthly obligation level
Feb :336
Mar =368
Apr :]31
May 178
Jun ____1883
1-9-7 5- _J u-1 76
Aug 163
Sep 182
Oct IE16 FY 1975
Nov 139 1monthly average
Dec 130 302
Jan 215
Feb 125
Mar __1286
Apr 125
May 1658
Jun 1323
1-9 7 6- _J u-1 1217
F
0.3
26

2
8
II

63
1 81

139
130
t12 5
125

Aug - 2_9 6-
Sep =226

Obligations = Funds committed for futur! spending under PL92-500. Excludes reimbursements to states for prior Act programs.
Source: Nati. Commission on Water Qual Ity from EPA "Activities of Construction Grants Programs", Feb.1973 - September 1975.
March 1976

FIGURE V-7
MONTHLY FEDERAL CONSTRUCTION GRANT ACTIVITY FOR PUBLICLY OWNED TREATMENT WORKS
APPLICATIONS RECEIVED & GRANTS AWARDED, FY1975

In millions of dollars
1974 July M137 I APPLICATIONS GRANTS
I RECEIVED AWARDED
Aug. ZD111 1 163
1 (Dollar Value) (Dollar Value
Sept. 223 182 1 of Obligationsl
0 ct. 136 196
Nov. ::::::::::::::::j2471 139 1
1 1 <i
Dec. .:.:.:.:120 130 n
------------ 0
325 215
1975 Jan. ......... j
Feb - ---------- 25@ 125
...........
..........
Mar. .... 382 @86
Apr. 427 125

............
.............
....................... ...........
May -------------- 906 658
June 819 1323
341 monthly average 301 monthly average

TOTAL ................... ...
...................
bil ion:
FY1975 .7-7-7-7-0-*

Obligations Funds committed for future spending under PL92-500. Excludes reimbursements to states for prior act programs.
Source: Nati. Commission on Water Quality from EPA "Activities of the Grants Programs", June 1975 with figures from "Construction Grants Facts Sheets,
Sept. 6,1975.
March 1976
76

V-51

Actual payments lag behind the obligation. As a consequence, the actual
construction and completion of treatment plants follows obligation of the
funds by some years. A recent analysis for-the House Public Works Subcom-
mittee on Investigations and Review shows that of*the $8.25 billion of
Federal funds obligated as of June 30, 1975, $2.3 billion had been obli-
gated to projects that were not yet under construction(68). This means
that both the stimulative (or inflationary) impacts of the construction
grants program,, as well as the resultant water quality improvements, will
occur some years after EPA first obligates the funds.

Lags in actual expenditures were understood by,the Congress during its
consideration of P.L.92-500. The House Committee Report contained the'fol-
lowing anticipated pattern of expenditurds(69):

Fiscal Year Millions

1973 $ 20.0
1974 250.0
,1975 2,450.0
1976 5,000.0
1977 5,955.0
1978 3r250.0
1979 1,050.0
1980 50.0
Total $18,000.0

The EPA Admi *nistrator acknowledged this pattern of expenditures and
stated "the major outlays produced by-the contract grant authority will
not.occur until the fiscal years 1976-1981 time period."(70) He added
.that ".traditional impoundment techniques pursuant to 31 U.S.C. 665 may
properly be employed to limit the amount of obligations to be incurred
under Title II of the enrolled bill."(71) Neither obligations nor
outlays have occurred in the expected pattern. The degree to which
actual obligations and outlays were influenced by the early Presidential
refusal to allot $3 of the $5 billion for fiscal year 1973 and $3 of the
$6 billion for fiscal year 1974 is debatable. EPA manpower was concen-
trated on other priorities and necessary regulations had not been com-
pleted. There is little doubt, however, that allotments created uncer-
tainty as to the ultimate disposition of unallotted funds.. In resolving
the issue of allocation, on February 18, 1975, the Supreme Court said,

As conceived and passed in both Houses, the legislation was
intended to provide a firm commitment of substantial sums within
a relatively limited period of time in an effort to achieve an
early solution of what was deemed an urgent problem. We cannot

V-52

believe that Congress at the last minute scuttled the entire effort
by providing the executive with the seemingly limitless power to
withhold funds from allotment and obligation.(72)

With regard to obligation, as contrasted with allocation, the Court indi-
cated, ". . . as we view the legislative history, the indications are that
the power to control, such as it was, was to be exercised at the point where
funds were obligated and not in connection with the threshold function of
allotting funds to the states"(33). Commenting on the contracting proce-
dure, the Court said, "This mechanism considerably reduces whatever discretion
Congress might have exercised in the course of making annual appropriations"
(74). While this case was pending, Congress enacted the Congressional
Budget and Impoundment Control Act of 1972 (P.L.93-344, 88 Stat.207). What
impact this Act might have, if any, on the questions raised in the litiga-
tion over Presidential refusal to allot authorized amounts under contract
provisions such as those in P.L.92-500 was not considered since it was
effective subsequent to P.L.92-500.

Rates of obligation and expenditure are significant to an
evaluation of progress toward achievement of the requirement for
secondary treatment by publicly owned treatment works by July 1, 1977.
Table V-12 indicates that as of July 1, 1975, only some 37 percent of
the allotted $18 billion had been obligated and only 6.3 percent had
been expended. State percentages obligated ranged between 21 percent
for South Carolina to 74 percent for Arizona; percentages expended ,
ranged from 1.3 percent for Hawaii to 27.4 percent for Oregon. Since
Federal funds are paid as work is completed and bills are submitted,
rates of outlay suggest that completion of projects -- or submission
,of bills for payment -- is proceeding very slowly. Higher yearly levels
of Federal authorizations following commitment of existing authorizations
will be effective only to the extent that rates of obligation and expendi-
ture can be increased. The desired water quality improvement will come
only with operation of completed treatment works.

Wide and erratic fluctuations in monthly obligations rising to
high peaks just before deadlines and dropping to low levels immediately
thereafter create severe administrative strains: A smooth flow of appli-
cations throughout the year at every level is administratively more
efficient and certainly more effective in making progress toward the
Act!s requirements and goals. Municipalities could be informed of the
flow of applications and encouraged or compelled to submit applications,
using either state priority lists, administrative.orders or permit
conditions to fix construction schedules. State And EPA reviews could
be streamlined to minimize duplication and provide a steadily rising
volume of grant approvals to fulfill the Act's 1977 requirements f6r
publicly owned treatment works as soon as possible. Earliest possible
authorization of funds for fiscal years after September 30, 1977, is
important so that there is no gap in the pipeline of projects. EPA

V-53

TABLE V-12

Publicly Owned Treatment Works
Status of Construction Grant Funds
I .
Under P.L. 92-500, as of June 30, 1975
(Millions of $, Fiscal Years 1973-75)

Percent Percent
Allotment Obligated* Unobligated Obligated Expended

Region I Connecticut $ 308.7 $ 105.4 203.3 34 9
Maine 153.1 67.1 86.0 44 17.9
Massachusetts 573.9 226.1 347.8 39 10.6
New Hampshire 153.8 64.5 89.3 42 11.3
Rhode Island 90.9 32.1 58.8 35 7.9
Vermont 45.4 13.9 31.5 31 8.7

Region II New Jersey 1,300.7 499.9 800.8 38 8.4
New York 2,089.6 682.0 1,407.6 33 4.9
Puerto Rico 170.0 49.5 120.5 29 --
Virgin Islands 15.4 4.9 10.5 32 --

Region III Delaware 111.0 46.2 64.8 41 3.6
Maryland 564.7 244.4 320.3 43 6.3
Virginia 496.2 219.0 277.2 44 12.7
West Virginia 122.2 32.9 89.3 27 4.0
Pennsylvania 992.8 327.5 665.3 33 4.9
Dist. of Columbia 146.3 112.5 33.8 77 --

Region IV Alabama 95.8 36.3 59.5 38 4.1
Florida 691.7 316.0 375.7 46 2.6
Georgia 242.6 58.2 184.4 24 3.7
Kentucky 188.6 59.7 128.9 32 6.0
Mississippi 80.8 28.0 52.8 35 4.3
North Carolina 227.0 57.1 169.9 25 4.5
South Carolina 170.5 35.0 135.5 21 4.5
Tennessee 213.1 74.7 139.0 35 6.5

Region V Illinois 1,136.4 412.5 723.9 36 6.6
Indiana 483.6 170.5 313.1 35 4.4
Michigan 1,213.7 486.9 726.8 40 4.8
Minnesota 337.9 159.9 178.0 47 9.5
Ohio 979.3 313.8 665.5 32 6.5
Wisconsin 284.8 99.9 184.9 35 3.9

Region VI Arkansas 81.4 23.5 57.9 29 9.2
Louisiana 154.4 49.5 104.9 32 6.0
New Mexico 36.3 11.3 25.0 31 6.0
Texas 420.3 186.1 234.2 44 10.9
Oklahoma 134.3 30.5 103.8 23 4.4

Region VII Iowa 197.2 70.5 126.7 36 12.6
Kansas 112.7 26.4 86.3 23 5.1
Missouri 314.8 110.8 204.0 35 8.5
Nebraska 78.0 33.0 45.6 42 9.4

Region VIII Colorado 89.9 36.9 53.0 41 11.1
Montana 28.2 14.5 13.7 52 26.1
North Dakota 12.0 7.6 4.4 63 13.3
South Dakota 17.7 6.7 11.0 38 17.1
Utah 45.0 24.5 20.5 56 8.6
Wyoming 8.3 4.2 4.1 50 7.1

Region IX Arizona 43.3 31.9 11.4 74 5.6
California 1,894.1 591.9 1,302.2 31 6.3
Hawaii 109.6 58.1 51.5 53 1.3
Nevada 64.9 15.7 49.2 24 10.8
American Samoa 1.5 .2 1.3 15 --
Guam 12.9 8.7 4.2 68
Trust Territories 5.1 3.0 2.1 5.8 --

Region X Alaska 51.6 26.9 24.7 52 19.7
Idaho 38.0 18.3 19.7 48 25.6
Oregon 154.2 66.1 88.1 43 27.4
Washington 213.2 98.4 114.8 46 20.2

Total $18,000.0 $6,591.6* $11,408.4 37 6.3

includes FY 1976 Allowance (initially unallotted FY 1973, 1974 and 1975 funds).

SOURCE: Allotments, Obligations and Unobligated amounts from "Activities of the
Grants Assistance Programs," EPA, June 1975, p. 17; Percent Obligated
calculated; Percent Expended from "The Path to Clean Water," "Fulfilling
a Promise," National Utility Contractors Association, Inc., p. 18.

V-54

projections indicate four states may exhaust presently available allot-
ments in fiscal 1976 and another 24 states and territories will do the
same in fiscal 1977 without new authorizations. Applicants receiving
Step 1 and 2 grants must be reassured that Step 3 funds will be avail-
able when construction is to begin so that there is no excuse for delay.
Another period of uncertainty about funding levels might have the same
effect as deferral of allotments.

Distribution of Grants Among Steps 1, 2 and 3 -- Ideally, the
states should maintain the optimum mix of Step 1, 2 and 3 projects to
maximize the number of municipalities moving toward completion of
collection and treatment facilities while maintaining an even flow of
funds to projects ready to begin construction(75). Exactly what that
optimum is cannot be exactly determined based on experience and data
available to date. Table V-13 shows that, for the entire nation, as
of August 31, 1975, there were 2,227 Step 1 projects ($147.1 million),
403 Step 2 projects ($171.3 million), and 1,573 Step 3 projects
($6,448.5 million). Of the Step 3 projects, 518 ($2,369.7 million)
were awaiting construction, while 1,055 ($4,078.8 million) were under
construction. If the assumptions that each $1 in planning will generate
$20 in construction(76) are valid, then Step 1 grants in progress
represent some $2.9 billion in construction, while step 2 grants in
progress represent some $1.7 billion in construction.

State-by-state distribution of grants among the steps as of June
30, 1975, is shown in Table V-14. The approximate values of pending
construction for each can be calculated using the same multipliers. The
largest number of projects, nearly 53 percent, are in Step 1, with nearly
10 percent in Step 2 and 37 percent in Step 3. This imbalance in distri-
bution among the three steps suggests that the wide fluctuations in
approval of grants is likely to continue unless Federal, state and local
governments cooperatively undertake remedial measures now. In some
instances, projects are not submitted to EPA until they are ready for
Step 3. Thus the statistics here do not include those in Steps 1 and
2 of which EPA is unaware. To fully obligate the remainder of funds
authorized in P.L. 92-500, EPA expects to make new grant awards through
the fiscal years ending September 30, 1977 in the following pattern:

TABLE V-13

Publicly Owned Treatment Works
CONSTRUCTION GRANT ACTIVE PROJECTS
UNDER P.L. 92-500
August 31, 19751/

($ in millions)

Total Step, 1 Projects Step 2 Projects Step 3 Projects
FY 73-75 Active Projects Projects Projects
Region Allotments Awaiting Under Total
Construction Construction
No. Amount No. Amount No. Amount No. Amount No. Amount No. Amount

I $ 1,325.8 169 $ 526.5 38 $ 3.2 10 $ 2.3 34 $ 180.7 87 $ 340.3 121 $ 521.0

11 3,575.7 190 1,267.4 55 13.4 24 22.6 53 326.3 58 905,1 ill 1,231.5

111 2,433.2 354 1,009.6 91 5.7 52 56.8 86 238.3 125 708.8 211 947.1

IV 1,910.7 786 648.8 585 38.7 58 18.4, 47 200.4 96 391.4 143 591.8 IF
Ln
Ln
V 4,435.7 799 1,717.6 487 28.5 37 30,4 103 892.2 172 766.5 275 1,658.7

VI 826.7 652 281.5 439 22.0 64 10.5 74 104.5 75 144.6 149 249.0

VII 702.7 367 218.5 125 2.2 76 11.2 44 17.3 122 187.8 166 205.1

VIII 201.2 354 96.1 240 4.7 25 1.7 21 15.8 68 73,8 89 89.6

Ix 2,131.4 249 773.3 70 22oB 20 8,3 -40 376.0 119 366.2 159 742.2

x 456.9 283 227.6 5.9 37 9.1 16 18.2 133 194.3 149 212,5

TOTALS $18,000.0 4,203 $6,766.9 2,227 $ 147.1 403 171.3 518 $2,369.7 1,055 $4,078.8 1,573 $6,448.5

l/ Preliminary figures.
Includes Step 2 + 3 Projects awarded prior to July 1, 1974.

SOURCE: EPA, Unpublished data.

TABLE V-14
F.blicly Owned Treatment works
ACTI'llyi CONS-i;@;G- ON -r-RA.v-,S AW, - . -P- ts-- 92--S06- BY -@ATn-
@-S@TF JLNE: 30, 1975
Number of/@rantq _ao. as % of iLtate totat Grant'amounts awarded A mount as % of state total
State Step I step 2 step 3 Step I 212p 2 Lt!,.2 3 @Step-l Step,2 Step 3 Step I Step 2 Step 3
(A) (In thousands of dollars) (B')

Alaska 10 1 9 50% 5% 4 5*/, 670 250 $ 25,750 3% 1% 96%
AlabaLma 89 12 9 81 11 a 6,270 1,310 14,140 29 6 65
Arkansas 45 2 10 79 4 17 1,000 80 19,000 5 - 95
Arizona s 2 5 6 13 3 450 550 26,500 2 2 96
California 38 10 102 25 7 68 18,860. 3,060 539;350 3 1 96
Colorado 1@9 4' 8 60 13 27 1,050 450;' 32,380- 3 1 96
Connecticut 2 - 17 11 - 89 270 105,120 - - 100
Distric@ of Columbia - - 1 - 100 111,060 - 100
Delaware 3 2 10 20 13 67 80 790 45,300,, - 2 98
Florida 22 4 22 46 a 46 1,790 2,000 294,040 1 1 98
Georgia 29 10 34 40 14 46 2.570 3,990 45 620 5 a 87
Guam - - 1 - - 100 - - 7:000 - 100
Hawaii .1 - 4 20 so 1,200- - 55,790 2 98
Iowa 27 7 28 44 11 45 830 1.550 63,510 .1 2 97
idah@ 17 3 23 40 7 53 530 500 15-260 3 3 94
illinois 97 8 88 50 4 46 4,360 18,860. 387:600 1 5 94.
Indiana as 3 53 61 2 37 7,380 434 161,050 5 - 95
".nsaq -23 12 17 44 23 33 440 770, 23,710 2 3 95
Kentucky 81 4 4 92 4 4 Y.490 3,800 40.310 7 8 B5
Loui@siana 34 4 27 52 6 42 4,150@ 210 40,700 9 1 90
Has sachusetts 1 28' 3 6 91 140 620 225.310 - 100
Maryland 2 - 27 7 - 93 380 242,430 - 100
Maine - - 21 - - 100 - 66 060 - 100
ml ch,' gar, 74 5 35 65 4 31 3.180 477:460 1 99
14
.innesota 69 7 17 75, 7 18 2,780 2,030 155,070 2 1 97
Misso,iri 22 35 69 17 28 55 300 7,870 76,250 - i 10 90
Mississippi 103 13 8 83 10 7 4,480 3,290 5,440 34 25 41 0%
Montana 32 1 7 80 2 18 420 200 13,330'. 3 1 96
Nebraska 37 le 22 46 23 29 430 610- 29,5QO 1 2
North Carolina as 1 17 83 1 16 3,840 630 37,770 9 1 90
North Dakota 68 24 68 8 24 530 60 6,090 a 1 91
New Hampshire 16 4 30 32 a 60, 1.130 1,200 62,250 2 2 96
31 35 6 59 5,210 17,100 467,430 1 3 96
Ne. J.r@ey 18 3
New Mexico 33 5k 12 66 10 24 2,220 820 7,810 20 8 72
Nevada 1 1 16 6 6 ea 1.690 20 8,970 16 - 84
New York - - 65 - - 100 - . 682,040 - - 100
Ohio 33 3 42 42 4 54 1,660 750 292,310 1 - 99
OXlahor,a lis 10 34 73 6 21 2,200- 240 21,320 9 1 90
Oregon - 2 52 - 4 96 - 580 64.570 - 1 99
Penr8@lvania 2 - 114 2 - 98 190 278,960 - 100
Trust Territories - - - 100 - 2,960 - - 100
P@uerto Rico 34 21 6 56 34 10 7,990 5,460 3,480 47 32 21 1
Rhode Island. 3 - a 27 - 73 760 - 31!.350 2 - 98
South Carolina 53 a 19 " . 10 24 3,440 1,710 25,550 11 6 83
South Dakota 95 3 17 83- 3 14 1;980 90 3,950 33 1 66
Tennessee 79 6 22 74 6 20 9,050 - 820 67,540 12 1 87
Texas 207 29 53 72 10 is 11,450 7,230 144,860 7 4 89
Utah 15 5 9 52 17 31 280 870 23,140 1 4 95
Virginia 24 31 34 27 35 38 3,410 43,170 165 370 2 20 78
virgin islands - - 1 - - 100 - - 4:870 - 100
Vc.-= nt 7 11 39 - 61 370 - 13,580 3 97
wash =ton 62 24 57 43 17 40 3,720 5,510 85,870 4 6 90
Wisconsin 59 5 16 74 6* 20 6,660 5.590 86,910 7 6 87
West Virginia 53 17 19 60 19 21 1,490 2,340 29 340 4 7 89
Wyoming 1 -1 i 3 75 6 L9 370 20 3:380 JO 1 69
National total active grants; 3,931-
Total active grant awardst $6.253 Billion
VOTES i
(A) Includes Step 2/3 Grants,
':u) All amounts rounded to nearest $10,000.
Source- Institutional Assessment of the Implementation of the Construction Grants Program Under Public Law 92-500,
Touche Ross & Co., report to NCWQ, July 3, 1975o Ex'libit 111-A-6, p. III-A-17.

V- 57

TABLE V-15
Numbers of Projects
Fiscal Year Fiscal Year Fiscal.Year
steps 1975 1976 1977*

1 1,693_ 1,800 1,100

2 266 1000 2,600

3 632 1,200 1,700
Totals 2,591 4,300 5,400

Active Projects 3,646 8,000 9,000

Because of change in fiscal years, this year consists of 15 months.

Achieving.A smooth, even, accelerating monthly flow of projects
will be particularly important should the level of Federal financing be
significantly increased for fiscal years ,ending after September 30,
1977. Early efforts to optimize thb.distribution among the steps could
avoid complications in the event higher funding is provided. Responses
of state and local units of government -- cities, counties and regional
authorities -- and their consultants will be-critical to the success of
any deliberate program to equalize and accelerate the flow of grants
since "the action is really with the potential grantee, his consultant,
and the state."(77) While EPA has "little direct control over the
process at thd application development stage"(78), it can concentrate
its efforts to assure that duplicate review is.minimized and that funds
are available for grant awards in a timely fashion. At a time when
construction activity is slowed because of general economic conditions,,@:
and with the number of approved projects now in Step 1, rapid progres-
sion to Step 3, the construction stage? should be attractive to states
and local communities to improve employment and general economic activity.

For its part, EPA can analyze its own procedures and those of
states and municipalities to see whether there are ways to more rapidly
move grants through the step process. While there may be adequate
justification for the number of months approved projects remain in the
various steps, the speed with wLch projects move through the pipeline
is affected by the length of time projects remain in the various steps.
Table V-16 shows how long various projects had been in the several steps
as of June 30, 1975. Just moving the 518 projects representing $2.4
billion in construction shown in Table V-13 as already in Step 3, but
"awaiting construction" to "under construction*," would represent a substan-
tial increase in construction activity. Distribution of 473 of these

V-5 8

projects by EPA regions with months held Awaiting construction are shown
in Table V-17. Unusual or significant delay between award of a Step 3
grant and taking of bids could result in higher bids because of inflation,
requiring amendment of the grant and a consequent further delay.

TABLE V-16

Publicly Owned Treatment Works
Elapsed Time in Steps, Contruction Grants Active Projects
(As of June 30, 1975)

EPA estimate
Number of Grants by Elapsed of time
Time Since Grant Award (in months)* required

0-6 6-12 12-18 18-24 Over 24

Step 1 .1,034 587 404 25 1 1 year

Step 2 192 67 so is 34 1 year

Step 3** 419 225 302 120 403 2-4 years

Does not include completed grants.
Includes Step 2/3 grants.

Source: The Water Pollution Control Act of 1972: Institutional
Assessment, Construction Grants, Exhibit III-1, p. 111-4,
data from Office of Water Programs, EPA.

Size of Projects -- Every application for a grant or project,
3@egardless of size, presumably is subject to the same requirements;
thus the smallest town filing a construction grant application for a
treatment works must comply with the same statutes, rules and regula-.
tions as the largest city in the nation. The amount can be a few
thousand dollars or hundreds of millions. While the current law makes
no distinctions according to size, logic suggests that there are real
differences based on size of project. EPA already provides abbreviated
4
instructions for small cormunities in some areas.

Table V-18 shows that nearly 80 percent of the number of projects
for cities and towns with populations under 25,000 account for slightly
more than one-fourth of the contract dollars; two-thirds of the projects

TABLE v-17

Publicly Owned Treatment Works
Construction Grant Active Projects
Under P. L. 92-500
Months Held Awaiting Construction Approval
As of August 31, 1975

($ in millions)

(0 3) (4 - 6) (7 - 12) (13 - 18) (Over 18) Total
,Region Amount No. Amount No. Amount No. Amount No. Amount No. Amount No.

I $ 59.8 9 $ 92.0 13 $ 23.1 8 $ 2.6 3 $ $177.6 33

262.7 37 17.8 8 39.7 6 2.3 1 3.9 1 326.4 53

57.1 26 31.5 16 71.1 27 66.1 16 7.9 4 233.6 89

IV 150.6 30 35.1 12 13.3 2 .4 1 199.4 45

V 662.3 75 218.5 21 6.0 3 .9 1 887.7 100

VI 27.7 29 25.6 3 .5 1 1.2 1 55.0 34

VII 7.3 28 4.4 7 1.1 3 3.0 2 15.8 40

VIII 12.9 16 2.6 3 .3 2 15.8 21

Ix 185.0 28 187.9 12 11.0 4 383.9 44

x 11.6 10 .3 1 6.2 2 .6 1 18.7 14

$1,437.0 288 $615.7 96 $157.9 53 88.1 28 15.2 8 $2,313.9 473

Source: EPA unpublished data.

V-60

TABLE V-18

Publicly Owned Treatment Works
Construction Grant Contract Awards
By Population of Recipients
.(As of August 31, 1975)

Community Grant Awards U.S. Population*
Size Number % of Total $ Millions % of Total Thousands % of Total

Under 2,500 1,850 41 $ 420 6 11,235 7.7

2,500-5,000 613 14 228 3 8,038 5.6

5,001-10,000 510 11 370 6 12,924 8.9

10,001-25,000 570 13 829 12 21,415 14.8

Sub-Total Up
to 25,000 3,543 79 $ 1,847 27 53,612 37.0

25,001-50,000 293 7 754 11 17,848 12.3

50,001-250,000 - 400 8 .2,158 32 31,010 21.5

Sub-Total
25,001-250,000 693 15 $ 2,912 43 48,858 33.8

250,001-500,000 80 2 682 10 10,442 7.2

500,001 and over 168 4 20 31,736 22.0

Sub-Total
250,001 and over 248. 6 $ 2,083 30 42,178 29.2

TOTAL 4,464 100% $ 6,842 100% 144,648** 100%

Per U.S. Census Bureau.
Not including: (1) that portion of the population classified as
"Other Rural" (farmers, ranchers and others not living in communities)
(This = 43,379,000 people.) and (2) "Unincorporated Parts of Urbanized
Areas." (This = 15,186,000 people.)

Source: EPA unpublished data, adjusted to format, and Statistical Abstract
of the United States, 1974; U.S. Department of Commerce, Bureau
of the Census, page 18.

V-61

are for places with populations under 10,000 and represent only 15 percent
of the money. These data suggest that attention might be given to simpli-
fied procedures for smaller projects, while concentrating time and personnel
on those which encompass larger populations and projects. Another suggested
simplification of procedure'would be to combine the Step 2 and Step 3
procedures into one step.

Manpower -- Manpower required to process a volume of construction
grants adequate to meet the intended pace under P.L. 92-500 is a function
of what has to be-done initially, the depth to which original documenta-
.tion is reviewed 'and the number of different reviews performed. The
program is not, and perhaps cannot be, structured so as to achieve
maximum efficiency. Projects are initiated by local units of government
deciding to apply for construction grants or responding to regulatory or
enforcement action by applying. Ultimately, the entire process depends
upon local action, whether internally or externally stimulated; thus the
volume of projects in process is whatever number local applicants, their
engineers and consultants, governmental employees at other levels and
the construction industry can generate, develop and shepherd through the
approval procedure to completion under current statutory requirements
and regulations.

Manpower at the Federal level has not grown in proportion to the
obligation of funds as reflected in Table V-19. During the period from
1968 through the 1976 fiscal year, a nearly 25 fold increase in
yearly obligations has been achieved with triple the numberof Federal
construction grants employees. Requirements'also became considerably
.more complex during the same period. Conferees on P.L. 92-500 urged
"the Administrator, the states, and local governments to draw from the
experience of the highway program to improve the efficiency of the waste
treatment grants program"(79). Comparing EPA staffing with that of the
Federal Highway Program (390 employees per billion dollars obliga-Eed)(80),
the construction grants program should now have nearly 2,000 employees
to obligate@the $5.1 billion projected for fiscal year 1976. In fact, EPA
will have 16ss.than half that number. EPA has indicated that more than 200
employees, in addition to the 963 it will use in 1976, will be necessary
to move to the fiscal 1977 level of $7 billion in obligations. Distribu-
tion of Federal construction grants staff within the ten regions is shown
in Table V-20, with a comparison of the distribution of the number and
dollar amount of applications among the regions. Two particular areas of
activity were identified where lack of manpower is now "a definite impedi-
ment" -- "field inspections and audits," with only 35 man-@years budgeted
in fiscal year 1975-to audit the construction grants program(81): with
"few personnel at the state or EPA levels . . . regularly involved in the
inspection heavy reliance is placed . . . upon consulting engineer-
ing firms to manage and monitor the actual construction. . . 11(82) The
same shortage had been noted earlier by EPA(83), which is now exploring the
possibility of interagency agreements with the General Services Administra@
tion and the Corps of Engineers to provide interim construction inspections.

V-62

TABLE V-19

ENVIR014MENTAL PROTECTION AGENCY
FEDERAL PERSONNEL AND OBLIGATIONS
CONSTRUCTION GRANTS PROGRAM*
1968-1976

Estimated
Federal Fiscal Year
Fiscal Year Personnel* Obligations
(Billions of $)

1968 320 $ 0.2
1969 320 0.'2
1970 360 0.4
1971 420 1.6
1972 402 0.9

1973 452 3.0
1974 595 2.6
1975 567 3.'6
1976 (as of 10/30/75) 963 5.2,(Est.)

Notes

1968-1974 personnel and obligations from Review of the Municipal
Waste Water Treatment Works Program, November 30, 1974, U.S. EPA,
Tables II-1 and 11-2, p. 8.

1974-19.76 personnel and obligations from "Construction Grants
Fact Sheet," EPA, 9-6-75, and EPA unpublished data.

Estimated Federal Personnel for fiscal years 1968 through 1972
(October 18, 1972) do not include NPDES personnel as this program
did not exist.

The figures for fiscal years 1968 through 1975 include post
construction personnel. The figures for 1976 do not.

The figures for fiscal year 1975 do not include 107 positions
which were new to the construction grants program. These were
re-positioned people--constituting an internal shift. They
are counted in 1976 figures, as the additions were made at the
very end of fiscal year 1975.

The figures for fiscal year 1976 include 300 new positions.
Of these, 250 were new; 50 were reallocations within the agency.
The distribution is as follows:

New Positions: 225 to regions + 25 to HQ = 250 total
Reallocated: 39 to regions + 11 to HQ = 50 total
TOTAL 264 to regions + 36 to HQ = 300 total
The 1976 figures do not include NPDES personnel as they were moved.

TABLE V-20

DISTRIBUTION OF EPA REGIONAL CONSTRUCTION
GRANTS PERSONNEL VS. GRANT
APPLICATIONS IN PROGRESS
(As of June 30, 1975)
Construction Grant Regional Portion of
Applications in Progress Personnel in Total Regional Regional Regional
EPA Construction Personnel in Applications Grant Amounts
Region Number Amount Grants Program, Program As % of Total As % of Total
(Millions of $)

1 41 $ 92.7 34 7% 6% 9%

11 43 330.2 56 12% 6% 31%

111 55 114.9 60 12% 7% 11%

IV 89 17.8 61 12% 12% 2%

V 204 304.4 91 20% 27% 28%
a,

VI 82 16.2 45 9% 11% 1%

VII 151 48.6 40 8% 20% 4%

VIII 15 2.6 30 6% 2% 0

Ix 51 155.9 39 8% 7%@ 14%

x 0. 4.6 29 6% 2% 0-

745 $1,087.9 485 100% 100% 100%

Source: Municipal Construction Division
Office of Water Program Operations
EPA

V-64

As to general engineering manpower, in some places either there
are too few consultants practicing in the state (West Virginia) or a few
firms hold the bulk of the contracts (five firms handle 50*percent of all
active P.L.92-500 projects in New York; 11 firms handle . . . [about] 90
percent in California) and do not have sufficient manpower to expedite all
projects at once"(84).

Lack of adequate manpower at the state level has also been identified
as a critical problem(85). States have been reported as "short an esti-
mated 3,400 positions in their water pollution agencies," of which only a
part would be for construction grants(86). "State performance in provi-
ding guidance consistent with P.L.92-500 (by the states), size of staff
and an appropriate range of skillsO(37).

Both state and EPA construction grants personnel appear to be
vulherable to high turnover "because of the exposure . . . (they) receive
to consulting engineering firms and other parties,. . the salary
potential. . with many private firms," and "the relatively low salary
structure in. . many state governments."(88) Local applicants have
complained about the lack of continuity in project reviewers at the EPA
regional offices which results from employee turnover or reassignment
to accommodate widely fluctuating work loads.

Certification of Construction Grants Functions Performed by the
States -- Recognizing that manpower limitations and duplicate reviews
were complicating the construction grants approval process, EPA on
January 23, 1974, announced a procedure for state "certification of
adequacy of plans and specifications, operation and maintenance manuals,
and certain documents involved in the bid and contract process," pursuant
to written agreements between EPA regions and the states(94). subse-
quently on February 4, 1974, EPA authorized certification of "any and
all program functions" associated with such grants but made clear that
the regulation "does not and cannot provide for transfer of authority
to the states to actually approve grantee submittals."(90) As of
September 2, 1575, certification was exercised by 28 states for plans
and specifications, 33 for operations and maintenance manuals, 28 for
change orders and three for bid tabulations (See Table V-21); EPA
expects agreements to be executed during the fiscal year ending June
30, 1976, with 10 additional states for plans and specifications,
six for O&M manuals, 11 for change orders and 10 for bid tabulationsl9l).
In addition, Agreements are expected with seven states for certification
of the results of interim inspections.

The end result of these agreements has been differently charac-
terized. In 1974, EPA felt that initial certification of three program
function's by some states "were 1) working satisfactorily, 2) reducing
duplication, 3) improving administration of the program, and 4) receiving
the support of the state and regional staff involved."(92) The Commission

V-65

TABLE V-21

Publicly Owned Treatment Works
CERTIFICATON OF CONSTRUCTION GRANTS REVIEW BY STATES
(As of September 2, 1975)

State Plans and 0 & M Change Bid
specifications Manual Orders Tabulation

Region I
Connecticut x x x
Maine
Massachusetts
New..,Hampshire
Rho@e Island
Vermont x x x
Region 11
New Jersey
New York x x x
Puerto Rica
Virgin Islands
Region III
Delaware
Washington, D.C.
Maryland x x
Pennsylvania
Virginia _ x x x
West Virginia
Region IV
Alabama
Florida x x x
Georgia x x x
kentucky.
kis@issippi
North.Carolina x x x
south Carolina x x x
Tennessee x x x
Region,V
Illinois
Indiana x
Mi6higan x
Minnesota
Ohio, x
wi;corisin x
Region VI
Arkansas x x x
Louisiana x x x
New,m6xico x x x
Oklahoma x x x
'Tex@s x x x
Region VII
Iowa.
Kansai. x x x
Missouri x x x
Nebraska x
Region VIII
Colorado x x x
Montana x x x x
North Dakota x x x x
South Dakota x x x
Utah x x x
Wyoming x x x
Region IX
Arizona
California x x
Hawaii
Nevada
Territories
Region X
Alaska x
Idaho x x x
Oregon x x x
Washington x x
TOTAL 28 33 28 3

Source: EPA 9-2-75. (unpublished data).

V-66

contractor, after noting that the states are limited to certifica-
tion of technical and/or administrative accuracy in their review, (and)
only EPA can approve a grant," reported that in its "field review in seven
of eight regions, the EPA personnel still review every grant prior to
approval despite state certification"(93). EPA, too, has commented that
"state certification . . . tends to be unreliable . . . (One region), for
example, finds that about half of the applications certified by one state
are not approvable as received. About 10 percent are returned outright,
another 10-20 percent have substantial problems, and another 20-30 percent
have forms missing, signatures missing, etc."(94)

The Commission contractor concluded that the present certification
process may not result in efficiency. Even if the state-attains control
over the administrative and technical requirements, "Key questions relating
to growth or land use must be approved by EPA. . . The policy of decentra-
lization is, therefore, restricted by both the law and regulations. One
result of this policy is a series of duplicative reviews by state and EPA
personnel"(95).

Actual and effective certification of various functions by more states
should produce better utilization of available Federal, state, regional
and local manpower. In describing its options for 1974, EPA indicated
that its construction grants manpower should be increased by 455 persons,
in addition to the 595 it then had -- 138 to improve the management of the
program and 317 to process additional applications. State certification
was listed as an alternative to this personnel increase(96). Currently,
EPA indicates acceptance of state certification already made and expected
through fiscal year 1976 would save the Agency some 49 man-years annually.

While certification can result in better manpower utilization, it is
no substitute for adequate numbers of personnel. There is still evidence
that effective and timely administration of the construction grants pro-
gram requires more trained people at all levels. At the same time,
"delegation of functions to the states would not reduce the basic process-
ing time required. It merely transfers the processing from one agency to
another, without necessarily saving time"(97). As the agreements are
presently executed, too, "EPA expressly retains ultimate responsibility
for final determination regarding other grant conditions listed in the
regulations (40 CFR 35.935), including the facility plan, the state plan,
priority certification, state allocation limitation, applicant's funding
capability, permits, National Environmental Policy Act review, civil
rights compliance, and the scope of project and grant amount"(98).

The State of California proposed a mechanism for providing performance
of construction grant functions, such as review of plans and specifications,
for which the state would charge the applicant or grantee a fee that would
then be accepted by EPA as a project cost, 75 percent reimbursable under
the eventual Federal grant. This procedure would enable the state to

V-67

recover its expenses for necessary review staff, while the applicant would
pay only 25 percent of the added cost as part of the non-Federal share of
the project. Subsequent EPA regulations permitted the use of this "Cali-
fornia fee proposal" nationwide, but only California has thus far qualified.
There is some indication that whatever manpower savings may have been
realized by the EPA regional office have been more than offset-by addition
of new employees to the California pollution control agency payroll. The
overall result is almost surely a total net increase in manpower in the
program. Whether the "California" approach will be utilized more widely
will probably depend upon the outcome of Congressional consideration of
more direct statutory delegation.

various methods for state certification can perhaps streamline the
construction grants process. Substantial net time and manpower savings,
.however, may not be realized. Qualified personnel will still be necessary,
whether employed at the state or EPA regional level; whether the procedure
would represent an identifiable net saving in total Federal and state per-
sonnel cannot be determined easily. The functions required to be performed
by P.L.92-500 must still be completed before final approval of the various
steps in the process. Personnel needs of the states will be increased.
States may still face difficulty in recruiting new employees because of
salary levels, job locations, state revenue problems and personnel ceilings
and the advisability of expanding staff for an activity with authorized
funding only through fiscal 1977. Rather than net reductions in personnel,
EPA would be better staffed to perform its responsibilities more effectively
and efficiently since manpower availability will be a continuing influence
on progress of the construction grants program. Adequate EPA staff would
be required to assess state "authority, responsibility, and capability" to
assume certificationduties and audit state performance where certification
has been approved to assure uniform, national compliance with the law.

The findings of a recent EPA task force on decentralization concluded
that although decentralization was a highly commendable objective, they
were not sanguine about the future prospects and detected a relativelack
of commitment at both the Federal and state levels. Indeed, the task force
concluded that "EPA and the states, collectively, have failed to establish
the necessary program management systems to implement the water program
in a decentralized fashion" (99). With appropriate and adequate EPA super-
vision and state commitment to the,procedure, the grants approval process
should be less cumbersome*and time-consuming. The arrangement would, to be
sure, add some substance to the declaration in P.L.92-500 that "it is the
policy of the Congress to recognize, preserve, and protect the primary
responsibilities and rights of states to prevent, reduce and eliminate
pollution. (Sec.101(b)).

V-68

EPA Definitions of Secondary Treatment and-,"Best Practicable Waste
Treatment Technology over the Life of the Works"

EPA definitions of the treatment technologies and the effluent limita-
tions required to be met by publicly owned 'treatment works by July 1, 1977,
and July 1, 1983, have already been discussed. (See Chapter II.) Pre-
scribed effluent limits for "secondary treatment" are permissible concen-
trations of BOD, suspended solids, fecal colif6rm and pH. Higher limits
must be met for discharges to water-quality limited waters. For 1985, EPA
has essentially fixed 1983 requirements equal to those for 1977; three
alternatives are listed for meeting the 1983 limits -- treatment and dis-
charge, land application and reuse.

Projections of technologies to be installed in treatment plants with
needs reported in the 1974 EPA needs survey show the following treatment
or disposal system:

Process Number of Plants

Activated Sludge 5,700
Trickling Filters 4,600
Aerated Lagoons 1,000
Oxidation (or waste stabiliza-
tion) Ponds 3,4QO
Land Application 9QO
Total 15,400

of approximately l6,000.facilities in place in 1974, m6re than 80 per-
cent provide some form of secondary treatment, 5 percent provide some type
of treatment more advanced than 'Secondary, and some 3,000 are untreated
discharges. Those secondary treatment facilities in place do not always
achieve the defined level of effluent limitations. The oxidation waste
stabilization ponds generally cannot meet the suspended solids limit, and
becapse a large number are already installed, a question has been raised
as to a specific secondary treatment definition to cover such facilities.
Most are for communities with populations below 10,000 persons. EPA is now
considering a modification to its secondary treatment definition to accommo-
date these ponds. Similarly, only certain types of trickling,filters will
achieve the* required results and then only when not overloaded and carefully
operated.

Coastai cities accustomed to discharge through deep'-ocean outfalls
have argued that little adverse environmental effect has been demonstrated
where wastewater receiving less treatment than nec .essary to meet the secon-
dary treatment BOD limit has b4�en-discharged. They contend some level
short of secondary treatment, as defined by EPA, is Imore cost-effective and
will assure compliance with requited water q@ality standards. Pending legis-
lation in the House CQmmittee on Public Works and Transportation would allow
the EPA Administrator to extend the July 1, 1977, deadline for treatment

V-69

works.discharging to ocean waters and "co 'nsider the cost of achieving secon-
dary and alternative treatment and the effects such secondary and alternative
treatment will have on public health and water quality, including effects
on aquatic life, the propagation of fish, and recreation." No time modi-
fication "shall extend beyond July 1, 1982." (H.R.9560, Sec.9.) In addi-
tion, a recent report of the General Accounting Office to that Subcommittee
recommends amendment of Sec. 402 of P.L.92-500, to provide the Administrator
with authority to exempt certain categories and classes of dischargers with
a minimal adverse impact on water quality.

A Panel on Secondary Treatment assembled under the auspices of
the Committee on Water Quality Policy, Environmental Studies Board,
National Academy of Sciences-National Academy of Engineering addressed
some of these questions(loo). The Panel concluded that the EPA definition
of secondary treatment is appr'opriate exce@t for inclusion of a fecal
coliforms limitation and percentage removal limitations and 1) suggested
that disinfection be required where necessary for water quality standards
on a case-by-case basis; 2) indicated that the requirement that effluent
BOD and suspended solids not exceed 15 percent of the influent levels
is not operationally achievable even with the bedt of secondary treat-
ment processes during certain times of the year when influent contains
low concentrations; 3) concluded that waste stabilization ponds generally
cannot meet the EPA secondary treatment 1 ,imitations without additional
facilities for removal of stspended solids; and 4) recommended that
improvements to such ponds to meet the limitations receive low priority
because of poor cost effectiveness unless the effluents are causing
measurable harm to beneficial uses of the receiving waters. Regarding
priorities, the Panel suggested that first priority be given to construc-
tion of municipal facilities to treat discharges which cause significant
adverse effect on beneficial uses of receiving. waters. Next should be
facilities serving.large Populations because of greater cost effective-
ness, with preference given to treatment of discharges to fresh or
estuarine waters over discharges to the open ocean where dilution poten-
tial is greater. Lowest priority should be given to small communities
with discharges of one million gallons per day or less (contributory
populations of 10,000 or less).

The EPA Administrator commented on the Panel's report as follows:

The 15 percent limitation on BOD and suspended solids is a
complex subject. If we were to remove this limitation, then
there will be a significant shift in the cost effectiveness
analysis for infiltration/inflow 6r flow reduction. We would
like to encourage removal, of major sources of extraneous flow
from the sewers. Moreover, if only the 30.mg/l limit applied,
then it is probable that only primary sedimentation would
achieve the standard on an influent value of 50 to 60 mg/l.
On balance, we wanted to avoid dilution being used to meet the
standard, while recognizing that.combined sewers require special
attention(lol).

V-70

Recycling, Reuse and Reclamation of Wastewater and land Application of
Wastewater and Sludges

The Act encourages reclaiming and recycling as partof the requirements
covering construction grants. Section 201(d) states that:

(d) The Administrator shall encourage waste treatment manage-
ment which results in the construction of revenue producing
facilities providing for

(1) the recycling of potential sewage pollutants through
the production of agriculture, silviculture, or aquaculture
products, or any combination thereof;
(2) the confined.and contained disposal of pollutants not
recycled;
(3) the reclamation of wastewater; and
(4) the ultimate disposal of sludge in a 'manner that will
not result in environmental hazards.

In addition, "The Administrator shall not make grants from funds authorized
for any fiscal year beginning after June 30, 1974 . . . unless the grant
applicant has satisfactorily demonstrated to the Administrator that --

(B) as appropriate, the works proposed for grant Assistance
will take into account and allow to the extent practicable
...,the application of technology at a later date which will
provide for the reclaiming or recycling ofwater or other-
wise eliminate the discharge of pollutants.

For land application of wastewater in the 5 '4 states and territories, 22
(41 percent) have formal regulations (Table V-22); Washington has draft
regulations. Thirty-eight states (70 percent) require a minimum of secon-
dary or higher level of treatment before application. Application is pro-
hibited in the District of Columbia, discouraged in Rhode Island, and not
practiced in Nebraska, Ohio and Iowa, according to information compiled by
the Commission or supplied by the various governmental jurisdictions.

