[Federal Register Volume 60, Number 151 (Monday, August 7, 1995)]
[Rules and Regulations]
[Pages 40230-40235]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-19191]




[[Page 40229]]

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Part II





Environmental Protection Agency





_______________________________________________________________________



40 CFR Parts 122 and 124



Storm Water Discharges; Amendment to Requirements for National 
Pollutant Discharge Elimination System Permits; Final Rule

  Federal Register / Vol. 60, No. 151 / Monday, August 7, 1995 / Rules 
and Regulations   

[[Page 40230]]


ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 122 and 124

[FRL-5271-7]


Amendment to Requirements for National Pollutant Discharge 
Elimination System (NPDES) Permits for Storm Water Discharges Under 
Section 402(p)(6) of the Clean Water Act

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule; withdrawal of direct final rule.

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SUMMARY: Today, EPA is withdrawing the storm water phase II direct 
final rule published on April 7, 1995 (60 FR 17950) and promulgating a 
final rule in its place based on an identical proposal published that 
same day (60 FR 17958). By today's action, EPA is promulgating changes 
to the National Pollutant Discharge Elimination System (NPDES) storm 
water permit application regulations under the Clean Water Act (CWA) 
for phase II dischargers. Phase II dischargers generally include all 
point source discharges of storm water from commercial, retail and 
institutional facilities and from municipal separate storm sewer 
systems serving populations of less than 100,000.
    Today's rule establishes a sequential application process in two 
tiers for all phase II storm water discharges. The first tier provides 
the NPDES permitting authority flexibility to require permits for those 
phase II dischargers that are determined to be contributing to a water 
quality impairment or are a significant contributor of pollutants to 
waters of the United States. (``Permitting authority'' refers to EPA or 
States and Indian Tribes with approved NPDES programs.) EPA expects 
this group to be small because most of these types of dischargers have 
already been included under phase I of the storm water program. The 
second tier includes all other phase II dischargers. This larger group 
will be required to apply for permits by the end of six years, but only 
if the phase II regulatory program in place at that time requires 
permits. As discussed in more detail below, EPA is open to, and 
committed to, exploring a number of non-permit control strategies for 
the phase II program that will allow efficient and effective targeting 
of real environmental problems. As part of this commitment, EPA has 
initiated a process to include stakeholders in the development of a 
supplemental phase II rule under the Federal Advisory Committee Act 
(FACA). This rule will be finalized by March 1, 1999 and will determine 
the nature and extent of requirements, if any, that will apply to the 
various types of phase II facilities prior to the end of the six-year 
application period defined by today's rule.

DATES: The direct final rule published on April 7, 1995 at 60 FR 17950 
and corrected on April 18, 1995 at 60 FR 19464 is withdrawn and this 
final rule is effective on August 7, 1995. In accordance with 40 CFR 
23.2, EPA is explicitly providing that this rule shall be considered 
final for purposes of judicial review at 1 p.m. (Eastern time) on 
August 7, 1995.

ADDRESSES: The docket for this rulemaking is available for public 
inspection at EPA's Water Docket, Room L-102, 401 M Street, SW, 
Washington, DC 20460. For access to the docket materials, call (202) 
260-3027 between 9 a.m. and 3:30 p.m. (Eastern time) for an 
appointment. Please indicate that the docket to be accessed is for the 
April 7, 1995 Federal Register notice on the storm water phase II 
regulations. As provided in 40 CFR part 2, a reasonable fee may be 
charged for copying services.

FOR FURTHER INFORMATION CONTACT: Nancy Cunningham, Office of Wastewater 
Management, Permits Division (4203), Environmental Protection Agency, 
401 M Street, SW, Washington, DC 20460, (202) 260-9535.

SUPPLEMENTARY INFORMATION:

I. Overview of Today's Action

    Today, EPA is promulgating the phase II storm water application 
regulations as proposed on April 7, 1995 (60 FR 17958). EPA also is 
withdrawing the direct final rule published on that same date (60 FR 
17950); corrected at 60 FR 19464, April 18, 1995. The direct final and 
proposed rules contained identical requirements. By today's rule, EPA 
promulgates changes to the NPDES storm water permit application 
regulations under the CWA to establish a common sense approach for all 
phase II storm water dischargers. Phase II storm water dischargers 
include those storm water discharges not addressed under phase I of the 
storm water program.\1\. Generally, phase II dischargers are point 
source discharges of storm water from commercial, retail, light 
industrial and institutional facilities, construction activities under 
five acres, and from municipal separate storm sewer systems serving 
populations of less than 100,000.