*For purposes of the ensuing discussion, the following words or phrases have
these stated meanings: 1)reclamation -- groundwater recharge using effluent,
effluent used for a substantial part of the water supply in lakes used for
recreation or aesthetics and effluent used in man-made canals; 2) reuse --
municipal effluent used by industry or within the municipal treatment plant
and effluent used in flushing toilets; 3) confined disposal -- confined
effluent storage ponds and subsurface disposal areas; and 4) land applica-
tion or recycling -- spray and other forms of irrigation and sludge disposal.
These descriptions appear to best describe the Congressional intent of Sec.
201(d) and the stated practices on a nationwide basis. Land application or
recycling has 'generated greater state activity via regulations, guidelines
and projects than confined disposal, reuse and reclamation.

V-71

TABLE V-22

SUMMARY TABLE
LAND APPLICATION
OF WASTEWATER AND SLUDGE

STATE WASTEWATER SLUDGE
Regu- Treatment and Other Regu-
lations Restrictions lations Restrictions

Alabama . . . . . . . . . . . No Secondary Treatment No
Alaska . . . . . . . . . . . Yes Secondary or Advanced No Permit Required
Arizona . . . . . . . . . . . Yes 11 11 1. No
Arkansas . . . . . . . . . . NO Secondary No
California . . . . . . . . . Yes Primary to Advanced No Ad Hoc Basis
Colorado . . . . . . . . . . No Secondary & Disinfection No Allowed in Landfills
Connecticut . . . . . . . . . No Ad Hoc Basis No -
Delaware . . . . . . . . . . Yes Secondary & Disinfection No Landfill -Ad Hoc
D. C . . . . ... . . . . . . Yes Prohibited No -
Florida . . . . . . . . . . Yes Secondary to Advanced No Landfill -Ad Hoc
Georgia . . . . . . . . . . . Yes Secondary & Disinfection No -
Guam . . . . . . . . . . . . Yes Ad Hoc Basis
Hawaii . . . . . . . . . . . Yes Secondary & Disinfection No
Idaho . . . . . . . . . . . . Yes Secondary or Sec. & Disin Yes Heat treatment
Illinois . . . . . . . . . . Yes Secondary Yes Ad Hoc Basis
Indiana . . . . . . . . . . . No No stabilized
Iowa . . . ... . . . . . . . No Not Generally Practiced No Landfill if Dewatered
Kansas . . . . . . . . . . . No Secondary Yes Ad Hoc Basis - Landfill
Kentucky . . . . . . . . . . No Secondary & Disinfection No Ad Hoc Basis
Louisiana . . . . . . . . . . No Secondary No Ad Hoc Basis
Maine . . . . . . . . . . . Yes Secondary & Disinfection
Maryland . . . . . . . . . . No Secondary
Massachusetts . . . . . . . No Yes Landfill Ad Hoc
Michigan . . . . . ... . . . No Prohibited; or secondary & Yes Ad Hoc Basis
Disinfection
Minnesota . . . . . . . . . Yes Secondary & Disinfection No Guidelines in Preparation
Mississippi . . . . . . . . No No Stabilized - Ad Hoc

Missouri . . . . . . . . . . Yes Secondary &Disinfection Yes Landfill if Dewatered
Montana . . . . . . . . . . No Yes Landfill if Dewatered
Nebraska . . . . . . . . . . No Not Currectly Practiced NO
Nevada . . . . . . . . . . . No Ad Hoc by Permits No
New Hampshire . . . ... . . Yes Secondary &Disinfection Yes Permit - Ad Hoc Basis
New Jersey . . . . . . . . . Yes Secondary -Toxics Prohib.- Yes Landfill mixed with refuse
New Mexico . . . . . . . . . No - No
New York . . . . . . . . . . No Secondary -Disinfection No Ad Hoc Basis
North Carolina . . . . . . . No Advanced &Disinfection No Ad Hoc Basis
North Dakota . . . . . . . . No Secrndary Yes Landfill
Ohio . . . . . . . . . . . . No If not cost effective - no Yes Landfill - Ad Hoc
disposal
Oklahoma . . . . . . . . . . No Secondary Yes Landfill - Ad Hoc
Oregon . . . . . . . . . . . No Secondary & Disinfection or Yes Landfill - Permit
more stringent
Pennsylvania . . . . . . . . Yes Secondary & Disinfection Yes Landfill - Permit, if digested
& Dewatered
Puerto Rico . . . . . . . . No No
Rhode Island . . . . . . . . No Discouraged Yes Landfill Ad Hoc
South Carolina . . . . . . . No Ad Hoc Basis Yes
South Dakota . . . . . . . . No Secondary & Disinfection No Ad Hoc Basis
Tennessee . . . . . . . . . No Secondary & Disinfection Yes Dewatering
Texas . . . . . . . . . . . Yes Secondary or Secon. & Disin. Yes Landfill Ad Hoc
Trust Territories . . . . . No Ad Hoc Basis
Utah . . . . . . . . . . . . Yes Secondary Yes Digested or more Stringent
Vermont Yes Secondary & Disinfection to Yes Landfill - Ad Hoc
Prohibited
Virginia . . . . . . . . . . Yes Secondary & Disinfection No Stabilized or more Stringent
Washington . . . . . . . . . Draft Secondary &Disinfection
West Virginia . . . . . . . No
Wisconsin . . . . . . . . . Yes Secondary &Disinfection Yes Digestion as a Minimum
Wyoming . . . . . . . . . . No Secondary

Source: Compiled by the National Commission on Water Quality,

V-72

For land disposal of sludge, 21 states (19 percent) have some formal
regulations. Of the 35 states with policies regarding sludge disposal,
18 states (51 percent) allow or regulate disposal in landfills, 20 (57
percent) evaluate disposal on an ad hoc or case-by-case basis, five (14
percent) require dewatering, Mississippi and Indiana require some form
of stabilization, Wisconsin requires digestion, Idaho, heat treatment
and Pennsylvania requiresdigestion for landfill disposal.
In zi 1973 survey(108) of 67 municipal and 20 industrial facilities,
EPA and the American Public Works Association reached the following
conclusions concerning land application (as opposed to "disposal") of
effluents:
1. land application of wastewater is practiced successfully
and extensively in the United States and in many foreign
nations;
2. 11various degrees of municipal sewage pretreatment are
practiced prior to land application";
3. under proper conditions, land application is a workable
alternative to advanced treatment;
4. "small communities and food processing industries will
probably 'continue to be the principal users of land
treatment of effluents for the future";
5. a large variety of potential opportunities for land
application exists;
6. 11sale of effluent for beneficial use has been generally
unsuccessful";
7. there is a general improvement of the environment from
land application at the site as opposed to an impairment
of the indigenous ecology;
B. project monitoring has been generally minimal and inadequate;
9. Ifenergy requirements for land application systems may be an
important consideration".;
10. "secondary treatment is generally provided by municipalities
prior to land application"; and
11. 11spray irrigation is the most frequently used (57 facilities)
method of application."

A 1975 study of municipal wastewater "reuse" found continuing opera-
tions at 357 locations in the United States, exclusive of groundwater
recharge(103). The bulk, or 94 percent of these reuse, recycling and
reclamation activities were irrigation practices, 96 percent of which
occurred in Texas, California, Arizona, New Mexico, Colorado and Nevada.

The 1971 total "reuse" volume was 132 billion gallons, 58 percent
for irrigation, 41 percent for industrial reuse, 1.1 percent for recrea-
tional reclamation and 0.008 percent for nonpotable domestic reuse.
For irrigation, approximately 75 percent of the national operations
provided secondary treatment, the remainder being primary and some

V-73

advanced treatment. Proper irrigation management is needed for a
successful operation. For indu'strial reuse, 82 percent of the natiorial
volume is used by Bethlehem Steel in Baltimore for cooling. Only 14
industrial plants are reusing municipal wastewater. The greatest poten-
tial identified for industrial reuse is cooling; both once-through and
recirculating cooling systems using municipal effluent have proved
successful. The primary motivation for industrial reuse is economics.
For recreational reclamation or "reuse", three major projects exist in
Santee, South Lake Tahoe and Lancaster, California. The single largest
extra cost to the reuser was found to be transportation and storage r
facilities.

EPA regulations require that "land application systems shall be
designed so that the permanent ground waters. . which are in the zone
of saturation. . . that result from the application of wastewater will
not exceed the chemical or pestidices [arsenic, barium, chloride, chromium,
copper, fluoride, foaming agents as methylene blue active substances, iron,
lead, manganese, nitrate nitrogen, carbon absorbable organics-carbon;
chloroform extractable (CCE), carbon absorbable organics-carbons; alcohol
extractable (CAE), selenium, silver, sodium, sulfate, zinc, chlordane,
heptachlor, heptachlor epoxide, heptachlor and heptachlor epoxide, lindane,
hepthoxychlor, 2,4-D, 2,4,5-T, 2,4,5-TP, organophosphate and carbonate, and
insecticides] levels for raw or untreated drinking water,supply sotrces in
the EPA Manual forEvaluating Public Drinking Water Supplies. and
"any public drinking water standards for raw water supplies hereafter
issued by EPA which prescribe maximum allowable limits or permissible con-
centrations of chemicals or pesticides shall apply in lieu of those listed
above."(110).

Those who expected widespread and more frequent resort to these
waste treatment management methods have expressed their disappointment
that traditional capital-intensive facilities continue to dominate
the treatment of domestic wastes. The Commission contractor found
"that project designs prepared by consulting engineers generally
represent a uniform, standardized approach to the treatment of waste-
water. The similarity of treatment facilities applies to all geogra'-
phic areas, regardless of local wastewater, climatic, soil and receiving
water characteristics."(105). Consulting engineers and municipal
officials were found to be preoccupied with the facilities planning
requirements of Step.1 and concerned about delays that might result',
in cost increases. The contractor concluded "....the inflexibility of
secondary standards for dischargers and the constraints of the lengthy
review process are causing consulting engineers and municipalities
to submit standard designs for treatment facilities."(106) One other
suggested "major reason for the lack of innovative alternatives is the
number of projects designed prior to the enactment of P.L. 92-500.
In these instances, alternatives have been developed only to meet the-
legal requirements."J107)

V-74

A Panel on Water Reuse assembled under the auspices of the Committee on
Water Quality Policy, Environmental Studies Board, National Academy of
Sciences-National Academy of Engineering, considered the regulatory and
policy constraints and public health restrictions which may inhibit or re-
duce opportunities for reclaiming and recycling wastewater. The Panel's
statement concluded:

Although it is anticipated that water reuse projects will
increase in number and scope due to the impetus of P.L.92-500,
there are a number of regulatory, policy, public health, and
technological constraints that will inhibit the development
of such programs. Among the most important identified by the
Panel are:

(1) The requirements of P.L.92-500 that water reuse produce
revenue for the treatment facilities.

(2) Priority.systems utilized in the administration of the
Federal grant program.

(3) Regulations related to control of groundwater or irri-
gation under-drain water quality.

(4) The historic practice of utilizing the best quality of
water available for any purpose.

(5) Interference with existing water rights, particularly
those associated with the western doctrine of appropriation.

(6) Existing contractual commitments.

(7) Limits on quality parameters based on scientifically
established effects.

(8) Vublic health prohibitions and established national
policies against planned reuse of water for purposes for
which potable water is required (until such time as public
health factors and technological developments have been
resolved through adequate research).

(9) Political considerations involved in transporting
treated waters across political boundaries from their area
of origin to potential sites of reuse.

In spite of the constraints enumerated above, the planned
production of higher quality effluents over the next five
to ten years should produce numerous opportunities for
supplementing our natural water supplies with reclaimed
water wherever the quality characteristics and the econo-
mics of its production and distribution permit(10.8).

V-75

The EPA Administrator commented on the PaneVs report as follows:

With- regard to water reuse, we require that this be con--i
sidered in the cost effectiveness analysis. It has been our
judgment that if the analysis were.based on the potential
for reuse, the costs,to the Federal government and to state.
and local government, could be very high with no certainty
of achieving a beneficial use. Additionally, it is likely
that the construction without reuse will serve as an oper-
able portion of a reuse system should the need for this
water arise at some later time.

I know of no Federal regulations'or interpretations
of P.L.92@500 which require users of reclaimed water to
pay for increased treatment to provide for reuse. Cer-
tainly such charges are appropriate, but they are not neces-
sary in order for a reuse project to be cost-effective.#

"Needs," "Costs,"'State Allotments, Priorities, Federal Funding and
Inflation

"Needs," "Costs" and State Allotrmnts -- Beginning with the 1956 Water
Pollution Control Act Amendments, Federal funds for construction grants
were allocated to the states 50 percent on the basis of population and 50
percent on the basis of per capita personal income. A $250,000 maximum
per project prescribed for the Federal loan program, initiated in 1948i
was continued 'for'grant projects from 1957 until 1961. At least half of
the amount appropriated was required to.be spent for grants to municipali-
ies under 125,000 in population. Various limitations on the size of grants
for a single project were in"eff6ct.until the Clean Water Restoration Act
of 1966, and the 50 percent population-50 percent per capita income formula
was preserved for the first $100 million appropriated until 1972. Amounts
in excess of $100 million appropriated for fiscal years after July 1, 1965,
and until the-fiscal year beginning July 1, 1972, Were allocated to the
.states on the basis of "the ratio that the population of each state bears
to the population''of-all the states." (P.L.84-660, as amended, Sec.8(c).)

Allotments for fiscal years beginning July 1, 1972, were to be based
upon "the ratio that the estimated cost of constructing all needed pub-
licly owned treatment works in each state bears to the estimated cost of
construction of all needed pubiicly owned treatment works in all of the
states. 'Forlthe fiscal years ending June 30, 1973, and June 30, 1974,
such ratio shall be determined on the basis of Table III of House Public
Works Committee Print No.92-50." (P.L.92-500, Sec.205(a).) This table

*Letter from Russell E. Traint Administrator, U.S.EPA, to Joe G. Moore, Jr.,
Program Director, National Commission on Water Quality, April 14, 1975.

V-76

contained a state-by-state list of the 1972-74 neqds, as reported by EPA
after its 1971 survey. Allotments thereafter were required to be embodied
in Congressional Acts each two years, based on "a detailed estimate, bien-
nially revised, of the cost of construction of all needed publicly owned
treatment works in all of the states and of the cost of construction of
all needed publicly works in each of the states . . . submitted no later
than February 10 of each odd-numbered year (by the EPA Administrator)."
(Sec. 5 16 (a) . )

P.L. 92-500 contained authorizations of $5.0, $6.0 and $7.0 billion
to be appropriated for fiscal years ending June 30, 1973, 1974 and 1975.
[Section 207].

The Presidential decision to withhold allotment of $3.0 of the
$5.0 billion authorized for fiscal year 1973, resulted in an allocation
,which probably precipitated an adverse Congressional reaction to the
use of needs as a basis for alloting construction grant funds. Two
billion dollars was allocated for fiscal 1972 under the prior law on the
basis of each state's population as a percent of the total population;
the same amount was allotted for tJae next.,fiscal year., 1373, mder the
new Act on the basis of a state's percentage of needs for 1972-1974 as
shown in the 1971 EPA survey. Thirty-one of fifty-four states and
territories received less in 1973 allotments than for 1972, and in some
instances -- Alabama, Georgia, Kentucky, Mississippi, North Carolina,
South Carolina, Arkansas, Louisiana, New Mexico, Texas, Oklahoma, Kansas,
Colorado, Montana, North Dakota, South Dakota, Utah, Wyoming and Arizona,
for example -- the reductions were substantial, i.e., 50 percent or more.
(See Table V-26.) Considerable disruption faced these states. Had the
full $5 biilicn been allotted, every state would have had an increase with,
of course, some states getting much larger increases than others. Signi-
ficant shifts in. distribution of funds among the states might have been
more readily accepted had every state received an increase over its allo-
cation in the preceding fiscal year.

In its subsequent allotment statute (P.L.93-243), following the 1973
EPA needs survey, Congress prescribed that, for the fiscal year ending
June 30, 1975, one-half of a state's allotment would be based on its pro-
portionate share of costs for categories I through V, and one-half on its
proportionate share of costs for categories 1, 11 and IV-B, with a minimum
equal to its 1972 allotment. The minimum had to be applied for Alabama,
Arizona, Louisiana, Mississippi, Montana, New Mexico, North Dakota, Texas,
Wyoming and Guam when EPA allotted $4 billion for fiscal 1975.. When the
Supreme Court later ruled invalid the President's refusal to allot each
fiscal year's full authorization, the remaining $9 billion of the total
$18 billion authorized in P.L.92-500 was allotted on the basis of the
Congressional prescription for the fiscal year for which it had originally
been authorized. In transmitting the 1974 needs survey results to Congress,
EPA recommended "a new construction grant allocation formula . . . that

V-77

TABLE V-23

Publicly owned Treatment Works
Construction Grants Allotment to Selected States
Comparison, Fiscal Year 1972 with Fiscal Year 1973
($2.0 billion in Federal Funds Each Year)
(Millions of Dollars)

Allotment Allotment
State FY 1972 FY 1973 State FY 1972 FY-1973

Vermont $ 5.1 $ 4.4 Kansas $ 22.1 $ 7.5
Puerto Rico 27.0 17.7 Missouri 45.1 33.1
Alabama 33.8 7.2 Nebraska 14.9 11.1
Georgia 44.4 19.5 Colorado 21.8 6.3
Kentucky 31.5 13.2 Montana 7.5 3.3
Mississippi 22.3 7.9 North Dakota 6.9 .9
North Carolina 49.2 18.5 South Dakota 7.3 1.9
South Carolina 25.7 12.9 Utah 11.0 2.8
Tennessee 38.2 23.2 Wyoming 4.0 .5
Wisconsin 42.6 34.8 Arizona 17.7 2.7
Arkansas 19.4 7.1 Hawaii 8.1 6.6
Louisiana 35.6 18.9 Guam 2.2 1.7
New Mexico 10.7 4.2 Idaho 7.8 4.4
Texas 106.9 55.4 Oregon 20.6 17.0
Oklahoma 9'2 Washington 33.0 17.8
Iowa 27.6 23.1

Source: Fiscal Year 1972 allotments, Table III, Committee Print (93-28),
House Committee on Public Works, "Costs of Construction of
Publicly Owned Wastewater Treatment Works;" fiscal year 1973
allotments from 38 FR 15760, May 6, 1974.

V-78

would be based on an equal 50 percent division between population and the
Agency cost estimates for categories I, II and IV-B"(109).

In the same Act (P.L.93-243), Congress also required a special needs
survey encompassing the eligible costs: a) of "best practicable waste
treatment technology over the life of the works" [the 1983 requirement for
publicly owned treatment works in Sec.201(g)(2)(A)I; b) to meet water quality
standards established under Sec. 303; and c) "of constructing sewage collec-
tion systems and correcting excessive infiltration or inflow and . . ., of
correcting combined storm and sanitary sewer problems and treating storm
water flows," i.e., all of categories I through VI to meet 1983 require-
ments and the 1983 interim goal.

The 1971 survey, stated in 1971 dollars, estimated "needs" in the sense
that "needs" were considered the equivalent of then contemplated construc-
tion projects, i.e., costs of projects planned for the three-year period
1972-1974, most of which represented costs attributable to secondary or
advanced treatment projects. Congress subsequently enlarged this estimate
from $14.6 to $18 billion to cover fiscal 1975. The 1973 survey, stated
in 1973 dollars and based on serving the population projected for 1990,
estimated principally construction needs required for compliance with 1977
requirements for five waste collection and treatment categories -- secondary
treatment, more stringent treatment required by water quality conditions,
sewer rehabilitation to correct infiltration and inflow, new sewers and
correction of overflows from combined sewers. Compiled from questionnaires
addressedto municipalities, completed in some instances by consulting
engineers and state officials and revised by EPA officials, the'.1973 survey
indicated a construction "needs" total of $60 billion.

The 1974 needs survey, for the first time(110), addressed costs asso-
ciated with 1983 treatment requirements and produced a $342 billion estimate
of "needs."* With three years' hindsight, the 1972 commitment of $18
billion for construction grants will provide three to one matching funds
adequate to meet only a part of the collection and treatment requirements
of P.L.92-500. While the $342 billion(lll)estimate produced by the most
recent (1974) Needs Survey may be an overstatement(112),** the approxi-
mately $320 billion gap between 197i and 1974 estimates poses a vital
question: To what extent did the 92nd Congress commit the Nation to a
long-term, continuing municipal grant-in-aid program?

*Revised by EPA to $444.3 billion, reflecting 1975 dollar value rather than
1973 dollar value used in original 1974 Needs Survey. See Table 11-17 for
a comparison of EPA estimates.with Commission estimates.

**An examination of the validity of the 1974 Needs Survey was conducted by
the Commission.

V-79

The latest survey precipated widespread discussion about the reriabi-
lity of the cost estimates as a basis for allocation of grant funds to the
states. Some states and municipalities apparently inflated their need
estimates, hoping to maintain or improve their relative shares of annual
Federal grant allocations. Moreover, some states and municipal survey
participants did not support their estimates with detailed costs(113).
EPA transmitted the survey to the Congress with the following disclaimer:

The problem in using these estimates [for allocation of con-
struction grants] is that they are based on implementation
strategies that are in varying stages of development. Because
of the inherent flexibility of abatement choices, the states
could not be consistent or uniform in reporting their needs in
situations where goals were not well defined or where there was
no recognized "best method" for a solution. In those cases,
when the range of choices available for abatement actions re-
lating to a given pollution problem were wide, and when legal
requirements for correction offered significant latitude, there
was considerable unevenness in the impact of the diverse
approaches taken by the states in determining what corrective
abatement actions were necessary and in estimating the cost
of such actions"(114).

During August, 1975, EPA concluded that the 1976 survey should be
performed by two independent contractors -- in an attempt to develop a
definitive estimate of construction needs based upon the uniform appli-
cation of a consistent methodology. This survey will also fulfill the
statutory directive for the next biennial estimate of needs due in 1977.
The 1974 Needs Survey will be conducted by contractors for EPA with
assistance froin EPA regions, states and local agencies. Two separate
contracts will be awarded. One, covering categories I-IV, will produce
state and national costs and will use more detailed guidance to achieve
standardized estimates. A major effort will be devoted to obtaining
techniCal data on existing and needed facilities. The second contract
will cover categories V and VI. state and national costs will be
obtained by attempting to relate treatment'needs to receiving water
quality after*developing uniform models. States and local governmental
units will provide information and data, but final estimates.will be
produced by the contractors with close supervision by EPA.

A needs survey to be used as a basis.for allocation must be reasonably
accurate so as to produce an equitable distribution of funds. Several
components of the present survey can be manipulated to produce high
needs so as to enlarge a state's proportionate share of the available
Federal funds. Only carefuli documented state needs reports, prepared
according to standard instructions and methodologies and adequately
audited by EPA can assure equitable distribution. Among the variables
subject to manipulation,for the advantage of an individual state are
population projections, percentage of the population estimated'to be

V-80

sewered in future years, the expected life and capacity of collector and
interceptor sewers, the miles of existing sewers subject to infiltration/
inflow and requiring rehabilitation, the costs for correction of combined
sanitary and storm sewer overflows, the costs of controlling or reducing
pollution from storm sewers and effluent limitations more stringent than
secondary to meet water quality standards and the 1983 goal.

States can increase their costs for treatment at publicly owned treat-
ment works by designating waters at points of discharge as "water quality
limited," i.e., they can adopt water quality standards that will require
more stringent effluent limitations than secondary treatment. A letigimate
policy question is raised: If a state, for its awn water quality objec-
tives, adopts standards stricter than those that would comply with Federal
law and, in the process, increases the cost for publicly owned treatment
works, should that additional cost be considered in allotting Federal
funds to that state, and should that additional cost be entitled to 75 per-
cent Federal funding? To prevent inequities in, or manipulation of, the
allotment process, adequate comparisons should be made between adopted
water quality standards and state-reported needs. At the same time, the
extent to which state-adopted water quality standard 's are, more stringent
than required to meet the objectives and goals of the Federal Water Pollu-
tion Control Act should be examined to learn the possible effect of higher
standards on allotments.

While costs for secondary treatment, and even for additional treat-
ment processes that may be required for discharges to water quality
limited waters, are well understood and generally uniform for various
areas of the country, costs for some categories, particularly correction
or treatment of combined sewer overflows and control or treatment of
storm sewer flows, are less well identified, documented and defined.
There is little agreement as to acceptable methods or solutions for
control or treatment; a choice of the severity and d@ration of the storm
event for which control or treatment is to be'prescribed can substantially
affect the resultant'costs.

Meaningful comparisons between the three results of needs surveys
conducted from 1971 through 1974 are impossible because each successive
survey was based on its own definitions, interpretations and coverage.
(See Table V-24). While EPA, in each instance, has attempted to revise
or adjust the results of each one so as to make it more internally
consistent, inherent,differences in timing, instructions, interpretations
and methodologies severely restrict their year-to-year,comparability.

State-by-state comparisons of EPA estimates of total and 1990 per
4
capita needs from the 1974 survey are shown separately for categories I
through V and for categories I, Il and IV-B in Table V-25. Wide varia-
tions exist between states and EPA regions. Comparison of per capita
lineeds" with per capita allotments in Table V-26 a@so reflects. substan-
tial differences., Identifying the fifteen highest per capita states in

V-81

TABLE V-24

Publicly owned Treatment Works
EPA Needs Surveys -- Total Costs

Eligible 1971 1973 1974
Category 1973$ 1975$

I, II, IIIA and IVB $18.0 $35.2 $51.4 $67.1
Secondary and Advanced Treatment,
Infiltration and Inflow Correction
and interceptor Sewers

IIIB n/a n/a 7.3 9.2
Major Sewer Rehabilitation

IVA n/a 12.2 17.5 22.1
Collection Sewers.

V n/a 12.7 31.1 40.4
rorrection of Combined Sewer
overflows

VI n/a n/a 235.0 305.5
Treatment and/or Control of
Stormwater

TOTAL $18.0 $60.1 $342.3 $444.3

n/a not applicable.

Source.: Commission Staff Compilation of EPA Needs Surveys. 1971 needs
stated in 1971 dollars. 1973 needs stated in 1973 dollars.
1974 needs stated in 1973 and 1975 dollars.

V-t$2

TABLE V-25

Publicly Owned Treatment Works
EPA Estimate: state Needs and Par Capita Costs

1990 Categories T, I!, III Categories 1,
Population IVA, IVB and V 11, and IVB
Costs Costs Per Capita Costs** Costs Per.C its

Region I

Connecticut 3,946 1,594 403 484 123
Maine 1,142 $75 503 273 239
Massachusetts 7,052 2,964 420 1,32S 188
New Hampshire 907 740 815 384 423
Rhode Island 1,134 447 1.84 187 165
Vermont 536 204 380 125 233

Region XI
New Jersey 8,822 4,894 554 2,602 295
New York 21,799 15,302 701 4,603 211
Puerto Rico 0 603 368
Virgin Islands 0 44 31

Region III
Delaware 793 S" 688 199 251
Maryland 5,318 3,642 684 2,324 437
Virginia 5,958 1,884 316 1,129 189
West Virginia 1,845 2,360 11279 1,320 715
Pennsylvania 13,332 5,454 409 1,629 122
Dist. of Columbia 764 1,052 1,376 69 90

Region IV
Al-ba-8 3,850 778 202 472 123
Florida 11,728 2,704 230 1,874 160
Georgia 5,667 1,519 268 1,020 180
Kentucky 3,741 1,824 487 649 173
Mississippi 2,359 494 209 359 19,2
North Carolina 5,880 1,480 251 1,044 178
South Carolina 3,023 977 323 728 241
Tennessee 4,800 1,210 252 677 141

Region V
Illinois 13,177 6,234 473 2,343 178
Indiana 6,433 2,903 451 837 130
Michigan 10,961 8,102 739 1,673 153
Minnesota 4,577 1,330 290 707 154
Chio 13,202 7,773 588 2,367 179
Wisconsin 5,218 2,044 391 939 177

Region VI
Arkansas 2,068 898 434 582 281
Louisiana 4,159 1,283 3nS 499 120
New Mexico 1,232 155 125 97 79
Texas 13,666 3,222 235 2,025 148
Oklahoma 2,942 1,484 504 662 22S

Region VII
Iowa 3,053 911 298 532 174
Kansas 2,509 1,783 710 524 209
Missouri 5,488 2,298 418 843 154
Nebraska 1,562 924 591 227 145

Re2ion VIII
Colorado 2,848 409 143 259 91
Montana 714 127 177 90 126
North Dakota 606 189 311 74 122
South Dakota 643 75 116 72 112
Utah 1,509 291 192 218 144
Wyoming 600 84 140 55 92

Region IX

Arimna 3,384 500 147 266 79
California 26,601 6,208 233 4,104 154
Hawaii 11010 523 517 439 435
Nevada 933 209 224 177 190
American Samoa 0 36 0 7 0
Go- 275 93 338 60 218
Trust T2rritories 20S 195 951 133 649

Region X
Alaska 408 405 992 319 782
Idaho 758 393 518 216 285
Oregon 2,943 1,081 367 308 105
Washington 4,194 1,836 437 675 161
TOTAL 252,274 $107,289 $425 $46,204 $183

Thous@ands of People, 1990 population estimate
millions of 1973 dollars

Source: -Cost Estimates for Construction of Publicly owned Wastewater Treatment
Facilities, 1974 -Needs' Survey." EPA, February 10, 1975, Table SC-3,
with per capita mate calculated and Table EPA-4.

V-83

TABLE V-26

Publicly Owned Treatment Works
Per Capita, EPA 1974 Estimates, Construction Grants "Needs" and 1973-77 Allotments

Per Capita, 1990 Population Estimate
Allotment "Needs- Categories "Needs" Categories
PY 1973-77 1 through V I, II, and IV@B

Region I

Connecticut 78 $ 403 $ 123
Maine 134 503 239
Massachusetts 81 420 188
New Hampshire 170 815 423
Rhode Island 80 394 165
Vermont 85 380 233
Region 1 $90 443 189

Region ri

New Jersey 147 554 295
New York 96 701 211
Puerto RiCO
Virgin Islands
Region II $117 681 248

Region III

Delaware 140 688 251
Maryland 106 684 437
Virginia 83 316 189
West Virginia 64 1,279 715
Pennsylvania 74 409 122
District of Columbia 191 1,376 90
Region 111 87 533 238

Region IV

Alabama 25 202 123
Florida 29 230 160
Georgia 43 268 160
Kentucky 50 487 173
Mississippi 34 209 152
North Carolina 37 251 178
South Carolina 56 323 241
Tennessee 45 252 141
Region IV 46 268 166

Region V

Illinois 86 473 178
Indiana 75 451 130
Michigan ill 739 153
Minnesota 74 290 154
Ohio 74 588 179
Wisconsin 55 391 177 0
Region V 83 530 166

Region VI

Arkansas 39 434 281
Louisiana 37 308 120
New Mexico 29 125 79
Texas 31 235 148
Oklahoma 46 504 225
Region V1 34 293 161

Region VII

Iowa 65 298 174
Kansas 45 710 209
Missouri 57 418 154
Nebraska 50 591 145
Region VII 56 469 169

Region VIII

Colorado 32 143 91
Montana 40 177 126
North Dakota 20 311 122
South Dakota 28 116 112
Utah 30 192 144
Wyoming 14 140 92
Region VIXI 29 170 ill

Region IX

Arizona 13 147 79
California 71 233 154
Hawaii 108 517 435
Nevada 70 224 190
American Samoa
Guam 47 338 218
Trust Territories 25 951 649
Region IX 66 240 160

Region X

Alaska 126 992 782
Idaho 50 Sis 285
Oregon 52 367 105
Washington 51 437 161
Regim X 55 447 183

TOTAL- National 71 $425
Source: National Commission on Water Quality

V-84

each of the three categories reveals that only five states appear on all
three lists; another five states appear on one "needs' list and the allot-
ment list, while four states appear on both "needs" lists but not the
allotment list. There does appear to be some rough correlation between
allotments and needs under P.L.92-500. (Table V-27.)

Priorities -- As states and localities proceed to complete more of the
facilities required under the Act, detailed accuracy of the calculations
and compilation of needs will be increasingly important. Totals of recent
"needs" estimates, including the analyses by the Commission, raise the
question of priorities. Because of the total cost estimates for all cate-
gories of "need" and the amount of Federal appropriations required with
75 percent Federal funding, should the:categories I through VI be arranged
in some priority sequence? Congress is faced with making the conscious
decision whether it should fund all eligible categories or only some.
Similarly, if the decision is not to fund all categories, should some
eligible categories be funded in some states, based ori an analysis of the
potential benefits in relation to the costs? Decisions involving selec-
tive funding of projects in all eligible categories can lead to issues
relating to priorities among the states. For example, should projects in
categories I and II, relating to treatment, be funded in all states before
funding projects in categories IV-A (collector sewers) and VI (storm sewer
flows) in any state? Should states fix the priorities subject to EPA
approval on a year-to-year basis?

On July 31, 1975, the Administrator of EPA transmitted to the Office
of Management and Budget a proposal to alter project eligjbili@y and to
adopt a varolable Federal matching share. The proposal stated the 1974
Needs Survey cost estimates in 1975 dollars -- $444.3 billion, rather
than the original total of $342.3 billion. As indicated in Table.V-29,
EPA recommended that the Federal share of the $444.3 billion total be
limited to $88.5 billion -- $57.0 billion* of which would be authorized
by 1983. The proposal did not estimate when authorized funds would be
obligated or expended, and did not:recommend when or how the remaining
federal share of $31.5 billion would be authorized or obligated. Based
on the proposal, the cost of treatment and/or control of all stormwater
would be borne by state and local governments. With respect to categories
I-V, totaling $138.8 billion, the proposal suggests a federal/state-
local cost sharing of $57.0 billion/$22.3 billion for those projects
which would be eligible for grants from authorizations for fiscal years
1975 through 1982. The post-1982 cost-sharing suggestion calls for a
Federal share of $31.5 billion and a state-local share of $28.0 billion.

*The $57.0 billion share includes $15 billion of the $18 billion authorized
by P.L.92-500, but not obligated prior to July 1, 1974.

V-85

TABLE V-27

Publicly Owned Treatment Works
Fifteen Highest States
Per Capita EPA 1974 Estimates, Construction Grants "Needs"
And 1973-77 Allotments

State Allotment State "Needs" Categories
FY 1973-77 1 through V

"District of Columbia $191 **District of Columbia $1,376
*New Hampshire 170 ***West Virginia 1,279
*New Jersey 147 ***Alaska 992
*Delaware 140 ***Trust Territories 951
,"Maine 134 *New Hampshire 815
Alabama 126 **Michigan 739
**Michigan ill Kansas 710
*Hawaii 108 "New York 701
*Maryland 106 *Delaware 688
"New York 96 *Maryland 684
Illinois 86 Nebraska 591
**Vermont 85 Ohio 588
Virginia 83 *New Jersey 554
Massachusetts 81 ***Idaho 518
Rhode Island 80 *Hawaii 517

State "Needs" Categories
I, II-and IV-B

***Alaska $782
***West Virginia 715
.***Trust Territories 649
*Maryland 437
*Hawaii 435
*New Hampshire 423
*New Jersey 295
.***Idaho 285
Arkansas 281
*Delaware 251
South Carolina 241
**Maine 239
**Vermont 233
Oklahoma 225
Guam . 218

States on all three lists.
States on one "Needs" list and the allotment list.
States on both "Needs" list but not on the allotment list.

V- 86

TABLE V-28

Publicly Owned Treatment Works
EPA Construction Grant Proposal -- Scheduled Authorizations
(in billions)

Fiscal Years
Authorizations 175 '76 '77 '78 '79 180 181 182 Total
P.L. 92-500 $3.J $5.52 $5.92 --- --- --- --- --- $15.0
Proposed
7-31-75 --- --- 7.0 7.0 7.0 7.0 7.0 7.0 42.0

TOTAL $3.6 $5.5 $12.9 $7.0 $7.0 $7.0 $7.0 $7.0 $57.0

1 Actual obligations.
2 Estimated obligations.

Source: EPA, "Proposal for a Long-term Funding Commitment Based on
Variable Federal Share," transmitted to Office of Management
and Budget, July 31, 1975.

Municipal compliance with P.L. 92-500 treatment requirements will
be determined by both the magnitude and the scheduled outlay of Federal
funds. Both the magnitude and the schedule will depend upon two deter-
minations -- How much municipal construction incident to Public Law 92-
500 will be eligible for Federal grant assistance and over what period
of years will such eligible facilities be financed? The question of
magnitude will not be easily answered, and once a schedule of Federal
assistance is adopted, grant obligations and outlays must proceed without
delay.

Determination of the magnitude and schedule of Federal grant assistance
does not directly address the financial burden to be carried by state
and local governments. Based on EPA's proposal for a "Long-term Funding
Commitment," state-local costs could total $355.8 billion if present
estimates of stormwater control or treatment costs of $305.5 billion
were borne locally or by the states. Further study of the costs of
alternative control or treatment methods compared with benefits to be
derived from individual projects in this category could substantially
reduce the cost by identifying the least cost solution to meet water
quality goals or objectives.

TABLE V-29

Publicly Owned Treatment Works
EPA Construction Grant Proposal Based on Variable Federal Share
(in billions)

Total 1974 "Needs"l Federal Share State/Local
Eligible Federal By After By After By After
Category Share 1983 1983 Total 1983 1983 Total 1983 1983 Total

1, 11 & IVB (75%) $60.4 $ 60.4 $45.3 $ $45.3 $15.1 $ $15.1
Secondary and Advanced
Treatment and Intercep-
tor Sewers
00
IIIA (75%) 6.7 6.7 5.0 5.0 1.7 1.7
Infift@ration and Inflow
Correction

V (60%) 8.0 32.4 40.4 4.8 19.4 24.2 3.2 13.0 16.2
CorrFc-tion of Combined
Sewer Overflows

IVA (45%) 3.3 18.8 22.1 1.5 8.4 9.9 1.8 10.4 12.2
CoMi-c-tion Sewers

IIIB (45%) .9 8.3 9. 2 .4 3.7 4.1 .5 4.6 5.1
Major Sewer Rehabilitation
Vi --- 305.52 305.5 --- --- - --- 305.52 305.5
Treatment and/or Control
of Stormwater

TOTAL $79.3 $365.0 $444.3 $57.0 $31.5 $88.5 $22.3 $333.5 $355.8

1 1973 dollars used in 1974 Needs Survey adjusted by EPA to
reflect 1975 dollar values.
2 Commission staff assumes that Category V! Construction would, as
a -matter of resource availability, be r@eferred until after 191'3.
That assumption may not hold in all localities.

Source: FPA "Proposal for a Long-Term Funding Commitf-rieni: Based on A Variable Federal
Share" transmitted to Office of Management anr3 Buaget, July 31, '_@175

V-88

Federal Funding and Inflation. The uncertainty of Federal funding for
the construction grants program in recent years is reflected in Table V-30.
In the eight years from 1963 through 1971, appropriations fell $1.2 billion
short of the authorized $3.9 billion. The contract authority provisions,
coupled with the yearly authorized level of allotments in P.L.92-500, were
intended to provide some certainty and reliability to the flow of Federal
construction grant funds. Once obligated under EPA's contracting authority,
Congress is expected to provide appropriations in whatever total is neces-
sary to meet a,;tual yearly outlays under the contracts. Slow obligation
of new funds in the fiscal years immediately following fiscal year 1972
will require accelerated obligation over the current and 1977 fiscal years
to commit the $18 billion authorized in P.L.92-500.

while major Federal governmental effort is committed to retarding or
halting inflation, experience over the last several years has indicated
a severe increase in the cost of wastewater treatment plants and sewers.
(Table V-31.)

In connection with delayed allotment of the full authorized $18
billion, the Commission contractor described the inflationary impacts.

Although virtually any fixed sum of money became
progressively less effective in "buying power" during
this time period due to increases in the standard cost
of living index, the impounded grant funds were particu-
larly affected by the rate of inflation unique to the
construction industry. For example, during 1974, the
construction cost index for m@nlcipal treatment plants
rose 20% and the index for sewer construction rose 17.5%,
while the cost of living index rose approximately 12%
during the same time period. If only a 10% rate of con-
struction price inflation is assumed to have existed
during the fiscal 1973 through 1975 period, the "buying"
value of the impounded $9 billion will have declined by
$1.7 billion after the release of the impounded funds.
However, this sum is meaningful only if it is assumed
that the entire impounded amount of $9 billion could
have been spent in fiscal 1973, 1974 and 1975. Thus,
the only general conclusion that can be made is that
a double penalty results from delays in construction
grant projects, namely'-

a. Improvements in effluent quality are delayed; and

.b. the project will cost more to complete because of
inflation, and thus- will use more of available funds,
(115).

V-89

TABLE V-30

Publicly Owned Treatment Works
FUNDING HISTORY OF CONSTRUCTION GRANTS PROGRAM

Fiscal Allotted
Year Authorized Appropriated Under P.L. 92-500

1957 $ 50,000,000 $ 50,000,000 $
1958 50,000,000 46,657,000
1959 50,000,000 46,816,000
1960 50,1000,0.00 46,101,000
1961 50,000,000 45,645,000

1962 80,000,000 80,000,000
1963 90,000,000 90,000,000 --
100,000,000 �0,000,000 7-
1965 100,000,000 90!000,000 --
1966 130,000,000 121,000,000 7-

1967 150,000,000 150,000,000 --
1968 450,000,000 203,000,000
1969 700,000,000 214,000,000
1970 lF000,00.0.,000 800,000,000
1971 1,250,obo,ooo 1,000,000,000

1972 2,000,000,000 2,000,000,000
1973 7,750iqOO,000** 1,900,000,000** 2,000,000,000*
1974 6,600,000,000** 3,000,000,000*
1575 7,000,OdO,000 4,000,000,000*
1976
9,000,000,000*
1977 Remainder*

Contract Authority; funds need not be appropriated prior to obligation.
Includes $2.75 billion in 1973 and $600 million in 1974 authorized as
I I
part of P.L. 92-500 for treatment works constructed from fiscal 1957
to 1972; of these amounts, $1.9 billion was appropriated in 1973.

Source: 1974 GAO Report on Construction Grants for Municipal Waste
Treatment Plants, printed in Institutional Assessment of the
Construction Grants Program Under Public Law 92-500, Touche
Ross & Co., contractor report fok NCWQ, July 31,"1975,"
page III-H-2.

V-90

TABLE V-31

Publicly Owned Treatment Works
Inflation of Construction Costs for Treatment Plants and Sewers

Treatment Plants Sewers

Base (57-59) 100.0 100.0
1960 105.0 106.2
1961 105.9 108.2
1962 107.0 109.7
1963 108.5 113.1
1964 110.1 114.7
1965 112.0 116.6
1966 116.1 120.5
1967 119.4 124.5
1968 123.6 129.6
1969 132.7 138.7
1970 143.6 149.8
1971 159.8 167.2
1972 172.0 185.6
1973 182.6 199.6
1974 217.2 230.5

1975 (March) 247.4 253.0
1975 (June) 245.9 255.6
1975 (September) 251.3 261.3

Source: EPA Sewage Treatment Plant and Sewer Construction Cost Indices.

Using one possible pattern of Federal appropriations over an eleven-
year period to meet a $158.1 billion construction grant program for
categories I through V, with 75 percent Federal funding, provides an
example of the inflationary effect:

V-91

Appropriations
Fiscal Cummulative Billions of Billions of
-Year Inflation 1975 Dollars Inflated Dollars

1975 100.0% $2.6 $ 2.6
1976 107.9 5.9 6.4
1977 113.4 7.5 8.5
1978 -120.0 8.7 10.4
132.4 9.9 13.2
1980 144.0 11.2 16.2
1981 153.3 12.5 19.1
1982 162.9 13.8 22.6
1983 173.3 15.2 26.2
1984 183.7 15.6 28.6
1985 194.7 15.6 30.2
TOTAL $118.5 $184.4

If all sectors of the economy,were to simultaneously experience the
same rate of inflation, little adverse economic impact might result.
,When various sectors experience different rates, or some inflate while
others deflate -- either of which is the more likely occurrence in the
real world, then consequences for some sectors can be severe. Since
goverment expenditures can be inflationary, a program of the magnitude
outlined here could itself trigger or accelerate inflation. In shaping
the construction grants program 6ver the next decade, Congress will have
to evaluate both the impact of general economic conditions on various
alternative levels of expenditure and the economic impact of these
leivels on other sectors of the economy. The ideal rate of annual appro-
priations would be that which achieves Congress' selected objective with
minimal contribution to, or loss of purchasing value from, inflation.

V-92

Pretreatment, Industrial Cost Recovery and User Charges

Pretreatment and industrial cost recovery are provisions designed for
industrial or commercial sources discharging, or planning to discharge,
into publicly owned'treatment systems. 1@h6,purpose is to insure' that the
discharged wastes are compatible with-the,public treatment facilities and
that the dischargei pays a share of the cost of construction proportionate
to the use of the,system. User charges relate to recovery by the munici-
pality of the costs of operating and maintaiining the facility from all
users -- industrial, commercial and residential --@proportionate to the
use of the facility.

Each of these provisions has provoked controversy, although none of
them really has much of a record for analysis since they apply only to
projects funded and@comp@eted:under P.L.92-500, and few of those projects
'have been completed.' The Commission's work, therefore, was limited to an.
analysis of the expected problems and suc 1cess of the;e provisions and the
contentions surroundin4'them.

Although these provisions contain potential problems for industrial
compliance, theke:are also some very*distinct advantages provided to
industries that join up with Publicly owned treatment works. EPA has
identified the advc-,tnta4es to industries that choose"to discharge into
municipal systems as "economies of scale in public treatment,
avoiding the costs of obtaining their own permits, and (as long as they
meet certain pretreatm6nt.requiremen'ts) . . . [and] avoidance of certain
monitoring responsibilities. -Firms .@articipating in a municipal system
also avoid the nec'e@sity to raise@external capital themselves to purchase
pollution control equipment, i.e., they 4o not have to go to the capital
markets to borrow funds, thereby-perhaps altering,their debt-equity ratio."
EPA adds, "Using an opportunity cost of capital of 10,percent, recovered
over 30 years, and assuming that the industrial share of all local costs
is recovered, from industry, it can be demonstrated that the implicit
subsidy to industry on 0 ie" Federal share is 69 percent. If one takes into
acc6unt th4t many states provide supplementary grants that alsp do not
require that interest.be recovered, and that (in the Federal program) the
25 percent local share of industrial costs need not be recovered at all,
the effective subsidy to industry will, in many cases, exceed the 75 per-
cent subsidy to municipalities"(116).

Pretreatment

Probably no single aspect of the EPA's implementation of P.L.92-500
has caused more difficulty than the pretreatment regulation and guidelines
I .
issued pursuant to Sec. 307(b) of the statute. Regulations were proposed
over two years ago and have yet to be promulgated.

V-93

Sectiun 307(b)(1) of the statute requires the Administrator to promul-
gate pretreatment standards, "for introduction of pollutants into treatment
works . . . which are publicly owned for those pollutants which are deter-
mined not to be susceptible to treatment by such tre@tment works or which
would interfere with the operation of such treatment works." Original
pretreatment regulations, pursuant to the law, were published in November,
1973, but subsequently withdrawn. Proposed new regulations which, to this
date, are not yet final, were published in July, 1975 (40 CFR, Part 403).
Underthese proposed regulations, certain waste*s which would interfere with
the operation or performance of a treatment works are prohibited from
entering the publicly owned system. All others would be regulated under
limitations issued for each specific industry. As pointed out in the dis-
cussion of the economic impacts of the Act on certain industrial categories
in Chapter III, the uncertain status of these pretreatment regulations is
.a.major indeterminant as to the real economic impacts of the Act on many
small industries.

The most serious issues with regard to the pretreatment question con-
cern the definition of compatible and incompatible pollutants and the
factors that are to be taken into account in the issuance of pretreatment
standards. Tentatively, EPA has opted for including the variety of
factors that constitute the best practicable technology from the best
available technology guidelines, including macroeconomic impacts, ages,
sizes, characteristics of particular plants and other factors directly
related to the industry's production processes.

A second aspect of this problem concerns the relationship of volume to
the pollutants, themselves. That is, in many instances, an industry is
charged simply for the volume of water that accompanies its pollutants, not
for the pollutants themselves because, as a practical matter, a primary
cost factor with a municipal treatment plant is related to the sheer volume
of liquid that it needs to treat. Also, compatible and incompatible con-
stituents cari be inextricably linked in chemical compounds, requiring an
industry to apply the full treatment technology prescribed for BPT in order
to remove the incompatible pollutant. The result of the treatment, however,
is a level of reduction of BOD and suspended solids which would permit the
discharger to discharge directly into a water course --,an option that,
because of size or location, is probably not available.

An additional issue concerns the point of discharge. Does the regula-
tion apply at the point of the municipal discharge or at the point of the
industrial discharge into the municipal system? As a practical matter, it
is difficult to determine or to regulate the actual industrial discharge
because there is no permit on it if it is discharged into a municipal
system. Yet, a large municipal system could have 4,000-5,000 industrial
dischargers and it is extremely difficult to determine, from a sampling of
that municipality's effluent, which contributions are being made by which
industries.

V-94

In any event, the record of the implementation of Sec. 307(b) to date
is not good. A possible reason is that the regulations have been geared
directly to the industries, and not to the municipalities, and the muni-
cipalities have not been involved in their formulation. 'It has been
suggested that if the municipalities were to set their own pretreatment
requirements for their own industries, within perhaps somewhat broad
Federal parameters, some of these problems might be solved.

Industrial Cost Recovery

For the first time in the construction grants program, P.L.92-500
required recovery of the Federal share from "the industrial users" of "that
portion of the cost of construction of such treatment works (as determined
by the Administrator) which is allocable to the treatment of such industrial
wastes." [Sec.204(b)(1).] The grantee is allowed to retain an amount from
the repayment of the Federal contribution to the industrial share of costs
11equal to (A) the amount of the non-Federal cost of such project paid by
the grantee plus (B) the amount . . . necessary for future expansion and
reconstruction of the project, except that such retained Amount shall not
exceed 50 per centum of such revenues from such project." [Sec.204(b)(3).]

The concept of having users of wastewater treatment facilities bear
their proportionate shares of both the capital and operation and mainten-
ance costs was not new with P.L.92-500. Previously, EPA regulations
required industrial cost recovery of the local share of grants and charges
for the use of the system.

While the debate continues as to whether or not requiring recovery of
the portion of the capital costs attributable to an industry's pollution
either provides too much of a subsidy because it is, in effect, a long-term
interest-free loan, or too much of a cost to industry which had, before
the passage of P.L.92-500, been able to connect to municipal-systems at
no capital costs, it appears as though the actual implementation of the
industrial cost recovery provision has not seriously held up the construc-
tion grants program. Of the 5,000-6,000 projects currently in some form
of the construction grants pipeline, only 90 have been held up in som way
in order to solve problems relating to industrial cost recovery.

One problem has occurred in large municipal systems where several
grants are received every year for various portions of the system. For
example, the City of Chicago could receive a grant to expand the size of
an interceptor and that would be considered a separate grant. Then, the
industrial cost recovery for the cost of that interceptor would have to
be calculated and charged to each industrial user. This appears to be a
significant problem in large cities, and not a problem to smaller commu-
nities which receive their grants in one piece.

V-95

Another series of problems concerns the definition of an industry to
be considered under the industrial cost recovery provision. Commission
studies showed that commercial establishments, such as hotels and office
buildings whose waste is both compatible with the municipal treatment
plant and largely domestic in character, were treated inconsistently,
being exempted in some regions and included in others.

Another area relative to any discussion of industrial cost recovery
concerns the facilities which are constructed primarily to serve a parti-
cular industry. There have been situations where a single industrial
facility constituted a major proportion -7 up to 95 percent -- of the
waste discharged to a municipal facility. in effect, then, the munici-
pality has constructed a sewage plant primarily to treat the waste of
that particular industry and that industry has received an interest-free
30-year capital loan in order to solve its water pollution control problems.
While this situation is somewhat isolated in its occurrence, it raises a
serious question as to certain aspects of the industrial cost recovery
program.

The enabling provision of the statute provides for the municipality
to retain up to 50 percent of the money recovered under industrial cost
recovery for the specific use of either future reconstruction of the
facility or expansion of the facility. To date, EPA is still wrestling
with the question of exactly what the 50 percent that the community keeps
can be used for, and in what proportion.

The period of cost recovery is 30 years or the useful life of the
treatment works, whichever is less. The general average, on an aggre-
gated basis throughout the nation, of pay-back to the U.S. Treasury under
the industrial cost recovery provision is $6 million per year for 30 years,
for every $1 billion expended in construction grant funds. For the
original $18 billion in construction grant money authorized by P.L.92-500,
the total expected to be paid back to the Treasury under industrial cost
recovery is $108 million per year for 30 years, or a total of $3.24 billion.
A question has been raised as to why this money is paid back to the
general fund in the Treasury and not reallocated to specific pollution
control projects. In other words, while the first 50 percent of the
industrial pay-back may be kept by the community for designated purposes
of reconstruction and expansion of the facility, the other 50 percent goes
into the general revenues of the Treasury.

In conclusion, the Commission, in its examination of the construction
grant program, found that while there were certain philosophical differ-
ences and certain problems with actual implementation of the industrial
cost recovery program, there was no evidence of overwhelming obstacles to
its implementation.

V-96

User Charges

The user charge requirements established in P.L.92-500 were a major
departure from previous legislation. Specifically, a "proportionality"
procedure was included relating to local operations and maintenance
funding. Payment by users must be proportional to use and revenues
collected must be in excess of capital and O&M costs.

The concept of having users of wastewater treatment facilities bear
their proportionate shares of both the capital and operation'and mainten-
ance costs was not new with P.L.92-500. Previously, EPA regulations
required industrial cost recovery of the local share of grants and re-
quired user charges, although ad valorem taxes were considered an
acceptable form of user charges. Many political subdivisions w ere
already operating their systems as revenue producers. The major distinc-
tion produced by P.L.92-500 is the statutory and regulatory detail to
which acceptable systems are described. Even the determination of the
industrial share is not a simple, straightforward calculation because of
the complexity of some industrial wastes and the difficulty of allocating
treatment costs. Requirements of the new law and regu lations also con-
flict with existing long-term contracts with industrial users.

EPA initially determined that the proportionality requirements of the
law could be satisfied by a surcharge to the ad Valorem taxes of a com-
munity. GAO stated that this method of payments was not consistent with
the intent of the law for the following reason:

Although the EPA proposal is to achieve proportionality
between classes by imposing a surcharge for a class of
users' proportionate share of operation and maintenance
costs, the issue of proportionality within classes is
not addressed. The only exception to this is the case
of gross disproportionality. (117)

Because of this conflict, EPA rescinded its initial memorandum and
developed user charge models which are totally independent of the tax
structure. Specifically:

The user charge system must result in the distribution
of the cost of operation and maintenance of treatment
works within the grantee's jurisdiction to each user
(or user class) in proportion to such user's contribu-
tion to the total wastewater loading of the treatment
works. (118)

To determine proportionate contributions, the charge is to be based on
factors such as strength, volume and delivery flow rate. In addition, EPA
regulations regarding requirements for municipal treatment facilities state
that quantity discounts will not be acceptable.

V-9 7

The impact of this provision is that many municipalities which have
incorporated-waste treatment costs in the tax structure must reverse
these procedures. It has been estimated by EPA that approximately 25
percent of all municipalities in the U.S. currently have an ad valorem
structure. (See Table V-32.) This includes major urban centers such as
Chicago and Orange County, California.

Of the municipalities with acceptable user charge systems interviewed
during field visits, most were using a water usage charge for determining
waste treatment charges. The advantages to cities already using this
system are little increase in administrative costs and no costly additions
of meters to the sewer system (assuming a meter is used to monitor usage).

The impact of user charge system requirements has not been fully deter-
mined since the system does not have to be approved by EPA until the 80
percent level of construction grant payments has been reached. As of
completion of the Commission contractor's report on construction grants,
only 199 step 3 projects out of a total of 1,465 active step 3s had reached
or exceeded the 80 percent level(119).

User charge requirements necessitate that a nubmer of municipalities
must change legislation to comply with requirements. The user charge re-
quirements is a selective problem, insofar as EPA has estimated 70 percent
of municipalities already have the legal and administrative structure to
implement the provisions. This statement is qualified, however, in that
little operational data exists as to the extent to which municipalities
are affected by user charges. Larger municipalities have, in the past,
used some type of charge system other than ad valorem taxes. Although
these charge systems may not meet proportionality requirements, they do
provide a basis for defining future cost systems. Smaller communities
reflect greater instances of reliance on a tax basis, as well as being
least prepared for the administrative requirements inherent in a relatively
sophisticated cost assessment and collection system.

The regulations allow a water usage rate basis for administering the
user charge system. In municipalities where this is the case, the water
rate system reduces administrative costs and may be applied to both indus-
trial and domestic users. As pointed out in the economics chapter, one
advantage of this use-based system is that it definitely encourages indus-
trial users to reduce water use and loadings, thereby freeing up capacity
in the public treatment works.

Many municipalities have simply deferred the problem in.anticipation
of legislative action, citing as their reasons such matters as the delay
in publishing regulations or pending legislation. This tendency to wait
for a change in policy, rather than make the.required changes in legisla-
tion and implement@a new system, is indicated in the fact that, nationally,

V-98

TABLE V-32

Publicly Owned Treatment Works
User Charge and Industrial Cost Recovery System
(Population affected by ad valorem based systems)

STATE 1970 Urban Est. % Pop. Served Est. Pop.
Population by ad valorem by ad valorem

Alaska 146,000 100% 146,000

Arizona 1,409,000 95% 1,338,000

California 18,136,000 90% 16,322,000

Connecticut 2,345,000 95% 2,227,000

Hawaii 639,000 100% 639,000

Indiana 3,372,000 50% 1,686,000

Illinois 9,230,000 90% 8,307,000

Kansas 1,485,000 50% 742,000

Louisiana 2,406,000 50% 1,203,000

Massachusetts 4,810,000 50% 2,405,000

Montana 371,000 50% 185,000

North Carolina 2,285,000 90% 2,.056,000

South Carolina 1,232,000 50% 616,000

Utah 851,000 80% 680,000

Wisconsin 2,910,000 50% 1,455,000

Total 40,007,000

Total U.S. Urban Population (1970) - 149,325,000

Total U.S. Metropolitan Population (1970 - 139,413,000

Source: Environmental Protection Agency, Construction Operations Branch,
Office of Water Program Operations.

V-99

51 municipalities have completed more than 80 percent of construction, yet
have been paid less than 80 percent of costs. This represents 25 percent
of the grants which have reached the 80 percent level in construction. Of
the rest, 148 have progressed beyond this point, indicating that either a
user charge system acceptable to EPA was developed or that payments have
been made without an acceptable system. Of these, 22 percent have reached
the 100 percent payment level, indicating that there is definitely an
acceptable user charge system(120).

A significant number of grants (several hundred) will probably reach
the 80 percent level shortly. EPA expects that these grantes may create a
substantial backlog of projects either delaying payment or, in some cases,
slowing construction.

Unquestionably, user charge requirements have created administrative
problems, but many of these problems occur because of inconsistent policy.
The conflict of the original EPA position on ad valorem taxes and the GAO
ruling has affected the credibility of the existing requirements, thereby
creating the potential for future delays in the program.

The Environmental Financing Authority and Providing the Non-Federal Share

P.L.92-560, Section 12, provided for the creation of an Environmental
Financing Authority to assist appropriate applicants in securing the local
share of construction project costs. The Authority was authorized "to
make commitments to purchase, and to purchase . . . any obligation or par-
ticipation . . . issued by a State or local public body to finance the
non-Federal share of the cost of any project . . ."(121). Bef6re the
Authority could make such a commitment, the EPA Administrator was required
to certify: 1) "that the public body is unable to obtain on 'reasonable -
terms sufficient cridit to finance its actual needs;" 2) "has approved the
project as eligible and 3) "hasagreed-to guarantee timely payment
of principal and interest on the obligation" (122). The Treasury was
authorized to.advance funds until they could become available from the
$100 million authorization. The Authority's ability to make such commit-
ments expired on June 30, 1975, it was not renewed, and only one applica-
tion was made during its life(123).

The Commission contractor found little evidence that financing the
local share caused major problems. They did indicate that "a more signi-
ficant problem" might arise "as the cost of projects increase in the'
future" and that "at this time;.it appears to be a serious constraint
only in very small, economically depressed communities and, in some cases,
where bids received from the construction contractors.are significantly
higher than original project cost estimates"(124).

V-100

Subsequently, there have been indications of some communities having
difficulty raising their matching share. Testifying before the House
Subcommittee on Investigations and Review on February 24, 1976, EPA's
Administrator advised the Congressmen that some places, like New York
City, are experiencing real problems and singled out interest rates as
high as 18 percent being bid on municipal treatment bonds as the e:@plana-
tion...

Program Management and Goal Achievement

Public Law 92-500 is generally characterized as a regulatory Act, but
it is also a major resource allocation law -- particularly with respect to
the Federall. state and local resources which must be allocated to the
construction of publicly owned treatment works.

Construction grant assistance is inextricably related to the issuance
of municipal discharge permits, for the quality of receiving waters should
improve as more publicly owned treatment works meet the requirements of
the Act. Analytical data generated by the construction grant management
process is restricted almost exclusively to tracking construction grant
projects, obligations and outlays. To date, the treatment requirements of
the Act have not been translated into water quality objectives on a state-
by-state basis, and the capability to relate POTW construction to permitted
discharge conditions, to compliance monitoring and to enforcement activi-
ties has not been developed. While the management techniques used to
administer a grant-in-aid program may differ from those employed in the
administration of discharge permits, data regarding the elimination of
pollutants as a result of the independent and interdependent actions of
both programs is essential to an understanding of institutional response
to P. L. 92-500.

Summary and Future Prospects

EPA has undertaken two major internal examinations of the construction
grant programs, one in 1974 and one in 1975. In both instances, major
changes designed to improve and accelerate the procedures have resulted.
Continued evaluation of the program nad its operations will result in other
improvements which should serve to eliminate or minimize the causes of
delay enumerated above. Some of the time-consuming requirements --for
example, the large number of laws and regulations outside P.L.92-500 with
which applicants or grantees must comply -- probably cannot be changed
quickly or easily, and may never be altered. Congress must realistically
assess the time and resources necessary to manage and execute a program
of the existing magnitude, particularly as it evaluates the rate at which
it wishes to see the achievement of water quality improvements through
completion of publicly owned treatment works providing secondary or
advanced treatment to meet more stringent limitations and specified water
quality goals.

V-101

Governme nt Assistance to Impacted Industrial Dischargers

Congress made provision for minimizing any adverse economic impact
on an individual discharger of meeting the 19$3 requirements of the Act
(Section 301(c)].. An industrial or agricultural point source discharger
filing application for a'permit after July'l,,1977, may ask for, and the
EPA Administrator may grant, a modificat ion of the applicable 1983
requirements "upon a showing by the owner or pperator of such point
source satisfactory to the Administrator that such modified requirements
1) will represent the maximum use of technology zwithin the economic
capability of the owner or operator; and 2) will result in reasonable
further progress toward the elimination of the discharge of pollutants."

Among the Federal regulations and loan programs available to assist
"impacted" individual dischargers are'industrial revenue bonds, accelerated
depreciation, an investment tax credit and loans and loan guarantees
provided by the Small Business Administration.* Some'states also.allow
property tax exemptions'. sales and'use tax exemptions and fran6hisd and
income tax-deduct'
ions.

The first industkial revenue "pollution bond as such was brought
out in 1971 to provide,$5 million for a United States.Steel-installation
in Pennsylvania. Sinice then more than @6 billion in,sales have been-
reported and several hundred million dollars Are estimated to have been
spent but have not.been reported. .11(12-5). Acceleration of the use
of these bonds occurred particularly after.August 1972-, when the Internal
Revenue Service promulgated.necessary regulations. By the end of 1974,
all but two states "- Washington and North Carolina appakently had,
authorized this kind of bond, And sales have been reportpd over the last
two years from 37 states(126).- Two conditions must be met:- 1) "the',
improvement would not have'been made but for the pprposes-of pollution
control" and 2) "it is not designed'to'significantly'me'et@ any purpos@
other than pollution control."(127) Somegovernmehtal@entity inust
certify t@at the-financed facility.wi,11 meet,current-control st@ndards,
and at least 90 percent of the bond proceeds must be spent for-pollution
control.

Among the advantages of revenue bond financing are.

1. Savings in interest rates of 11.5 to 2.0 percentage points
("this can mean.a gross savings of about $4 million in total interest
expense on a 20-year $10 million@issue.").

unless otherwise indicated, this discussion is based upon Economic
R eport, Alternative Wastewater Treatment, Report,of the Administrator
of the Environmental Protection Agency, September, 1975, pp. IV-42
through'IV-@56, or information secured directly from the Small Business
Administration.

V- 102

2. Avoidance of "fees and related legal expenses" in connection
with Securities and Exchange regulation since the bonds are not regis-
tered (these savings can be partially offset by municipal bond counsel
fees, legal fees to local counsel and "the somewhat higher underwriters'
spread usually found in the tax-exempt market.").

3. By utilizing a lease (or installment purchase) arrangement the
treatment facility can be classified as owned property of the industry,
eligible for depreciation deductions and investment tax credit with part
of the lease payment deducted as though it were interest paid on a loan
and with miscellaneous other expenses deducted as costs of securing the
loan.

4. In some instances, the industry may receive favorable state
and local tax treatment such as exemption from property taxes, sales
taxes on construction costs (if done by a public body) and rental taxes
(through use of an installment sale)."(128)

As noted in the Economics Chapter, these industrial revenue bonds
are not without their adverse effects, especially upon state and local
borrowing capacity since the tax exempt revenue bonds tend to drive up
the cost of interest and to crowd out public tax exempt bonds.

Two characteristics of industrial revenue bonds tend to restrict
their use to large firms -- underwriting costs are such that they are
not feasible for projects costing less than approximately $2.3 million
and, as with conventional financing, the bonds are supported by the
firm's credit standing.

Accelerated depreciation, permitting a firm to depreciate in five
years the first 15 years of the useful life of pollution control equipment,
is available for such equipment installed between January 1, 1969, and
January 1, 1975. This assistance provision is rarely used since the
investment tax credit usually provides greater benefits.

Since 1971, a firm has been entitled to deduct 7 percent of its
investment in pollution control equipment during the first year of
installation. A firm may use either accelerated depreciation or the
investment tax credit. "Analysis has shown" that, for equipment with a
useful life between 12 and 22 years, accelerated depreciation is more
advantageous, while for equipment for a life less than 13 or more than
22 years, the investment tax credit provides the most assistance.

Section 8 of P.L. 92-500 authorizes appropriations not to exceed
$800 million to the Disaster Loan Fund of the Small Business Administra-
tion (SBA) to be loaned at low interest rates for long terms to small
firms "substantially injured" by expenditures necessary to meet the
requirements of the Act. Loan guarantees are also available. Firms

V-103

having financial difficulty prior to the imposition of pollution control
regulations are ineligible, and applicants must demonstrate that they
are unable to secure conventional financing. Loans are not available to
large marginal firms.

Nineteen programs of disaster and other assistance are financed
from the Disaster Loan Fund. The total current yearly appropriation of
$160 million is divided into two parts, $60 million for physical disasters
and $100 million for all other programs; no specific sum is earmarked
for pollution control loans or guarantees. In the 12-month period
between August 1974 and September 1975, SBA made 24 pollution control
loans totalling $8.6 million.

The Economic Development Administration (EDA) also administers low
interest loans available to impacted firms in designated areas of high
unemployment.

All the programs currently available assist-firms to finance
capital costs of pollution control. EPA has stated, "The result is a
bias in favor of capital-intensive pollution control programs, which may
be costlier than more labor-intensive methods of control. The pollution
control related.costs of land, buildings, and process equipment changes
are eligible for the SBA loan and loan guarantee programs and for IRB
[industrial revenue bond] financing, but not for rapid tax amortization
or the inve@stment tax credit. Consequently, there is a bias in favor of
end-of-pipe methods of tr,eatment as opposed to process changes."

V-104

Planning

The Commis'sion's examination of P.L. 92-500 planning activities has
been complicated by two principal features of water pollution planning.
First, water pollution planning covers a multitude of concerns -- from
engineering determinations of sewer pipe needs to assumptions of metro-
politan growth patt4@rns. And secondly, the implementation of the Act's
planning requirements has presented the Commission with a constantly
moving target -- particularly with respect to areawide planning activities.

When the Commission began its analysis of planning in November of
1974, 11 areawide planning agencies had been designated by EPA. When
the Commission's contractor submitted his final report on August 31,
1975, the number had grown to 149. Areawide funding during that 10-
month period jumped from $13 million to $163 million. During the same
period, EPA twice made major revisions in its planning guidelines, the
pace of the construction grants program was accelerated and permits were
issued to all major dischargers.

Congr ess intended that the permit and construction grants programs
would be integrated through the planning process. The language of the
two major planning sections -- areawide and statewide -- are directly
keyed to permitting and construction grant activities. Areawide waste
treatment management plans must include construction priorities [Section
208(d)].f and all NPDES permits must conform to approved areawide plans
[Section 208(e)].

Despite its intent, Congress did not incorporate planning provisions
into any single section of the Act. Instead, planning provisions appear
in various sections, are based on different planning assumptions and
have led to different kinds of interpretations which have often produced
different kinds of planning programs. Four major planning provisions
are set forth in the first three titles of the Act.

Section 106 of Title I requires state program plans which
define annual state water pollution control objectives and
indicate state level resource commitments. Annual Federal
grants to state pollution control agencies are conditioned
upon submission of acceptable plans.

Section 201 of Title II contains the provisions which have
been incorporated by EPA into the construction grant process
as Step 1 facility planning.

Section 208 of Title II requires areawide waste treatment
management plans which then lead to the designation of areawide
waste treatment management agencies.

V- 105

Section 303(e) of.Title III requires continuous state planning,
sometimes referred to as basin planning, which governs state
establishment of water quality standards for each state river
basin.

Given an uncoordinated legislative mandate, there is some justifica-
tion for the fragmented.implementation which has characterized planning
efforts to date. But an uncoordinated legislative mandate -- difficult
to interpret as it may be -- is not the sole explanation of the present
disarray of planning efforts. EPA and the states have responded to
fragmented planning provisions with fragmented implementation. The 1974
Water Quality Strategy Paper indicated that construction grants, permits,
and nonpoint source controls should key off the relevant plans. But.in
practice, relevant plans key off grants and permits.

Apparently, EPA regards the planning process as only one of a
number of program strategies -- set apart from other activities in a
separate division, and competing for attention and resources with
construction grants and permits. With few exceptions, the states follow
the EPA pattern.

Out of Phase

According to the timetables of the Act, initial state basin planning
should now be completed, and initial areawide plans would be close to
completion by mid-1975. Yet, not one areawide plan has been completed
and only one-third of 635 state river basin plans have been completed(129).

The data and management strategies-developed in these two planning
processes were intended to be used to determine controls necessary for
implementing the Act's 1983 goals since:

The areawide planning process should be used to determine best
practicable waste treatment systems for'the designated areas
and to develop strategies for control of nonpoint sources, a.nd

The state basin planning process should be used to determine
pollution control achievements and to identify additional
point source control requirements.

As a practical matter, neither planning process is yet affecting decision-
making.

Public Law 92-500 -- Four Major Planning Processes

State Program Plans (Section 106) Annual state program plans
define program objectives, indicate resource allocations and report to

V-106

EPA progress toward current year objectives. Approved yearly by EPA,
the plans are required as a condition precedent to Federal support of
state programs.

The state plans parallel the Federal.program planning effort (which,
now culminates in EPA's "Water Quality Strategy Paper"), but for the
most part, are not employed effectively as management tools. Rather,
state agencies parrot, as an expedient to EPA plan approval, the format
supplied by EPA(130). Two notable exceptions are Virginia and California,
where state program plans are used to manage the joint Federal/state
program.

Facilities Planning (Section 201) Facilities planning is the first
step of the three-step construction grants process. While facility
planning is not specifically authorized by the Act, the 1973 EPA Water
Quality Strategy Paper indicated that it regarded facility planning as a
major program objective. Construction alternatives, including siting,
size and number of facilities, are examined in Section 201 facility
plans, and the most cost-effective solutions devised. options considered
include land treatment, water recycling, flow reduction, and operations
and maintenance and are ranked in terms of the economic and environmental
effort(131) in an effort to reduce construction and operation and mainte-
nance costs and to ensure that facility size and location produce minimal
environmental damage. Facility plans and the Areawide management plans
overlap significantly, and since facility plans play an integral role in
the construction process, their impact on decision-making is great.

Areawide Planning (Section 208) Areawide planning is clearly the
most complex, and potentially innovative, of the four major planning
processes. It is the process with which implementing agencies have
experienced the most difficulty. After a slow start, areawide planning
is now EPA's top-priority planning activity for FY '76 and one of its
eight major program priorities.

The Senate, which originated the areawide management concept that
emerged in conference, made 208 (then 309) a clear and strong priority,
as demonstrated in the Public Works Committee Ranking Majority member's
floor statement:

A fifth major element in this bill is the mandate
for regional planning. This is accompanied by a
clear description of the planning requirements,
which would incorporate all sources, to agricul-
tural, mining, and urban runoff to the control of
accumulated sources of pollution, such as deposits
in harbors. Such broad planning is necessary to
develop truly comprehensive and adequate waste
management systems(132).

V-107

Areawide planning objectives include the development of a wastewater
management strategy which designates methods for the control or treat-
ment of all point and nonpoint pollution sources within an area. Once
an areawide plan is approved -- at the state level by a Governor and at
the Federal level by the EPA Administrator -- permits and construction
grants must conform with its provisions. Specific outputs resulting
from the Section 208 areawide planning process include:

treatment works necessary to meet anticipated municipal and
industrial waste treatment needs for a 20 year period with
provision for annual updating;

construction priorities for such treatment works with time
schedules for initiation and completion;

a regulatory program to 1) control or treat all point and
nonpoint pollution sources, including in place or accumulated
pollution sources; 2) control the location, modification, and
construction of any facilities within the area; and 3) assure
that industrial or commercial waste discharges into any publicly
owned treatment works meet applicable pretreatment requirements;

measures necessary to execute the plan (including financing),
the time required, costs and its economic and environmental
impact upon the residents of the area;

a process to identify agriculturally, silviculturally, mine
and construction related nonpoint sources of pollution, and
proposed procedures and methods (including land-use require-
ments) to control such sourcesp,

a process to 1) identify salt water intrustion into rivers,
lakes and estuaries, and 2) proposed procedures and methods to
control such intrusionj

a process to control the disposition of all residual waste
generated whiph could affect water quality; and

a process to control the disposal of pollutants on land or in
subsurface excavations to protect ground and surface water
quality.

V_ 108

State Basin Planning (Section 303(e)) EPA Guidelines indicate
that:

the basin plan is neither a broad water and
related land resources plan nor a basinwide
facilities plan. Simply stated, the basin plan
is a management document that identifies the
basin's water quality problems and sets forth
a remedial program to alleviate those problems.
A basin plan should be a dynamic management
.tool, rather than a rigid, static compilation
of data and material(133).

State basin plans should identify problems, determine priorities for
construction grants and discharge permits, and identify areawide needs
and priorities.

over 600 basin plans must be prepared nationally, and about 50 to
60 percent of.the plans will have reached an intermediate level of
development by the beginning of FY 1976(134). The 303(e) planning
program is essentially a continuation of requirements established by EPA
under its older 18 CFR regulations.

Basin plans have had their greatest impact to date in setting
priorities for construction grants, in issuing permits based on the
classification of stream segments (as either "water quality limited" or
"effluent limited" segments), and in determining waste load allocations
for particular river stretches. In most states, the water pollution
control agency develops basin plans with the assistance of contractors.
To date, the products have ranged from poor (purely descriptive, non-
analytic, non-program oriented) to very good, program-directed studies(135).

EPA has promulgated revisions to its basin planning regulations (40
CFR, Parts 130-131). These revisions require nonpoint "Phase II"
planning to follow approval of the "Phase V, point-source control
plans. Plans will refine point-source controls developed during "Phase
I", including necessary controls over stormwater runoff, develop control
solutions for nonpoint sources for the period from July 1976 to July
1981 [categories are to be addressed throughout the period so that the
requirements of Section 208(b)(2)(F-K) would be available by 19811,
merge areawide wastewater management and facilities plans with state
water quality management plans, develop regulatory programs and identify
necessary implementing and operating agencies.

Planning -- Coordination, Management and Nonpoint Source Control

While EPA has attempted to coordinate the several planning processes,
the attempts have, at best, been uneven. Proposed regulation revisions

V-109

will place all planning provisions of the Act within a single set of
regulations -- an important step in the right direction. At the same
time, the lack of coordination, first in the law and then in the course
of implementation, has produced a confused planning scheme with unclear
purpose and responsibilities.

The planning provisions have not yet influenced facility construc-
tion decisions and areawide wastewater management. Both Senate and
House versions of the Act emphasized the areawide management planning
process as central to its implementationr Areawide planning require-
ments are clearly linked to implementation and action in that construction
grants and permits must conform to gubernatorially approved plans. The
intent that planning was to guide and shape the action parts of the Act
is quite clear.

Delay in implementing areawide planning requirements has foreclosed
the prospect that construction and permits would reflect areawide
planning efforts'. Approved areawide plans will not impact construction
and permit programs for another two to three years and then in only a
relatively few areas in the country -- for only 149 areawide planning
agencies will be operating by Fall of 1975 (Figure V-8). Thus, for five
to six' years after the enactment of the Act, construction grant and
NPDES activities will have proceeded without the potential benefit of
locally developed areawide wastewater strategies. Those plans which
will.be developed will accommodate existing permits and facility plans
rather than influence their form, size and location.

States are just now being informed of their responsibilities for
water quality management planning in all areas of the state not served
by designated areawide planning agencies. EPA has not yet clearly
delineated.what state responsibilities are in these cases -- particularly
with regard to the relationship between state areawide planning responsi-
bilities and construction, regulation, permits, financing and management.*

Section.208 areawide-planning provisions contain the Act's only
direct reference to nonpoint source control. As a result of areawide
planning 4elay,,the question of nonpoint source control has not been
addressed in any substantial fashion. Despite concerned undertakings by
several local planning agencies and states, the benefits promised by the
nonpoint source control planning provisions in Section 208 have'be6n
jeopardized by the absence of specific'EPA guidance. State and local
misgivings about the propriety of using Section 208 as a- land-use control
device also'haVe contributed to a slow development of nonpoint source

In N.R.D.C. v. Train (decided June,5, 1975), the Court held that states
must perform Section 208 areawide planning activities in those areas
of the state not having a designated areawide planning agency.

- - - - - - - - - - -

FIGURE V-8
20BARAINIME HANAMMINT

ciAN

-A L A 3 9 A

p
SOURCE: Environmental Protection Agency.

V-111

planning. The Act and its legislative history clearly indicate that
Congress did not establish an absolute standard for solving nonpoint
source pollutant problems. Nonpoint source pollution was, and still is,
a problem area in that available regulatory and technological remedies
were, and still are in most cases, untested. As a result, the Act calls
for good faith effort by state and local governments to identify problems
and to develop control plans.

V.- 112

Public Participation

Opening the water pollution control policy and decision-making
process to the public is a major imperative of the Act. The Act contains
the most comprehensive provisions for public participation ever written
into Federal law.

It states that EPA and the states have affirmative responsibilities
to develop procedures to ensure public participation in water pollution
policy and decision-making processes:

Public partic;ation in the development, revision,
ip
and 'enforcement of any regulation, standard, effluent
limitation, plan or program established by the
Administrator or any state under this Act shall be
provided for, encouraged, and assisted by the
Administrator and the states. The Administrator,
in' cooperation with the states, shall develop and
publish regulations specifying minimum guidelines
for the public participation in such processes.
(Emphasis added)(136)

EPA promulgated minimum guidelines(137) establishing a public
participation program to provide for the timely distribution of informa-
tion to, and for consultation with, the public prior to final decision-
making. Additionally, the guidelines required that the public be provided
technical assistance and opportunities for public hearings on proposed
regulations, permits, and areawide, basin and facility plans.

EPA and the States: Partial Response

Neither state agencies nor EPA have completely met their responsi-
bilities for providing for, encouraging and assisting public participation
In the decision-making process. As established, the public participa-
tion program has been effectively isolated from the functional elements
of the program. Rather than incorporating guidelines into regulations
controlling categorical programs for permits, grants and planning, EPA
promulgated discrete public participation regulations.* The Act intended
citizen involvement to become an integral part of the categorical programs,
but the intent has been fulfilled only insofar as program regulations
provide for public hearings. As a Consequence, public participation
activities are centered around the public affairs offices, far removed
from the decision-making process.

There are public participation directives incorporated into the
planning, construction grant and NPDES regulations. These deal mostly
with public he4rings, with the exception of areawide planning which
requires provision for a citizen advisory committee.

V-113

Public participation regulatiONS-- developed apart from the cate-
gorical programs -- fail to define public roles, public participation
purposes, and responsibilities of the implementing agency. Although the
regulations contain provisions, for sanctions if the agency fails to
afford adequate participation opportunities, sanctions are seldom
invoked. In fact, the EPA has seldom enforced the reporting require-
ments which provide the basis for determing the adequacy of public
participation opportunities concerning a particular project(138).

As required by regulation, the information flow from a encies to
the public appears to be suffieient in size. But the content is often
either superficial or extremely technical and rarely seems to encourage
acitve participation. Most public affairs offices disseminate voluminous
informational booklets, newsletters and press releases which are informa-
tive in that they provide general descriptions of the Act, indicate ways
to participate and explain agency functions.

With respect to the technical aspects of water pollution control,
the flow of information takes the form of public notices tucked away in
newspapers or in NPDES fact sheets mailed directly to the interested
public. Agencies have responded to the criticism of excessive reliance
on public notices by issuing press releases and by using radio, tele-
vision and other media in order to reach more people (139). The technical
information which does reach the public is usually neither translated
from technical to non-technical terms nor summarized. More importantly,
few attempts are made to help the public fully appreciate potential
consequences of the decisions at hand and of underlying assumptions
which shape decisions -- such as those related to priority list criteria
and waste load allocations (140). As a consequence, the public is forced
to rely on highly technical documents such as permit applications or
basin planning materials.

EPA has sponsored a series of workshops in each of the ten EPA
regions. Conducted by The Conservation Foundation, these Water Quality
Training Institutes were an attempt to explain the complex legislation
and to describe methods of participation, that could be taken advantage
of during implementation of the Act. A series of follow-up workshops
were held in the states, but were felt to be less succesful than the
initial institutes(141). EPA is currently sponsoring a series of "Water
Quality Awareness" workshops, which are focusing on "non-environmental"
groups that traditionally are not concerned with water quality(142).

On the EPA regional level, efforts to educate the public are sparse.
Region I has instituted a course in water pollution control for local
officials. In Region V, the public affairs office has produced and is-
tributed 1,500 cassettes that describe the industrial permit program in
simplified language. Apparently, this technique has been popular with
citizens in that particular region. Region IX has undertaken a series
of seminars on facilities planning for major projects.

V-114

On the whole, EPA regulations emphasize public hearings as the
principal technique for public access to decision-making. The hearing
process is a carry-over mechanism from water pollution control efforts
prior to 1972. The various agencies and publics coniinue to view the
process critically. The almost exclusive use of hearings produces
public input at the end of the line when essential decisions have, for
all intents and purposes, been finalized. Generally, agency personnel
and public interest groups agree that hearings are of limited use as a
method of access and are a waste of resources(143).

Perhaps the most telling indicator of EPA's limited commitment to
public participation is reflected by the amount of resources allocated
to the program. While EPA acknowledges public participation resources
are inadequate, the Agency does not actively seek additional monies from
Congress(144). In most cases, public participation activities in the
water division are handled part-time by public affairs offices in both
Washington and the regions. At the regional level, no one having permit,
grant or planning responsibilities is assigned, even on a part-time
basis, to public involvement activities(145).

The EPA approach to allocating resources to public participation
activities has given the states a fair indication of what is an accept-
able level of public participation effort. As a result of state budget
variations, absolute state level resource commitments are not available,
but a relatively disproportionate amount of funds is being allocated to
information distribution as opposed to those resources being allocated
to participation activities(146). Too often, public information is
erroneously equated with public participation.

Several states have taken the initiative in assisting the public.
California has established a program for citizen participation in basin
planning, including workshops throughout the process. Maryland and
Pennsylvania have also set up citizen advisory committees for basin
planning. In addition, most 208 planning agencies have created citizen
committees.

Public Participation -- Resources and Commitment

Citizen group impact on the administration of the Act is hampered
by levels of commitment, expertise and funds. Generally, members of
the public are not program-oriented. Rather, they tend to involve
themselves when they feel directly affected by a particular issue(147).
There is a lack of continuing interest in permit and grant programs.
There is some evidence of a general decline in interest, on the part of
the public, in water pollution control. Issues, such as land-use control
and energy use and development, seem to be much more predominant and
perhaps more crucial in the public mind(148).

V- 115

Time constraints also hinder public involvement on the local level.
The task of sorting out and isolating critical technical issues is
extremely difficult. The time demand is compounded by the relatively
brief comment periods, usually 30 days, and the technical complexity of
many of the documents.

Many previously active citizen groups have dissolved for lack of
resources, while otherg are'experiencing financial difficulty. Lacking
adequate volunteer assistance, groups or individuals must pay technical
experts, because water pollution control requires expertise which the
public generally does not possess. In all probability, lack of resources
and expertise have hastened the declining public interest in water
pollution issues.

The general public, on the whole, only becomes interested in water
pollution control when directly affected. Attempts at stimulating this
public have failed. Again, expertise and the technical complexity of
the Act is the barrier. When the general public does respond, organized
groups have the task of picking out the issues and explaining the contem-
plated action. Seldom do they-get assistance in this interpretive task
from the state or Federal agency(149).

The Permit Program

The most structured public participation has occurred in connection
with issuing permits(150). With few exceptions, the public participation
regulations promulgated by EPA are being followed precisely; permits are
-drafted and notice is published,.after which 30 days are allowed for
comments and requests for a public hearing. Fact sheets and notices are
also widely distributed. overall, public'interest has been slight even
though permit conditions provide specific issues on which individuals
may focus. Changes in permit terms have occurred as a result of citizen
impact, but those changes have been relative ly minor. The lack of
participation is, in part, the result of the sheer number of permits
being written (approximately 28,000), and the technically complex nature
of permit conditions. A permit is essentially a contract written in
technical and legally enforceable language. Agencies have been under
such severe time pressure to issue permits that little assistance has
been provided to help the public fully understand proposed-permit terms
and the related issues.

The Planning Process

It is always difficult to engender and sustain public interest and
involvement in the planning process. As important as it is, it lacks
the immediacy of impending action, even though it may be even more
critical to the outcome of future events. Planning for water quality is
no exception. The development of Section 106 state program plans has

V-116

attracted little public interest. As a consequence, EPA no longer
requires that state agencies hold public hearings prior to adopting
annual state programs. Some have attributed the lack of,interest to the
fact that annual state program plans do not involve specific iss'ue's'with
which the public can identify. In developing the construction grant
priority list, state agencies are required to conduct hearings prior to
final adoption. those attending priority list hearings are normally
representatives of municipalities and consulting engineering firms. To
date, environmental groups and the general public have indicated relatively
little interest. Although changes in the lists do occur, the underlying
assumptions upon which the plans and changes are predicated are seldom
discussed or questioned by those present(151).

Section 201 facility plans must be adopted after a public hearing.
When specific and controversial issues are not involved, citizen interest
has been low. Those who become involved in facility plannin6 are normally
concerned with three areas -- single project planning, land use and
growth issues, and project costs(152).

Public involvement in approving Section 208 areawide plans has.not
developed, because no plans have been completed(153). Although it is
too early to assess public involvement in this area, committees of local
officials and the public will participate in the process from formu-
lating the plans through to final adoption. Some feel that areawide
planning holds the greatest promise for public involvement, while others
feel the technical complexities will discourage full citizen partici-
pation(154). One thing is sure, however, areawide plans will have scant
chance of being adopted and eventually implemented unless citizen groups
and organizations are supporti;7e of their general strategy. Thus, it
behooves areawide planning agencies to develop a wide base of public
involvement at the outset. Indications, thus far, are that most are
not.

With respect to state river basin planning, EPA regulations require
public hearings when there is a significant interest in a particul4r
plan. The results of participation in these plans have been mixed -
ranging from public hearings to formation of public advisory committees.
The most encouraging example is Pennsylvania's Comprehensive Water
Quality Management Planning program. A series of citizen advisory
committees has been formed and efforts are under way to explain to the
public the technical nature of the program. Workshops and other informa-
tional devices are being used to brief the public. This effort is
expected to consume about 25 percent of the $18 million budget(155).

Citizen Suits

Notwithstanding a clear congressional directive to incorporate
public views prior to the development of policies and decisions, the
most significant public impact on the implementation of the Act has been

V-117

made in the courts -- after agency decisions have become final. In
N.R.D.C. v. Train(156), the Court held that EPA must establish effluent
limitations for, and issue permits to, all point-source dischargers; EPA
does not have the authority to exclude from the regulatory process
insignificant point-source discharges. In N.R.D.C. v. Call'away(157),
Section 404 of the Act was interp .reted to 'require the Corps of Engineers
to issue dredge and fill permits in all waters of the U.S., rather than
just those which meet the traditional test of navigability. As a result
of other litigation initiated by N.R.D.C., EPA was forced to accept a
faster, judicially determined timetable for promulgating effluent limita-
tions(158), and to establish regtilations under which states would pursue
areawide planning in non-designated areas(150). Public participation
through judicial processes has advanced prospects for earlier, full
implementation of the Act by speeding the pace of effluent limitations
promulgation, by more clearly defining agency responsibilities and by
expanding areawide planning activities. But public participation early
in the administrative process has been infrequent.

Public Participation -- Basically Unchanged

Public Law 92-500 has not substantially expanded public partici-
pation. Generally, EPA and a majority of the states have not fully
implemented the public participation provision. EPA regulations and
guidelines for participation are inadequate in the sense'that enough
flexibility is provided to allow administering agencies to do as little,
or as much, as they desire in assisting and encouraging public involve-
ment(16o).

The public continues to involve itself much the same way it did
prior to 1972(161). Public hearings have and probably will continue to
provide the major avenue for public involvement in administrative
decision-making. With respect to planning activities, participation
requires a level of expertise which most publics do not possess and
cannot afford to purchase. In light of these impediments, actual
public participation input to administrative and policy decisions is
unlikely to meet the expectations of the framers of the Act.

V_ 118

P.L. 92-500 Litigation

Initial reaction by individuals and organizations affected by the
requirements of P.L. 92-500 indicates that most, if not all, of its
major provisions will be subjected to legal challenges. To date, at
least 350 lawsuits have arisen under the Act.* More than 285 of those
are still pending in the courts.

By and large, the suits represent challenges by environmental
groups, industry, states and local governments to EPA's implementation
of the Act's construction grants, planning. and regulatory requirements.
Most of the suits - about 320 as of June 30, 1975 -- relate to some
aspect of EPA's regulatory program. The construction grants program has
given rise to at least 25 suits, and the planning program has been the
subject of one major suit.

Construction Grants Program

One of the first legal issues to arise under the 1972 Act, and the
first to be settled by the U.S. Supreme Court, concerned the allotment
of Federal funds for the construction of publicly owned treatment works.
The controversy arose when President Nixon directed EPA to allot only
one-half ($9 billion) the maximum amount authorized and appropriated by
Section 207 of the Act for grants for the construction of POTWs. The
impoundment of the construction grant funds was challenged in at least
24 separate actions filed by states, cities, counties, private citizens,
congressmen, and organizations. The Supreme Court recently ruled that
the impoundment was unlawful and that the Act required EPA to allocate
11no, less" than the full amount of construction grant funds. The Court
indicated that EPA has discretion over the funds only at the point
where the funds are obligated and not in connection with the threshold
function of allocating funds to the states(162)..

Another category of suits under the construction grants program
includes those in which a state or local government has sought a court
declaration that compliance with the secondary treatment requirement of
the Act is not reauired unless such a requirement may be met with a
Federal grant. One such case, Virginia State Water Control Board v. Train,
is pending before the U.S. District Court for the Eastern District of
Virginia(163). EPA and the Natural Resources Defense Council have taken
the position that availability of Federal funding under Title II of the
Act for the construction of publicly-owned treatment works is not a
precondition to the obligation of states and localities to comply with
the secondary treatment requirement.

The Legal Issues study focused on lawsuits which could be identified
as of June 30, 1975, based on case files maintained in the EPA
Office of General Counsel. Cases being handled by EPA regional
offices or by the states were not studied.

V-119

Planning Program

To date, one case has addressed the planning provisions of the
Act(164). Environmental groups have challenged EPA's regulations imple-
menting Section 208 areawide planning.

In its regulations EPA defined as Section 208 planning areas only
those areas designated by governors or local officials as having
substantial water quality control problems. EPA excluded from its
Section 208 regulations those portions of the state which were "non-
designated."

EPA's interpretation was challenged by Natural Resources Defense
Council and other environmental groups. NRDC charged that under Section
208(a)(6)* the state must undertake the same planning in non-designated
areas that is required in designated areas, and must do it within the
same time constraints. The National Forest Products Association inter-
vened in the lawsuit and took a contrary position. It asserted that a
state need only engage in general, discretionary planning for the non-
designated areas, and that it need not engage in extensive areawide
planning for those areas.

The U.S. District Court for the District of Columbia accepted
NRDC's arguments and ruled that the division among governor-designated
and local-designated areas on the one hand and subsection (a)(6) areas
on the other is intended to regulate which level of government is to
develop a plan, not whether an area or portion of a state is to be
covered by such a plan. EPA was ordered to revise its regulations so
that the states can understand and fulfill their total planning respon-
sibilities under Section 208. This decision has been appealed to the
U.S. Court of Appeals by the National Forest Products Association.

Regulatory Program -- Introduction

To date, about 320 lawsuits have focused on EPA implementation of
P.L. 92-500's regulatory requirements.** More than 250 of the suits
reflect industry challenges to EPA regulations promulgating "effluent
limitations guidelines" applicable to existing sources and standards of
performance for new sources.*** These challenges have been consolidated
in U.S. Courts of Appeals to 21 proceedings and include challenges
brought by the following industries:

Section 208(a)(6) provides that "the state shall act as a planning
agency for all portions of such state which are not designated. . .11
About 15 percent of these suits deal with issues concerning "navigable
waters", common law nuisance actions, civil and criminal penalties,
dredge and fill, and oil spills and are not discussed in this summary.
Digests of these cases can be found in the Legal Issues Report.
In most cases, EPA issued one set of regulations addressing Section
301 effluent limitations, Section 304 effluent limitations guide-
lines, and Section 306 new source performance standards.

V-120

Beet Sugar Organic Chemicals
Cane Sugar Petroleum Refining
Electroplating Phosphates
Fertilizer Plastics and Synthetics
Fruits and Vegetables Pulp and Paper
Grain milling Rubber
Inorganic Chemicals Seafood Processing
Iron and Steel Steam Electric Power
Leather Tanning and Finishing Textiles
Meat.Processing Timber Processing
Nonferrous Metals

only one case has been decided on its merits(165). virtually all of the
remaining suits have been pending in the courts for -six to:18 months(166).
In light of the time required for appeals, final resolution of all
contested issues could extend two to four years beyond the date of
promulgation of the regulations. Details of the challenges to the
effluent limitations guidelines and the new source performance standards
are discussed in the sections that follow, including a section on special
issues raised by the steam electric power industry. Challenges to
implementation of the permit program, toxic standards and pretreatment
requirements also are discussed below.

Regulatory Program -- Effluent Limitations Guidelines

For existing sources, Section 301(b) of the Act, in part, provides:

"There shall be achieved -- (1)(A) not later than
July 1, 1977, effluent limitations-which shall
require the application of the best practicable
control technology currently available as defined
by the Administrator pursuant to Section 304(b)(2)...
(and) (2)(A) not later than July 1, 1983, effluent
limitations ... which... shall require the best avail-
able control technology economically achievable. . .
as determined in accordance with regulations issued
by the Administrator pursuant to Section 304(b)(2).

Section 304(b) of the Act, in part, provides:

"For the purpose of adopting...effluent limitations.
the Administrator shall-publish-regulations pro-
viding guidelines for effluent limitations..

Section 402(a)(1) of the Act, in part, provides:

"...[T]he Administrator rnay...issue a permit for
the discharge of any pollutant...upon condition
that such discharge will meet...all applicable
requirements under Section 301

V-121

Implementation of Section 301 effluent limitations, Section 304
effluent limitations guidelines, and Section 402 permits has generated
the most significant legal controversies under the Act.

The first dispute to arise concerned the date by which EPA would
issue guidelines under Section 304. P.L. 92-500 called for guidelines
to be published within one year of the statute's enactment, i.e., by
October 18, 1973. EPA's failure to meet this deadline prompted a law-
suit by the Natural Resources Defense Council. The suit resulted in a
District Court order requiring EPA to publish effluent limitations
guidelines consistent with a court-established schedule(167).

After conducting extensive rulemaking proceedings, EPA issued one
set of regulations to serve as both Section 304 effluent limitations .
guidelines,and Section 301 effluent limitations. Industry has challenged
these regulations for a variety of reasons. The legal questions involved
can be divided into questions concerning the fundamental nature of the
regulatory scheme, proper jurisdiction for challenges to the regulations,
and the substance of the regulations.

The industry dispute with the fundamental nature of EPA's regula-
tory scheme centers around the proper interrelationship of Section 301
limitations, Section 304 guidelines, and Section 402 permits. The
principal issue is whether P.L. 92-500 authorizes the EPA Administrator
to promulgate nationally uniform effluent limitations regulations under
Section 301, or whether effluent limitations must be set by a "permitting
authority" for an individual source as a part of an NPDES permit under
Section 402.

EPA contends that Congress intended Section 301 effluent limitations.
to be uniformly implemented by regulation. The agency also argues that
since Section 304 guidelines are "inextricably related" to Section 301
limitations, EPA properly promulgated both together. Hence, EPA concludes
that it has the statutory authority to issue a combined set of Section
301/304 regulations.

Industry argues that EPA does not have the authority to implement
Section 301 limitations by regulation. Congress intended that effluent
limitations be set in NPDES permits by the permitting authority using
Section 304 guidelines, according to industry. Thus, EPA's published
regulations must be viewed as Section 304'guidelines since EPA does
not have the legal authority to issue Section 301 limitations by
regulation.

This dispute gives rise to a problem of proper jurisdiction.
Whether the case belongs in a Federal District Court or a Federal
Court of Appeals may.depend upon whether the promulgated regulations
are combined Section 301 limitations/Section 304 guidelines or just
Section 304 guidelines. Based on EPA's interpretation that 301/304

V-122

regulations are validly issued, jurisdiction clearly lies in the U.S.
Court of Appeals since Section 509(b) of the Act provides for review of
the Administrator's actions "in approving or promulgating any effluent
limitation or other limitation under Sections 301, 302 or 306.11

Industry argues that the regulations must be viewed as Section
304 guidelines; thus, since Section 509(b) does not expressly provide
for review of Section 304 regulations, review must lie in U.S. District
Courts pursuant to the Administrative Procedure Act. The general
industry view of jurisdiction has not been adopted by the steam electric
power industry, which contends that, although the regulations are
merely guidelines, review should be in the U.S. Court of Appeals,
pursuant to Section 509. Promulgation of Section 304 guidelines is
an "action" which leads directly to the establishment of Section 301
effluent limitations by the issuance of NPDES permits, according to
the steam electric power industry.

To date, no court has squarely ruled on the challenges,relating to
fundamental nature of the regulatory scheme. Four cases, however, have
spoken to the question of jurisdiction. Three U.S. District Courts
have ruled that they do not have jurisdiction to review EPA's 301/304
regulations, although the courts did not agree why jurisdiction did
not lie in District Court. American Paper Institute v. Train(168) was
the first case decided on the 301/304 jurisdictional issue. The U.S.
District Court held that the regulations are effluent limitations issued
under Section 301 and, hence, review must be in a U.S. Court of Appeals
pursuant to Section 509.

In DuPont v. Train(16.9), the U.S. District Court for the Western
District@ at Virginia held that the Act, "taken as a whole," supports
EPA's construction that Section 301 effluent limitations are to be
promulgated as regulations apart from the Section 402 permit proceedings.
"It follows," the court ruled, "that plaintiff's substantive challenge
to such limitations must be brought in the Court of Appeal 's pursuant to
Section 509(b)(1)(E)." American Petroleum Institute v. Train(170) held
that the District Court lacks jurisdiction, but the court specifically
refused to decide whether EPA's procedure in issuing 301/304 regulations
complied with the Act.

In CPC International v. Train(171), the U.S. Court of Appeals for
the Eighth Circuit reached a different conclusion -- that the regula-
tions are reviewable not by a U.S. Court of Appeals, but by a U.S.
District Court. According to the Court, the regulations are reviewable
in U.S. District Courts because Section 301 does not expressly provide
that EPA must promulgate effluent limitations by regulation. The Court
found that the omission of such a specific provision was not an oversight,
since Congress provided unambiguously for the promulgation of national
standards in othersections of the Act. Moreover, the Court recognized

V- 12 3

that Section 304(b) sets a one-year deadline for promulgating effluent
guidelines. The Court stated that if the guidelines were intended only
for interim use in promulgating reguiations under Section 301, then
Congress would not have set a deadline for publishing the guidelines and
have failed to provide a deadline for the promulgation of 301 regulations.
on the basis of legislative history, the court held that Congress intended
to enforce uniformity of conditions for existing plants, not by authorizing
the promulgation of regulations under Section 301, but by granting EPA
the power to issue permits and to veto state-issued permits which do
not comply with the guidelines promulgated under Section 304(b). The
court concluded that since the Act does not grant the Administrator
separate authority to promulgate Section 301 effluent limitations,
review of Section 304 regulations lies exclusively in the District
Courts pursuant to the provisions of the Administrative Procedure Act.

Industry challenges to the substance-, as opposed to the basic
nature of the regulatory scheme and resulting jurisdictional issues-of
the Section 301/304 regulations, address six basic questions.

First, does the EPA categorization and subcategorization of indus-
tries, for purposes of establishing effluent guidelines, comply with
the Act? Industry does not challenge the format of the EPA categoriza-
tion and-subca:tegorization schem.e, although some specific classifications
are attacked as based on insufficient evidence or as being overly broad.
Rather, industry contends that the Act requires more than'what EPA did --
that Section-304 regulations must specify factors such as age of plant,
cost/benefit analysis and others which influence the establishment of
the 1977 and 1983 effluent limitations.

EPA, on the other hand, asserts that its procedures fully comply
with the requirements of Sections 301 and 304. It argues that the
regulations do specify how the factors enumerated in Section 304(b) are
to be applied in individual permit proceedings -- they have been found.
not to justify differential treatment, in general, since they do not
significantly affect the ability of plants to achieve the specified
limitdtions.

-- 'Second, does EPA's promulgation of single-number guidelines comply
with the Act's requirements? Several industries argue that Section 304
guidelines must provide a range of effluent reductions which will then
be applied to point-source discharges on a case-by-case basis in the
permit process. Uniformity of permit requirements comes not from the
mechanical application of a single number, according to industry, but
through the administration of a permit system controlled by guideline
regulations which ensure that similarly situated dischargers receive
similar effluent limitation permits.

EPA argues that the Act permits several different approaches to
handling a situation, and its decision-as to which approach to take

V-124

should be deferred to by the court in accordance with the general
principles of administrative law. According to EPA, the legislative
history of the Act supports the agency's position that establishment of
an effluent limitation range is neither precluded nor mandated -- that
the specific scheme is left to the discretion of the Agency.

Third, does EPA have the authority to include a "variance provision"
in its regulations promulgating 1977 effluent limitations based on best
practicable control technology currently available? The "variance'
provision" allows the Regional Administrator or the state (subject
to the approval of the Administrator) to adjust the effluent limitations
for a plant when the discharger demonstrates that the factors relating
to his plant are "fundamentally different" from the factors considered
in establishing the guidelines. The inclusion of this provision in the
regulations has been challenged by environmental groups as well as by
industry. NRDC charges that major variations may be established only
through the rule-making process used to determine subcategories(172).
EPA asserts that the variance clause imparts needed flexibility to an'
otherwise uniform system of regulation. Industry argues that even
the inclusions of the variance clause does not rescue EPA's regulations
from inflexible rigidity.

Fourth, was EPA's use of "exemplary plants", as the basis for
the guidelines, basically unfair because existing conditions in many
industrial categories were not adequately reflected? Industry argues
that EPA improperly relied on "exemplary plants" in identifying the
degree of effluent reduction attainable by applying 1977 and 1983
technologies. In industry's view, the "starting point" for determining
the range of numbers for each subcategory must always be a survey of
at least a representative sample, if not all, of existing performance
within the relevant subcategory, except where present practices through-
out the industry are inadequate. Industry also argues that EPA's
reliance on performance by a single exemplary plant, or by a theoretical
model plant, is not in accord with the Act.

According to EPA, the Administrator correctly interpreted and
applied the standard for specifying "best practicable" and "best
available" technology. The agency emphasizes that the Act gives EPA a
mandate to "press technology" -- that is, if effluent limitations are
too closely tied to routine existing performance, necessary improvements
in pollution control will not be obtained unless EPA prescribes the use
of more sophisticated technologies.

Fifth, did EPA fail to balance adequately the costs of the regula-
tions with anticipated environmental benefits? Many of the challenges to
the Section 301/304 regulations argue that EPA did not consider adequately
the economic, energy, and environmental costs of the technologies prescribed
for 1977 and 1983. Industry argues that the Act requires EPA to balance

V-125

the costs of effluent limitations against pollutant reduction benefits.
For example, the International Paper Company argues that EPA's economic,
energy, and environmental analyses are deficient, garbled and inconsistent,
thereby rendering the final regulations arbitrary and capricious(173).

EPA's response to these arguments has been a reiteration of the
rationale set forth in -the various Development Documents, and a defense
of EPA performance as the best possible in light of environmental and
economic data available for analysis.

Sixth, do.EPA's Section 301/304 regulations actually create a
criminal code for certain categories and subcategories of industries?
Several industry petitioners contend that the establishment of effluent
limitations by regulation would create by implication "a massive new
criminal code." Several petitioners argue that any regulations estab-
lishing Section@301 effluent regulations would be criminally enforceable
pursuant to Section 309(c) of the Act. They emphasize the uncertainties
that could result:

"Is there-a new criminal offense created for
violation of the Section 301 regulations, in
addition to the Act's Section 301(a) absolute
prohibition on dischargers 'without a permit,
or is'the absolute ban supplanted by the
different prohibition under the regulations?

"What is the status, as far as criminal liability
is concerned, of those who obtained permits
before Section 3bi limitations were established,
if the limits in the permit are different from
those in the regulations?"(174)

These fears of a "massive new criminal code" are "illusory," according
to EPA. EPA's brief assures the Court that it has no intention of
enforcing the Section 301(b) effluent limitations without reference
to either the discharge prohibition of Section 301(a) or the provisions
oIf Section 402 permit system. EPA contends that compliance with the
permit constitutes compliance with Section 301(b) effluent limitations
pursuant to Section 402(k). Thus anyone with a permit could not violate
Section 301(b) without violating Section 402 at the same time.

Regulatory Program -- Steam Electric Power Industry -- Special Issues

The regulations promulgating effluent limitati 'ons guidelines and
new source performance standards for steam electric power plants have
been challenged by 78 petitioners who own and operate over 50 percent
of the country's electric generating capacity affected by the challenged
regulations(175). The suits have been consolidated into one proceeding

v-126

which is pending before the U.S. Court of Appeals for the Fourth Circuit.
The basic contention of the electric utility industry is that EPA promul-
gated inflexible regulations which when fully implemented will impose
enormous costs, will waste valuable energy resources, and will result in
little, if any, environmental benefits.

First, the steam electric power industry argues that EPA's imple-
mentation of the Act is too rigid -- that EPA must acknowledge that
V, promulgated regulations for existing sources are guideline limitations
which are "presumptively applicable," but not absolutely binding. That
is, the guideline limitations should be applied in permits unless some
party to the permit proceeding sustains the burden of showing that, on
the facts of the particular case, the specific numbers are inappropriate.
According to EPA, the regulations fulfill the legislative mandate for
uniformity while retaining a sufficient amount of flexibility.

second, the electric utilities claim that EPA's blanket requirement
VX for backfitting closed-cycle cooling systems is arbitrary and capricious
because 1) the regulations were promulgated prior to completion of the
National Commission on Water Quality Report, 2) EPA's cost-benefit
analysis is inadequate, 3) the regulations impose unreasonable costs,
and 4) state-established water quality standards negate the value of the
backfit regulations.

Third, the steam electric industry maintains that EPA should not
require closed-cycle cooling on existing nuclear power plants when such
cooling systems have been approved previously by the former Atomic
Energy Commission (AEC) pursuant to National Environmental Policy Act
(NEPA) review. According to industry, P.L. 92-500 allows EPA to respect
the AEC's prior decisions and that, given the facts in the record, EPA's
failure to adopt a special subcategory for nuclear plants was arbitrary
and capricious. EPA, on the other hand, argues that although the AEC
may exercise its full NEPA responsibilities prior to the promulgation.of
FWPCA regulations, EPA is not bound to follow AEC's policy decisions
when it promulgates regulations pursuant to P.L. 92-500.

Fourth, the industry challenges regulations limiting the use of
cooling lakes as a means of closed-cycle cooling. EPA argues that
discharges into cooling lakes formed by the impoundment of navigable
streams ignores the fact that these cooling lakes are navigable waters.
As such, promulgation of regulations which would allow heat discharges
to those bodies of water would violate the FWPCA order that additions of
thermal pollution to navigable waters be reduced.

Fifth, the industry argues that the Section 316(a) variance provision
is presumptively satisfied by compliance with Section 303 state thermal
water quality standards approved by EPA. EPA argues that nothing in the
Act requires EPA to use Section 303 as presumptive (prima facie) evidence

V- 12 7

of satisfaction of 316(a), and, in fact, the Act may preclude such an
interpretation. Section 316(a) is meant to provide an evaluation of
site-specif ic characteristics to determine the stringency of an applicable
regulations, and a state water quality standard may not be strict enough
to protect a particular section of a river, although it may be adequate
to protect the river as a whole.

Sixth, the electric utilities challenge EPA's regulations which
prohibit open ocean discharges and require closed-cycle cooling at power
plants located along the nation's coastlines. In most cases, coastal
stations must use sea water cooling towers. EPA asserts that sea water
cooling towers of the necessary size are "demonstrated" in the industry
and appropriate for use since they will cause no unacceptably adverse
side effects. Industry argues that EPA is wrong for the following
reasons: 1) sea water cooling towers for a full size power plant are
not now "currently available" -- they are not "demonstrated"; 2) sea
water towers will cause unacceptable adverse environmental impacts; 3)
the economic costs of sea water towers are excessive; and 4) the sea
water cooling tower requirement violates sound land and water resource
development policy.

Regulatory Program -- New Source Performance Standards

For many industrial categories, EPA issued one set of regulations
promulgating both effluent limitations for existing sources and standards
of performance for new sources. As a result, many of the issues being
contested in litigation concerning effluent limitations are being
contested in the new source litigation; in fact, in many cases,the
challenges of a particular industry to both the effluent limitations and
the new source performance standards are set forth in the same brief.

As with'the litigation involving effluent limitations, the sole
decision to date on the merits of new source standards is the decision
by'the U.S. Court of Appeals for the Eighth Circuit in CPC International
v. Train(176). At issue were new source standards for the corn wet
milling subcategory of the grain mills point-source category. In that
subcategory, the new source standards were predicated on the availability
of the 1977 technology plus the use of deep-bed filtration. Deep-bed
filtration is a technology which EPA conceded has not been "demonstrated"
within the corn wet milling industry. But the agency has argued that
the technology has been successfully used in other industries and is
adaptable to the corn wet milling industry. The Court ruled that EPA
had not carried its burden of proof and directed EPA to.furnish additional
support for the new source standards as promulgated, or to promulgate
new regulations.

Nine cases concerning new source performance standards are pending
in the U.S. Courts of Appeals. Generally, the significant issues include:
1) What consideration of costs is required by Section 306? 2) Can the

V- 12 8

1977 "best practicable" control technology be used as a "floor" from
which to project new source standards? 3) To what extent can new source
standards be based on "technology transfer?" and 4) Is the system of
categorization and subcategorization being employed by EPA adequate to
comply with the purposes of P.L. 92-500?

A noteworthy argument is presented by the FMC Corporation in
FMC Co. v. Train(177). In the sodium carbonate industry, soda ash is
produced either by a "natural" process which generates no water pollu-
tion or by a synthetic process which generates significant water pollution.
FMC argues that the "no-discharge" new source performance standard will
effectively preclude the construction of new synthetic soda ash plants --
an effect which the Act does-not authorize. EPA acknowledges that
imposition of the no-discharge requirement may well preclude construction
of new synthetic soda ash plants unless a radically new technology is
developed, but the Agency does not believe that the requirement limits
the future of the industry. According'to EPA, it has recognized that
economic-and environmental considerations require that any increase in
soda ash capacity.be accomplished by building natural process plants.

Regulatory Program -- NPDES

At least 15 cases have arisen under the NPDES program. These cases
touch on a variety of issues including exemption of point sources from
the NPDES program, approval of state permit programs, and approval of
NPDES permits.

In promulgating regulations setting up the NPDES program, EPA
decided that certain point dischargers would not have to apply for (and
be issued) a permit, although the exempted sources still would have to
comply with applicable effluent limitations and other requirements under
the Act. The exemptions included storm sewer discharges composed entirely
of storm runoff uncontaminated by industrial or commercial activity;'
discharges from relatively small animal confinement facilities; dispharges
from silvicuitural activities; and-irrigation return flow from point
sources where the flow is from less than 3,000 acres(178). @The exemption
of these categories from the NPDES program was chalienged by NRDC in'a
suit filed in the U.S. District Court for the District of Columbia.
NRDC charged that even if EPA developed effluent guidelines an''d limitations
for the exempted'categories and even if such limitations and guidelines
could operate independently of the permit program,'the'permit system is
still "indispensable" to the effective implementation and enforcpment-of
the guidelines. EPA, on the other hand, argued th@Lt the exempted cate-
gories, although within the Act's definition of point source, nevertheless
are "ill-suite'd" for inclusion in a permit program. Discharges from
storm sewer, agricultural, and silvicultural point sources are best
eliminated-by process changes, which prevent pollutants from entering
rainwater runoff, EPA asserted, rather than the end-of-pipe treatment
method used by most point sources. EPA also contended that the tremendous

V-129

number of point sources in the exempted categories would make the permit
system unworkable, and so it exercised its discretion to ensure that a
manageable permit program was established. The Court was unsympathetic
to EPA's argument and ruled that the Administrator could not lawfully
exempt point sources discharging pollutants from regulation under NPDES(179).
EPA has asked the Department of Justice to appeal this decision(180).

Another category of cases deals with EPA's approval of certain
state applications to administer their own NPDES permit program. For
example, California and Washington have challenged the Administrator's
decision, in approving their permit programs, to exempt Federal facilities
from complying with the state permit requirements. EPA takes the position
that while Federal facilities must comply with substantive requirements
imposed by states, such facilities are not subject to state procedural
requirements such as obtaining discharge permits. The Ninth Circuit
Court of Appeals upheld the states' position, and ruled that the provisions
of P.L. 92-500 "clearly mandate a Federal agency duty of full compliance
with all aspects of state permit programs."(181) This case is awaiting
final.resolution by the U.S. Supreme Court.

Pending litigation concerning the decision of the Administrator to
approve a state application to administer the NPDES program also touches
on (a) whether EPA followed correct procedures in acting on state applica-
tions and (b) whether EPA acted arb@trarily and capriciously in making
its decision on a state application. Peabody Coal Company is challenging
the approval of several state permit programs, and asserts that EPA's
approval of a state permit program is a rule-making action and as such
is subject to the procedural requirements of the Administrative Proce-
dure Act(182). Peabody also challenges the substantive considerations
on which the approval was given. For example, Peabody argues that EPA
could not have determined that Montana had "adequate authority" to carry
out its program (as required by Section 402) because EPA approval came
before the requirements of Sections 301/304 were promulgated.

A third category of suits relates to the approval of individual
permits. The administrative process is time-consuming and most of the
challenges to permits are tied up in about 1,500 adjudicatory hearings.
once the administrative process is completed, a number of the 1,500
disputes.may be appealed to the courts. While the Commission's legal
issues study did not examine the adjudicatory hearings process, decisions
issued by the EPA General Counsel during the course of adjudicatory
hearings were reviewed. The issues of law addressed by the General
Counsel may foreshadow those to be raised in court appeals. Some of the
issues raised and the resulting answers of the General Counsel are
summarized below:

May EPA issue NPDES permits prior to the promulgation of
effluent limitations guidelines? Yes.

V- 130

May a permit require achievement of effluent limitations more
stringent than "best practicable" control technology? Yes.

Does EPA have the authority to issue NPDES permits based on
effluent limitations which are being litigated? Yes, even if
the permittee is a party to the litigation.

Does EPA have the authority to control, through conditions
included in NPDES permits, the disposal of pollutants into
wells? Yes.

Does EPA have the authority to issue a permit which includes a
"force majeure" clause? Yes.

Does EPA have the authority to impose, as a condition of an
NPDES permit, a compliance date prior to July 1, 1977? Yes.

Must the effluent limitation for a municipal waste treatment
system which discharges into the ocean include the July 1,
1977 deadline for secondary treatment? Yes.

Does the EPA have the authority to issue permits containing
provisions allowing for malfunctions of properly operated and
maintained pollution control equipment? Yes, discretionary
authority.

Will existing, effective permits be amended automatically to
reflect any changes in the guidelines resulting from the
resolution of the pending guideline litigation? No.

The suits which have reached the courts to date involve challenges
to the permit procedures rather than actual permitted conditions. For
example, EPA refused two permittees adjudicatory hearings on the merits
of their respective permits and the refusals have been appealed to the
Seventh Circuit Court of Appeals(183).

Regulatory Program -- ToXiCS Standards and Pretreatment Requirements

Environmental groups are challenging EPA's failure to promulgate
toxics standards and pretreatment requirements. In EDF v. Train, the
Environmental Defense Fund and NRDC are seeking to force promulgation
of standards for the nine toxic pollutants listed by EPA(184). In NRDC
v. Agee, NRDC is seeking a court order to establish a schedule for EPA
promulgation of pretreatment standards for discharges into publicly.
owned treatment works(185). Both cases are still pending.

V-131

Summary

The courts have played, and will continue to play, an important
role in shaping the implementation of P.L. 92-500. Litigation brought
by environmental groups has directly impacted the implementation of the
Act: for example, the Corps of Engineers must utilize the Act's expanded
definition of "navigable waters" in issuing Section 404 dredge and fill
permits; EPA had been required to publish effluent limitations guidelines
consistent with a court-established schedule; EPA's exemption of certain
categories of sources from NPDES permit requirements has been.struck
down; and states must carry out Section 208 planning in "non-designated
areas". Environmental groups are alleging an EPA failure to adequately
prescribe toxics standards, are challenging EPA's inclusion of a variance
provision in the regulations for various industries, and are challenging
EPA's failure, to date, to regulate discharges of all radioactive materials
into navigable waters. States and local governments have challenged
EPA's exemption of Federal agencies from state permit requirements and
its impoundment of Federal funds for the construction of publicly owned
treatment works. Industry suits concerning "effluent limitations guide-
lines" and new source performance standards represent the most.significant
challenges to date to P.L. 92-500's implementation.

Despite extensive litigation, it is too early to assess the court's
role in the implementation of the Act. Most of the important legal
issues are still pending before the courts. one thing is certain,
however more litigation of P.L. 92-500 can be expected.

V- 132

PEOPLE, PARTICIPANTS AND PRACTITIONERS

Reactions and Responses to P.L. 92-500

During the course of its studies, the Commission sought to obtain
the views and opinions of the public in many ways. Technical meetings
were held in Boston, Los Angeles, New Orleans, Portland (Oregon),
Kansas City, Chicago and Atlanta. Representatives of industry, con-
servation and government were invited to Commission offices periodically
for briefings. The program staff worked closely with contractors in
field interviews and plant and city visits and participated in many
conferences and meetings. The Commission also conducted a formal study
of attitudes of selected groups, using accepted opinion survey techniques(.186).

Much information was obtained by mail. On three occasions, the
Chairman sent letters to interested publics -- local government leaders
and members of civic and conservation groups. More than 1,000 persons
some representing government agencies, industries and organizations
replied. If all their comments were combined with the oral statements
made at the technical meetings and with views received in unsolicited
letters, the record would fill several thousand pages. Following are
the general reactions and responses to P.L. 92-5001 as expressed by
representatives of the government, industry, agriculture, public interest.
and conservation communities and individual-citizens.

Public Interest Communities

I love to listen to my 75-year-old father and
other people of his generation talk about life along
the Mississippi before World War II -- How.he swam
along the side of the ferry to reach Natchez,
Mississippi, without fear of ingesting industrial
wastes -- How such a large proportion of the citizens
made a satisfactory living from the fish they took
from the waters each day. I do not suggest that
we attempt to return 100% to the lifestyle of 1910;
that is a ridiculous suggestion. We do have a right,
however, to enjoy and reap the benefits of renewable
natural resources, such as those derived from clean
healthy waters, and not place all of our emphasis
on an economic system which depletes and destroys
for one use only, those natural resources.

Individual from Baton Rouge, Louisiana

Of the more than '700 letters received by the Commission from en-
vironmentally concerned citizens and public interest organizations, the

V-133

vast majority believe that P.L. 92-500 represents a milestone in water
pollution control efforts. They applaud the Act's goals and adamantly
support its effluent limitations. They see application of uniform
technology-based effluent limitations within firm deadlines as the best
way to achieve clean water. This view was strongly confirmed by the
Commission's Attitudes Survey which showed 79 percent of those surveyed
as favorably inclined toward the Act, and highly supportive of its basic
implementation strategy.

Experience, they point out, teaches that extending deadlines only
discredits the force of control efforts. "An exception here, a post-
ponement there, and the controls soon become virtually meaningless,"
observes an individual from Baintree, Maine.

They argue that water quality standards, as the sole basis for
controlling discharges, have proven ineffective and do not encourage
development of recycling methods or new technologies leading to elim-
ination of discharges of pollutants. Frequently, they credit P.L. 92-
500 with the water quality improvement they have begun to see in many
areas of the country.

The most overwhelming reaction to the Act by environmentally aware
citizens is the willingness to accept the costs of meeting its require-
ments. Clean water for themselves and for future generations is to them
a basic right. Industry and government must accept the responsibility
for reducing, and ultimately eliminating, their wastes as a cost of
doing business. As an individual from North Amherst, Massachusetts,
wrote: "Nobody has the right to dump chemicals and waste into our
rivers, lakes and oceans. It is argued that elimination of such dumping
will raise prices on many goods. My answer is that the purchase price
of such goods does not reflect their true cost. The hidden cost is the
degradation of our environment. If the purchase price included the
expense of clean-up, then there might be more,of a stimulus for in-
venting efficient, non-polluting ways of doing things."

Recycling is generally viewed as a vital element of the Act's
strategy for water pollution control. They view it as the ultimate
cost-effective treatment technology, turning wastes into useable pro-
ducts. While realizing that it is not a panacear many support and want
to strengthen the Act's encouragement of land application and disposal
of wastewaters. They see it as an opportunity to turn polluting wastes
into nutrients for food production.

most of those.commenting to the Commission see the Act's net impact
on employment as positive rather than negative, creating jobs in the
construction of waste treatment facilities.

V- 134

Nearly all respondents mentioned some benefits accrued as a result
of improved water quality -- safe drinking water, increased production
of merchantable fish and shellfish, enlarged recreational 'opportunities,
aesthetically improved environments and intangibles such as the satis-
faction of protecting a vital natural resource for future generations.
one individual from California observed that shellfish are returning to
areas of San Francisco Bay for the first time since the turn of the
century. "If current objectives are met in the Bay,-it will be possible.
to harvest and consume these shellfish," he said.

In evaluating the economic impacts of the Act, many public interest
organizations point out that the Commission has failed to calculate many
of the benefits, particularly health benefits. Some benefits, of course,
are not quantifiable. Even for those which the Commission quantified,
they believe the benefits far outweigh the costs. They see the costs of
achieving the Act's requirements as principally one-time-only costs,
while the benefits continue to multiply.

The message that comes through over and over again is that the
nation's citizens cannot afford not*to clean up their waters. Many of
the letters from environmentalists emphasize that if we do not meet the
'Act's requirements, water quality will be further degraded and the cost
to restore the water later will be far greater than the cost of controlling
discharges now.

The following comment from an individual in Arcata, California,
illustrates what many have stated: "We must stop thinking and acting in
ways that achieve only short-term economic gains. Past generations have
done this and that's the reason our pollution costs are so high today.
Tomorrow the price will be even higher."

Many individuals also expressed fear that failure to meet the Act's
requirements will cause irreversible environmental damage.

In their comments, conservationists share a deep concern for pro-
tection of water quality for the future. They are particularly worried
about the continued availability of safe drinking water. Many individuals,
as well as public interest organizations, wrote to the Commission ex-
pressing shock that even with the Act, pollutants hazardous-to our
health are being discharged into drinking water supplies. As an in-
dividual from Madison, Wisconsin, said, "If we err, please let it be in
the direction of being too safe."

others have cautioned that the discharge of toxic chemicals and
pollutants associated with various land uses are either not adequately
addressed by the Act, or sections dealing with these issues have not
been effectively implemented. Channelization and damming, draining and

V-135

dredging activities are viewed as a major pollution problem in many
parts of the country. Land uses frequently mentioned as major causes of
pollution by the Act are mining, agriculture, forestry and construction.
Therefore, environmentalists want Sections 208 and 404 of the Act fully
implemented and-even strengthened-.,'

Environmentalists want the Act strictly and expeditiously imple-
mented with uniformity across the country. They are strong in insisting
that the main authority for the program should-remain with EPA and not
be delegated to the states.

The Commission received many comments about funding for water pol-
lution programs. Writers and speakers agree that more is needed --
more for EPA administration, monitoring and enforcement; more for states;
more for construction grants; and more for research on new treatment
technologies to reduce pollution more effectively and cheaply.

Several groups reported that the planning processes under the Act
are cumbersome and time-donsuming4 However, they recognize that planning
is an integral part of water quality improvement, and are particularly
eAger-to insure the examination of secondary growth impacts of sewage
treatment facilities'.

While recognizing that many administrative problems have caused
delays early in the program's implementation, most of the citizens
commenting to the Commission believe the worst of those problems are re-
solved. Now, we face what some have called the "people problem" --
the attitudes of those who must act. "I believe hostility toward the
many mandatory and new policies embodied in the Act is and will continue
to be a major limiting factor to achieving the Act's laudable goals,"
writes an individual from Athens, Georgia.

many of the individuals and organizations commenting to the Commission
are frustrated by public participation as it is currently being con-
ducted at all governmental levels. Eiren agencies that follow the letter
of the law do not follow its spirit, they charge. Agencies are not en-
couraging and assisting public participation. Notices are distributed
and hearings held as the regulation's require, but there is no,real pro-
gram to assist and encourage participation in the control process. Some
public interest groups suggested establishing an ombudsman in each EPA
office and state agency to at least see that understandable information
flows in a systematic way to interested persons.

Many believe that to "encourage and assist"-public participation,
agencies must fund public interest organizations. To provide the often
technical information needed by agencies takes a great commitment of
time and energy by volunteers in these groups. The only way for them
to provide the quality of involvement necessary to be effective and

V- 136

helpful is to be funded by the governmental agency. In this, too,
attitudes are especially important. Agency staffs must view public
participation as not just a chore and wasted effort,, but as a useful
part of their activities, environmentalists point out. Conservationists
add that public education, teamed with public involvement in making
decisions, fosters cooperation from the general public and the willing-
ness of taxpayers to bear project and program costs.

In summary, conservationists and public interest groups generally
support the Act. They believe initial implementation problems are being
solved. They think the Act must be effectively implemented and strictly
enforced. They strongly oppose any major changes in its requirements,
goals, deadlines or administration.

Industry

The business and industrial community, concerned about the negative
economic impact of the Act on their respective companies, has maintained
a high level-of interest in both the scope and detail of the Commission's
study efforts. American Metal Climax, Inc., wrote the Commission: "It
is our understanding that the Commission has broadened the inquiry to
cover the 1985 goal of no discharge of pollutants as established in the
Act. We fully endorse this broader investigation as the Commission's
report to Congress will set the stage for possible amendments to the
Act." The Procter and Gamble Company wrote, "The approach the Commission
is taking of conducting studies on selected industries and regional
assessments appears very sound." .

The private sector has challenged the appropriateness of single
number national effluent limitations for each industry and industry sub-
category. Many spokesmen favored a matrix system, or at least provision
in the law which would authorize EPA to negotiate compliance on a plant-
by-plant basis. ASARCO wrote saying, "In evaluating standards, we think
there should be consideration given to the ability of the receiving
waters to cope with specific pollutants." Anheuser-Busch, Inc., wrbte
that "in order to meet the legislatively established deadlines, EPA has
conceived guidelines in haste and has neglected such innovative approaches
as the so-called matrix technique developed by the Effluent Standards
and Water Quality Information Advisory Committee." Flexibility was
mentioned in most of-the correspondence as being extremely important,
especially in cases of economic or social hardships.

As to meeting the legislatively stipulated 1977 and 1983 deadlines
on time, there is a divergence of opinion. Most respondents said their
companies intend to meet the 1977 BPT requirements; some reported that
all, or most, of their industry category has already been issued permits
and said that they expect the permit conditions will be met on time.
The American Textile Manufacturers Association, for instance, wrote thatr

V-137

"From the viewpoint of pollution abatement, a cooperative approach with
EPA has resulted in a general acceptance by our industry of the 1977
limitations and has resulted in efforts toward compliance with them
rather than litigation over their validity." However, Procter and
Gamble commented, 'VIt is our belief that the national goals of a quality
of water that 'provides for the protection and propagation of fish,
shellfish and wildlife, and provides for recreation in and on the water'
will largely be met by imposition of the July 1, 1977, treatment limi-
tations on.industr@ and,municipalities." Going further, United States
Steel said that, "In effect, We will be required in many cases to achieve
by July 1, 107', what*was,contemp'lated by 1983 or 1985, if at all, with-
out regard to the costs involved -- economic, social and environmental.
Inasmuch as the 1977 deadline is unattainable in any event, by munici-
palities, it woIuld make sense to wait until all of the first phase
techno'logy is in place so that existing water quality could be appraised
before further significant.exbenditures are made." For the 1983 BAT
requirements, industry was almost unanimous in asserting that they were
too stringent, too costly" wasteful of manpower, energy and raw materials,
and that they realized marginal improvements in water quality. Union
carbide Corporation indicated that, "it is particularly true for the
1977 to 1983 increment where'a 50 percent increase in investment and
operation costs will be needed to accomplish a five percent decrease in
overall pollutant reduction,"

Discussing the 1985 goal, Westvaco wrote, "We are unable to place a
realistic price tag on the goal calling for complete elimination of the
discharge of pollutants by 1985. However . . . it is not unreasonable
to anticipate additional expenditures amounting to twice the total of all
previous outlays to reach the pristine state anticipated by 1985. What-
ever the actual cost, it is wasteful of both financial and natural V
resources to attempt to achieve this goal, which in our opinion is
totally unnecessary." The Dow Chemical Company wrote, "The whole concept
of 'zero discharge' for the ele&Eroplating industry can be seen to be
nonsepse spending of public and private resources -- and it will almost
certainly put a substantial number of companies out of business with-
out achieving any significant environmental.improvement."

A number of companies expressed concern about the economic impact
of P.L. 92-500, especially in relation to national economic uncertainties
and other regulatory requirements which demand cost outlays from industry
or affect productivity. The International Paper Company wrote, "An
extension of time for implementation of Public Law 92-500 would do no
significant damage to the environment, but would greatly diminish the
inflationary impacts of these enormous expenditures by spreading them
over a number of years. In short, the extension would help the Nation
to recover both economically and environmentally." American Metal Climax
wrote, "The Clean Air Act and the Federal Water Pollution Control Act
have necessitated investment of large amounts of capital in unproductive

V- 138

plant and equipment by AMAX and many other firms." The Joan of Arc
Canning Company wrote, "The problem encountered is the tremendous
capital investment. The four combined governmental agencies of EPA,
Food and Drug, OSHA, and OEO will tend to bankrupt the smaller food pro-
cessing companies. We have already closed two smaller operations within
our own organization to transfer the production from these operations
into larger facilities better able to spread the capital expense over a
greater number of units of production."

Many companies commented on the problems of intermedia transfer,
energy requirements and technology transfer. The Medford Corporation
wrote, "Not everything taken out of waste waters can be incorporated into
a saleable product, recycled back into the manufacturing process or
harmlessly discharged back to the sources. These unusable pollutants
must be put somewhere on air, water, or land, causing problems of con-
centration. This concentration would soon become a new environmental
hazard." The Hoerner-Waldorf Corporation wrote, "Our real concern in
the promulgation of the standards is the seemingly total lack of concern
of the energy costs to achieve a limit for the sake of a limit." American
Metal Climax, Inc., wrote, "In several cases, EPA has required levels of
effluent treatment at our plants based on technology used in other in-
dustries. Treatment technology used in one industry is not necessarily
transferrable for application in another industry. Individual plants
and plant processes are often unique and cannot be economically modified
or retrofitted with pollution control equipment in a manner that may be
feasible for a particular industry."

A number of business concerns also expressed dissatisfaction with
the industrial cost recovery and the user-charge provisions of P.L.
92-500. Some asserted that municipalities were using the provision as
a new revenue source. others objected to it as inequitable.. Anheuser-
Busch wrote, "In practice, an industry using a federally funded facility
must pay back 75 percent of the cost of that portion of the plant allo-
cated for the use of'the particular industry. This cost recovery burden
is unique in that it falls only on one user class -- industry. Industry
must in effect pay twice for pollution abatement: once for the treat-
ment of its own wastes through industrial grant recovery and again for
the treatment of wastes produced by others not subject to grant recovery
through industry's payments of federal income taxes."

A number of letters received by the Commission indicated that exten-
sive administrative problems were being encountered. For instance,
United States Steel.wrote, "We continue to have problems with the over-
lapping jurisdiction of local, state and Federal agencies. In some cases,
their objectives are inconsistent. In others, state or local agencies
arbitrarily insist on standards'more stringent than Federal standards
which in themselves may be unattainable or at best represent the limits
of technology. Conflicts of this nature, which are actually retardants

V- 139

to progress, must be eliminated." Bethlehem Steel wrote, "We have ex-
perienced difficulty with conflicting state and federal regulations.
Whereas the EPA wants standards based on pounds per day, some states
insist on low concentrations. These-two standards are often incompatible."

Yet, in spite of-the serious criticisms expressed by industry toward
the Act, the Commission's attitudes survey revealed that a majority of
industry spokesmen surveyed were generally favorable toward the-Act,
believing, however that major adjustments were needed in the goals, re-
quirements and guidelines. Based upon this survey and the other responses,
industry's views toward the appropriate course for "mid-course corrections"
could be summarized as follows:

1. The 1977 compliance date for BPT should not be enforced against
industries that make a good-faith showing that they have been seeking to
achieve permit compliance in a timely manner or where litigation has been
initiated challenging the effluent limitations or the permit requirements.
An appropriate period of time after final judicial appeal must be allowed
to plan, design and construct the facilities.

2. The 1983 compliance date for BAT should be temporarily delayed
or perhaps permanently discarded if the 1983 interim goal is achieved by
less restrictive requirements, (i.e., BPT). Much of the industry
testimony given at the NCWQ technical meetings indicated that an evalu-
ation of water quality should be undertaken after (a) industry has
installed BPT (or technologies to meet more stringent limitations in the
case of water-quality limited rivers and water bodies); (b) the public
sector has had-sufficient time to achieve secondary treatment; and (c)
abatement programs have been implemented for nonpoint sources of pol-
lution.

3. The 1985 goal of EOD should be eliminated entirely as being
unrealistic.

4. The assimilative capacity of the receiving waters should not
be ignored, nor should an inordinate percentage of a state's rivers,
lakes, streams or estuaries be designated to be restored and maintained
at a quality adequate to meet the 1983 interim goal. Some spokesmen
have maintained that the highest and best use of at least some American
waters should be for industrial production, with the attendant social
benefits realized from area employment.

Flexibility in methods for resolving these and other issues was a
common concern voiced by the industrial community. P.L. 92-500 is
characterized as an unusual piece of legislation in that it stipulates
mandatory compliance deadlines and other requirements, and yet provides
little directadministrative flexibility for EPA and little language
that the courts have been able to interpret as allowing EPA much flexi-

V-140

bility. The industrial sec@or consistently expressed a genuine desire
to work cooperatively with EPA to develop and fix limitations, guide-
lines, standards and appropriate schedules for compliance. They hope
this might occur not only on an industrywide basis initially, but
that it might also occur during the permit negotiations relating to a
specific process or plant. To the extent that P.L. 92-500, as inter-
preted by the courts, does not now allow this flexibility, industry
feels that it must be amended.

Agriculture

Agricultural interests see themselves in a unique and perplexing
situation regarding P.L. 92-500. There is an acceptance of the fact
that agriculture can and does have a marked impact on water quality and
the environment. However, there is also almost unanimous feeling that
the provisions of P.L. 92-500 are unsuited to agriculture.

In referring to one of the water quality problems associated with
irrigated agriculture, the Colorado River Board of California commented,
"(We) concur with the statement that@in the Colorado River Basin 'the
overriding water quality problem is salinity."' The Johnson County,
Kansas, Soil Conservation District commented, "erosion and the resulting
sediment"is the'4reatest pollutant of water by volume," and agreed that
erosion was tfie'prio@it
y water pollution challenge.

However, most representatives of agricultural communities felt that
the Act's reliance upon waste treatment technologies applied to point
source discharges is completely unsuited to addressing agriculture's
impact on water*quality. If progress is to be made in improving water
quality, it will only come'as new agricultural practices are adopted.
There is widespread feeling that EPA does not understand the nature of
agricultural problems and would be overzealous and irrational if it
attempted to bring about improved'practices.

The governmental structure needed to implement an agricultural
permit and enforcement program is almost totally nonexistent. There is
no consistent policy defining which public or-private organization
could be required to obtain and-comply with discharge permits. Governor
Daniel J. ]Evans, of Washington, commented, "This is the issue of the
apparent institutional inadequacies of local levels of government to
enforce NPDES conditions for managing irrigation return flows. When
such flows emanate from Federally constructed projects, the-respective
roles and responsibilities-of the Federal government and operating irri-
ga@ion districts are even more controversial."

Many commenters broached the subject of possible conflicts between
the appropriative water rights doctrine of the western states and the
provisions of P.L. 92-500. Western'water law is based upon the right
to "beneficial:'use" of a water resource'. As summarized in a Colorado

V-141

River Basin report, "Water quality limitations on the definition of bene-
ficial use are almost always opposed by western water users. Some even
go so far as to claim that rights to the beneficial consumptive use of
water implies a right to pollute and that water quality limitations
constitute a 'taking' in violation of due process."

Another common opinion expressed is that the water quality problems
associated with agriculture, particularly salinity and sediments, are
natural or nonpoint pollutants. Although these problems may be exacer-
bated by agriculture, they should not and cannot be controlled by
uniformly applied treatment technologies. Other agricultural pollutants,
including fertilizers and pesticides, are best controlled by regulating
their application, rather than through the treatment of runoff or drain-
age water.

Two more concerns of the agricultural community are the economic
consequences of abatement and the status of agricultural dischargers as
public or private entities. Many farmers, irrigators and ranchers commented
that the individual operator would not be able to afford the cost of
abatement control measures. A Nebraska feedlot operator stated that the
costs for pollution control would be five to six dollars per head and
that this cost could not be passed on to the consumer. Several commenters
pointed out that farm subsidies are available from the Farmers Home
Administration, the Soil Conservation Service and the U.S. Forest Service,
all in the Department of Agriculture. However, none of the programs is
large enough to cover the costs of abatement measures and many agri-
cultural operations would be unable to meet these costs.

Many people also commented on the ambiguity concerning the status
of agricultural operations as public or private concerns. While the
irrigator, farmer or rancher is certainly a private individual, irri-
gation, drainage or soil conservation districts are public organizations.
Many commenters suggested that an effective way to influence agriculture
is through public agencies such as soil conservation services, agri.-
cultural extension services, etc. Several commenters from the Bureau
of Reclamation and the.states-in the Colorado Rivet Basin pointed out
the program of the Colorado Salinity Control Act (P.L. 93-320) is jointly
funded on a 75-25 percent federal-local basis, as are publicly owned
waste treatment plants under P.L. 92-500. In addition, state pollution
control programs for agriculture always involved planning by either
state or areawide organizations.

Government

The response to P.1. 92-500 by Federal, state and local governmental
agencies* has been both diverse and numerous. The institutional com-

*Unpublished Digests of Letters, National Commission on Water Quality.

V- 142

plexities, combined with individual attitudes, cont inue to affect imple-,
mentation of this Act. Generally, the attitude of the state and local
officials, as characterized in the Commission's survey, was supportive
of the Act and many of its essential concepts, especially financial
incentives and revenue producing devices, but negative about the ad-
visability and likelihood of achieving the major goals of the Act.

The responses from various government officials at all levels are
grouped into four general program aspects or characteristics: 1) fiscal,
2) administrative, 3) constraints, and 4) priorities.

Fiscal Factors -- Both state and local government officials express
concern about availability of adequate funding in a highly competitive
governmental fiscal situation. At the state level, there have been fre-
quent statements that inadequate funds have been provided to achieve
the Act's requirements. This concern is illustrated by comments from
the State of Alabama: ". . . it would appear that it is not feasible
to place all, or substantial amounts of available construction grant
funds in one or two areas . . . at the expense of other areas . . ." and
from the State of Ohio: ". . . I assume that the study will address the
effect of the impoundment of construction grants. . . (T)his has (been)
. . . and is . . . a deterrent to the program."

Local or municipal governments expressed)equal concern. Communities
as small as Hanover, New Hampshire, and as large as Oakland, California,
expressed concern about both the availability and commitment of Federal
monies. For example, Nashville, Tennessee, commented that ". . . coirdnu-
nities will not move without assurance of Federal funds and Federal
funds are not enough to stretch to every potential recipient in the
appropriate amounts. . ." Poweskirk County, Iowa, commented: "It is
not easy to say to a small community that you are going to have to meet
this Act's requirements when it is almost certain it cannot even get
on a priority list (for federal funds)."

In addition to concern about the availability of funds for capital
construction, state and local governments voiced strong feelings about
operation and maintenance costs. Winchester, Virginia, says, "One of
the main problems that we face . . . is a shortage of personnel . . .
I think the salaries and public image of these workers must be improved,"
and Brockton, Massachusetts, echoes, "I could never understand why we
spend millions of dollars to build sewage plants and give so little
thought to the staffing of these plants."

The ultimate effect of national economic trends, very tangible at
the local level, is evidenced by this statement from Petersburg, Virginia:
"Energy requirements for increased capacity and treatment levels are
expensive. Labor costs have risen sharply. Costs for replacement

V-143

parts and dates for delivery are becoming unreasonable. Chemicals are
more costly and harder to obtain. All of these costs must be passed on
to the user and are slowing down our national goals."

Responses to two'of the Act's key provisions, "user charges" and
"industrial cost recovery," were numerous. Responses indicated a general
acceptance of the user charge concept, but disagreement with the court
decision that ad valorem taxes are unacceptable. States and many muni- _J__
cipalities feel that increased flexibility allowing local entities to
determine the methods for assessing and collecting user charges would
make the implementation of this requirement much simpler and easier.

The industrial cost recovery requirement generated complaints from
the public sector. opposition was not directed so much to the purpose
of the requirement, which was intended to ensure that some industries
did not get a free ride at the expense of the Federal taxpayer, as to
the procedure by which the purpose is to be realized. The general
feeling is reflected in a comment from Wichita, Kansas: "The engineering
required as well as the bookkeeping necessary to administer the in-
dustrial cost recovery provision . . . is not a practicable approach to
the problem."

Administration -- A major concern of state and local governments is
administrative deficiencies in implementing the Act -- chief among them,
the effects of "excessive paper work," "duplication" and "red tape."
The intensity and number of responses on this subject are impressive.
Other concerns -- such as delay, duplicationt lack of delegation of
authority and responsibility, rigidity, erratic policy guidance and lack
of continuity in the program -- were identified not only as administrative
problems, but also as major factors contributing to or, in some cases,
causing duplication and excessive paper work.

This problem is described well by comments of San Antonio, Texas:
"Our second most pressing problem is the tremendous amount of paper
work . . . the requirements are repetitive and absurd; others are
frightening . . . (T)he most important steps which could be taken to
improve the Federal-State-local partnership would be to study all means
of cutting red tape." Another good example is the statement of an
official from Palo Alto, California: "It is extremely frustrating to
those in the wastewater field to spend a million dollars and four years
on reports which are repetitive and redundant without ending up with
plans and specifications from which to @olicit bids or a single element
of construction."

States also voiced strong opinions about administrative demands,
insisting that administrative and regulatory provisions of the Act have
imposed enormous workloads on their staffs. Even with increased staffs,

V- 144

they asserted that the requirements of the Act adversely affected their
ability to carry out other responsibilities under state law. From
Wisconsin: "I am concerned that over the long'haul-the State legis-
latures will not continue to support the State contributions to the
overall program. . . Duplication of regulations and jumping back and
forth from State to Federal regulatory procedures will result in a
serious loss of confidence by the public as well as those.who are
regulated."

Technological Constraints -- While a few responses specifically
indicate purely technical constraints to implementing the program, a
few technological and "environmental" factors were characterized as
being counterproductive to achieving the Act's requirements. Many
officials questioned,the need, in all cases, to provide "secondary"
treatment as rigidly.defined by EPA. Many argued that it would be more
effective to allow the use of several different types of conventionally
defined wastewater treatment processes such as-waste stabilization
.lagoons or ponds. Although these processes may not meet the strict EPA
criteria, some felt they would fulfill local environmental needs, and,
lessen the fiscal and administrative impact.

States-and municipalities in.coastal areas have argued against the
need for "full secondary treatment." In northern or wet climates, the
imposition of the "infiltration/inflow requirements" posed a seasonal
constraint wh@rever actual field analysis was required. This problem
occurs primarily during spring runoff; consequently, nature -- not the
Act -- dictates when a reliable technological assessment can be made.

These responses generally indicated that the rigid imposition of
11requirements" strongly influenced state and local administrative
personnel and elected officials'-attitudes toward the acceptability of
the Act.

Priorities -- one subject receiving a large number of,responses,
particularly from the states, was planning. many government officials
voiced concern over numerous and often ambiguous planning requirements,
uncoordinated and overlapping planning programs and priorities, un-
realistic deadlines, and the uncertainties and inevitable shortages of
funds. Some questioned the need and utility of the new extensive planning
levels initiated by the Act. They argue that construction of wastewater
treatmen@'facilities will abate pollution, but studying the problem
will not. A few others argue that these studies essentially have al-
ready been performed. Thus, the new requirements only generate more
paperwork and waste the taxpayers' money.

There appears to be a general acceptance of the need for planning,
but a major concern about the most beneficial kind of planning. For
example, the State of Washington states that, "Facility planning is a

V-145

study area . . . that could use a closer look. over-planning of alter-
natives for rural areas, unrealis,tic,projections of growth, and duplication
of effort need to be adequately addressed." The State of South-Carolina
adds that ". . .,comprehensive water resource planning should not be
allowed to evolve into a series of separate efforts with only token
coordination."

Apother.subject posed as.a question of priorities is the control of
pollution from nonpoint sources. While reactions to the program addressing
this problem 'under the Act have been mixed, responses tend to show that
the most significant question is, "Who will have ultimate responsibilty
for this planning?" State, local and regional groups have all demonstrated
a desire.to "control" the nature of this planning, primarily because of
its land use'implications. An indication of the level of this concern
is illustrated by comments from the State of New Mexico: many of
the.western states either do not understand, or do not agree that 'non-
designation' under -section 208 (of the Act) has the effect of requiring
the establishment of state land use control sufficient to regulate the
location, modification and construction of any facilities which may re-
sult in any discharge."

Other problems, such as research and development, manpower training
and public participation have also been listed as concerns in the estab-
lishment of priorities by government officials.

V-146

REFERENCES

(1) Hearings on H.R.11895 and H.R.11896 before the House Committee on Public
Works, 92d Congress, lst Session, p.298. (1971.) (Testimony of William
Ruckleshaus, EPA Administrator.)
/(2) Oregon Research Institute, Attitudes of Selected Groups toward Implemen-
tation, pp.19 and 58. (1975.)(Hereinafter cited as "Attitudes Study.")
(3) Staff of Subcommittee on Investigations and Review of House Committee
on Public Works, "Interim Staff Report," p.3. (April, 1975.)
(4) 35 Fed.Reg.15623 (1970); 84 Stat.2086. (1970.)
(5) Touche, Ross & Co., The Water Pollution Control Act of 1972: Institu-
tional Assessment, Construction Grants, p.III-G-11. (1975.)(Hereinafter
cited as "Construction Grants Report.")
A6) Senate Committee on Public Works, 93d Congress, lst Session. A Legis-
lative History of the Water Pollution Control Act Amendments of 1972.
Vol.I, p.294 (Comm.Print 1975.)(Hereinafter cited as "Legislative
History.")
vl(7) Environmental Law Institute, The Water Pollution Control Act of 1972:
In@,titutional Assessment, Enforcement, p.67. (1975.)(Hereia@after cited
as "Enforcement Study.")
(8) Ibid., p.71.
(9) Ibid.
(10) Natural Resources Defense Council v. Train, 6 ERC 1033(D.D.C.1973),
aff'd in part 7 ERC 1209 (D.C.Cir.,1974).
(11) See, infra, pp.V-119-124; also, see p.II-60 for discussion of subcate-
gorization.
Z (12) Energy and Environmental Analysis, Inc., The Water Pollution Control Act
of 1972: Institutional Assessment, Permits, p.140. (1975.)(Hereinafter
cited as "Permits Study.")
(13) Ibid., p.114.
(14) 38 Fed.Reg.35388 (Dec. 27, 1973).
(15) See, infra, p.V-32.
(.16) Report of the Decentralization Task Force, U.S.Environmental Protection
Agency, Dec., 1975. p.2.
(17) Permit Study, p.150.
vl(18) Schaffer, Robert B. "Control of Water Pollution through Issuance of
Discharge Permits, Implementation of P.L.92-500," a paper presented at
Fourth U.S./Japan Conference on Sewage Treatment Technology, Oct.28-29,
1975.
_,,--(19) Implementing the National Water Pollution Control Permit Program: Pro-
@rams and Problems. Report*of the General Accounting Office to the House
Subcommittee on Investigations and Review of the Committee on Public
Works. February, 1976.
(20) See, infra, p.V-37.
(21) EPA, Clean Water Report to Congress, 1975. p.III-5 (draft).
(22) EPA Internal Guidance Document, Chapter I, p.3 on file at National Com-
mission on Water Quality's offices.

V-147

(23) Permit Study, p.193.
(24) Energy Resources Company, Inc., The Federal Water Pollution Control Act
of 1972: Institutional Assessment, Compliance Monitoring, p.VII-11.
(1975.)(Hereinafter cited as "Compliance Monitoring Report.")
(25) Ibid., p. 11-7.
(26) Enforcement Report, pp.I-1, 15.
(27) EPA, Guidelines for Water Pollution Enforcement. July 23, 1973@
Enforcement Report, pp.III-16, 18.
(28) EPA, 1976 Strategy Paper, p.B-2.
(29) Schaffer, op cit., p.8.
(30) EPA, Economic Re ort, Alternative Methods of Financing Wastewater'
Treatment, p.A-2.
(31) Environment Reporter, July 18, 1975. p.479.
(32) Legislative History, p.153.
(33) Ibid., p.168.
(34) T3 Comp.Gen.547 (February 14, 1974); reaffirmed by GAO File H B166506,
July 1, 1974.
(35) Construction Grants Report, p.III-G-16.
(36) EPA, Review Report, 1974. p.23.
(37) P @id. , p. v.
(38) See, infra, p.V-38.
(39) EPA, Review of the Municipal Waste Water Treatment Works Program,
p. 7 (Nov. 30, 1974) .
(40) Ibid.
(41) Ibid., p. 10.
(42) EPA, Report of the Administrator's Special Construction Grants
Task Force, p. 4 (May 31, 1975).
(43) EPA, Review of the Municipal Wastewater Treatment Works Program,
P. iv.
(44) Ibid., p. 10.
(45) Ibid., p. 22.
(46) Ibid., P. 22.
(47) Ibid., p. 10.
(48) Ibid., p. 22.
(49) EPA, Report of the Administrator's Special Construction Grants
Task Force, p. 16.
(50) "Interim Staff Report, supra note 3, p. 9.
(51) EPA, Report of the Administrator's Special Construction Grants
Task Force, pp. 1, 14.
(52) Construction Grants Report, p. III-F-1.
(53) Municipal Waste water, supra note 39, p. 19.
(54) Civil Engineering-ASCE, U.S. Water Clean Up_Program Speeds Up
But Still Much Red Tape, p. 71 (Aug. 1975).
(55) Task Force Report, supra note 42, p.-14.
(56) Ibid., p.15.
(57) Municipal Waste Water, supra note 39, p.27.

V- 148

(58) Construction Grants Report, p.III-F-16.
(59) Ibid., pp.III-F-6, 7.
(60) Ibid., pp. III-F-B, 9.
(61) Task Force Report, supra note 46, pp. 13, 14.
(62) Construction Grants Report, p. III-D-8-
(63) Task Force Report, supra note 46, p. 22.
(64) Construction Grants Report, p. III-D-10.
(65) Task Force Report, supra note 46, p. 9.
(66) Construction Grants Report, p. III-D-8.
(67) Task Force Report, supra note 46, p. 23.
(68) Task Force Report, supra note 19.
(69) Legislative History, p. 834.
(70) Ibid., p. 154.
1(71) 'Ibid. p. 153.
(72) Train v. Campaign Clean Water, 7 ERC 1501 (U.S. Sup. Ct. 1975);
Train v. City of New York, 7 ERC 1497 (U.S. Sup. Ct. 1975).
(73) Ibid.
(74) Ibid., footnote 2.
(75) Construction Grants Report, p. III-A-16.
(76) Ibid., pp.70, 71.
(77) Task Force Report, supra note@42, p. 8.
(78) Ibid.
(79) Legislative History, p. 168..
(80) Construction Grants Report,.p.74.
(81) Ibid., pp.III-G-18, 19.
(82) "Ibid.
(83) Task Force Report, supra note 42, p. 6.
(84) Ibid., p. 10.
(85) Ibid., p. 27.
(86) Interim.Staff Report, supra note 3, p. 2.
(87) Task Force Report, supra note 42, p. 10.
(88) Construction Grants Report, p. III-G-9.
(89) Municipal Waste Water, supra note 39, P. 47.
(90) Ibid.
(91) unpublished EPA Document (Sept. 2, 1975) on.file at National
Commission on Water Quality offices.
(92) Municipal Waste Water, supra note 39, P. 50.
(93) Construction Grants Report, p. III-F-14.
(94)..Task Force Report, supra note 42, P. 17.
Construction Grants-73--port, p.111-F-14.
(96) Municipal Waste Water, supra note 39, p.iv.
(97) Ibid., p.22.
(98) Construction Grants Report, p.III-C-3.
(99) Decentralization Task Force, supra note 16, p.2.
(100) Letter Report, Panel on Secondary Treatment, Committee on Water
Quality Policy, Environmental Studies Board, Commission on Natural
Resources, National Research Council, National Academies of Science
and Engineering (February 15, 1976).

V- 149

(101) Letter from Russell E. Train, Administrator, U.S. Environmental
Protection Agency, to Joe G. Moore, Jr., Program Director,
National Commission on Water Quality, April 14, 1975.
(102) EPA, Survey of Facilities Using Land Application of Wastewater,
No. 430/9-73-006 (July 1973).
(102) Curtis J. Schmidt, et al., Municipal Wastewater Reuse in the U.S.,
Journal of Water Pollution Control Federation, Vol. 49, No. 9,
p. 2229.
(104) EPA, Best Practicable Waste Treatment Technology, pp. 2-3 (March 26,
1974).
(105) Construction Grants Report, p. III-C-6.
(106) Ibid , p. III-C-8.
(107) Ibid., p. III-B-29.
(108) Letter Report, supra note 100, pp.12-13.
(109) EPA, 1974 Needs Survey, p.iO (February 10, 1975).
(110) EPA, Clean Water Report to Congress 19751 p.IV-5.
(111) See, infra, Table V-27, p.'V-83.
(112) American Public Works Association, An Analysis of the U.S. EPA
Needs Survey,(April, 1975).
(113) Construction Grants Report, p.III-A-11.
(114) 1974 Needs Survey, supra note 109, p.6.
(115) Construction Grants Report, pp.III-H-23, 24.
(116) Alternative Methods of Financing, supra note 30
(117) Construction Grants Report, supra note 5.
(118) Ibid.
(119) Ibid. , p. III-H-191.
(120) Ibid., p.III-E-10.
(121) Ee_g_islative.History, p. 155.
(122) Ibid.
(123i Construction Grants Report, p. III-H-12.
(124) Ibid., p. III-H-23.
(125) John E. Peterson, Analysis, municipal Finance officers Association,
"The Tax-Exempt Pollution Control Board," p. 3 (March 10, 1975).
(126) Ibid., p..5.
(127) Ibid., p. 3.
(128) Ibid., p. 4.
(129) Harold F. Wise, et al., The Water Pollution Control Act of 1972:
Institutional Assessment, Planning, p. 5 (1975) (hereinafter cited
as "Planning Report")
(130) Ibid.
(131) EPA, Facilities Planning Summary, p. 1 (Jan. 1974).
(132) Legislative History., p. 1306.
(133) 40 C.F.R. Parts 130-131.
(134) Planning Report, p. 111-46.
(135) Ibid., p. 12.
(136) Federal Water Pollution Control Act, Section 101-(e),
.33 U.S.C.A. Section 1251 (Supp. 1974).
(137) 40 C.F.R. Section 105 (197.4).

V-150

(138) James Ragan and Associates, The Federal Water Pollution Control Act
of 1972: Institutional Assessment, Public Participation, p.5 (1975).
(Hereinafter cited as "Planning Report.")
(139) Ibid., p. 117.
(140) Ibid., p. 151.
(141) Ibid., pp. 124-125.
(142) EPA, Clean Water Report, Ch. X, P. 3 (1975).
(143) Public Participation Report, op.cit., pp. 120 and 151.
(144) Ibid., p. 71.
(145) Ibid., p. 72.
(146) Ibid., P. 103.
(147) Ibid., p. 77.
(148) Ibid., p. 121.
(149) Ibid., pp. 140 and 149.
(150) Ibid., p. 109.
(151) Ibid., p. 150.
(152) ibid., p. 109.
(153) See Institutional Chapter, page V-
(154) Public Participation Report, op.cit pp. 113-114.
(155) Ibid., p. 111.
(156) 7 E.R.C. 1881 (1975).
(157) 7 E.R.C. 1784 (1975).
(158) N.R.D.C. v. Train, 6 E.R.C. 1033 (1974).
(159) N.R.D.C. v. Train, 7 E.R.C. 2066 (1975).
(160) See 40 C.F.R. Section 105.2, 105.4 (1974).
(161) Public Participation Report, op.cit. pp. 143-144.
(162) Train v. Campaign Clean Water, 7 E.R.C. 1501 (U.S. Sup. Ct. 1975);
Train v. City of New York, 7 E.R.C. 1497 (U.S. Sup. Ct. 1975).
(163) Civil Action No. 74-0328-R (July 19, 1974).
(164) N.R.D.C. v. Train, 7 E.R.C. 2066 (D.D.C. 1�75).
(165) CPC International v. Train, 7 E.R.C. 1887 (8th Cir. 1975) (new
source performance standards for grain mills industry).
(166) Legal Issues Report, pp. 98a-119a.
(167) N.R.D.C. v. Train, 6 E.R.C. 1933 (D.D.C. 1973), aff'd in part
7 E.R.C. 1209 (D.C. Cir. 1974).
(168) 7 E.R.C. 1207 (D.D.C. 1974).
(169) 7 E.R.C. 1965 (W.D.Va. 1974).
(170) 7 E.R.C. 1795 (D.Colo. 1975).
(171) 7 E.R.C. 1887 (8th Cir. 1975).
(172) N.R.D.C. v. Train, C.A. No. 74-1258 (ed. Cir. Feb. 22, 1974).
(173) International Paper Co. v. Train, C.A. No. 74-1967 (D.C. Cir.
Aug. 16, 1974).
(174) Legal Issues Report, pp. 70-71.
(175) Legal Issues Report, p. 72.
(176) 7 E.R.C. 1887, (8th Cir. 1975), Supra, page
(177) C.A. No. 74-1296 (4th Cir. Mar. 12, 1974).
(178) See 40 C.F.R. 125.4(f), (j)(1974).

V-151

(179) N.R.D.C. v. Train, 7 E.R.C. 1881 (D.D.C. 1975).
(180) BNA, Environmental Reporter, Vol. 6, p. 990 (Oct. 10, 1975).
(181) California v. EPA, 7 E.R.C. 1667 (9th Cir. 1975).
(182) E.G., Peabody Coal Co. v. EPA, C.A. No. 74-2688 (9th Cir.
Sept. 16, 1974) .
(183) Stepan Chemical Co. v. EPA, C.A. No. 74-2020 (7th Cir. Dec. 17,
1974); Village of Sauget v. EPA, C.A. No. 74-1973 (7th Cir.
Nov. 27, 1974).
(184) C.A. No. 75-0172 (D.D.C. Feb. 6, 1975).
(185) C.A. No. 75-1267 (D.D.C. Aug. 4, 1975).
(186) Attitudes Study, supra note 2 (1975).

VI. THE REGIONAL ASSESSMENT STUDIES

vi-i

VI. THE REGIONAL ASSES SMENT STUDIES

Table of Contents

Page

A. SUMMARY FINDINGS AND CONCLUSIONS . . . . . . . . . . . . . VI-1

B. THE REGIONS: . . . . . . . . . . . . . . . . . . . . . . VI-5
The Merrimack & Nashua River; . . . . . . . . . . . . VI-5
The Delaware River . . . . . . . . ... . . . . . . . VI-7
The Kanawha River . . . . . . . . . . . . . . . . . . VI-7
Lake Erie . . . . . . . . . . . . . . . . . . . . . . VI-8
The Ohio River . . . . . . . . . . . . . . . . . . . VI-8
The Yellowstone Basin . . . . . . . . . . . . . . . . VI-9
Puget Sound . . . . . . . . . . . . . . . . . . . . . VI-9
San Francisco Bay/Central Valley . . . . . . . . . . VI-10
The Colorado River . . . . . . . . . . . . . . . . . VI-11
Houston Ship Channel/Galveston Bay .. . . . . . . . . VI-11
Chattahoochee-Flint-Apalachicola . . . . . . . . . . VI-12

C. THE EFFLUENT LIMITATIONS AND WATER QUALITY PROBLEMS . . . VI-12
Unregulated Sources . . . . . . . . . . . . . . . . . VI-14
a. Urban-Industrial Areas . . . . . . . . . . . . . VI-14
b. Irrigated Agriculture . . . . . . . . . . . . . VI-19
2. Controlled and Uncontrolled Pollutants . . . . . . . VI-23

D. GROWTH AND ENVIRONMENTAL QUALITY . . . . . . . . . . . . . VI-26
1. urban Areas . . . . . . . . . . . . . . . . . . . . . VI-27
2. Water-short Areas . . . . . . . . .. ; . . . . . . . . VI-32

E. CAPITAL EXPENDITURES AND WATER POLLUTION ABATEMENT . . . . VI-35

F. BENEFITS . . . . . . . . . . . . . . . : . . . . . . . . . VI-41
1. Recreational Opportunity . . . . . . . . . . . . . . VI-42
2.* Shellfish Bed Openings . . . . . . . . . . . . . . . VI-44
3. Costs of Degradation . . . . . . . . . . . . . . . . VI-44

G. OVERLAPPING JURISDICTIONS . . . . . . . . . . . . VI-47
T. International Commitments . . . . . . . . . . VI-47
2. Interstate Jurisdiction . . . . . . . . . . . . . . . VI-48
3. Intercommunity Jurisdictions ... . . . . . . . . . . VI-50

0
H. OVERLAPPING PROGRAMS . . . .. . . . . . . . . . . . . . . . VI-52
1. Navigation . . . . . . . . . . . . . . . . . . . . . VI-53
2. Water Resources . . . . . . . . . . . . . . . . . . . VI-53

I. REFERENCES . . . . . . . . . . . . ... 10 . . . . . . . . . VI-58

VI-1

VI. THE REGIONAL ASSESSMENT STUDIES

A. SUMMARY FINDINGS AND CONCLUSIONS

America is rich in diversity -- of its lands, its climate, work
force and levels of government. Because of this diversity, the impacts
of water pollution.abatement progr .ams upon the' environment, the economy
and people are likely to vary substantially from place to place.

Reasons for the variations are many. One area may be growing;
another declining. One stream may be polluted; another clean. One
stream may be easily accessible to bathers or boaters while another may
be lined with factories.

The-eleven regional studies undertaken by the Commission to analyze
the local impacts-of the Federal Water Pollution Control Act Amendments-
of 1972 clearly confirm thisdiversity. The studies show, for example,
that in some regions projected growth could virtually negate the progress
made by Abatement programs within a few years. In other regions, .however,
the law's requirements would provide long-term protection to water
quality if extensive growth does occur. industry will bear the brunt of
the cleanup costs in some regions, while municipalities'will pay a
larger share in others. In some places, the law's requirements would
bring only marginal improvement in a stream while in others the improve-
ments would be-substantial.-

The eleven regions represent a wide range of economic and environ-
mental setting and incorporate a great diversity of water pollution
problems. Each assessment has been a case study of the environmentall
economic, social and institutional aspects of point source abatement
programs'in'a'particular region. Each has focused on key water quality-
related issues in specific local areas within'the basin.

0 With few exceptions, achieving the 1977 effluent limitations
for industries and municipalities is a rational first step in overcoming
local water pollution problems.

In'highly industrialized areas, the Act's poiht-source pro-
visions are most effective. Industrial pollution loadings dominate
in such areas. Effluent limitations applied to these dischargers
in most cases will result in marked water'quality improvement'. In
other cases,, the sources controlled by.effluent limitations contri-
bute a'smaller portion of the total pollutant loading.
Urban,runoff And the discharge of stormwater from separate
sewers or combified,sanitary and storm sewer overflows can inter-
mittently degrade water quality near large metrppolitan'areas. In

VI-2

the regions studied, programs to control urban stormwater generally
have not been developed or implemented. Lack of stormwater discharge
control may markedly restrict the environmental improvement achieved
by point-source abatement programs. Metropolitan areas near coastal
waters argue that the secondary treatment requirement for publicly
owned treatment works discharging into marine waters is unnecessarily
stringent and ineffective. In Seattle, for example, the 1977
technology-based effluent limitations are questioned for discharges
to Puget Sound. Economically, it is argued that they are more
stringent and therefore more costly than required; and environmen-
tally that, by focusing on oxygen demanding materials, they ignore
the more important toxic materials and nutrients.
In regions where irrigation drainage discharges poor quality
water into streams and rivers, the effectiveness of regulating
point source return flows is highly problematic. The institutional,
economic and hydrological characteristics of irrigated agriculture
in the three regions studied suggest that the utility and overall
impacts of measures to reduce point-source discharges should be
reviewed as part of basinwide plans for water quality and use.
Other problems will remain. Under EPA's interpretation of the
Act's technology-based point-source provisions, neither eutrophica-
tion nor salinity will be effectively reduced. Control of these
problems will have to come as a result of applying the Act's more
stringent provisions related to water quality standards or the
state pollution control programs.

0 The stringency of the effluent limitations and abatement mea-
sures required to achieve and maintain water quality standards exceeded
those of the 1977 technology-based requirements for industrial dischargers
and publicly owned waste treatment plants in nine of the eleven regions
studied.

In many areas with sizable urban-industrial concentrations,
effluent limitations are based upon the allocation of pollutant
loadings compatible with maintaining water quality. In these
locations, major publicly owned treatment works are generally
required to achieve pollutant reductions significantly more stringent
than EPA's definition of secondary treatment. The effluent limita-
tions required of industrial dischargers generally are more stringent
than BPT, but less stringent than BAT.

0 Economic and population growth implies a need to achieve
increasingly stringent abatement or to accept increased total pollutant
discharge and degraded water quality.

In undeveloped areas, vigorous pollution control programs,
including eliminating the discharge from new steam electric generat-
ing and coal conversion plants and achievement of at least secondary

VI-3

treatment for municipal wastewater, must be implemented to assure
water quality maintenance if growth.occurs and energy resources are
developed. In the Yellowstone basin, for example, if the dischargers
in the population centers can meet the required effluent limitations,
water quality standards generally will be maintained and water
quality degradation circumscribed. A major effort will be required
in the basin, however, to assure control of pollution from present
and potential surface mining activities and to identify localities
where new growth will occur so that they can plan for adequate
waste treatment.
In many urban-industrial areas, economic growth will require
increasingly stringent abatement measures to control industrial and
municipal point sources and urban stormwater. Effluent limitations
more stringent than the technology-based requirements of 1983 may
be necessary in such areas to assure the maintenance of water
quality standards.

0 In many regions requiring industrial and agricultural dis-
charges to achieve by 1983 limitations more stringent than those for
1977, without similarly requiring a more stringent level for publicly
owned facilities, is both environmentally and economically questionable.

The relative portion ofthe.pollutant load contributed by
public and private dischargers varies markedly from region to
region as does the relative cost to achieve compliance with the
1977 and 1983 effluent limitations. Generally, abatement require-
ments are more stringent for industrial dischargers. As the 1977
requirements are met, the relative portion of the discharge of
nontoxic pollutants, such as BOD, nutrients and suspended solids,
contributed by municipal sources increases. Similarly, the public
sector"s portion of the regional cost is usually smaller than its
contribution to the total pollutant load. The 1983 technology-
based requirements continue the trend of increased stringency in
the private sector over that in the public.

0 The benefits of pollution abatement are determined not only by
changes in water quality, but also by local and regional factors including
the public's perceptions of the water's suitability for recreational
pursuits an@! its desire to use or preserve the uses of the specific
water courses.

The willingness to open and use recreational areas or allow
commercial or recreational fin and shellfishing is determined by
many features, including the historic perceptions and the avail-
ability of alternative recreation or fishing areas. Often the
policies of such state and local institutions as recreation depart-
ments, boards of health, and fish and game departments are central
in determining the degree of recreational participation or the
allowed level of fin and shellfishing.

VI-4

0 Many of the institutional concerns associated with P.L. 92-500
are related to the prior status of pollution control programs in the
regions.

Each of the Act's major programs -- pollution control planning,
enforcement and publicly owned waste treatment facility construction
has a prior history and institutional embodiment. The institutional
impacts depend upon the similarities and differences between these
programs and the Act's requirements. In states such as California
where discharge permits have been in effect prior to the enactment
of P.L. 92-500, the Act's program requirements can be duplicative
and inhibiting, in cases even slowing down the state program. More
frequently, however, the Act has required major alterations in
state laws and programs.

0 One of the major impediments to effective implementation may
be the difficulty in designing workable strategies that the various
levels of local, state and interstate governmental entities will accept.

Section 208, "Areawide Waste Treatment", provides a mechanism
for designing management schemes for waste treatment programs where
more than one local authority or municipality is affected. It is
premature to judge the impact Section 208 grants will have in help-
ing to improve institutional structures. *In multistate basins,
there is a need to coordinate the priorities for constructing waste
treatment plants and waste load allocations among several states.
EPA's review authority can be used to assure this coordination in
cooperation with interstate agencies or advisory groups.

0 The Act does not effectively recognize the water quality pro-
visions of agreements with Canada and Mexico.

It is likely that timely fulfillment of the U.S. obligations
to Canada can only be successful if separate appropriations are
specified for abatement measures on the Great Lakes. The obligations
to Mexico will be fulfilled by programs separately authorized by
.the Colorado River Salinity Control Act (P.L. 93-320).

0 Hydrological changes caused by dams, channels or diversions
are important water quality considerations in many basins.

Pollution discharge abatement measures alone cannot assure the
ability to control water quality degradation. P.L. 92-500 specifies
that alterations in flows or hydrological patterns are to be con-
sidered for their effects on water qualty Both the institutional
and physical problems in evaluating hydrological changes are extreme-
ly complex. However, 'the Actis basinwide planning and water quality
standards provisions potentially can be used to assure the compat-
ibility of proposed water resource projects and water quality
concerns.

vi-5

B. THE REGIONS

Four criteria were important in selecting the regions-and 9tudy
topic@. The regions were to cover a range of environmental settings,
including small and large rivers, lakes, coastal bays and estuaries.
They were to represent a range of demographic settings, from rural,
through small and medium-sized towns, to urban complexes. They were to
include major classes of.pollution problems municipal, industrial or
agricultural point sources, storm,runoff and nonpoint 'sources. Finally,
they were to include a range of severity of water quality problems and a
range of past programs for water pollution; control.

The purpos Ie of this ch4pter is to hiqhlight@some bf the variations
found among the'regions in relation to the Act afid to digcu�s why these
variations occur. The results presented here were chosen to illustrate
certain topics; where possible, the chapter will draw con@parisons
between regions. A comprehensive treatment of all the regional studies
is in a supp'lementa'ry volume.

The Merrimack & Nashua Rivers

The Merrimack River B@sin diain's an area of 5,01b,bquare miles in
New Har@pshire and Massachusef-ts. Formed by the 6onfluence of two head-
water tributaries at Franklin, N.H., the m4ain stem extends 118 miles.
Twenty-two of these ake tidal estuary. The,Nashua fiowg northerly from
Lancasteri Mass., to the confluen6e with the Merrimback at Nashua, N.H.

While three-fourths of the basin's land area lies'@in New Hampshire,
three-fodrths of the population is in Massachusetts. The basin's pop-
ulation in 1970 was one million,.about,45 percent of the population of
New Hdmp S'shire.and 19 percent of the population of Massachusetts.
'in and j
Although the weste northern fringes of suburban Boston lie within
the basin, much of the population lives in medibm-sizea towns.
At present, the-Mer'rimack and Nashua Aiv'ers are severely polluted
by municipalities and industries; Important industrial dischargers are
food processing, textiles., paperi chemicals, metal fabricating and
leather plants. many of,the firms are small and concentrated in the
older part of the industry.

Until recehtlyj pollution abatement piograms in the baisin were con-
sidered weak. This can be attributed in part to the,histori6al percep-
tionof the Merrimack as an industrial river dnd.to the difficulty' in
taking effective action with diverse and independent local governments.
An extensive abatement program f or the construction of publicly owned
treatment plants was initiated prior to 1973, however.

Figure VI-1
REGIONAL ASSESSMENT STUDY SITES

Puget Sound &
Lake Washington
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San Francisco'
Bay & Central Kanawh
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Valley
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110 Colorado River -now-g-,, -'a,
Chattahoochee-
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Flint &
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uston Ship
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veston Bay

Nall. Commission an Water Quality
February 1976

VI- 7

The Delaware River

The Delaware River extends from southern New York State about 250
miles to the Atlantic Ocean. Below Trenton, N.J., the river is tidal.
Salinity in the estuary increases downriver to a point near Wilmington,
Del. There the estuary widens to form Delaware Bay.

The southern portions of the basin are highly urbanized. More than
seven million people live in the basin. The largest concentration of
people occurs along the estuary from Trenton to Wilmington and includes
the Greater Philadelphia-Camden area. The other important population
center is located on the Lehigh River, a Delaware tributary and includes
the industrial area of Allentown, Bethlehem and Easton.

many of the urban areas are associated with large industrial com-
plexes. The Delaware estuary receives wastes from population centers
and petrochemical industries. The Lehigh River receives wastes from
energy and metals industries.

Before 1950 the Delaware and its tributaries were extremely polluted.
An interstate agency, formed in 1936, eventually evolved into the Dela-
ware River Basin Commission. Under the aegis of the Commission a program
designed to achieve water quality standards was initiated in 1968.
Standards have not been met. During the summer, dissolved oxygen concen-
trations may go to zero downstream of Philadelphia. Many municipal dis-
charges do not presently receive secondary treatment, but facilities to
upgrade treatment are being built.-

The Kanawha River

The Kanawha River basin drains an area of 12,300 square miles in
the States of North Carolina, Virginia and West Virginia. Formed by the
New and Gauley Rivers at Gauley Bridge, West Virginia, the Kanawha flows
97 miles northward to the Ohio River.

The major population center in the basin is Charleston, W. Va. The
Charleston SMSA has about 256,000 people, slightly more than 30 percent
of the basin's population. The primary industry in the Charleston area
is chemical manufacturing, which provides 9,800 of the total 15,700
manufacturing jobs in Kanawha County. The plants are large and well-
established. Industrial pollution continues to be a major factor in the
degradation of the Kanawha. Municipal sewage and acid mine drainage
also are problems.

The Kanawha has experienced a severe decline in water quality since
World War I. In-1958 the West Virginia Division of Water Resources
began a three.-phased approach to cleanup. With the cooperation of
industry, the program has been successful in raising levels of dissolved
oxygen and lowering levels of many pollutants. By 1972, the BOD level

VI-8

had been reduced by 85 percent and minimum dissolved oxygen concentra-
tions were 3 mg/l. At that time, the state set.a more stringent standard
of 4 mg/l.

Lake Erie

Lake Erie is the smallest and shallowe6t of the five Great Lakes.
The shallow western third of the lake -- with an average depth of 25
feet -- is particularly susceptible to degradation.

The largest concentration of population and industry is located on
the south shore of the western and central basin s'. The 1970 population
of the western half of the-basin was about 10 million. The three major
urban-industrial centers are.Detroit, Cleveland and Toledo. The Maumee
River basin southwest of Toledo is heavily farmed.

The water quality in the western basin is severely degraded. Near-
shore problems exist from municipal and industrial discharges. A critical
lakewide problem is accelerated eutrophicatioh induced by large phos-
phorus loadings. Principal phosphorus sources are municipal treatment
plants, urban stormwater from separate and combined sanitary and storm
sewer overflows and agricultural runoff. The lake has been an important
recreation and commercial fishingarea. The catch of desirable fish has
been declining, however. In past years many'beaches were closed because
of high bacterial levels. Recently, beaches in some areas have improved.

In the past decade the lake has served as a national symbol of
environmental pollution. Publicity, enforcement conferences and legal
actions have helped force major polluters into abatement programs. A
U.S.-Canadian agreement now sets limits for the discharge of phosphorus.

The Ohio River

The Ohio main stem is formed at Pittsburgh, Penna., by the Allegheny
and Monongahela Rivers. The Ohio flows 98 1 miles to its confluenc6 with
the Mississippi at Cairo, Ill. The basin drains 163,000 square miles in
eleven states.

Major population centers include Pittsburgh, Steubenville-Weirton,
Wheeling, Huntington-Ashland-Portsmouth,, Cincinnati and Louisville.
Recently, development and population growth have been more rapid in the
Cincinnati region than in the eastern portions of the basin.

The Ohio is an important transportation corridor for heavy industry
in the East. The river is controlled by a series of locks and dams to
assure minimum depths required for barge traffic. Manufacturing indus-
tries, including chemicals, metals and energy, are located along the
river. The enormous concentrations of heavy industries and large popula-
tion centers, combined with low summer flow, result in serious water
quality degradation.

VI-9

Duringthe early 1900's the river became increasingly polluted.
Water quality problems on the river have been particularly difficult to
control because of the large number of jurisdictions involved. A basin-
wide authority, the Ohio River Valley Water Sanitation Commission (ORSANCO),
has been the center of pollution control activities. In the early
1950's very little of the waste load from municipalities and industries
was treated. By 1973 all dischargers were using some form of treatment.

The Yellowstone River

The Yellowstone River flows west about 450 miles from Yellowstone
National Park in northwest Wyoming to the Missouri River in western
North Dakota. Four of the main tributaries are the Powder, Tongue,
Bighorn and Clark's Fork Rivers.

The basin has a population of about 280,000. Billings, Mont., with
a 1970 population of 61,500, is the only community with more than 15,000
people. There are three Indian reservations in the basin -- the Crow
and Northern Cheyenne in Montana and the Wind River in Wyoming.

Water pollution problems of the basin are not severe compared with
many other rivers in the U.S. Water quality-varies widely and seasonally.
In the upper mountainous regions, streams are generally cold, clear and
low in suspended.and dissolved solids. Erosion occurs throughout the
lower elevations where limited precipitation supports only sparse
vegetative cover. Agriculture is the largest water user. Nearly one-
third of the total 3.3 million acres of cropland is irrigated. The
Middle Yellowstone region receives the largest municipal and industrial
point oource discharges.. These include the discharges from the Billings
sewage treatment plant, two petroleum refineries and a sugar beet process-
ing plant.

In recent years, concern about water quality has increased because
of proposed development of the basin's vast coal,resources.

Puget Sound

Puget.Sound is an inland extension of the sea. The Sound drains an
area of about 2,340 square miles. The region contains four distinct
types of water environment -- rivers, lakes, estuaries and the marine
waters of the Sound itself. Lake Washington, the largest lake in the
region, is located in the heart of the Seattle area.

Sixty-five percent of the population of the State of Washington
resides in the region. More than 80 percent of the region's total
population of 2.2 million live in the metropolitan Seattle and Tacoma
areas.

VI-10

Waters are generally of high quality and are extensively used for.
recreation and commercial fishing. Sources of pollution include indus-
trial and municipal discharges and disposal of dredged materials. Major
discharging industries are lumber products, pulp and paper and food
processing.

Initially, anti-pollution efforts focused on public education and
voluntary cooperation of municipalities and industries. An industrial
permit program was established in 1955 and by 1963, 93 percent of all
industrial discharges were under permit. In general, municipalities
discharging to the Sound have been required to have primary treatment,
while those discharging to freshwaters have been required to employ
secondary treatment. The most dramatic pollution control results occurred
in the Lake Washington cleanup in the 1960's when municipal effluents
were diverted from the lake to the Sound. The Municipality of metropol-
itan Seattle (METRO), a regional sewage agency, gained a national reputa-
tion for its role in this cleanup.

San Francisco Bay/Central Valley

Central California is a large valley drained in the north by the
Sacramento River and in the south by the San Joaquin. The rivers meet
and discharge through the Carquinez Strait to San Francisco Bay and the
Pacific ocean. much of the Bay itself extends to the south and is not
continuously flushed by freshwater inflows. Salinity levels in the
south Bay at times exceed those of seawater.

The population of the region is more than 7.5 million. About 4.8
million people live in the San Francisco area. The industrial centers
follow the northern Bay and the Carquinez Strait. Agriculture and food
processing are important in the area. The area's small rainfall means
that much of the agriculture is irrigated.

The region has had three different types of water pollution problems.
In the south Bay, sewage discharges have resulted in coliform and low
dissblved oxygen problems. Fish kills in the north Bay and Carquinez
Strait have raised questions about the toxicity of industrial and munic-
.ipal effluent. Pollution problems in the Central Valley have been
related to drainage from irrigated agriculture.

California has had an aggressive water pollution control,program.
which has effectively addressed the municipal problems in south Bay and
the potential toxicity problems in the Carquinez. Many industrial
plants are using advanced treatment technologies. The system of State
Boards has enormous power to control pollution problems on an areawide
andcomprehensive basis. ,

VI-11

The Colorado River

The Colorado River, more than 1,400 miles long, drains one-twelfth
the area of the contiguous 48 states. The land at lower elevations is
desert, averaging less than 10 inches of rain each year. Averaged over
the entire basin, the yearly runoff is about one inch.

One aspect of the Colorado distinguishes.it from nearly all other
rivers -- its flow does not reach the ocean. Almost all of the water in
the Colorado is diverted directly or is stored in reservoirs to meet
current and future consumptive uses.

The basin's total population is 2.5 million. There are three urban
centers -- Tucson, Phoenix and Las Vegas. Much of the population lives
in small towns or on farms. The basin is nonindustrial and sparsely
populated. Agriculture and, to a lesser extent, mining are the most
important activities affecting water quality.

The overriding water quality problem is salinity. About 65.percent
of the salt comes from natural leaching. Irrigation adds additional
salts to the river. A more important aspect of irrigated agriculture's
impact, however, is that it selectively evaporates water, increasing the
concentration of dissolved salts. Salinity has a greater impact on
man's use of the river, particularly irrigation, than it does on fish
and wildlife.

The salinity control program in the Colorado has two.aspects. The
water below Imperial Dam in California flows to Mexico. Its quality is
to be maintained through the use of desalting technology. The quality
in the river above Imperial Dam must be maintained through a complex set
of measures applied to irrigation and energy uses.

Houston ShI2 Channel-Galveston Bay

The Houston Ship Channel is a man-made navigation route connecting
the City of Houston with the Gulf of Mexico. Twenty-two miles of the
channel are inland, while the remaining 29 miles extend through Galveston
Bay. The Bay itself is an important Gulf Coast estuary receiving the
flows of the Trinity and San Jacinto Rivers. . 4

Three major cities are located in the vicinity of the Bay -- Houston,
Texas City and Galveston. The region, particularly the Houston area,
has experienced extremely rapid growth. The 1970 population for the
greater Houston area was 2 million.

Houston is a major port. The shipping carries the products of the
area's petrochemical industry. The large concentration of industry in
the Houston area, particularly along the Ship Channel, includes chem-
icals, pulp and paper and metals. These industries contribute to the
waste discharges to the Channel and the Bay.

VI-12

The low dry weather flows and large municipal and industrial waste
discharges to the Ship Channel significantly degrade water quality.
Water from the Channel is flushed into the Bay during storms. In 1965,
the Texas Water Quality Board began a program to control pollution to
the Channel and ultimately the Bay. By 1972 the discharges of pollutants
had been reduced considerably. Existing permits, valid through 1979,
are very stringent. Majpr industries are being required to achieve
effluent limitations which are very nearly the same as the Act's limita-
tions for 1983. Major municipal dischargers will reduce their effluent
to one-third of the secondary treatment levels defined by EPA.

Chattahoochee-Flint-Apalachicola

The Chattahoochee River rises in the Blue Ridge Mountains of northern
Georgia and flows south for 436 miles where it meets the Flint River to
form the Apalachicola. The Flint rises just south of Atlanta and flows
about 350 miles southward. The Apalachicola, the main stem of the river'
system, is 133 miles long. The river system drains 19,500 square miles
in Alabama, Florida and Georgia. The Chattahoochee recently has been
dammed about 160 miles south of Atlanta near West Point, Ga., mainly for
flood control.

The major population centers on the upper portion of the Chattahoo-
chee are Atlanta and West Point, Ga.-Lanett, Ala. Total population of
the two areas is about 2.8 million, primarily in the Atlanta region.
Population in the Atlanta area has been growing rapidly and growth is
expected to continue. The Atlanta area has little heavy industry.
Textile and food processing plants are located in the West Point-Lanett
area.

Water quality in the Chattahoochee south of Atlanta has been poor.
Municipal sewage discharge and urban storm runoff are the major sources
of pollution. Sewage treatment plants.in the Atlanta area are being
upgraded and are expected to achieve secondary treatment in 1975.

Because of the poor quality water south of Atlanta and the newly
built reservoir at West Point, a stringent abatement program has begun.
The municipal plants are scheduled to employ advanced waste treatment
technology by 1979.

C. THE EFFLUENT LIMITATIONS AND WATER QUALITY PROBLEMS

How effective are the technol.ogy-based point-source effluent
limitations for solving local water pollution problems?

Each of the regional studies has assessed alternative abatement
programs to determine their costs and environmental impacts. The find-
ings indicate there are important differences between regions regarding

VI-13

the water quality and environmental changes which can be expected from
achieving the presently defined point-source effluent limitations.-q@wo
factors were found to be important in determining the effectiveness of
the technology-based effluent limitations for controlling pollution'T
discharges. These are the relative contribution of unregulated sources
to the total discharge of pollutants and the relative importance of
nutrients or other materials not covered by the technology-based effluent
limitations.
Technology-based effluent limitations have not yet been defined"for
two important categories of point sources. These sources are the
confined return flows from irrigated agricultural lands and urban storm-
water* from storm sewers or from combined sanitary and storm sewer
'overflows.

in addition to mandating effluent limitations for point sources,
the Act provides for programs to assist planning for the control of rion-
point sources. The Act defines nonpoint sources to include activities
such as agriculture, silviculture, mining and construction, associated
with actual increases in pollutant discharge. In addition, the definition
is extended to include modifications of ground or surface water hydrology
leading to water quality degradation or salt water intrusion.

A discussion of the situations where effective pollution control
programs must incorporate additional or more stringent measures may-give
an incorrect impression of the relevance of the technology-based effluent
limitations to pollution problems. The Act specifically recognized that
more comprehensive and more stringent programs would be necessary in-
certain areas. In many instances the technology-based effluent limita-
tions are a necessary first step in a pollution control program. The
regional studies identified only two cases where serious questions were
raised as to the environmental rationality of imposing uniform effluent
limitations. The first concerned deep-ocean disposal of effluents. In
this instance, secondary treatment removes oxygen demanding materials '
from the effluent. The case was presented that a more reasonable strategy
would concentrate effort on removing toxic materials or nutrients'
and decrease the priority for BOD removal. The second instance was
salinity and sediment control for irrigated agricultural sources. Hd-re
it was argued that a comprehensive water management plan designed to.
assure water quality should be used as the frame of reference for decid-
ing the utility of requiring specific changes in irrigation practices.

*The term "urban stormwater" is used in this chapter to note the discharge
from sewers. The term "urban runoff" is used to mean the discharge-both
from sewers and diffuse sources.

VI-14

1'. Unregulated Sources

More information exists on the types and quantities of pollutants
discharged from point sources than from nonpoint sources or urban run-
off. Many of the regional assessments were unable to address nonpoint
problems and others used only generalized-information to determine the
possible magnitude of nonpoint problems. However, a few of the studies
did report specific information on mine drainage, agricultural runoff
and urban stormwater discharged from storm or combined sanitary and
storm sewers.

The findings of the regional studies provide information on two
topics -- the extent to which urban stormwater or nonpoint sources limit
the water quality enhancement achieved by industrial and municipal
point-source abatement and the importance of natural and nonpoint source
discharges in limiting the efficacy of abatement programs for irrigated
agriculture.

a. Urban-Industrial Areas

At least two different types of situations are apparent in the
urban-industrial areas studied. The Kanawha River near Charleston, W.
Va., and the northern portions of Puget Sound illustrate situations
where urban stormwater or nonpoint sources are not now particularly
important. In these areas, the urban centers are not large. Industrial
wastes are, by far, the most important portion of the pollutant discharge.
The industrial component dominates the municipal, not only in terms of
BOD and suspended solids, but also in its potential for having a toxic
effect on the environment. The Houston Ship Channel and the reach of
the Chattahoochee River south of Atlanta, on the other hand, are areas
where urban stormwater may limit the ability of effluent limitations to
achieve clean water.* Urban populations in both areas are very large
and sewage treatment plants contribute a significant fraction of the
total point-source discharge.

The Kanawha River and Puget Sound differ significantly in their
water quality. The present and historical water quality in Puget Sound
is relatively good while that in the Kanawha River ha's been poor. The
history of pollution abatement programs on the Kanawha River illustrates
the impact of point-source effluent limitations for a water quality-
limited river. The impact of abatement on Puget Sound illustrates the
impact of technology-based effluent limitations.

*In this chapter the average discharge of BOD in stormwater is presented
as a daily average for comparison with municipal and industrial sources.
The environmental@effects of stormwater, of course, depend on character-
istics other than annually averaged BOD loading.

VI-15

Figure V 1-2
IMPORTANCE OF STORMWATER AS A POLLUTANT
BOD* PROJECTIONS FOR 4 CITIES

ADDITIONAL STORMWATER LOAD" POINT SOURCE BOD LOAD
(Percent of Point Source Untreated)
ATLANTA (Chattahoochee River)

63 STOR Untreated MUNICIPAL 100
3.
1973 INDUSTRIAL.
bs/day
63 150,000 23
Existing 100 237,000 lbs/day
1977 BPT .25

1983 AT

HOUSTON (Ship Channel)

20 Untreated 100
20 1973
115,000 1 bs/day 23
Existing 100 584,000 lbs/day
1977 BPT

1983 BAT 7

CHARLESTON W. VA. (Kanawha River)

.............. I.......
..............................
8 Untreated
100
8 ............ ...............
31,000 lbs/day 1973 15
Existing 100 411,000 lbs/day
1977 BPT

1983 BAT 3
EVERETT, WASH. (Gardner Bay) (MUNICIPAL 1% ALL LEVELS)

...................
... ..................
t Untreated
100
.....................................................
........................................................
...........................................................
1973 t t
...........
t ............................ 0 01- ......................... 100
............ ............0................S..........
Biochemical oxygen Existing .................
demand, 100 = 805,000 lbs/day
Daily average load t 1977 BPT 7
Breakdown not available
tInsignificant amount of t 1983 BAT 2
stormwater
tt Includes primary treatment

Source: NCWQ (Hammer & Siler - Atlanta; Dames & Moore - Cincinnati; Texas Water Quality Board - Houston)
February 1976
I F10
@7
7

:
5
:: F3

VI-16

Kanawha(l)

The history of water pollution control in the Kanawha River begins
well before World War II. However, at the end of the war, water quality
in the river just below Charleston was poor. Municipal and industrial
load reduction was achieved by June 30, 1968. Phase III was initiated
in 1970 and was designed to achieve an 85 percent reduction of the
discharge of oxygen demanding material. Phase III was completed on
schedule in 1972 and a water quality standard of 3 mg/l dissolved oxygen
was achieved.

In 1973 the average total oxygen demand load of organic and nitro-
genous material for the river in the Charleston area was about 185,000
pounds per day. Of this, 65 percent was discharged by industry, 9 per-
cent by municipalities, and 26 percent by storm sewer and combined
sanitary and storm sewer overflows. When the 1977 technology-based
point source.effluent limitations are achieved, the total BOD* load will
be reduced to about 101,000 pounds per day -- 41 percent from industry,
9 percent from municipalities, and 50 percent from stormwater. Achieve-
ment of the 1983 effluent limitations for industries would further
reduce the load to about 78,000 pounds per day.

For extreme low-flow conditions, the present discharges will result
in a minimum dissolved oxygen concentration of 1.8 mg/l.** Achievement
of the 1977 effluent limitations would produce minimum dissolved oxygen
concentrations in excess of 4 mg/l and achievement of the 1983 limita-
tions would raise the minimum to greater than 5 mg/l.

The Kanawha River study briefly assessed the additional nonpoint
problem of acid mine drainage. Acid mine drainage has a detrimental
effect on many of the tributaries to the Kanawha. The degradation is
intermittent in the lower main stem, however.

Puget Sound(2)

Gardner Bay lies off Possession Sound, one of the two major arms of
the complex system of marine channels of the Puget Sound area. Five
rivers discharge into the Bay and together account for one-third of the
freshwater inflow to Puget Sound. The dominant waste discharges are
effluents from pulp and paper plants. The other significant point

*The term BOD is used consistently in this chapter to mean five-day
biochemical oxygen demand.

**The Kanawha regional study did not incorporate nitrogenous biochemical
oxygen clemand into water quality projections. If nitrification is an
importaut process on the Kanawha, the actual dissolved oxygen levels
will be lower than those projected in the study.

VI-17

sources are s6waqe treatment plants. One-third of the basin's popula-
tion of 156,000 reside in the town of Everett, Wash. The principal
nonpoint sources are runoff from pasture land and large log rafts stored
on the Bay . While the study was not able to accurately assess the
quantity of pollutants from these sources', they are considered to be
inconsequential.

The history of water pollution control in Gardner Bay began with
various surveys during the 1940's. At that time, all industrial and
municipal wastes were discharged directly to the Bay's surface waters.
The quality of,the water suffered and the concentration of dissolved
oxygen decreased significantly. The pulp and paper wastes include
sulfite solution@, termed "wastie liquors", used in processing thewood
to pulp. This material is known to be toxic to fish and wildlife. Fish
kills occurred in Gardner Bay in the late 1940's.: Although the salmon
were'not among the species of dead fish recovered and there was little
evidence of altered salmon populations, the fish kills and the large
area of degraded surface water quality raised the question of a blockage
in the salmon migratory route from the marine waters to the region's
rivers. In 1951, two paper companies responded to this concern and
began discharging wastes through a deep-water outfall. Water quality at
the surface improved markedly. In theory, migrating salmon will avoid
the outfall's effluent plume.

The deep-water outfall is designed to discharge up to 22 million
gallons per day of the concentrated digester wastes from the two sulfite
mills. The remaining municipal and industrial wastes of 130 million
gallons per day are discharged to the Bay's surface waters. Currently,
the biochemical oxygen demand of the effluents is 805,000 pounds per
day. Of this, the municipal contribution is less than 1 percent. If
the 1977 abatement requirements are achieved, the BOD loading would be
reduced to 57,600 pounds per day, of which 8 percent would be municipal
contribution. Achievement of the 1983 effluent limitations would
further reduce the industrial loading and result in a net dischargi2@ of
15,600 pounds per day.

Under present conditions, a plume of water extending from the dis-
charger has high concentrations of sulfite waste liquor and low.dissolved
oxygen. The plume extends a few miles, and typically shows sulfite
waste liquor concentrations of 40 mg/l. When the 1977 effluent limita-
tions are achieved, this plume will effectively disappear. Sulfite
waste liquor concentrations will not exceed 10 mg/l and dissolved oxygen
values will exceed 5 mg/l, except quite near the discharger point.
Achievement of the 1983 technology-based effluent limitations will not
effect much change in water quality.

VI-18

In contrast to the situation in the Kanawha River and northern
Puget Sound, the water quality in certain areas may be affected by urban
runoff and other nonpoint sources. Two of the regional assessments --
the Chattahoochee River and the Houston Ship Channel -- represent situa-
tions where urban runoff, storm sewer discharge or combined sanitary and
storm sewer overflows may well be a significant factor in-limiting the
efficacy of point source abatement programs. Both of these urban areas
are large and both receive considerable rainfall during certain seasons.

The water quality in the Chattahoochee below Atlanta and in the
Houston Ship Channel is poor. Both areas are currently implementing a
program of stringent control of point source discharges. However, the
ultimate degree of improvement in water quality will be limited by the
effects of urban stormwater.

Chattahoochee(3)

The pollution control program for the Chattahoochee River has been
fairly aggressive in achieving abatement. in 1973, about 77 percent of
the total BOD load of 237,000 pounds per day was being removed. The
remaining discharge of 54,000 pounds per day degraded water quality
downstream from Atlanta. In addition, a dam has recently been completed
in the West Point-Lanett area, and its reservoir is now being filled.
The future water quality in the reservoir would be seriously affected by
the present BOD and nutrient loadings from upstream discharges. The
sewage treatment plants in the Atlanta area will begin using advance
waste treatment technology by 1979. This technology will reduce the
discharge of nutrients, as well as organic materials.

Atlanta's combined sanitary and storm sewers overflow during wet
weather. Based on the findings of a 1971 study, the BOD loading from
urban stormwater is estimated to be 150,000 pounds per day, averaged
over the year. The discharge of suspended solids may be from 100,000 to
500,000 pounds per day.

The true environmental impacts of the urban runoff and combined
sanitary and storm sewer overflows are difficult to determine. Storm
events will result in water of very low dissolved oxygen traveling down
river. It is unlikely that significant populations of pollution-
sensitive species can exist. In addition, the preliminary information
indicates that the nutrient discharge from stormwater alone may be
sufficient to produce undesirable algal growths in the new West Point
reservoir.

Houston Ship Channel(4)

The land along the Houston Ship Channel is almost solely devoted to
industries which discharge their wastes into the Channel. The Channel

VI-19

also receives the wastewater discharge from municipal sewage plants,
storm sewers and runoff from the urban area. The industrial discharge
of BOD amounts io 35,000 pounds per day, while the municipal contribu-
tion is about 98,000 pounds per day. The BOD loading from urban runoff
has been estimated to be of the same magnitude as the combined total of
industries and municipalities, roughly 115,000 pounds per day on average.
Ten percent of the annual figure may be discharged during a single large
storm.

One of the contributing factors to the pollution problem in the
Houston Ship Channel is the lack of dry-weather flow. Waste discharges
in the Channel are not continually diluted. The accumulated wastewater,
often essentially depleted of dissolved oxygen, is flushed into Galveston
Bay during storms. This poor quality water may have marked impacts on
the biology of the upper portion of the Bay. The historic fish kills
may have occurred as surges of poor quality water reached the Bay.

b. Irrigated Agriculture

The Colorado River, the San Francisco Bay/Central Valley and the
Yellowstone River regional studies addressed the pollution problems
associated with irrigated agriculture. Canals, ditches or pipes carrying
the drainage or runoff from irrigated lands constitute point source
discharges of pollutants. The quality of these waters is often signifi-
cantly degraded from the quality at intake. No limitations or technologies
have as yet been designated by EPA as a]@plicable abatement measures.
Howeverl each of the studies did address the impacts of two strategies
for controlling the discharge of pollutants from these sources. The
first indluded various measures to increase the efficiency of water use
in agriculture. The second included various schemes to treat and remove
pollutants from the return flows. The practice of irrigated agriculture
may increase the concentration of several pollutant parameters, including
salinity, sediment, fertilizer and pesticides. The regional studies did
not specifically examine fertilizer or pesticide control.

Although irrigation practices and their associated pollutant dis-
charges are not the same for all regions and crops, the problems of
salinity concentration and sediment transport are typical of most areas
of large scale farming. Point, nonpoint and natural sources contribute
to these problems.'

Sediments

In furrow or flood irrigation, water is applied to the land by
diverting it from a stream and letting it flow onto the soil. The
degree of control in the application of this water varies in different
geographic settings. However, it is impossible to apply precisely the
correct amount and the excess will run off the bottom of the field.

VI-20

Surface runoff, or "tailwater", carries sediment with it and this material
returns to the stream. Control practices for sediments in tailwater in-
clude collecting the water and pumping it back to the irrigation distri-
bution system for reapplication or more careful control of the applied
water. Controlled application can also be achieved by using sprinkler,
bubbler or drip irrigation systems.

The Clarks Fork valley is an area of extensive irrigation in the
Yellowstone basin (5). The natural sediment load in the river is
large, particularly during spring and summer, and far exceeds the
contribution from irrigated lands.

Since there are no storage reservoirs, as much of the spring
runoff as possible is diverted to the land, where it percolates into the
soils. Delivery canals and farmland temporarily store the diverted
water and filter out much of the sediment. Excess water eventually
returns to the river in surface and subsurface flows and becomes a major
part of the streamflow later in the season.

Data on sediment loads and irrigation return flows are tenuous for
the Clarks Fork region. Based upon a single year's data in the lower
river, an estimated 489,000 tons of sediment are discharged yearly from
the region. About 23 percent, or 112,000 tons come.from agricultural
return flows. About 150,000 tons of sediment are withdrawn along with
water diverted from the river. With present practice, the difference
between sediment diverted from the river and that returned results in a
net sediment removal of about 38,000 tons a year.

Net removal occurs during spring and summer when flows and sediment
concentrations are highest. During other times of the year when the
sediment load in diversions is smaller, surface irrigation return flow
is a net contributor to suspended solids in the Clarks Fork. The de-
tailed balance in sediment removal and addition by irrigation will
depend upon the specific characteristics of.a basin's soils and hydrology.

Increased efficiency of irrigation practices could slightly reduce
sediment load in the Clarks Fork. For the same acreage, increased
efficiency would mean less water diverted and much less surface water
returned. Improved irrigation practices could reduce the se4iment load
in the river by as much as 15,000 tons annually by the year 2000.
However, this is only a 3 percent decrease in the total load.

Salinity

The other irrigation pollution problem addressed in the regional
studies is increased salinity. Two mechanisms are important in causing
high salt concentrations. Crops absorb and transpire irrigation water,
selectively rejecting the dissolved salts. These salts must be removed

VI-21

from the soil near the plant's roots if agriculture is to continue.
Extra water is used to leach and drain the salt from the fields. The
drainage water would normally return the salts to the rivers and streams.
The net effect is the same as evaporation. Water is removed but the
salt load remains unchanged and hence concentration increases. In
addition, soils may contain soluble salts. When irrigation water is
applied to the soil, some of these salts are dissolved-and are added to
the return flows. As long as leaching processes continue, new salt
loads are-added to the river. In some areas salt balance in the soils
can be achieved after a few years and no new salt will be added. In
other areasi the soil is so saline that leaching may continue indefinitely.

Two types of control measures could be used to reduce the polluting
effects of irrigation. Increased efficiency in using diverted water
could reduce drainage flows and hence the rate of salt weathering in
areas where it is occurring. Technological means can be used to remove
salt from the return flows. These technologies are'expensive and their
practicality depends upon the salt concentration in the incoming water.
Desalting technologies decrease both the concentration and total salt
loads in irrigation return flows. Increased irrigation efficiency on
the other hand will actually increase the salt concentration of the
return flows while reducing their volume and total salt load.

most-of the salt in the water is initially derived from natural
sources. To the extent that these sources could be eliminated, the
concentration buildup could be prevented. The Colorado River study
examined a variety of measures for controlling salt concentrations in
the river. Two types of measures were examined for their ability to
reduce salt loads in the river above the Mexican border. These were
improved irrigation practices and eliminating three highly saline ground
or surface water inflows. Of the total 9.0 million tons of salt pres-
pntly carried each year in the river, 2.2 million would be eliminated by
a strict program to control irrigation efficiency(6). An additional
320,000 tons would be eliminated by the three projects*(7). Irrigation
return flows could rejoin the Colorado River below the Imperial Dam. If
the quality of the water flowing to Mexico is to be sufficiently high
and if these return flows are to comprise part of that flow, their salt
content must be lowered. A large desalinization plant has been proposed
to treat the return flows from the Wellton-Mohawk irrigation project.

There is an important relation between the concepts of point and
nonpoint sources for irrigated agriculture. When the water is applied

*The three salinity control projects at Paradox Vallay, Crystal Geyser
and Las Vegas Wash isolate a flow of very saline water. This flow is
evaporated and the salt stored.

VI-22

to the fields, it percolates through the soils until it joins the gen-
eral pattern of groundwater flow. Groundwater may discharge into drains
or directly to natural water courses. That portion collected in drains
becomes a point-source discharge. The groundwater discharging into the
rivers constitutes a nonpoint source. The relative fraction of the
water returning in drainage ditches and that moving with the pattern of
groundwater flow is usually not well established. However, it is likely
that the dominant return is groundwater discharge. In both the San
Joaquin a@d Colorado Basins, groundwater makes up a very significant
portion of the return flows. In these basins only about 5 percent of
the land is drained (6,8). A salinity program focused on uniform -
measures for drained lands may well miss the most significant portion of
the problem.

Hydrology

In many basins, most of the annual runoff is diverted for irrigated
agriculture. In such basins, the practice of irrigation can significantly
alter the ground and surface water hydrology. Methods for c 'ontrolling
water quality degradation resulting from irrigated agriculture include
changing practices to increase the efficiency of water use, i.e., to
reduce the amount'of water applied to the land to that minimally necessary.
In basins where irrigated farming has changed the natural patterns of
ground and surface water flow, abatement measures modifying irrigation
practices can, in turn, affect the overall hydrological patterns of the
basin. Such changes have both economic and environmental impliqations.
The regional studies documented situations where the requirements for
increased efficiency would, in fact, alter downstream flow.

Several factors in the regional hydrology and in the irrigation
practices themselves are important in determining the effect of increased
irrigation efficiency. Generally, irrigation will tend to decrease the
total annual basinwide runoff and to extend the period of stream flow
into the dry.seasion. In basins such as the Colorado and the San Joaquin
Valley, where dams impound water, spring runoff is stored and released
at a later time. .In areas like the Clarks Fork, there are no storage
reservoirs and runoff is diverted directly to the fields. As much water
as possible is applied and allowed to percolate into the ground. The
movement of this water through the ground to surface discharge later in
the summer extends stream flow well into the dry season. If the spring
irrigation were more efficient and less water were applied to the land,
less water would be available to downstream users later in the year.

In some basins, the natural water supply is augmented by importing
water from out of the basin. Generally, these water imports are con-
tracted by irrigators. The return flows from irrigated farms may provide
much of the downstream flow. If practices achieving increased efficiency
are required, the amount of water imported may decrease. This, in turn,

VI-23

would decrease downstream flow and would probably lower downstream water
quality. If the level of water imports were to be maintained and less
water were to be applied by contracting irrigators, a way would have to
be found to pay for the imported water which was not utilized. The
regional study of California's Central Valley documented a situation
where requiring increased efficiency would probably reduce water imports.
This, in turn, would have detrimental effects on downstream water uses,
water quality and wildlife areas. As in all cases where water is moved
from one basin to another, impacts related to changes in water quantity
occur both in the supplying and receiving basin.

one final aspect of changing irrigation practices may involve the
relationship of groundwater quantity and quality to surface water supplies.
in many basins, both groundwater and surface water are used for irriga-
tion. The excess water applied to the land percolates down and joins
the groundwater table. If the groundwater recharge rate is decreased by
decreasing the application of irrigation water diverted from surface
streams and if the groundwater pumping rate is maintained, a groundwater
overdraft will occur and the water table will fall. Cases where ground-
water overdrafts would result from more efficient irrigation practices
require careful evaluation of the water supply and water quality impli-
cations of proposed requirements for modified irrigation practices.

2. Controlled-and Uncontrolled Pollutants

Effluent limitations have been established for various categories
of municipal, industrial and agricultural point sources. The limitations
specify allowable discharges of particular pollutant parameters. Two
important parameters -- nutrients and salts -- are not generally included.
Additional abatement measures may be required if water quality is to
improve. Effluent limitations would be imposed under the state authority
or under the Federal authority on the basis of water quality considerations.

In the Colorado River basin, the important water quality parameter
is salinity. Current and future levels of development of the energy
industry in the basin can significantly affect the salinity concentrations.
The technology-based effluent limitations for the steam electric power
industry regulate the discharge of heat, but in the Colorado basin the
energy industry, or any water-consuming industry, must limit the discharge
of salt. Because.major water losses through evaporation would aggravate
the downstream problems, all of the Colorado basin states are considering
special requirements for salt discharges. Steam electric generating
plants or any new energy development would have no salt discharge.
Wastewaters can be evaporated and the salts or brines can be disposed of
so that they do not return to the river.

While the problem of salinity is localized to a few western areas,
the problems of nutrient discharge and eutrophication are widespread.

VI-24

More than half of the regions studied -- the Merrimack, the Ohio, Lake
Erie, Puget Sound, San Francisco and the Chattahoochee -- show the
importance of nutrients in contributing to water quality degradation.
The two most important classes of nutrient materials are phosphates and
nitrates. Concentrations of these materials, while,not particularly
significant themselves, may induce the growth of algae. Generally,
lakes or other slow-moving waters are more likely to show excessive
algal growth than are rivers or streams.

Algae growths will give water bodies an unpleasant appearance and
can also severely degrade water quality by consuming dissolved oxygen.
After the algae die, the process of decay consumes oxygen. In addition,
the metabolism of the living algae consumes oxygen. The net effect is
that waters supporting large algae concentrations may show marked oxygen
deficiencies, particularly during the night or early morning hours.

Perhaps the most important eutrophication problem occurs in Lake
Erie. However,-specific nutrient abatement measures have been proposed
for at least three other regions -- the Merrimack River, the Seattle
area of Puget Sound and the Chattahoochee River near Atlanta.

Most of the pollutant discharge to the Merrimack River is from
publicly owned treatment works. These works are designed to meet the
requirements of secondary treatment, i.e., BOD and suspended solids
removal, but are not designed to control nutrients. The findings of the
Merrimack study indicate that the nutrient load may have an important
effect and ultimately limit the degree to which water quality will be
3-mproved(9). Nutrient concentrations in the slow-moving pools behind
dams on the Merrimack may well induce algae growths. The study documented
the present levels of dissolved oxygen in the river and projected future
levels once the treatment plants become operational. Implementation of
secondary treatment will markedly improve the water quality in the
river. However, restricted stretches of the river may have poor water
quality if algal growths do, in fact, develop.

The situation on the Chattahoochee River south of Atlanta is similar
to'that on the Merrimack. Most, if not all, of the point-source discharge
is from publicly owned treatment works. The Chattahoochee has been
dammed recently near West Point, Ga., and the reservoir is now being
filled. The nutrient concentrations in the Atlanta effluents would
possibly cause serious eutrophication problems for the reservoir. "A
program has begun to remove nutrients from the municipal point sources
with A goal of 90 percent reduction in nitrogen to be achieved by 1979(3).

By far the most important pollution problem on Lake Erie is accel-
erated eutrophication induced by phosphorus. The United States and
Canada have entered an agreement which includes the control of phosphorus

Figure' V 1-3

EFFECT OF NUTRIENTS. ON WATER QUALITY
31 MILE SEGMENT. OF MERRIMACK RIVER
Milligrams DO/liter
.12 DISSOLVED
OXYGEN
10- 1977 BPT without Algal BOD
..............................
8- ...................
op
00

1977 BPT with Algal BOD

2
Existing 1973

0
50 48 46 44 42 40 38 36 34 32 30 28 26 24 22 20
BPT = Best practicable technology River mile
BAT = Best available technology Source: NCWQ (Abt Associates)
BO D = Biochemical oxygen demand February 1976

VI-26

discharges to the Lake. The agreement specifies that the phosphorus
discharge be limited to 23 million pounds per year -- a 56 percent
reduction from the present levels(10). The Lake Erie study focused on
the western half of the basin, particularly the cities of Detroit,
Toledo and Cleveland, and the agriculture in the Maumee River valley.
The important sources of phosphorus are municipal point sources (39
percent), urban runoff from storm and combined sewers (12 percent), and
agricultural runoff (46 percent). Various programs have been initiated
to limit the discharge of phosphorus. The effluent from municipal
treatment plants must contain no more than 1 mg/1 phosphorus. Several
jurisdictions -- including all of Canada, Indiana, Akron and Euclid in
Ohio, and Buffalo in New York -- have controlled the use of phosphate in
detergents. These limitations will help abate the water quality problems
in Lake Erie. However, they fall short of achieving the level of reduc-
tion required by the Canadian agreement. To achieve these reductions, a
program to control agricultural and urban runoff will be required.

D. GROWTH AND ENVIRONMENTAL QUALITY

What is the effect of future economic growth on water pollution
control requirements?

The three decades since World War II have marked a period of rapid
economic growth. Population increased while per capita productivity,
income and consumption rose even faster. These increases multiplied
pollutant discharges and water quality problems. Many regions experienced
serious pollution problems for the first time, while in established
urban-industrial centers, existing problems became more severe. P.L.
92-500 aims to reverse this trend toward greater pollution loads and
deteriorating water quality. As long as effluent limitations do not
change, increases in industrial production, in per capita consumption or
in total population would cause increases in pollutant discharges.

The Act contains four provisions which would increase the stringency
of effluent limitations over time. First, the 1983 technology-based
effluent limitations require a large fractional decrease from 1977
levels in the allowed discharge of pollutants. Second, the technology-
based effluent limitations are periodically reviewed and modified if
improved treatment technologies are available. Third, the Act requires
that more stringent effluent limitations be set if they are necessary to
assure instream water quality. Finally, all new facilities must meet
new source performance standards and be reviewed for their environmental
impact under the National Environmental Policy Act of 1969.

In areas not grossly polluted, the technology-based effluent limita-
tions effectively assure water quality maintenance well into the future.
In urban-industrial areas, economic growth implies a continuing need to

VI-27

implement increasingly stringent water-quality-based effluent limitations
or to accept water quality degradation.

The regional assessments used a simple method for projecting pollu-
tion discharge. The method assumes abatement requirements remain static
and equates the growth rates for population or industrial production
with the growth rates for pollution loads. For example, if a regional
growth rate of 5 percent is projected for the organic chemical industry,
then that industry's discharge would grow at 5 percent per year. Increases
in sewage treatment effluents are assumed proportional to population
increases.

This analysis is applicable only if abatement requirements do not,
in fact, change. In areas where a fixed maximum load must be maintained
to assure water quality, effluent limitations would become more strin-
gent. Since the method assumes static abatement requirements, it will
project future loads above the allowed maximum.

The Act specifically recognized the difficulties of dealing with
the implications of economic growth for water quality in individual
localities. Section 208, "Areawide Waste Treatment Management", and
Section 303(d), "Water Quality Standards and Implementation Plans",
provide for the identification of organizations in areas with urban-
industrial concentrations or other substantial water quality problems.
Such local agencies will have to develop detailed and comprehensive
management schemes to assure the compatibility of waste loads and pro-
posed treatment facilities for a 20-year period.

In water-short areas, the question of growth cannot be separated
from the question of water supply. Two regional studies -- the Colorado
and the Yellowstone -- include a more complete treatment of the relation-
ship between future economic and water-use patterns and water quality.
Each of these studies examines several projections of future water use
and the effect of alternative pollution abatement programs.

1. Urban Areas

Houston, Atlanta And Cincinnati are located on seriously polluted
water bodies. These bodies have been designated as water-quality-
limited, and discharge permits are written on the basis of discharge
load allocations, rather than 1977 technology-based requirements.
Pollutant loadings have been projected for a period extending from the.
1960's through the year 2020. Thefigures in this section should not be
interpreted as predictions of future loads. Rather, they are projections
of loads assuming effluent allocations based upon static formulas for
the allowed discharge per unit of economic activity, and upon future

Figure V1-4
800.01SCHARGES BY ABATEMENT LEVELS
HOUSTON, ATLANTA, CINCINNAT4

INDEX 100 1983 abatement level. low point 100 39,160 lbs/day -P-3820
1273 130 D5 1800 .00,2100
1200- 100 37,000 lbs/day BOD5 100 24,620 lbs/day BOD5
0

800-

500 OD

0
389 497 40
400
de
300 @qll 2 2 30sw 223 370
200 1979 =:=A- 8 \qJ1
100 A983 BAT 1(3S3 BAT
0 1 1 1 1 1 1 a I I I
(b70 77 83 90 -0 10 Q) 77 83 90 -0 10 Q)77 83 90 -C@ 10' SZ)
Z
0
41
HOUSTON ATLANTA CINCINNATI
Ship Channel Chattahoochee River Ohio River
Projections based on Ober's growth rates BPT = Best practicable technology
Source: NCWQ (Hammer & Siler - Atlanta; Dames & Moore - Cincinnati; Texas Water Quality Board - Houston) SAT = Best available technology
February 1976 BOD = Biochemical oxygen demand
AWT = Advanced waste treatment
W-Z I UU

oe
"2

T 19
JQS3 BA

VI-29

projections of economic activity*(11). The 1977 loadings of biochemical
oxygen demand are the total allowable discharge under the existing per-
mits in each area.** The 1983 loadings shown assume compliance with
technology-based effluent limitations.

In Houston, the 1977 permits are based on achieving water quality
standards in the Houston Ship Channel, and for major dischargers they
are much more stringent than 1977 best practicable technology (BPT)
requirements(4). Large industrial dischargers will have almost achieved
the 1983 guidelines for "best available technology" by 1977, while major
municipal dischargers,will have reduced BOD concentrations to one-third
of 1977 requirements for secondary treatment. Abatement measures will
also reduce discharges of oxygen-demanding material such as amnonia.

The Houston graph shows three projections for the future -- con-
tinuation of the fractional abatement achieved in 1973; continuation of
the fractional Abatement required by current permits; and continuation
of the fractional abatement required to be achieved in 1983.

To assure that permitted loads do not violate water quality standards,
the Texas Water Quality Board specifically included a 5 percent growth
rate when it developed,permits in 1974. When these permits expire in
1979, EPA and the Board will reevaluate the ability of 1983 limitations
to maintain water quality(12).

Atlanta, unlike Houston, has'few industrial point sources. Publicly
owned treatment plants discharge most of the pollutant load(3). These
plants currently meet the requirements for secondary treatment, but will
ingtitute advanced wastewater treatment in 1979 to meet water quality
standards.. Effluent BOD concentrations will be about two-thirds of the
1977 secondary treatment requirement of 30 ppm. The municipal load will
increase if Atlanta's population continues,to grow at a rate comparable
to the past annual rate of 2.7 percent. Municipal dischargers.will have
to improve effluent quality further and begin addressing the problem of
stormwater if population growth by the year@2000 is to avoid degrading
the water.

*The U.S. Water Resources Council publishes the OBERS growth projections
for regions of the country. Series E projections were used in all
regional studies.

**BOD is used as an example in this chapter. Similar projections were
developed in each region for other pollutant parameters, e.g., suspended
solids, coliform bacteria and nutrients.

VI-30

In Cincinnati, as in Atlanta and Houston, most of the present point
sour ce discharge is from publicly owned treatment works(13). However,
most of the industrial load is discharged to the municipal system. In-
dustries contribute 25-30 percent of municipal inflows and an estimated
43-48 percent of the BOD. Municipal plants presently discharge poor
quality effluent. Many provide only primary treatment for influent
sanitary and highly concentrated industrial wastes. Achieving effluent
limitations based on water quality standards will cause a ninefold
decline in BOD loads. Imposition of 1983 BAT does not further reduce
the pollution load very much. Most area industries discharge to a
municipal system and are not, therefore, subject to the 1983 BAT requirements.

Cincinnati has an annual population growth rate of 0.8 percent, and
an industrial growth rate of about 4.4 percent. If these growth rates
continue, more stringent measures will be required to assure the water
quality behind Markland Dam on the Ohio River.

Seattle differs from these three cities in that BOD discharges do
not presently degrade water quality or cause 'violations in state dissolved
oxygen standards(2). When 1977 BPT requirements are achieved, BOD
levels will drop 70 percent. However, nitrogen loads, which contribute
to algae growth, will increase sharply by century's end. In 1983,
nitrogen concentrations may cause algal blooms, lowering dissolved
oxygen concentrations below standards. Increased nitrogen loads would
result from a 1.7 percent population growth rate and an expansion of the
service area of treatment plants.

Seattle METRO has proposed nitrogen removal for its plant on the
Duwamish Estuary in Seattle. The proposed technology would achieve an
87 percent reduction in ammonia, the major nitrogen component in sewage,
and keep algae at acceptable levels beyond the end of the century.

Seattle, like Cincinnati, Houston and Atlanta, must provide treat-
ment beyond secondary treatment in order to maintain water quality
standards -- in this case, nutrient removal.

In areas which are not water-quality-limited, publicly owned treat-
ment plants are required to achieve secondary treatment in 1977, and
best practicable waste treatment technology over the life of the works
in 1983. EPA has defined these requirements to be identical in most
cases. Typically, this corresponds to an 85 percent reduction in BOD
discharge. Because of EPA's interpretation of the 1983 technology-based
effluent limitations for publicly owned-treatment works, only industrial
discharges are reduced. In areas wherl municipal discharges constitute
a sizable portion of the pollutant load, the discharge decrease achieved
in 1983 may not be large.

VI-31

Figure V 1-5
EFFECT OF AMMONIA-NITROGEN REMOVAL
Seattle (Duwarnish Estuary)
30 AMMON WNITROGEN LOAD (RENTON STP)

2.5% population
Z growth

z 20 - 1.706
growth

0
10 - Ammonia stripping
instituted

2.5% growth
1.7% growth
01 .1 1 1
1977 1983 1990 2000 2010 2020

DISSOLVED OXYGEN CONCENTRATION
10
SA TURA TION A T 180C
1983* *Ammo.nia stripping used
C
.2
2000*
8
Existing 1971

0
1983
............. .....
E 6 ....... ....... STA TE STA NDA RD
M 2000 6.5 MGIL OR
CURVES REPRESENT
70% SA TURA TI ON
SURFACE LA YER
CONCENTRATIONS

RIVER TEMP. 180C (640F)

0 3 6 9 12
Miles below Renton sewage treatment plant (STP) outfall
Source: NCWQ (Stevens, Thompson, & Runyan)
February 1976

VI-r32

The Delaware Estuary receives pollutants from many industrial point
sources, mostly petrochemical plants, and from municipal point sources,
mainly Philadelphi@L's primary treatment plants(14). Industry contributes
about one-third of,thertotal oxygen demand. Total BOD loads will drop
more than 60 percent when 1977 requirements are imposed -- from 930,000
pounds per day to 320,000 pounds per day. When 1983 requirements are
imposed, tot#l BOD loads drop about 10 percent -- from 368,000 pounds
per day to'344,000 pounds per day. Growth will negate any gain over
1�77 -totals of 320,000 pounds per day.

2. Water-Short Areas

The prospect of economic development in the western states has
implications for water use. Two regional studies, the Yellowstone and
the Col@rado, address,the questions associated with development in
water-short areas. Questions of the level of development, the avail-
ability of water resources, and maintenance of quality are interrelated
in these regions.

The undepleted natural flow of the Colorado River at Lee Ferry, the
divisio n point between the Upper and Lower Basin,* is conservatively
estimated 'to"beabout 14 million acre-feet per year. Currently 11.3
million acre-feet are depleted by out-of-basin transfers or consumptive
use from the Colorado River and its tributaries in the Upper Basin and
from the main stem of the Colorado River in the Lower Basin. In addition,
1.5 million acre-feet are delivered to Mexico each year. The Upper
Basin use amounts to about 3.7 million acre-feet each year, including
reservoir evaporation. The Bureau of Reclamation has recently estimated
that the demand could grow to-5.9 million acre-feet annually by the year
2oo6(15).

The salt concentrations in the Upper Basin water are generally much
lower than those in the Lower Basin. The consumptive use or out-of-
basin transfer of high quality water in "the Upper Basin will result in
increases in salt concentration in the lower reaches of the river. The
degree"to which increased use in the Upper Basin will affect the Lower
Basin,salinity problem will depend to some extent on the type of develop-
ment which occurs. Currently, the salt concentration at Imperial Dam is
about 850 mg/l. Upper division development could raise the concentrations
to 1,250 mg/l if no abatement measures were implemented.

Uniform abatement measure's potentially applicable to all irrigated
agriculture include measures for increasing the efficiency of water.use.
Additionally, the Bureau of Reclamation program for salinity control in

*By Congressionally approved compact, the Upper Basin includes all areas
the drainage for which enters @he river above Lee Ferry, Arizona; the
Lower Basin.includes all areas'the-drainage for which enters below Lee
Ferry.

VI-33

Figure V 1-6
BOD DISCHARGES BY ABATEMENT LEVELS
PHILADELPHIA (Delaware Estuary)

Thousands lbs/day BOD(Ult)

1973 level

900

600-

1983 BAT

300- 1977,13PT

on
1973 1977 1983 1990

BPT = Best practicable technology Source: NCWQ (Betz Environmental Engineers)
BAT = Best available technology February 1976

VI-34

the Colorado River Basin includes diverting and evaporating highly
saline inflows. These measures could reduce the salt concentration by
as much as 400 mg/1(6). Most of the reduction would be achieved by
controlling irrigation practices.

The seven states of the Colorado River Basin have cooperated to
develop water quality standards(16). Their proposal includes among its
provisions sixteen specific agricultural and natural source control
projects. These projects are those authorized for planning or construc-
tion by Title II of the Colorado Salinity Control Act.

Water pollution problems in the semi-arid Yellowstone Basin presently
are not considered severe compared with many other rivers of the nation.
Pollution from municipal and industrial sources is minor throughout the
basin. Of more concern are the large volumes of sediment from natural
and agricultural point and nonpoint sources. With the advent of wide-
spread energy production in this coal-rich region, the situation could
change(5).'

Forecasts include increases in coal production in Montana and
Wyoming from the present levels of about 15 million tons yearly to as
much as 728 million tons by the year 2000. The construction of coal-
fired electric generating plants and coal conversion plant,'@ in the basin
is expected as the nation pushes for energy self-sufficiency. The
energy plants and mining operations would use large quantities of water.
Surface mining would disturb groundwater and might cause large amounts
of sediment, containing metals and other wastes, to wash into the streams.

Energy development would bring rapid population growth. Some towns
may double in population in a few years, producing severe sewage pollu-
tion problems unless local officials can plan adequately for growth.
With extensive energy development, the basin's population could increase
from the present 280,000 to as high as 380,000 by the year 2000. Much
of.that increase could come within the next decade.

Sheridan and Buffalo, Wyo., and Billings, Mont., are examples of
communities that may be affected by intensified energy development.
Sheridan, located in the Tongue River basin in northeast Wyoming,
presently has a population of about 11,000 which could increase to more
than 23,000 by the year 2000. Buffalo, located in the Powder River
basin about 40 miles south of Sheridan, could increase from today's
3,400 population to 7,400 by the turn of the century. The Billings
SMSA, located more than 100 miles northwest of the coal-rich Tongue and
Powder areas, could feel the indirect effects of coal development through
expansion as a regional trade center. Its present population of 87,400
would increase to more than 114,000 persons by the year 2000.

VI-35

Sheridan presently has a 1.5 million gallons per day trickling
filter facility which provides secondary treatment for'most of the com-
munity's two mgd in wastes. The remainder receives primary treatment.
A doubling of population without upgrading these facilities could cause
severe degradation to Goose Creek, a tributary of the.Tongue. Dissolved
oxygen levels during low-flow conditions in Goose Creek below Sheridan
could fall below 4.0 mg/l. The Wyoming standard for that stream is 6.0
mg/l. Even with secondary treatment for the'expected population, DO
levels may fall below this standard during low,-klow. Only with advanced
waste treatment would the standard consistently be met and fish popula-
tions protected.

Buffalo, located along Clear Creek, presently has an overloaded
evaporation lagoon to treat its 1 mgo in wastes. The town is conducting
studies for improved treatment facilities. Under average,flows secondary
treatment would provide moderate fish protection in Clear Creek below
Buffalo for all projected growth levels- However','during,critical*low-
flow periods DO probably would not be adequate to,support fish life.,
Advanced waste treatment would provideminimal protection for fish
during the three-month low-flow period and high,to moderate fish@pro-
tection the other nine months. If high growth occurs', Buffalo may@need
wastewater storage during low-flow periods to'prbvid6 adequate fish
protection year-round.

In Billings, there are several major sources of pollution including
the Billings sewage treatment plant, presently being upgraded,from pri-
mary to secondary, two oil refineries anda sugar beet refinery. with
projected growth, BOD loadings into the Yellowstone would increase from
a maximum of 32,200 pounds per day to more than 52,000 pounds per day by
the year 2000 in the absence of secondary treatment and BPT. If these
requirements are met, BOD loadings would be,redtced to a maximum of
8,100 pounds per day by the year'2000. This would permit DO levels to
be at or near saturation.

Without-secondary and BPT requirements, projected additional loads
could degrade the Yellowstone downstream of Billings. During low-flow
conditions, the-DO could drop to 4 mg/1 on occasion. The Montana
standard for this stretch is 5 mg/l,,

E. CAPITAL EXPENDITURES AND WATER POLLUTION ABATEMENT

What capital expenditures for wastewater treatment facilities are
required of the public and private sectors to meet abatement
requirements and what levels of abatement are achieved?

The abatement measures of the Act will require capital expenditures
by a variety of public and private point-source dischargers. Each of

VI-36

the eleven regional assessments attempted to calculate the total cost of
compliance in the public and private sectors. In addition, each study
evaluated the discharge abatement achieved.*

The range of variations among the regions with respect to the
absolute cost of compliance and the relative division of the cost be-
tween public and private sectors was very large. Similarly, the size of
pollution loads and the relative contribution of industry and muni-
cipalities varied markedly from one region to another.

The status of abatement programs in 1973 was also different in the
regions. Some areas had made considerable progress in using treatment
technologies; others had not. Additionally, some of the regions' abate-
ment programs will require stringent effluent limitations based on water
quality considerations; others require the technology-based limitations
for 1977.

Despite the differences in the nature of the inventories of dis-
chargers, the degree of progress prior to 1973 and'the demands of water
quality considerations, the patterns of the relative distribution of
costs and abatement for public and private dischargers are similar in
many of the regions. Generally, the abatement programs are more stringent
for the private sector. The relative portion of the total pollutant
load discharged by publicly owned treatment plants increases as more
stringent requirements are met. **In addition, the relative cost for the
private sector is generally higher than its contribution to the total
discharge.

Ultimately, the costs of pollution abatement must be paid by the
public -- either in increased charges for sewage treatment, or indirectly
as increased prices for consumer products. The Act requires that publicly
owned treatment plants receiving federal grants 'institute a proportional
system of charges to cover operation and maintenance costs. An industrial
discharger to a publicly owned plant must meet any pretreatment costs
and a proportional share of the capital investment, but is not required
to achieve BPT in 1977 or BAT in 1983.

*The regional studies attempted to establish compliance costs by deter-
mining the individual costs for each discharger and adding them. This
proved to be very difficult and it is likely that cost figures may be
in error by as much as 50 percent.

**EPA has not required more stringent technology-based measures for
publicly owned waste treatment plants in 1983. Unless these measures
are required on the basis of water quality considerations, the addi-
tional costs of the 1983 requirements fall in the private sector.

VI-37

The relative amounts of industrial and sewage wastes received by
publicly owned works and the relative numbers of local industries dis-
charging to public plants vary greatly among the regions. In areas such
as Cincinnati and the Merrimack Valley, most of the industries discharge
to publicly owned plants and their wastes are the major portions of the
total influent load. In other areas, such as Seattle or Houston, almost
none of the industries discharge to municipal systems and industrial
wastes are an insignificant portion of the load to municipal plants.

Three examples -- Atlanta, the Huntington (W. Va.)/Ashland (Ky.)/
Portsmouth (Ohio) urban area and Charleston -- illustrat-e the cost
Eurdensand degree of abatement achieved in situations typical of the
regions studied. In Atlanta, the vast majority of discharge is from
publicly owned treatment works. In the HAP area, the relative discharge
from the public and private sector is approximately equal and in Charleston,
the industrial discharge dominates.*

The Atlanta area of the Chattahoochee River presently experiences
low DO concentrations resulting from municipal point sources(3). Although
many of the municipal sources are currently or soon will be operating at
EPA's defined secondary treatment level, the DO concentration in the
Chattahoochee does not meet water quality standards. During periods of
heavy rainfall, Atlanta's combined sewers overflow increasing pollution
discharges. The present point-source BOD load in the Atlanta area
averages 54,305 pounds per day. The municipal sector contributes about
52,179 pounds per day or 96 percent of the load.

Compliance with the waste load allocations based on water quality
standards requires major municipal dischargers to achieve a level of
treatment considerably more stringent than the 1977 secondary treatment
effluent limitations. At this level of treatment, the BOD load will be
reduced to 27,300 pounds per day. Municipal discharges will still
dominate, contributing 24,916 pounds per day or 90 percent. Total cost
to the public and private sectors to attain this level will be about
$145 million. The municipal share will be $144.4 million or more than
99 percent of the total.

compliance with the 1983 abatement level will require the industrial
dischargers to meet BAT, and the medium-sized municipal dischargers to
meet the advanced waste treatment levels assigned on the basis of water
quality. Achievement of this treatment will reduce the BOD load to
24,300 pounds per day, an 11 percent reduction from the estimated 1977
load and a 55 percent reduction from the present load. The cost of
meeting this level is about $40 million. The municipal sector cost for

*BOD is used as a surrogate for total pollution loadings in this chapter.
Detailed information on other pollutant parameters is available in each
regional assessment study.

VI-3@

Figure V1.7
MUNICIPAL INDUSTRIAL WASTEWATER
LOAD REDUCTIONS & COSTS

BOD 5Thousandslbs/day COST Millions of 1975 dollars
PERCENT PERCENT
Mun Ind ATLANTA, GA. (Chattahoochee River) Mun Ind
96 4 541 1973
90 10 27 1977 1$145 99.7 0.3
98 2 24 1983 185]* 98 2

HUNTINGTON,W.VA./ ASH LAN D,KY./ PORTSM OUTH,O. (Ohio River)
32 68 371 1973
51 49 13[:E 1977 72.6 21 79

76 24 9 1983 135.7* 11 89

CHAR LESTON,W.V A. (Kanawha River)
16 84 621 1973
19 8i 23FF////7/7// 1977 W////////A]96.2 8 92
170.3*
38 62 12 1983 5 95

1977 & 1983 are abatement levels. 1973 existing. Source: NCWG(Hamer, Siler, & George) Chattahoochee
1983 costs are cumulative from 1973. (Dames & Moore) Ohio, Kanawha
Municipal - Mun EM industrial - Ind Februery-1976
Includes the cost for achieving both 1977 &
1983 requirements.

VI-39

advanced waste treatment is $36.7 million or about 92 percent of the
total. The $40 million is in addition to the $145 million necessary to
meet the 1977 requirements. The total cost to go from the present level
of treatment to 1983 is about $185 million. The municipal share is
about $181-million or 98 percent.

The urban-industrial region, including Huntington, W.. Va.; Ashland,
Ky.;.and Portsmouthl Ohio, is representative of an area with major
pollution problems, a high out-migration rate and an economic dependence
on a few industries that will have to meet abatement costs(13). The
pollution abatement program in the Ohio River basin has been a multi-
state effort since 1948. Because of the severe water quality problems
resulting from economic growth and industriali'zation during World War
II, a program designed to achieve primary treatment was instigated
during the 1950's. Under the aegis of the Ohio River Valley Water
Sanitation Commission (ORSANCO), most industries and municipalities
achieved a degree of treatment by the early 1960's.

The present total BOD load in the HAP area from municipal and
industrial point sources is 37,150 pounds per day, with industry con-
tributing 25,410 pounds per day or about 68 percent. Compliance with
the 1977.effluent,limitations will reduce the BOD load to 12,630 pounds
per day at a capital cost of $72 million. Both the abatement and cost
requirements for the private sector exceed those of the public sector.
Once the 1977 requirements are met, industrial BOD loads will be'approx-
imately equal to those from publicly owned treatment works.

Compliance with the 1983 requirements will reduce the BOD load from
the 1977 levels to 8,520 pounds per day; a reduction of 30 percent. At
this abatement level,'the municipal loads will exceed the industrial,
with municipalities discharging about 6,500.pounds per day or 76 percent
of the total. The incremental cost to reach the 1983 level from 1977 is
ab9ut $63.1 million.

The total cost of achieving the 1977 and 1983 abatement levels is
$135.7 million. Industry's requirement is about 89 percent or about
$120.6 million. Industrial dischargers account for 80 percent of the
total BOD reduction of 28,630 pounds per day. In addition, industrial
compliance will remove other types of pollutants. Some of the costs are
met by industries such as iron and steel manufacturing. For these
industries, other pollutants are more significant than BOD.

.The Charleston area of the Kanawha River is a situation where the
industrial loads far outweigh the municipal loads and the water quality
needs dictate a more stringent level of treatment to meet the 1983 goals
of the Act(l). Industry is not far from achieving BPT, but is being
required to providelmore stringent treatment to meet water quality
standards and, therefore, will incur increased costs.

VI-40

In 1958 a major three-phase cleanup program was begun on the Kanawha.
By 1972 the industrial and municipal BOD discharge had been reduced by
85 percent, and a dissolved oxygen concentration of 3 mg/1 was achieved.
In 1972 the minimum DO standard of 3 mg/l was upgraded to 4 mg/l. This
necessitated still further reduction in the organic waste loads.

Industry presently contributes 84 percent of the BOD load to the
Kanawha River. Almost all of the industrial load is from the chemical
industry. EPA and the West Virginia Department of Natural Resources
have determined that the technology-based effluent limitations for 1977
will not achieve the water quality standard of 4 mg/l for DO. Municipal
dischargers have not been required to provide more control than secondary
treatment.. The major industries, however, are expected to reduce their
discharges.*

.Upon compliance with these 1977 effluent limitations, the present
BOD load of 61,730 pounds per day would be reduced to 22,490 pounds per
day, a drop of about 64 percent. At this 1977 abatement level, industry
still dominates, contributing about 81 percent of the BOD load. The
total cost to reach this level is about $96.2 million. Industry's share
is about $88.4 million or about 92 percent. It is estimated that 1977
reductions will produce a DO concentration above the desired 4 mg/l.

Compliance with the 1983 effluent limitations requires industrial
dischargers to meet best available technology and municipalities to
continue to meet secondary treatment in the basin. Achieving this level
of treatment will reduce the BOD load to 11,680 pounds per day,,a 48
percent reduction from 1977 and an 81 percent reduction from the present
load.

The total cost is about $74.1 million, of which the industrial
share is about $72.8 million or more than 98 percent. The $74.1 million
is in addition to the $96.2 million necessary, to meet the 1977 abatement
level.

Total cost in going from the present to the 1983 level is about
$170.3 million. The industrial share is $161.2 million or 95 percent.
Achieving the 1983 abatement level would raise the DO concentration to
almost 5 mg/l.

*The effluent limitation assumed for the,,Kanawha industries corresponds
to 74 percent of.the "best practicable technology" waste load. Actual
industrial permits issued subsequent to the completion of this study
are somewhat less stringent.

- VI-41

F. BENEFITS

What changes in water use or other benefits can be expected from
improved water quality?

The eleven regional studies examined changing patterns of water use
resulting from improved quality. These changes in water-related activ-
ities may be broadly defined as the "benefit" of pollution abatement.
More specifically, each study examined three categories -- changing
industrial and municipal water uses, recreational uses and commerical
fishing.

Ideally, one would like to identify all the types of activities
that may result from cleaner water, assess the magnitude of the changed
levels of use and assign a monetary value to the projected changes.
Given the state-of-the-art and the limited data base available, this is,
at best, an arduous undertaking. The regional assessments were at least
partially successful in the first step -- identifying the types of uses
to be made of cleaner water. More importantly, perhaps, the studies
were also able to identify regional concerns regarding the availability
of better water and factors which influence the demand for water use --
particularly recreational use. Three concerns are apparent in the
collected findings.

First, factors such as perceptions, access and availability of
recreational facilities will greatly influence the level of participa-
tion in water-based, recreation where water quality does improve. The
studies indicated that the importance of these factors varies from
region to region and, in many cases, is not necessarily related to water
quality. The public's perception of the "appropriate" uses of a water
body can influence its willingness to use it for recreation. For many
rivers which are viewed as industrial waterways, recreational access has
become restricted and water quality allowed to deteriorate. If these
rivers are cleaned, their recreational value may not be realized until
the river's "image" improves.

Second, commercial fishing is often regulated to assure protection
of public health or to prevent depleting fish populations through over-
fishing. Local regulations and institutional arrangements may affect
the ability of commercial fisheries to benefit from pollution abatement.
The regional studies documented the variability in the criteria used in
determining whether or not to allow commercial shellfishing. In some
regions, the local policies tend to be more restrictive than national
criteria and shellfish areas will possibly not be reopened even if water
quality improves.

Third, in many areas, public concern is not focused on the direct
benefits of cleaner water, but on expenses which could have been avoided
if water quality had not been allowed to deteriorate. Several regional

VI-42

studies documented increased costs for developing alternative municipal
water supplies where local supplies have become polluted and been aban-
doned. In a similar way, the capital value of fishing fleets is allowed
to depreciate in areas where commercial fishing is adversely affected by
pollution. In a real sense, water quality preservation has a benefit in
that certain expenses are not incurred. It would be extremely difficult
to quantify this type of benefit. However, the costs of developing
distant water supplies or the decay of fishing fleets are often emotional
subjects'in localities where they occur.

1. Recreational opportunity

The Merrimack regional study provides an example of the effect that
perceptions can and will have on the degree to which cleaner water may
be exploited as a recreational resource(9). The Merrimack and Nashua
Rivers have long been too dirty to be considered for extensive recrea-
tional uses. Since the early years of the industrial revolution in New
England, the Merrimack-Nashua system has been used for disposal of
industrial and municipal wastes. Access to the river has been restricted
by land use and development practices.. In general, for the past 50 to
75 years, the people of the Merrimack basin have not looked to the
Merrimack and Nashua Rivers to satisfy their recreational demands.
Instead, they have traveled to the more rural recreational sites nearby.

With rising population, increased demand for recreational sites has
grown in the communities along the Merrimack. Yet, there are striking
differences in the perceptions of the river by local residents.

In Nashua, N.H., for example, there is only limited access and no
water-based recreation of any consequence on or near the Merrimack.
What recreation that does occur consists mostly of activities such as
picnicking and hiking. Even these are limited near the shoreline because
a railroad restricts the right-of-way, creating a psychological barrier
to the river.

Planning for recreation parks and development has not progressed to
the drawing board stage in Nashua. Priorities have been established,
but include only a dock, a fishing pier and areas for picnicking and
hiking. The city planning board has stated that water-contact recreation
is not even a "long-range dream", and "no one of sound mind would develop
water-oriented recreation plans here . . . the water is too bad." At
this stage, the perception of the Merrimack is such that the prospect of
cleaner water means very little to planners concerned with future recrea-
tion sites.

In the same basin, but in a neighboring community, there are similar
water quality problems, but remarkably different attitudes toward the
future use of the Merrimack as a recreation area. Lowell, Mass., is the

VI-43

major urban center in the northern Middlesex area of the Merrimack
basin. It-is the population center for the Massachusetts portion of the
basin, yet the available land suitable for recreation is limited.

Since the 1930's, increasing pollution of the Merrimack and connect-
ing canals have impaired recreational opportunity in the Lowell area.
Recreation today does include limited boating, fishing and shoreline
activities, but as in the Nashua area, most people turn to rural areas
for recreational activities.

Unlike in the Nashua area, however, the perception of the river is
rapidly.changing inLowell. The development of the Lowell Urban National
Cultural Park is indicative of a new enthusiasm toward the river. This
park is being specifically planned to take advantage of the river and
canal system.,

As up stream point sources are controlled and water quality improves,
people are beginning to think of increased uses for the river. Boating
on the river.-and canals will become an important feature of-the Cultural
Park. The numbers of fish should increase. This, and a more attractive
waterway, will provide local sport fishing opportunity to Lowell's urban
residents.

The situation on the Merrimack may be similar to that on the Kanawha
near Charleston, W. Va. Until the early 1960's, the,Kanawha River, in
the 40-mile stretch surrounding Charleston, was one of the dirtiest
rivers in the country. For the past ten years, there has been a vigorous
and on-going program, sponsored by the State of West Virginia in coopera-
tion with the major industries.

The result of th is program has been a.marked abatement of pollution.
Ten years ago, 'recreation on the Kanawha River.was almost nonexistent.
Although the water is not yet entirely suitable for contact uses, the
citizens of the Kanawha Valley have begun to realize that the Kanawha
can provide an area for family recreation(l). over the past ten years,
there has been an increase in boating activities,-including water skiing.
Today, there is a need for 3.9 million recreation days per year. By
.1990, this need is projected to be approximately 5 million.

The Houston Ship Channel is a striking example of a waterway where
access is severely limited by industrial development(4). On the upper
portions particularly, all the land is devoted to heavy industry. It is
a unique body of water, designed.by man to be a transportation corridor.
It has been used as a depository for industrial and municipal wastes and
for drainage of urban runoff. These uses have traditionally overshadowed
its recreation potential.

Understandably, a survey conducted as part of the regional analysis
indicated that only six percent of the people had used the lower portion

vi-44

of the Ship Channel for recreation during the past year. Surprisingly,
57 percent indicated that they would use the lower portions for recrea-
tional activities, such as fishing and boating, if it were not polluted.

2. Shellfish Bed Openings

Benefits in the form of reopened shellfish beds will vary as a
function of water quality and state public health regulations. Improve-
ments in water quality sufficient to allow reopening in one state will
not permit renewed harvesting in another.

There are few point.sources discharging to the Apalachicola Estuary
and Bay, but shellfish beds ate often closed during the prime collecting
season. The State of Florida bases-bed closings on,total coliform,
counts which can come from natural or nonpoint sources, rather than
fecal coliforms, a more accurate indicator of sewage contamination. In
the Apalachicola, high c6liform counts occur during periods of high
flow, suggesting that the counts may not be associated with municipal
point-source.discharges. Unless state standards and monitoring programs
are based upon fecal coliform counts, point-source abatement programs
may not lead to increases in the oyster harvests.

San Francisco Bay and the Merrimack Riverestuary, both of which
could support commercial and recreational shellfishing, have their
shellfish beds totally closed because of bacterial contamination.
Projected improvements in water quality could allow reopening of commer-
cial shellfishing under present state standards. Facilities were, at
one time, provided on the lower Merrimack for decontaminating shellfish.
However, as coliform counts continued to increase, all harvesting was
abandoned. It is likely that the Merrimack's beds will be harvested
again if bacterial counts are diminished by abatement measures.

No shellfish beds are projected to reopen in Puget Sound since the
present practice of state authorities seems to prohibit shellfishing
near sewage treatment plant outfalls, regardless of effluent quality.
Until state policies change, beds will remain closed if they are located
near a sewage treatment plant outfall.

3. Costs of Degradation

The "benefits" associated with the preservation of clean water are
not easily defined or assessed. The regional studies included many
instances illustrating costs which would have been avoided if water
quality had been maintained. The studies documented two cases where the
cost of delivering municipal water supplies was significantly increased
when nearby resources were abandoned because of pollution.

Communities along the Chattahoochee, south of Atlanta, must obtain
their water supplies from other sources(3). Many communities rely on

VI-45

limited groundwater resources. The more abundant supply of water in the
Chattahoochee River is badly polluted by Atlanta's sewage and waste
discharges. The limited supply of groundwater, combined with the costs
of providing adequate storage and pressure, has been a major concern and
may have restricted industrial and residential expansion. Areas that
have realized growth have been obligated to incur large costs to insure
adequate water. For example, the towns of Newnan and Shenandoah are
jointly constructing a 29-mile water line to the Flint River near Gay,
Ga., because the nearby Chattahoochee is too polluted to use.

Nonpoint sources and urban runoff also contribute to the problem of
maintaining an adequate water supply for the basin's growing population.
Residential development north of Atlanta is increasing runoff and pollu-
tion in the area's principal storage reservoir. Urban runoff from
Atlanta itself is endangering the water supplies for the urban counties
of Cobb, DeKalb and Gwinett.

In Charleston, the West Virginia Water Company is the primary
supplier of drinking water(l). The firm serves a population of 180,000
about 79 percent of the total population in Kanawha County. Other -
communities along the Kanawha, including Belle, Nitro and Dunbar, have
joined the service area. The communities had previously drawn their
public water supplies from the Kanawha; however, because of taste and
odor problems, they abandoned the Kanawha in favor of the West Virginia
Water Company, which obtains its supply from the Elk River.

Capital expenditures could have been avoided if the Kanawha were
less polluted. It is unlikely that the Kanawha would replace the Elk as
a cheaper source of water for communities along the Kanawha main stem
even if the requirements of the Act were implemented. However, the.
costs for drinkable water are currently higher because the river is used
to carry industrial and municipal wastes and has not been preserved for
public water supplies.

An important "benefit" of maintaining water quality will be the
preservation of fishing commerce. The regional studies documented a
wide range of'situations regarding the viability of commercial fisheries.
Although several economic factors can be important, water pollution has
severely limited or eliminated fishing in many areas.

The decline of the U.S. commercial fishing industry on Lake Erie in
the past two decades has been caused, in part, by pollution problems.
As water quality worsened and, simultaneously, spawning grounds were
dredged or otherwise impaire&, populations of desirable species de-
creased. Bordering states, particularly Ohio, began a program to control
the catch of desirable species by restricting the types of fish that
could be caught by commercial and sports fishermen, and by regulating
the types of fishing equipment that could be used.

VI-46

Canada views Lake Erie's pollution problems as arising mainly from
the U.S. side, and therefore has not been as active in restricting
fishing in her waters.

Between 1950 and 1970, the U.S. fish catch in Lake Erie dropped
from 24 million pounds to 10 million pounds per year, and decreased in
value from $4.5 million to $1.3 million*(17).

The Canadian fish catch, on the other hand, has been increasing.
In 1960, 1965 and 1970, the reported catches were 30, 35 and 50 million
pounds per year. The values of these catches were $2.0, $3.3 and $3.0
million dollars respectively*(17). Even with the large increase in
weight of catch between 1965 and 1970, the total selling price remained
relatively constant. The trend of decreasing value per pound of fish
caught reflects the historic decrease in populations of high-quality
fish. The catch of high-quality species has decreased and has been re-
placed by lower value fish despite efforts, particularly on the U.S.
side, to regulate the pressure on the remaining resources.

The Lake Erie fishing commerce clearly contrasts with that of Puget
Sound where the fish catch has remained relatively constant. The selling
price of the 1970 catch exceeded that of 1955, although its true value
may be less because of inflation.

The control of pollution in Puget Sound may have been relatively
easier than in Lake Erie. Nevertheless, fish kills began to occur in
the Sound during the 1950's and 1960's. Although it is difficult to
associate fish kills unambiquously with pollution discharges, the State
of Washington instituted a-pollution abatement program. The program
emphasized controlling potentially toxic industrial discharges, eliminating
sewage discharges to freshwaters and assuring pollution-free corridors
for migrating fish species. Improved water quality in the region has
been instrumental in preserving the fishing industry.

If no additional pollution control measures were taken by cities
and industries along Lake Erie, historical trends in water quality
degradation would accelerate because of population and industrial growth(10).
Although the assumption that no further steps would be taken is highly
unlikely, it does provide a "worst case" to show what could happen if
water quality is not preserved. By 2020 there would be no swimming
beaches open on the south shore and lake water would seldom meet bac-
terial standards. Drinking water.would have to be heavily chlorinated,
raising the cost.of treatment.

In the long term there would be a total collapse of the fishery in
nearly all areas. Important species of fish would decline dramatically
or disappear, while several "trash" types would continue to increase.

*Dollar values are not corrected for inflation.

VI-47

seasonal oxygen depletion in the bottom waters would spread from
the central basin to the western and eastern basins. The eastern basin,
which is presently relatively clean, would become more like the rest of
the lake.

Implementation of the 1977 and 1983 requirements would produce
significant improvements in the lake's water quality, particularly near
the shore. However, the lake would never return to its earlier pristine
condition. With improved water quality, several species of valuable
sport and commercial fish would increase in number.

G. OVERLAPPING JURISDICTIONS

What overlapping authorities or responsibilities exist for public
organizations charged with implementing the programs of the Act?

The provisions of P.L. 92-500 place specific.responsibilities on
Federal, state and local governmental organizations. Progress in achiev-
ing the goals and fulfilling the requirements of the Act will depend
upon the relationship of the organizations to each other. An aspect of
this relationship is the ability of organizations at the same level to
cooperate in pursuing their responsibilities and tasksi, By focusing on
problems at the basin level, the regional studies identified instances
where interstate or intermunicipal cooperation could play a role in
furthering the progress of the Act's programs. Additionally, treaties
with Canada and Mexico have affected pollution control programs on the
Great Lakes and the waters of the Colorado River delivered to Mexico.

1. International Commitments

Imperial Dam, on the Colorado River, lies just above the Mexican
border. A part of the waters^,arriving at Imperial Dam, the last major
point of diversion in the U.S., as well as return flows from some of the
lands in the U.S. irrigated-by water diverted at Imperial Dam are delivered
to Mexico in accordance with the 1944 Treaty. To implement a recent
agreement (Minute No. 242), executed by the Commissioners for the United
States and Mexican Sections of the International Boundary and Water
Commission and approved by,the two governments, a portion of the return
flows will be treated to control the salinity. Minute 242 stipulates
that salt concentrations in the Mexican flow would not exceed those of
the waters behind Imperial Dam by more than 115 ppm (plus or minus 30
ppm). Title I-of the Colorado Salinity Control Act (P.L. 93-320) authorizes
the construction of desalting works for the drainage waters of the
Wellton-Mohawk project. When completed, these works will enable the
U.S. to fulfill its obligations.

Title II of P.L. 93-320 charges the Secretary of the Interior with
implementing a salinity control policy for the Colorado River. The

VI-48

policy is to be in conformity with the conclusions and recommendations
of the Colorado River Pollution Abatement Conference, held in 1972 under
the authority of the 1965 Federal Water Pollution Control Act. Four ,
salinity control projects are authorized. Three'of these are designed
to stop specific highly saline inflows to the river. The fourth project
is designed to improve water use efficiency in the Grand Valley irriga-
tion project. The Secretary is also charged with completing plans for
an additional twelve projects.

The seven basin states have supported the Salinity Control Act,
particularly the provisions of Title II. The desalting works of Title I
will be federally funded. The salinity projects of Title II are funded
on a cost-sharing basis: 75 percent of the cost is Federal and 25
percent is derived from the Upper and Lower Colorado River Basin Develop-
ment Funds. P.L. 93-320 authorizes over $280 million for the Title I and
Title II projects.

Under the authority of the Boundary Waters Treaty, the U.S. signed
a broad agreement with Canada in 1972(18) regarding water quality in the
Great Lakes. Measures for pollution control include discharge from
ships, as well as from shore facilities. One of the important provisions
of the agreement calls for the abatement of the discharge of phosphorus
to Lake Erie and Lake Ontario. Municipal waste treatment plants and the
discharge of storm sewers or combined sanitary and storm sewer overflows
are important sources of phosphorus. The municipal permit provisions
include limitations on phosphorus, and the major cities are developing
plans to control discharges from combined and storm sewers.

Although the Federal authorities have agreed to a schedule for
phosphorus abatement, all the Lake Erie basin states do not necessarily
view Lake Erie and Lake Ontario as their most important pollution problems.
The states participate in advisory panels to the International Joint
Commission established by the Boundary Waters Treaty and have endorsed
the requisite stringency of phosphorus abatement measures. However, the
Federal Water Pollution Control Act was amended in 1974 by P.L. 93-243
to clarify the point that no state must consider international agreements
in establishing its priority system for waste treatment construction
grants.

2. Interstate Jurisdiction

When adrainage basin contains portions of more than one state,
effective progress toward water pollution control may require coopera-
tion between the states. For two of the Act's functions -- the issuing
of discharge permits designed to assure achievement of water quality
standards and the development of state priorities for the construction
of publicly owned treatment works -- this may be particularly important.
In the Delaware, Ohio and Merrimack basins, interstate agencies have
water quality-related authority and responsibilities.

VI-49

The Delaware River Basin Commission (DRBC) and the Ohio River
Valley Water Sanitation Commission were organized for different purposes.
ORSANCO is primarily a pollution control agency; the DRBC, on the other
hand, was organized to manage the water resources of the Delaware basin.
The New England Interstate Water Pollution Control Commission (NEIWPCC)
is ptimarily'a water pollution control agency and is involved in all the
interstate streams in New England.

Although ORSANCO and NEIWPCC were organized for water pollution
control and DRBC for a broader purpose, their attitudes and approaches
to their roles have been similar -- they have all assumed roles which
emphasize coordination rather than operation or enforcement. All three
agencies set water quality standards and have active programs in monitor-
ing and surveillance. Load allocations were set by the DRBC for the
Delaware, and by the individual states for the Ohio using ORSANCO water
quality models.: NEIWPCC was instrumental in, deciding the designation of
water quality limited stream segments.

All three agencies left priorities for construction grants, NPDES
permit issuance and enforcement to the states. Although the agencies
have not functioned directly in these programs, they have used their
influence to try to insure compatibility between the states.

An early requirement of states was that they establish a system for
setting priorities for Federal construction grants. The priority system
guidelines approved by EPA for use throughout the nation were based upon
a numerical system which assigned weights to such considerations as:
population served, water use affected, geographic locations, and severity
of pollution.

Although Ohio and West Virginia are across the Ohio River from each
other, they have different priority setting systems. West Virginia
heavily weights factors which assign high priorities to projects on the
Ohio River. Ohio's priority setting system assigns highest priorities
to projects in the Lake Erie area. Portions of New Jersey, Pennsylvania
and Delaware lie in the lower Delaware River basin. Each of the states
views the Delaware differently and these differences are reflected in
the priorities they have assigned to constructing treatment plants.
Delaware and Pennsylvania have been moving ahead with abatement programs
on the Delaware. In the past, New Jersey had tended to give higher
priority to the rivers in the northern portion of the state.

The-general opinion of the interstate agencies, themselves, has
been that the priority system is not presently the reason for delay in
meeting the objectives of P.L. 92-500. The agencies believe they can
achieve an appropriate degree of compatibility of priority systems with-
in their respective basins.

VI-50

3. Intercommunity Jurisdiction

If neighboring communities participate in regional waste systems,
they may realize a cost savings and advantageous financing arrangements.
P.L. 92-500 encourages regional systems by requiring that federally
subsidized treatment projects be cost-effective. In addition, the Act
stresses the need for areawide waste treatment planning and management.
Most states provide a number of legislative mechanisms which enabl 'e
communities to join efforts for a joint purpose. However, it is common
for individual communities to resist regional systems and to favor local
control. Much of this feeling probably stems from fear of losing local
identity or control of local development.

Much of the controversy surrounding Section 208, "Areawide Waste
Treatment Management", is related to these fears. This portion of'the
Act calls for planning to solve the administrative, managerial.and
operational aspects of areawide waste treatment. In doing so, the Act
raises questions relating to the relative roles of state, areawide and
local authorities in providing an essential public utility -- waste
treatment. Many local organizations are acutely aware that the power to
provide or withhold utilities, including waste treatment, ultimately may
be used to control growth and development. 4

The regional studies included representative cases where localities
have encountered and solved the problem of regionalization. Regional
systems such as the Gulf Coast Waste Disposal Authority, the Metropolitan
Municipality of Seattle, and the Metropolitan Sewer District of Cincinnati
are examples of organizations which are now dealing with areawide waste
treatment problems.

Metropolitan Sewer District of Greater Cincinnati (MSD)(19)

The district was formed in 1968 by resolution of the City and
Hamilton County and is operated by the Cincinnati Department of Sewers.
Stimulus for the formation of the district came when Ohio threatened to
prohibit further development in the County because of inadequate sewage
collection facilities. The District now handles the waste from most of
the municipalities and townships in Hamilton County. A significant
portion of the waste is industrial.

Expansion policies are set by the Hamilton Board of Commissioners.
Decisions to expand sewer service areas are presumably based upon economic
considerations. The district probabiy will expand into other counties
and perform more extensive waste mahagement functions in its authorized
area.

The incentive for communities to join is monetary. The district
has no legislative limit on its capacity to issue revenue bonds. As the

VI-51

need for additional treatment arises, the economics of scale and avail-
ability of financing will induce communities to join the MSD system.
However, a few communities are resisting these inducements for matters
of local preference. MSD can only offer to provide service; reluctant
communities cannot be forced to join.

Gulf Coast Waste Disposal Authority-(GdWDA)(4)

The Gulf Coast Waste Disposal Authority is a unique organization.
It is a state agency authorized by an act of the Texas legislature, but
it operates as a quasi-public utility.

Its main business is waste treatment. It will contract with any
industry or community desiring the service and able to pay for it.
.Until recently, it had the authority to force municipalities to accept
its services.*

Funds are derived entirely from user charges to the industries and
public agencies served. Although GCWDA has broad authority in matters
of water quality management, it has chosen not to exercise it. At
present, the agency views its chief responsibility as providing services
and tends to-aVoid using its enforcement powers.

GCWDA will build, purchase or operate waste treatment works. How-
ever, the agency will assume responsibility.for an existing plant only
if the plant is considered adequate to meet the abatement requirements
set for it.

GCWDA can sell public agency tax-free bonds backed by revenue con-
tracts with the community.or industry. If industries contract for such
bonds, the contracts are irrevocable. GCWDA can, but does not, levy
taxes and it receives no funds from the state government. It can
refuse to accept a waste into its treatment plants if it deems that the
waste is incompatible with its treatment objectives. Dischargers whose
wastes are refused treatment then come under enforcement jurisdiction of
agencies other than the GCWDA.

The agency simultaneously holds NPDES discharge permits from EPA
and state permits from the Texas Water Quality Board. The NPDES permit
includes specific-effluent,limitations for each infludnt waste stream.
GCWDA has protested this arrangement and feels that EPA has illegally
exercised its authority.

*The Gulf Coast Waste Disposal Authority has been delegated powers
similar to those of River Basin Authorities under the Texas Constitution
and state laws. Since 1967 the authorities have been empowe red to ac-
quire, construct and operate waste treatment facilities.

VI-52

Although the agency is eligible for EPA funds, it has no EPA grants
at this time but is presently in the process of filing.

Metropolitan Municipality of Seattle (METRO)(2)

METRO Seattle represents an instance where a number of communities
were able to submerge thei.r differences and join forces to solve a
common recognizable problem -- the cleanup of Lake Washington.

Wastes from the City of Seattle and other communities were causing
algae blooms in Lake Washington. With the support of local citizen
groups, METRO was formed with the goal of saving the lake. There were
fears of a regional government, the loss of local identity and takeover
of small communities by larger communities. However, the need to save
the lake transcended local fears and the district was formed.

Within ten years, METRO developed and constructed a system where
all sewage formerly discharged to Lake Washington was collected, treated,
and discharged to Puget Sound.

METRO completed the difficult task of acquiring locally owned
interceptors, pumping stations and treatment plants. These were either
incorporated into the system or abandoned.

METRO's reputation during this period was good, and little opposi-
tion was generated toward its formation or financing of the proj,ect.
.There was a general feeling in the affected communities that METRO was
doing a job at reasonable cost.

Now that METRO has matured as a governmental organization, attitu-
dinal changes are taking place in some member communities. There appears
to be a resurfacing of the fears of losing local control. For instance,
there is a difference of opinion between the City of Seattle and METRO
as to which entity should solve the problems of combined sanitary and
storm sewer overflows. Some member communities now object to subsidizing
construction in other areas and of possibly stimulating movement of
families from one community to another.

METRO has entered the controversy concerning the suitability of the
secondary treatment requirements for plants discharging into the ocean.
METRO feels that secondary treatment is not needed. The conflict is
particularly important to METRO since its primary attraction to prospec-
tive member communities is its ability to provide treatment more efficiently
than the communities could on their own.

H. OVERLAPPING PROGRAMS

What is the relation between the water pollution control programs
of the Act and programs in water resource management?

VI-53

The implementation of a water pollution control program inevitably
involves concerns and interests other than pollutant discharge abatement.
There are situations throughout the nation where abatement measures
cannot assure the ability to control the degradation of water quality.
The Act recognizes the situations and specifies that alterations in
flows or hydrologi'cal patterns are to be considered for their effects on
water quality. In the regional studies there were two important cases
where an effective water pollution control program must include more
comprehensive measures than control of point and nonpoint discharges
through applicable technologies.

1. Navigation

The first of these situations is encountered on the Ohio River. In
order to improve the waterway as a transportation corridor, a series of
dams have been built. These dams slow the flow of the river and establish
standing water pools or reservoirs and thereby tend to aggravate pollu-
tion problems. Currently, the dam system on the Ohio is being changed
to increase the height of the major dams and the depth of-these pools.
A-similar dam-building program is proposed for the Chattahoochee.
Permits for point-source,discharges into-these waterways have been
developed from a consideration of the hydrologic conditions as-they now
exist. Projected dams or navigation changes are only begun after environ-
mental impact statements have been prepared. However, there is no
formal mechanism which assures that dams, channels 'or other new hydrolog-
ical modifications will be compatible with permitted and nonpoint pollutant
discharges. The Ohio regional study extensively documents the water
quality degradation which resulted from the construction of the Markland
Dam and the failure of dischargers to implement abatement measures
simultaneously. This project would have required 40 percent decrease in
the discharge of organic pollutants if the dissolved oxygen-concentra-
tion were to be maintained.

The planning provisions of the Act, particularly those pertaining
to state functions, are extensive. The lead times required for planning
navigation projects and the requirements of an environmental impact
statement suggest that the' Act's water quality planning processes could
and should include review of proposed changes in waterways,as they may
affect concentrations of pollutants.

2. Water Resources

In many basins, questions of water quality, quantity and use are
inexorably related. Water users divert water, consume a portion and
return the remainder,.carrying wastes. In basins where the demand for
water is1arge, discharged effluent comprises a major fraction of'the
downstream flow and water resources are repeatedly reused. As demands
increase, instream water quality will degrade and approach that,of the
effluent discharges.

VI-54

Where the demand for all uses is large but the demand for consump-
tive use (including consumption required by pollutant discharge abatement)
is small, sufficiently stringent abatement requirements theoretically
can assure instream water quality. If the requisite levels of abatement
are not technologically or economically achievable, satisfying all the
demands for polluting uses may degrade water quality below acceptable
levels. Section 302 of the Act, "Water Quality Related Effluent Limita-
tions", specifically recognized this situation and established a procedure
to determine the relationship between the economic and social costs and
benefits of implementing the requisite abatement measures.

In basins where the demand for consumptive water uses is an appre-
ciable fraction of the available flow, and where the consumptive uses or
other uses add pollutants, water quality is determined by a delicate
balance between pollutant discharge and water consumption. In water-
short areas, i.e., those areas where potential consumptive demand equals
or exceeds available supplies, pollution may become critical. Since
consumptive demand reduces the volume of water, pollutants tend to
become increasingly concentrated. Allowed to run to extremes, the
demand for water consumption may lower water quality to the point where
further use is not possible.

Water quality management in water-short areas or those approaching
shortage is physically and institutiohally complex. Water quality
depends upon the levels of achievable pollutant discharge abatement and
on the consumptive requirements of various water uses. Water use, on
the other hand, may be limited by poor water quality. The technology
and water quality-based effluent limitations of the Act and various
state laws deal with pollution abatement. Water resource utilization,
particularly in water-short areas, is determined by a system of "rights"
to beneficial use, a system established under state water law. In
theory, the concepts of appropriative or riparian doctrines and the
requirements for pollution discharge abatement are broad enough to
accommodate one another. However, as water rights and pollution abate-
m(@nt laws were originally conceived and as they may be actually practiced
in some jurisdictions, they are yet to be made completely compatible.

The concept of ambient, or "instream", water quality standards
allows for the complexity of water quality management in regions of high
demand. In theory, all proposed changes in a basin are assessed for
their impact on water quality and are initiated only after these impacts
are compared to established standards. The analysis must include a
careful assessment of changes in pollution loadings, matched with antic-
ipated hydrological patterns. Inevitably, the analysis and assessment
process leads to institutional questions. Issues arise as to the legal
status of water quantity and water quality concerns in determining the
acceptability of a proposed hydrological modification or in selecting
between alternative proposals.

VI-55

Although problems of limited available water suppl y occur through-
out the nation, the Colorado River Basin and San Francisco Bay/Central
Valley regional studies clearly illustrate the nature of the issues
involved.

The Colorado Basin

Apportionment of water resources of the Colorado River basin is
complex. Institutionally, water is apportioned among seven states and
Mexico by various treaties, compacts, Federal laws and court decisions.
Within each state, water is apportioned among individuals and public or
private organizations according to state law. Physically, it is divided
among a variety of uses; including out of basin transfers, water for
cooling or other requirements-in the energy industry and irrigated
agriculture. (Municipal and industrial use within the basin requires
smaller quantities of water and has a lesser effect on salinity than
either energy or irrigation use.)

salt is discharged to the river by natural processes and in irriga-
tion return flows. Diversions for out-of-basin use and for new energy
uses will not return salt or water.* At the present time, the salinity
concentration in the lower reaches of the river is high enough to impair
some water uses. Consumption in the upper basin will increase in the
future as upstream states commit to use the quantities to which they are
entitled. When this occurs remedial actions to control the salinity
concentrations will be required.

Colorado River water is managed by the Secretary of the Interior
through the Bureau of Reclamation. Most of the major dams and diversion
projects are operated by the Bureau. Generally, it has the responsibility
and capability of assuring the proper water deliveries.

The seven basin states are in the process- of developing water
quality standards. Standards include numerical criteria for salt cohcen-
trations at Various points and measures which will assure achievement or
maintenance of the criteria. EPA must approve both the numerical concen-
trations, the number of locations where they are applicable and the
abatement or control measures for their achievement. Among the many
issues and controversies associated with this process is the institutional
one of which organizations will be required to implement remedial measures
to achieve finally accepted salinity standards. Meanwhile, the Colorado
River Basin Salinity Control Act charges the Secretary of the Interior

*Newly constructed coal-fired steam electric power plants and plans for
coal gasification plants follow the "no-salt return" policy. The Water
Quality Standards proposed by the Colorado River Basin Salinity Control
Forum include the statement, ". . . the objective for industrial dis-
chargers shall be a no-salt return policy wherever practicable."

VI-56

with completing four projects which will remove salt inflows to the
River. Twelve additional projects are being planned for controlling
salt from irrigation and natural point or diffuse sources. other organi-
zations which theoretically might be required to take additional measures
are the states, irrigation districts, drainage districts, individual
irrigators as well is any of a wide variety of legally recognized public
or private organizations.

There are many institutional and attitudinal problems in identifying
organizations which have the necessary authority and interest in water
pollution control. Most interests in the region historically have been
concerned primarily with water resource development projects and concern
about salinity control is relatively new. Although concern over salinity
is widespread, interest in development projects and concern
resource attitudes, and the institutional structure reflects this domi-
nance. For example , while irrigation districts can recover the costs of
delivering water, it is questionable whether they have the authority to
assess charges for pollution control measures or to place requirements
on irrigation practices.

EPA has not yet applied the NPDES permit program to irrigated agri-
culture. EPA's original policy, defining who should hold permits was
successfully challenged in court. As yet no formal policy has been
established. Currently the sole provision of the effluent limitations
for irrigated agriculture is monitoring the quantity and quality of
diversions and return flows. The permitting provisions of the Act are
flexible enough so that EPA theoretically could require specific abate-
ment measures or effluent limitations of individual permit holders.
This flexibility potentially allows consistency between the measures
required to achieve and maintain salinity standards and the NPDES permit
program.

The San Joaquin River

Many of the water quality/water quantity questions or concerns are
similar in the San Joaquin River Basin to those in the Colorado. However,
there are important differences in both the physical system and in the
institutional structure for its management.

The San Joaquin Valley contains large areas of irrigated agriculture.
The San Joaquin River collects all drainage waters and carries them to
the Delta. Water for irrigation is obtained from the river and storage
reservoirs in its tributaries. Additional water is pumped from the
Delta and imported into the Valley. Since the waters of the Sacramento
and San Joaquin Rivers mix in the Delta, a portion of this supply is
actually from the San Joaquin. To the extent that San Joaquin water is
recycled, its salt content will remain in the valley and, in the long-
term, salt concentrations will increase. Nitrates are an important
constituent of the salt load.

VI-57

The San Joaquin and Sacramento Rivers connect through the Delta and
discharge to San Francisco Bay. Unless adequate freshwater flows are
maintained, salt water will intrude upstream past existing water diver-
sions. The ecology of the Bay-Delta-River system depends to some degree
on seasonal variations in the outflow and the position of the salt water
transition zone.

The central problem in the region is the management of the entire
water resource to assure that the proper salt loads are removed from the
San Joaquin Valley, that the proper outflows occur through the Delta and
that nitrate concentrations'do not produce eutrophication problems.*

Some of the drainage waters from the San Luis irrigation project
will be collected and carried out of the basin. This measure will
assure that salts,- particularly nitrates, are not added to the pollution
load in the San Joaquin. However, the absence of this water will reduce
the net outflow and will therefore not be available to buffer salt water
intrusion. New drainage projects would help eliminate the discharge of
pollutants to the San Joaquin, but would further complicate the problem
of salt water intrusion.

The California Water Resources Control Board both issues water
rights and administers discharge permits. California's discharge permit
program predates P.L. 92-500 and the NPDES program has been delegated to
the state. The Board is issuing discharge permits for irrigation. The
present permits require only that the quantity and quality of return
flows be monitored. However, if abatement measures which changed water
use or consumption, were to be required, the changes would affect the
projects supplying water to the valley. The Department of Water Resources
plans and develops water resource projects. These projects must receive
water rights permits from the Water Resources Control Board. Unlike
most other states, California separates the agency interested in future
water resource projects from the agency responsible for water quality
and water quantity regulation(20).

*Various management plans ior the Delta are now being discussed in
California. Debate centers upon a proposed "peripheral" canal to'allow
controlled water transfers from the Sacramento River.

Vi-58

REFERENCES

(1) -Dames and Moore, Inc., Assessment of the-Impacts of P.L. 92-500
on the Kanawha River Basin, 1975.

(2) Stevens, Thompson and Runyan, Inc., Puget Sound Regional Assess-
.ment Study, 1975.

(3) Hammer, Siler, George Associates, Regional Assessment Study of
the Chattahoochee-Flint-Apalachicola Basin, 1975.

(4) Bernard Johnson, Inc., Regional Assessment Study - Houston Ship
Channel/Galveston Bay, 1975.

(5) Stevens, Thompson and Runyan, Inc., Yellowstone Regional Assess-
ment Study, 1975.

(6) Utah State University Water Research Laboratory, Colorado River
Regional Assessment Study, 1975.

(7) Colorado River Water Quality Improvement Program, U.S. Bureau of
Reclamation, January 1974.

(8) Arthur D. Little, Inc., San Francisco Bay/Central Valley Regional
Assessment Study, 1975.

t9) Abt-Associates, Inc., Regional Assessment Study - Merrimack-Nashua
River Basin, 1975.

(10) Palton, Dalton,@Little and Newport, Great Lakes Regional Assess-
ment .Study, 1975.

(11) U.S. Water Resources Council, The 1972 OBERS Projections of
Economic Activity in the U.S.,April 1974.

(12) Texas Water Quality Board, Waste Load Evaluation for the Houston
Ship Channel, September 1974.

(13) Dames & Moore, Inc., Assessment of the Impacts of P.L. 92-500 on
the Ohio River Basin, 1975.

(14) Betz Environmental Engineers, Regional Assessment Study of the
Delaware River Basin, 1975.

(15) U.S. Department of the Interior, Report on Water for. Energy in the
Upper Colorado River Basin, July 1974.

VI-59

(16) Colorado River Basin Salinity Control Forum, Water Quality Standards
for Salinity Including Numeric Criteria and Plan of Implementation
for Salinity Control, June 1975.

(17) U.S-Department of Connerce-(NOAA), Fishing Statistics of the
U.S., 1971.

(18) Agreement Between the United States and Canada on Great Lakes Water
Quality (Signed April 15, 1972) TIAS 7312.

(19) Arthur J. Inerfield & Associates, Consultant report to NCWQ, 1975.

(20) R. L. Dewsnup, D. W. Jensen (National Water Commission), A Summary-
Digest of State Water Laws, 1973, U.S. Goverment Printing Office.

APPENDIX A: CONTRACTOR AND STAFF REPORTS

1. CONTRACT REPORTS PUBLISHED (as of April 27, 1976)*

Water Pollution Abatement Technology, Capabilities and Costs.
Organic Chemicals Industry - Catalytic, Inc., PB 244 544.
$19.25.
Inorganic Chemicals Industry - Catalytic, Inc., PB 244 $00.
$12.50.
Publicly Owned Treatment Works Metcalf and Eddy, PB 250 690.
@46.25.
Irrigated Agriculture Toups Corporation, PB 250 016.
$9.00.
Iron and Steel Industry - Arthur G. McKee and Co., PB 249 661.
$16.25.
Urban Runoff - Black, Crow and Eidsness/iordan, Jones and Goulding,
PB 247 391. $10.75.
Control of Water Pollution from Selected Nonpoint Sources - Midwest
Research Institute, PB 248 806. $10.00.
Metal Finishing Industry - Lancy Laboratories, PB 248 808. $16.25.
Pulp,and Paper Industry - Hazen and'S4wyqr, PB 242 376. $11.50.
Textile Industry - Lockwood Greene tn4ineers, PB,244 802. $12.50.
Canned and Preserved Fruits'and Vegetables " Environmental Associates,
PB@'244 801. $19;25.
Petroleum Refining Industry - Engineering Science, Inc., PB 243 830.
$15.2@.
Selected Industries - Battelle Memorial Institute, PB 251 437. $95.75.

Water Pollution Control Act of 1972, Economic Impacts.
Leather Tanning Industry Development, Planning and Research Assoc.,
PB 2@0'019. $6@00.
Iron and Steel Industry National Bureau of Economic Research, PB 248 802.
$6.00.
Nonferrous Metals Industry - National Bureau of Economic Research.
PB 248 804. $7.75.
Metal Finishing Industry National Bureau of Economic Research,
PB 248 803. $6.75.
Pulp and Paper industry National Bureau of Economic Research,,
PB 248 801. $10.00.
Textile Industry - National Bureau of Economic Research, PB 249 948.
$7.50.
Petroleum Refining Industry - National Bureau of Economic Resparch,
PB 248 800. $9.00.
PlantClosures - National Bureau of Economic Research, PB 250 015.
$4.50'
Fertilizer Industry Development, Planning and Research Assoc.,
PB 250 017. $6.75.
Direct and Cumulative Industry Impacts Development, Planning and
Research Assoc., PB 251 224. $6.75.
Meat Products Development,.Planning and Research Assoc., PB 251 215.
$16.25.

Available from National technical Information Service, Springfield, Va., 22161.
Specify PB number when ordering. All reports are avail able in microfiche
at the cost of $2.25 per volume.

A-II

Canned Fruits and Vegetables @ Development, Planning and Research Assoc.,
PB 251 216. $10. 75.
Dairy Products - Development, Planning and Research Assoc., PB 251 217.
$8.00.
Grain Milling - Development, Planning and Research Assoc., PB 251 223.
$7.75.
Pilot Study, Five Industries - The Conference Board, PB 251 628.
$18.75.
Irrigated and Non-Irrigated Agriculture - Center for Agricultural and
Rural Development, Iowa State University, PB 248 807. $6.75.
State and Local Revenues and Expenditures -.Data Resources, Inc.
PB 250 018. $18.75.
Foreign Trade - Public Research Institute, PB 249 949,
$10.50.

Water Pollution Control Act of 1972, Technologies and Economic Impacts.
The Feedlot Industry - Development, Planning and Research Assoc.,,
PB 251 214. $10.75.
Steam Electric Power Industry - Teknekron, PB 251 372. $32.75.

Water Pollution Control Act of 1972,
Demographic and Quantitative Analysis - Human Resources Planning
Institute, PB 251 321. $5.50.
Municipal Options - Meta Systems, PB 249 947. $13.50.
Social Impacts, Eight Case Studies - Abt Assoc., PB 250 106.
$13.00.

Benefits from Water Pollution Abatement.
Beach Closings and Reopenings - Battelle Memorial Institute, PB 251 221.
$16.25.
Property Values - David Dornbusch and Assoc., PB 248 805. $9.75.

Annualized Costs of Pollution Control, State Tax Incentives - National
Bureau of Economic Research, PB 251 436. $4.50.

An Analysis of the U.S. Environmental Protection Agency's Needs Survey-
American Public Works Assoc., PB 244 803. $9.50.

Innovative Technologies for water Pollution Abatement - Water Purification
Assoc., PB 247 390. $13.00.

Water Pollution Control Act of 1972, Institutional* Assessment.
Digest of Legal Issues - Environment and Safety Research Service,
PB 250 975. $12.50.
Construction Grants - Touche Ross & Co., PB 244 804. $10.00.
Attitudes of Participants - Oregon Research Institute, PB 247 392.
$10.00.
Planning - Harold Wise & Assoc., PB 244 907. $7.50.
The Permit Program - Energy and Environmental Analysis, Inc., PB 244 805.
$10.50.
Public.Participation - James Ragan and Assoc., PB 245 410, $8.75.
Enforcement - Environmental Law Institute, Two Volumes. Volume I,
PB 246 321, $12.50. Volume II, PB 246 322, $18.75. Set, PB 246 320,
$30.00.

A-III

Water Pollution Control Act of 1972, Regional Impacts.
Delaware River Basin - Betz Environmental Engineers, PB 249 910.
$41.75.
San Francisco Bay/Central Valley - Arthur D. Little, Inc., PB 249 730.
$21.25.
Ohio River Basin - Dames & Moore, Inc., PB 249 680. $55.25.
Colorado River Basin - Utah State University, PB 249 660. $46.25.
Merrimack Nashua River Basin - Abt Assoc., PB 250 060. $41.75.
Kanawha River - Dames &-Moore, Inc., PB 250 105. $23.75.
Lake Erie - Dalton, Dalton, Little, Newport, PB 251 009. $28.25.
Yellowstone River Basin - Stevens, Thompson and Runyan, PB 251 072.
$7.75.
Puget Sound/Lake Washington - Stevens, Thompson and Runyan, PB 251 319.
$7.75.

Environmental Impact Assessment, Water Quality Analysis.
Puerto Rico - Tetra Tech, PB 251 323. $8.00.
Gulf of Alaska - Tetra Tech, PB 251 322. $9.00.
Hawaii - Tetra Tech, PB 251 320. $9.00.
St. John River (Florida) - Atlantis Scientific, PB 251 225. $9.00.
S. California Bight - Tetra Tech, PB 251 435. $12.75. -
South Platte - Tetra Tech, PB 251 446. $12.00.
Escambia River and Bay - Atlantis Scientific, PB 251 447. $9.00.
Hudson River Lawler, Matusky and Skelly, PB 251 099. $13.00.
J. Percy Priest Reservoir Vanderbilt University, PB 251 098. $9.25.
St. John River (Maine) -Meta Systems, PB 250 942. $10.50.
Yadkin Peedee River Basin TRW, Inc., PB 250 933. $8.00.
Connecticut River - The Center for the Environment and Man, PB 250 924.
. $9.00.
Susquehanna - Lawler, Matusky and Skelly, PB 250 925. $9.75.
Housatonic River - Lawler, Matusky and Skelly, PB 250 926. $11.00.
Missouri River Basin - Midwest Research Institute, PB 250 930. $7.75.

Water Quality Analysis.
Upper Mississippi River Basin - Water-Resource Engineers, PB 250 982.
$5.50.
Snake River - Tetra Tech, PB 250 929. $5.50.
Columbia River - Tetra Tech, PB 250 927. $5.50.
Santee River Basin - Water Resource Engineers, PB 250 928. $6.00.
Upper Rio Grande - Water Resource Engineers, PB 250 981. $4.50.
Iowa-Cedar River Basin - Water Resource Engineers, PB 250 931. $6.75.

Water Pollution Control Act of 1972, Environmental Impact Assessment.
Potomac River - Academy of Natural Sciences, PB 250 934. $7.75.
Iowa-Cedar River Basin - Midwest Research Institute, PB 251 227. $12.00.
Snake River - Parametrix, PB 251-226. $7.50.
Upper Mississippi, River.Basin - Midwest Research Institute, PB 251 222.
$10.00.
Santee River Basin - Academy of Natural Sciences, PB 251 354. $9.25.
Upper Rio Grande - Academy of Natural Sciences, PB 251 228. $6.00.
Columbia River - Parametrix, PB 251 324. $7.75.

Disposal of Wastewater Residuals - Environmental Quality Systems, PB 251 371.
$28.25.

A-IV

CONTRACT REPORTS IN PUBLICATION (AS of April 27, 1976)
Water Poilut'ion Control Act of 1972, Economic Impacts.
Chemical and Allied Industries - International Research and Technology
Municipal Bond Market - Data Resources, Inc.
Macroeconomic Impacts - CONSAD Research
The Distribution of Water Pollution Control Costs. Two Vols. -
Urban Systems Research and Engineering, Inc.

Water Pollution Control Act of 1972, Capabilities and Costs.
Water treatment Systems - American Water Works Association

Capital Markets an d Water Quality Needs (1975-1985) The Conference Board

November 1975 Staff Draft Report, Review and Comment National Research
Council

Water Pollution Control Act of 1972, National Residuals Discharge Inventory
National Research Council

Strategic Environmental Assessment System, Residuals Forecasting -
Iniernational Research and Technology

water Pollution Control Act of 1972, Institutional Assessment, Problems of
Municipal and Agricultural Doers - Victoria Price/David Hartley

Benefits from Water Pollution Abatement.
Coastal Waters - Florida State University
Recreation - National Planning Association

Environmental Impact Assessment, Water Quality Analysis.
Biscayne Bay Water Resource Engineers
Trinity River Water Resource Engineers
Charles River/Boston Harbor - Process Research
Guadalupe/San Antonio River Basin - Water Resource Engineers
Chesapeake Bay - Virginia Institute of Marine Sciences

Water Quality Analysis, The Potomac River - GKY Associates

Public Law 92-500:
Regional Assessment, Technical Volume.
Environmental Impact Assessment and Water Quality Analysis, Technical
volume.
Technology Assessment, Technical Volume.
Economic and Social Impacts, Technical Volume.

Water Pollution Control Act of 1972, Regional Impacts.
Houston Ship Channel/Galveston Bay - Bernard Johnson, Inc.
Chattahoochee-Flint-Apalachicola - Hammer, Siler, George Associates

-APPENDIX B

STAFF, CONSULTANTS, ADVISORY COMMITTEES AND CONTRACTORS

I. STAFF

EXECUTIVE STAFF

Frederick J. Clarke Rosalie D. Miller
Lieutenant General, USA (Ret) Secretariat
Executive Director
Bert M. Ritter
Joe G. Moore, Jr. Special Assistant to
Program Director Executive Director

James N. Smith Michael L. Italiano
Deputy Program Director Assistant to Program
Director
Thomas E. Cahill
General Counsel Gerald R. Ryan
Assistant to General
Donna R. Mitchell Counsel
Assistant to the Chairman
Dorpthy M. Read
John C. Waugh Helen G. Stainback
Special Assistant - Media Patricia A. Baker
Jean R. Pierce

STAFF ASSISTANTS

J. Charles Baummer, Jr., Ph.D. Bruce Kennedy
(Senator Buckley) (Representative Grover)

William M. Corcoran Robert G. Kissell, Jr.
(Representative Blatnik) (Dr. Gee)
(Repre@entative Johnson)
James L. Larocca
Jack R. Fickessen (Representative Jones)
(Senator Bentsen)
Leslie 9. Mack
John D. Freshman (Mr. Carl E. Wright)
(Senator Muskie)
William D. McCann, Jr.
E. Lanny Hall (Mr..Kudukis)
W. Carlos Moore
(Representative Wright) Austin W. Nelson
(Mr. Gianelli)
Robert L. Harris
(Senator Randolph)

B-II

James D. Range Bobby G. Voss
(Senator Baker) (Mr. Davies)

Jack L. Schenendorf Charles C. Ziegler
(Representative Cleveland) (Representative Harsha)

PROGRAM STAFF

Economic and social Impact
Adam A. Sokoloski, Ph.D., Director Dale Whittington
Robert E. Burt, Jr. William M. Corcoran
Ray K. Ericson David C. Fege
Paul A. Hoxie Robert G. Gross
Douglas R. Korty John L. Harris
Roy A. Loe Sampson Boozer, Jr.
Barbara J. West Holly A. Kristoff
Randal S. Scott

Environmental Impact
Harold L. Allen, Ph.D., Director James D. Range
Edward R. Meyer, Ph.D. Norman Shields
James L. Peterson., Ph.D. Kathleen T. McKee

Institutional Assessment
Joseph N. Crawley, Ph.D., Director John D. Freshman
Richard Morrison, Ph.D. E. Lanny Hall
Carl H. Braubach Jack L. Schenendorf
Darcia D. Bracken Charles C. Ziegler
Mark Reiter Barbara F. Spindel
Nancy E. Wyatt

Regional Assessment
Steven R. Reznek, Ph.D., Director William D. McCann, Jr.
William J. Chandler Nancy L. Creason
Allen L. Jaisle Maureen A. McCall
Jack R. Fickessen, Margaret B. Ross
Robert L. Harris Phyllis M. Callahan

Technological Assessment
Charles W. Carry, Director J. Charles Baummer, Jr., Ph.D.
David B. Larger Ph.D. Robert G. Kissell, Jr.
Dan M. Wells, Ph.D. Richard Cunningham
Robert L. Wilcox Teresa Y. Hardrick

B-III

Public Affairs
Robert S. Hutchings, Chief Robert S. Prolman
Judy Campbell Bird William D. McCann, Jr.
Phillip A. Clark H. Daniel Jones
Barbara E. Bird James G. Cowles
Marion C. Chafetz Nancy K. Dodge

Administration
Russell D. Anderson, Director Linda M. Merrick
Robert N. Baker, Director Agnes L. Soos
William T. Forrest Arlene L'Heureux
Rosa D. Keatts Mark T. O'Brien
J. CeCe Fegel Ruth H. Allen
Jean C. Boone Robert A. Fletcher
Margaret C. Borengasser Raymond J. Reynolds
Sandra J. Criste James D. Tucker

Summer Interns
.Paul S. Babiarz Craig W. Jeffery
Robert J. Barbera Douglas P. Henry
Bruce A. Broberg Robin Hiscock
Lynn W. Davis Kimberly J. Perry
Robert E. Dickens Russell V. Randle
Danny L. Ferguson

II. CONSULTANTS

David J. Allee Samuel S. Baxter
Department of Agricultural Consulting Engineer
Economics Philadelphia, Pa.
Cornell University
Ithaca, N.Y. Milton Beychok
Consulting Engineer
Lee G. Anderson Irvine,.Calif.
Center for the Study of
marine Policy John J.,Boland
University of Delaware Department of Geography and
Newark, Del. and Environmental Engineering
The Johns Hopkins University
Martin S. Baker Baltimore, Md.
Demori Morris, Levin
.and Shein Daniel W. Bromley
New York, N.Y. Center for Resource Policy
Studies and Programs
Alan E. Barnes University of Wisconsin
Texas Research League Madison, WIS.
Austin,'Tex.@

B-IV

Edwin G. Brown. Herbert B. Charmbury
Graduate School of Social Mining and Environmental
Work Consultant
University of Utah State College, Pa.
Salt Lake City, Utah
Charles J. Cicchetti
Gardner M. Brown, Jr. Social Systems Research
Department of Economics Institute
University of Washington University of Wisconsin
Seattle, Wash. Madison, Wis.

Richard L. Brustkern Lyman H. Clark
Department of Civil Economics and Finance
Engineering Consultant
Montana State University Washington, D.C.
Bozeman, Mont.
Jesse Coates
Charles G. Bueltman Coates Engineering Associates
C.B. Inc. Baton Rouge, La.
Mountain Brook, Ala.
Howard L. Cook
Oscar R. Burt Washington, D.C.
Department of Agricultural
Economics Ralph C. d'Arge
Montana State University Department of Economics
Bozeman, Mont. University of Wyoming
Laramie, Wyo.
Jarvis L. Cain
Department of Agricultural Donald Downing
Economics New York State Agricultural
University of Maryland Station
College Park, Md. Cornell University
Geneva, N.Y.
Dale A. Carlson
Department of Civil Riley E. Dunlap
Engineering Department of Sociology
University of Washington Washington State University
Seattle, Wash. Pullman, Wash.

Emery N. Castle Howard J. Edde
Oregon State University Howard Edde, Inc.
Corvallis, Ore. Bellevue, Wash.

William G. Characklis James E. Etzel
Department of Environmental School of Civil Engineering
Science and Engineering Purdue University
Rice University Lafayette, Ind.
Houston, Tex.

B-V

Anthony-C. Fisher Susan' D .',Haseltine
Bureau of Business and Co6pekative Wildlife Unit
Economic Research Ohlo State.Univer'sity
University of Maryland Col -umbus, Ohio
College Park, Md.
Ru:�sell F.. Heckman'
D. Gardner Foulke Consulting Chemical
Research Services Enqihedr
OMI Sel-Rex 'r Rapid City, S.D.
OXY metal Industries
Corporation Richard J. Hill
Nutley, N.J. Department of Sociology
University of Oregon
Irving K. 'Fox Eugene, Ore.
Wastewater Research Center
University of British Richard S. Howe
-Columbia School of Public and
Vancouver, Canada Environmental Affairs
Indiana University
Richard P. Gale Bloomington, Ind.
Department Of Sociology
University of Oregon F3;ank J. Humenik
Eugene, Ore. Department of Biological and
Agricultural Engineering
Elizabeth Gardiner North Carolina State University
Department of Environmental Raleigh, 14.C.
Sciences
University of Virginia Arthur j. inerkielA
Charlottesville, Va. Arthur J. Inerii@ld
.and Associates
William J. Gillen Burlingame# Calif.
Economics"and Energy
Consultant Heien M.@,Ingram-
Madison, Wis. Department of Government
University of A&itona
Albert E. Gollin Tucson, Ariz.
Bureau of Social Science
Research, Inc. Lynn E. Johnson
Washington, D.C. The Centgr for th@ Environment
and Mah, Inc.
Elizabeth H. Haskell. Hartfokd, Conn.
Environmental Policy
Consultant William R. Johnston
Martinsville, Va. Irrigation and Drainage
Consultant
Myron B. Hawkins Fresno, Calif.
Environmental Consultant@
Redwood City, Calif.

B_VI

Robert E. Keen Ralph Luken
Department of Zoology National Academy of Sciences
University of Vermont Washington, D.C.
Burlington, Vt.
Robert J. Livingston
A. Thomas King Biological Sciences
Bureau of Business and Department
Economic Research Florida State University
University of Maryland Tallahassee, Fla.
College Park, Md.
Brian W. Mar
Lester M. Klashman Department of *Civil Engineering
Consulting Environmental and Institute for
Engineer Envirorunental.Studies
Malden, Mass. University of Washington
Seattle, Wash.
Allen V. Kneese
Department of Economics James R. Marsden
University of New Mexico Department of Economics
Albuquerque, N.M. University of Kentucky
Lexington, Ky.
Christopher C. Koenig
Biological Sciences Randy G. Martin
Department Department of Marine Biology
Florida State University University of Florida
Tallahassee, Fla. Gainesville, Fla.

Louis A. Krumholz Rodney 0. Martin
Water Resources Laboratory Agway Corporation
University of Louisville Syracuse, N.Y.
Louisville, Ky.
Joseph-Masselli
Alan J. Krupnick Industrial Waste Laboratory
Hy@ttsville, Md. Wesleyan"University
Middleton, Conn.
Theodore Lane
Human Resources Planning Lawrence S. Mayer
Institute Department of Statistics
Seattle, Wash. Princeton University
Princeton, N.J.
Victor A. Liguori
Department of Sociology William T. McKean
College of William and Mary Robertson Pulp and Paper
Williamsburg, Va. Laboratory
Raleigh, N.C.
Ronald L. Little
Department of Sociology Francis C. McMichael
Utah State Universi@y Department of Civil Engineering
Logan, Utah Carnegie-Mellon University
Pittsburgh, Pa.

B-VII

Robert L. Mensch Frederick G. Pohland
Farmstead Engineering Service School of Civil Engineering
Fairmont, Minn. Georgia Institute of
Technology
William H. Miernyk Atlanta, Ga.
Regional Research Center
University of West Virginia Paul E. Polzin
Morgantown, W. Va. Bureau of Business and
Economic Research
Perry E. Miller University of Montana
Consulting Environmental Missoula, Mont.
Engineer
Clayton, Ind. Kenneth S. Price
Clark, Dietz and Associates
J. Ronald Miner Urbana, Ill.
Department of Agricultural
and Civil Engineering Thomas W'. Pullum
Oregon State University Department of Sociology
Corvallis, Ore. University of California
Davig, Calif.
Raphael J. Moses
Moses, Wittlemeyer & Harrison Charles S. Revelle
Boulder, Colo. Department of Geography and
Environmental Engineering
Peggy B. Musgrave The Johns Hopkins University
Northeastern University Baltimore, Md.
Boston, Mass.
Jeffrey E. Richey
Nelson L. Nemerow Fisheries Research Institute
Department of Civil Engineering University of Washington
Syracuse University Seattle, Wash.
Syracuse, N.Y.
Susan Rose Ackerman
Donald A. Nichols institute for Social Policy
Department of Economics Studies and Economics
University of Wisconsin Yale University
Madison,.Wis. New Haven, Conn.

Gaylord Northrop Clifford Russell
The Center for the Environment Resources for the Future
and Man, Inc. Washington, D.C.
Hartford, Conn.
George F. Sawdy
Robert H. Pealy Brown University
Institute of Governmental Providence, R.I.
Research
University of Washington Edward I. Selig
Seattle, Wash. Waban, Mass.

B-VIII

Joseph J. Seneca Owen S. Stratton
Department of Economics Depcirtment of Political
Rutgers University Science .
New Brunswick, N.J. Wellesley College
Wellesley, Mass.
Mark Sharefkin
Resources for the Future Robert 0. Sylvester
Washington, D.C. Department of Civil
Engineering
Gaylord V. Skogerboe University of Washington
Department of Agricultural Seattle, Wash.
Engineering
Colorado State University Frank J. Trelease
Fort Collins, Colo. College of Law
University of Wyoming
V. Kerry Smith Laramie".Wyo.
Department of Economics
State University of New York Jeno Vegh
Binghamton, N.Y. Economic Consultant
Washington, D.C.
Loren M. Solnick.
School of Business George R. Webster
state University of New York Enviro@mental Consultant
Albany, N.Y. Birmingham, Mich.

Irving A. Spaulding Fred Wells
Department of Resource Resources for-the Future
Economics Washington, D.C.
University of Rhode Island
Kingston, R.H. Nicholas L. White
School of Law
Alfred J. Steffen Indiana University
School of Civil Engineering Bloomington, Ind.
Purdue University
West Lafayette, Ind. Ira L. WhitmAn
Environmental Engineering
Carlos D. Stern and Management Consultant
Department of Economics Coliimbus, Ohio
University of Connecticut
Storrs, Conn. Frank Wiersma
College of Agriculture
R. Michael S@evens University of Arizona
Center for the Study Tucson, Ariz.
of Federalism
Temple University
Philadelphia, Pa.

B- Ix

Aaron Wildavsky Kenneth Young
School of Public Policy GKY Associates
University of California Annandale, Va.
Berkeley, Calif.
Harmon L. Ziegler
James E. Wilen Center for Educational
Department of Economics Policy and Management
University of British Oregon Research Institute
Columbia Eugene, Ore.
Vancouver, Canada

Nadia Williams
Graphics Consultant
Rockport, Mass.

III. ADVISORY COMMITTEES

A. National Academy of Sciences and National Academy of Engineering
Study Committee on Water Quality Policy

Gordon Wolman, Chairman Robert K. Davis
The Johns Hopkins University U.S. Department of Interior
Baltimore, Md. Washington, D.C.

Neal E. Armstrong Franklin D. Dryden.
Department of Civil Engineering County Sanitation District
The University of Texas of Los Angeles County
Austin, Tex. Whittier, Calif.

Guthrie S. Birkhead Earnest F. Gloyna
Maxwell School of Citizenship Department of Civil Engineering
and Public Affairs The University of Texas
Syracuse University Austin, Tex.
Syracuse, N.Y.
Gene E. Likens
Blair T. Bower Division of Biological
Arlington, Va. Sciences
Cornell University
Margaret Bryan Davis Ithaca, N.Y.
Department of Biology
Yale University Howard C. Madsen
New Haven, Conn. American Meat Institute
Washington, D.C.
Otto A. Davis
School of Urban and Public
Affairs
Carnegie-Mellon University
Pittsburgh, Pa.

B-X

Perry L. McCarty S. E. Reynolds
Department of Civil Engineering State Engineer's Office
Stanford University Santa Fe, N.M.
Palo Alto, Calif.
Frank J. Rozich
Ronald T. McLaughlin Water Pollution Control
ENWATS Commission
Santa Monica, Calif. Denver, Colo.

Ralph Mitchell Carl M. Shy
Division of Engineering Institute for Environmental
and Applied Physics Health
Harvard University University of North Carolina
Cambridge, Mass. Chapel Hill, N. C.

Stuart S. Nagel Abe Silverstein
Department of Political Lewis Research Center
Science NASA
University of Illinois Cleveland, Ohio
Urbana, Ill.
Harold W. Wolf
Parker F. Pratt Water Reclamation Research
Department of Soil Science Center
and Agricultural Dallas, Texas
Engineering
University of California
Riverside, Calif.

B. Panels of the N-AS-NAE Study committee on Water Oualitv Policy

1. Panel on Secondary Treatment of Municipal Wastes

Perry L. McCarty, Chairman Richard S. Engelbrecht
Department of Civil Engineering University of Illinois'
Stanford University Urbana, Ill.
Palo Alto, Calif.
Earnest F. Gloyna
Franklin D. Dryden Department of Civil
County Sanitation District Engineering
of Los Angeles County- The University of Texas
Whittier, Calif. Austin, Tex.

B-XI

Henry J. Ongerth Richard L. Woodward
Department of Public Health Camp, Dresser and McKee
Berkeley, Calif. Boston, Mass.

Donald E. Schwinn
Stearns and Wheler
Cazenovia, N.Y.

2. Panel on Reuse of Waste Waters

Franklin D. Dryden, Chairman Frank J. Rozich
County Sanitation District Water Pollution Control
of Los Angeles County Commission
Whittier, Calif. Denver, Colo.

Blair T. Bower Carl M. Shy
Arlington, Va. Institute for Environmental
Health Studies
Gene E. Likens University of North Carolina
Division of Biological Sciences Chapel Hill, N.C.
Cornell University
Ithaca, N.Y. Harold W. Wolf
Water Reclamation Research
Perry L. McCarty Center
Department of Civil Engineering Dallas, Tex.
Stanford University.
Palo Alto, Calif.

Parker F. Pratt
Department of Soil Science and
Agricultural Engineering
University of California
Riverside, Calif.

3. Panel on Ecosystem Analysis

Neal E. Armstrong, Co-Chairman George Lauff
Department of Civil Engineering Michigan State University
The University of Texas Lansing, Mich.
Austin, Tex.

Daniel B. Botkin Robert May
Yale University Princeton University
New Haven, Conn. Princeton, N.J.

B-XII

4. Panel on Institutional Arrangements

Guthrie S. Birkhead, Chairman S.E. Reynolds
Maxwell School of Citizenship State Engineer's Office
and Public Affairs Santa Fe, N.M.
Syracuse University
Syracuse, N.Y. A. Dan Tarlock
University of Pennsylvania
Robert K. Davis Philadelphia, Pa.
U.S. Department of Interior
Washington, D.C.

Stuart S. Nagel
Department of Political Science
University of Illinois
Urbana, Ill.

C. The Institute of Ecology Advisory Committee

John Cairns, Jr. Joseph F. Koonce
Center for Environmental Studies Case Western Reserve
Virginia Polytechnic Institute University
Blacksburg, Va. Cleveland, Ohio

Kenneth Cummins Gene Likens
Michigan State University Division of Biological
Hickory Corners, Mich. Sciences
Cornell University
Jared Davis Ithaca, N.Y.
U.S. Nuclear Regulatory
Commission John Neuhold
Washington, D.C. Ecology Center
Utah State University
Wilfred R. Gardner Logan, Utah
Department of Soil Science
University of Wisconsin, Richard A. Parker
Madison, Wisc. Washington State University
Pullman, Wash.
Joel F. Gustafson
California State University J. Herbert Snyder
San Francisco, Calif. California water Resources
Center
Arthur D. Hasler University of California
University of Wisconsin Davis, Calif.
Madison, Wisc.

Galen Jones
University of New Hampshire
Durham, N. H.

B-XIII

Donald Wohlschlag
The University of Texas
Port Aransas, Texas

D. Advisory Committee for the Permit Program Study

Bill B. Dendy Ronald B. Outen
California Stat6Water Natural Resources Defense
Resources Control Board Council
Sacramento, Calif. Washington, D.C.

Wesley E. Gilbertson Preston Tack
Department of-Environmental Association of Metropolitan
Resources Sewerage Agencies
Harrisburg, Pa'. Bellevue, Wash.

Henry J. Graeser, Jr. Jerome Wilkenfeld
Water Utilities Department Hooker Chemicals and Plastics
Dallas, Tex. Corporation
Niagara Falls, N.Y.

F. Advisory Committee on Public Participation

William R. Adams, Jr. Robert E. Burt
Maine Department of Environmental California Manufacturers'
Protection Association
Augusta, Maine Sacramento, Calif.

Donald Benson Walter E. Newman
Munidipalitiy of Metropolitan U.S. Environmental Protection
Seattle Agency
Seattle, Wash. Boston, Mass.

Lelia L. Botts Clem L. Rastatter
Lake Michigan Federation The Counservation Foundation
Chicago, Il. Washington, D.C.

G. San Francisco Bay/Central Valley Advisory Group

John W. Abbott James E. Cook
California Tommorow U.S. Department of Interior
San Francisco, Calif. Washington, D.C.

Harold Chadwick Paul DeFalco
California Department U.S. Environmental Protection
of fish and Game Agency
Stockton, Calif. San Francisco, Calif.

B-XIV

Fred H. Kierker Gerald Meral
California Regional Environmental Defense Fund
Water Quality Board Berkeley, Calif,
Oakland, Calif.
Daniel Murphy
Roger Dolan Bay Area Sewerage
East Bay Municipal Services Agency
Districts Berkeley, Calif.
Oakland, Calif.
Bill Press
Barbara Eastman Planning and Conservation
Los Altos Hills, Calif. League
Sacramento, Calif.
Robert Hagan
Delta Environmental Charles R. Roberts
Advisory Group San Francisco Bay Conservation
University of California and Development Commission
Davis, Calif. San Francisco, Calif.

Edwin B. Haycock Jim Robertson
State Water Resources Water Quality Control
Control Board Board
Sacramento, Calif. Sacramento, Calif.

Mike Herz Ronald B. Robie
Oceanic Society California Department
Sacramento, Calif. of Water Resources
Sacramento, Calif.
William S. Hyde
Sacramento Regional County Gilbert G. Stamm
Sanitation District Bureau of Reclamation
Sacramento, Calif. U.S. Department of Interior
Washington, D.C.
Robert B. James
California Regional H.E. Stone
Water Quality Control Board Del Monte Corporation
Oakland, Calif. San Francisco, Calif.

Paul Jepperson James L. Welsh
California Regional Water Department of Water
Quality Control Board Resources
Sacramento, Calif. Sacramento.' Calif.

Paul Lamborn
U.S. Agricultural Extension
Service
Pittsburg, Calif.

B-XV

H. Colorado River Advisory Group

Katherine Fletcher W. Don Maughan
Environmental Defense Fund State Water Resources
Denver, Colo. Control Board
Sacramento, Calif.
Russ Freeman
U.S. Environmental Protection John A. McComb
Agency The Sierra Club
San Francisco, Calif. Tucson, Ariz.

Roger Frenett Owen Oplin
U.S. Environmental Protection School of Law
Agency University of Utah
Denver, Colo. Salt Lake City, Utah

Ival V. Goslin Donald L. Paff
Upper Colorado River Department of Conservation
Commission and Natural Resources
Salt Lake City, Utah Las Vegas,,Nev.

Ernest Gregory S. E. Reynolds
Nevada State Health Department State Engineer's office
Carson City, Nev. Santa Fe, N.M.

Don Grimsley Hon. William Rhoads
Federal Energy Administration Cody, Wyo.
Washington, D.C.
Frank J. Rozich
Myron Holburt Water Pollution Control
Colorado River Board Commission
of California Denver, Colo.
Los Angeles, Calif.
Martin Seneca
W. John D. Kennedy U.S. Department of Interior
Rocky Mountain Center Washington, D.C.
on Environment
Denver, Colo. Gilbert G. Stamm
Bureau of Reclamation
Allen Kneese U.S.. Department of Interior
Department of Economics Washington, D.C.
University of New Mexico
Albuquerque, N.M. Wesley-E. Steiner
Arizona Water Commission
John Maletic Phoenix, Ariz.
Bureau of Reclamation
U.S. Department of Interior Lynn Thatcher
Denver, Colo. Salinity Control Program
Salt Lake City, Utah

B-XVI

I. Committee of Consultants on Irrigated Agriculture

Robert S, Ayers Roy S. Rauschkolb
Department of Land, Air Department of Land, Air
and Water Resources and Water Resources
University of California University of California
Davis, Calif. Davis, Calif.

Roy L. Branson Herbert Schulbach
Soil Science and.Agricultural Cooperative Extension
Engineering University of,California
University of California Colusa, Calif.
Riverside, Calif.
Robert K. Schulz
George V. Ferry Department of Soils
Cooperative Extension and Plant Nutrition
University of California University of California
Hanford, Calif. Berkeley, Calif.

Robert M, Hagan Leslie K. Stromberg
Department of Land, Air Cooperative Extension
and Water Resources University of California
University of California Fresno, Calif.
Davis, Calif.
Kenneth K. Tanji
Jewell L. Meyer Department of Land, Air
Cooperative Extension and Water Resources
University-of California University of California
Modesto, Calif. Davis, Calif.

Donald R. Nielson Lynn D. Whittig
Department of Land, Air Department of Land, Air
and Water Resources and Water Resources
University of California University of California
Davis, Calif. Davis, Calif.

Victor P. Osterli William W. Wood, Jr.
Cooperative Extension Cooperative.Extension
University of California University of California
Davis, Calif. Riverside, Calif.

Parker F. Pratt
Department of Soil Science
and Agricultural Engineering
University of California
Riverside, Calif.

IV. CONTRACTORS

The Academy of Natural Sciences The Conference Board
Philadelphia, Pa. New York, N.Y.

Abt Associates Consad Research Corporation
Cambridge, Mass. Pittsburgh, Pa.

Advisory Commission on Control Data Corporation
Intergovernmental Relations Rockville, Md.
Washington, D.C.
Dalton, Dalton, Little,
American Public Works Association Newport
Chicago, Ill. Cleveland, Ohio

Art Services (Graphics) Dames and Moore, Inc.
Washington, D. C. Cincinnati, Ohio

Association of Metropolitan Data.Resources, Inc.
Sewerage Agencies Washington, D.C.
Seattle, Wash.
Development Planning and
Atlantis Scientific Research Associates, Inc.
Tallahassee, Fla.' Manhattan, Kan.

Battelle Memorial Institute David M. Dornbusch and Co., Inc.
Columbus, Ohio San Francisco, Calif.

Betz Environmental Engineers Electronic Data Systems
Plymouth Meeting, Pa. Washington, D.C.

Black, Crow and Eidsness, Inc. Energy and Environmental
Atlanta, Ga. Analysis, Inc.
Arlington, Va.
Boeing Computer Services, Inc.
Philadelphia, Pa. Energy Resources Company, Inc.
Cambridge, Mass.
Bureau of National Affairs
Washington, D.C. Engineering-Science, Inc.
Austin, Tex.
Catalytic, Inc.
Philadelphia, Pa. Environmental Analysts, 'Inc.
Deerfield, Ill.
The Center for the Environment
and Man Environmental Associates, Inc.
Hartford, Conn. Corvallis, Ore.

Coastal Ecosystems Management, Inc.
Fort Worth, Tex.,

B-XVIII

Environmental Dynamics, Inc. Jordan, Jones and Goulding, Inc.
Los Angeles, Calif. Atlanta, Ga.

Environmental Law Institute Iowa State University
Washington, D.C. Center for Agricultural.
and Rural Development
Environmental Quality Systems, Inc. Ames, Iowa
Rockville, Md.
Lancy Laboratories
Florida State University Zelienople, Pa.
Department of Economics
Tallahassee, Fla. Lawler, Matusky and Skelly,
Engineers
GKY Associates Tappan, N.Y.
Alexandria, Va,
Linton, Mields and Coston, Inc.
Hammer, Siler and George Associates Washington,' D.C.
Washington, D.C.
Arthur D. Little, Inc.
David K. Hartley Cambridge, Mass.
Washington, D.C.
Lockwood Greene Engineers, Inc.
Hazen and Sawyer Spartanburg, S.C.
New York, N.Y.
Management Sciences Systems
Human Resources Planning Institute Alexandria, Va.,
Seattle,.Wash.
Arthur G. McKee and Co.
Hydroscience, Inc. Cleveland Ohio
Westwood, N.J.
Meta Systems, Inc.
The Institute of Ecology Cambridge, mass.
Washington, D.C..
Metcalf and Eddy, Inc.
Interindustry Economic Boston, Mass.
Research Fund
College Park, Md. Midwest Research Institute
Kansas City, Mo.
International Research
and Technology Corporation National Academy of Sciences
Arlington, Va. Washington, D.C.

James Ragan Associates National Bureau of Economic
Pacific Palisades, Calif. Research
New Haven, Conn.
Bernard Johnson, Inc.
Houst9n, Tex. National Planning Association
Washington, D.C.

B-XIX

North Star Research Toups Corporation
and Development Institute Santa Ana, Calif.
Minneapolis, Minn.
TRW, Inc.
Oregon Research Institute Redondo Beach, Calif.
Eugene, Ore.
The University of California
Parametrix, Inc. Department of Water Science
Seattle, Wash. and Engineering
Davis, Calif.
Victoria Price
Brooklyn, N.Y. The University of Texas
Lyndon B. Johnson School
Process Research, Inc. of Public Affairs
Cambridge, Mass. Austin, Tex.

Procon, Inc. The University of Virginia
Des Plains, Ill. Office of Sponsored Programs
Charlottesville, Va.
Public Interest Economics Center
Washington, D.C. Urban Systems Research
and Engineering, Inc.
Public Research Institute Cambridge, Mass.
Arlington, Va.
Utah State University
Resources for the Future Water Research Labora-tory,
Washington, D.C. Logan, Utah

Stevens, Thompson and Runyan, Inc. Vanderbilt University
Seattle, Wash. Department of Environmental
and Water Resources Engineering
Southern California Coastal Nashville, Tenn.
water Research Project
El Segundo, Calif. Virginia Institute of marine
Sciences
Teknekron Gloucester Point, Va.
Berkeley, Calif.
Water Purification Associates
Tetra Tech, Inc. Cambridge, Mass.
Pasadena, Calif.
Water Resources Engineers
Tippets-Abbett-McCarthy-Stratton Austin, Tex.
New York, N.Y.
Touche Ross and Co. Harold F. Wise,"A.I.P.
Washington, D.C. Washington, D.C.

U. S. GOVERNMENT PRDrTING OFFICE 1976 623-722/544

C 0 A S 7 L Z 0 NNE
INFORMATION CENTER

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