    \1\ Phase I dischargers include: dischargers issued a permit 
before February 4, 1987; discharges associated with industrial 
activity; discharges from a municipal separate storm sewer system 
serving a population of 100,000 or more; and discharges that the 
permitting authority determines to be contributing to a violation of 
a water quality standard or a significant contributor of pollutants 
to the waters of the United States.
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    Today's rulemaking will promote the public interest by relieving 
most phase II dischargers of the immediate requirement to apply for 
permits. Consequently, this rule relieves most phase II dischargers 
from citizen suit liability for failure to have an NPDES permit over 
the next six years. If a phase II discharger complies with the 
application deadlines established by today's rule, the facility will 
not be subject to enforcement action for discharge without a permit or 
for failure to submit a permit application.
    Under today's rule, application deadlines are in two tiers. The 
first tier allows the permitting authority to focus current efforts on 
those facilities that will produce the greatest environmental benefit. 
The first tier is for those phase II dischargers that the NPDES 
permitting authority determines are contributing to a water quality 
impairment or are a significant contributor of pollutants to waters of 
the U.S. Those dischargers that have been so designated are required to 
obtain a permit and must submit permit applications to the permitting 
authority within 180 days of being notified that such an application is 
required. The permitting authority has the flexibility to extend this 
deadline. Under the second tier, all remaining phase II facilities must 
apply for permits by August 7, 2001, but only if the phase II 
regulatory program in place at that time requires permits. EPA is 
actively exploring alternative control strategies with broad 
stakeholder involvement. EPA is also establishing application 
requirements for phase II dischargers, as well as making other 
conforming changes to other portions of the NPDES regulations in 
today's rule.
    EPA is subject to a court order to propose supplemental rules for 
phase II sources by September 1, 1997, and finalize them by March 1, 
1999. Natural Resources Defense Council, Inc. v. Browner, Civ. No. 95-
634 PLF (D.D.C., April 6, 1995). However, if the CWA is amended prior 
to these dates to address some of these storm water issues, EPA will, 
of course, move to expeditiously implement the statutory changes.

II. Background

    EPA provided an extensive discussion of the statutory and 
regulatory background of the storm water program in the direct final 
rule published in the April 7, 1995, Federal Register notice (60 FR 
17950). For the sake of brevity, EPA refers the reader to that notice 
and 

[[Page 40231]]
only briefly repeats the background necessary to explain the need for 
today's final rule.
    As explained in CWA section 101, Congress enacted the CWA ``to 
restore and maintain the chemical, physical, and biological integrity 
of the Nation's waters'' through reduction and eventual elimination of 
the discharge of pollutants into those waters. CWA section 301 
prohibits the discharge of pollutants from a point source except in 
compliance with certain other sections of the Act. One of those 
sections, section 402, established the National Pollutant Discharge 
Elimination System (NPDES), the permitting program for control of point 
source discharges including storm water.
    In the 1987 amendments to the CWA, Congress enacted section 402(p). 
Section 402(p)(1) relieved certain storm water dischargers (commonly 
referred to as phase II dischargers) from the requirement to obtain a 
permit until October 1, 1992. Section 402(p)(6) provided that EPA was 
to publish regulations by October 1, 1992. Congress later extended the 
date for the permitting moratorium until October 1, 1994, and the date 
for publication of phase II regulations until October 1, 1993. See 
Water Resources Development Act of 1992, Public Law No. 102-580, 
section 364, 106 Stat. 4797, 4862 (1992).
    Though the relief from the permit requirement lapsed on October 1, 
1994, EPA had not published phase II storm water regulations. On 
October 18, 1994, EPA issued guidance explaining that regulations had 
not yet been promulgated for the phase II storm water program, and that 
the Agency was unable to waive the statutory prohibition against 
unpermitted discharges of pollutants to waters of the United States in 
the absence of such regulations. EPA is not attempting to extend the 
CWA deadlines in today's rule, but rather is establishing the phase II 
storm water program under section 402(p)(6). (See Response to Comment 
section below for further discussion of this issue.)

III. Regulation Changes

    In today's rule, EPA is designating under section 402(p)(6) all 
phase II sources as being part of the phase II program. EPA is 
establishing permit application deadlines for these dischargers in two 
tiers in today's rule. To obtain real environmental results early, the 
first tier applies to those phase II dischargers that the NPDES 
permitting authority determines are contributing to a water quality 
impairment or are a significant contributor of pollutants. Those 
dischargers that have been so designated by the permitting authority 
are required to obtain a permit and must submit a permit application 
within 180 days of being notified that such an application is required. 
The permitting authority has the flexibility to extend this deadline. 
Under the second tier, all other phase II facilities must apply for 
permits by August 7, 2001, but only if the phase II regulatory program 
in place at that time requires permits.
    EPA also is establishing application requirements for phase II 
dischargers, as well as making other conforming changes to other 
portions of its NPDES regulations in today's rule. For example, EPA is 
providing flexibility to the permitting authority to modify the 
specific application requirements for phase II dischargers. Again EPA 
believes this is a common sense approach to alleviate unnecessary 
burden on phase II dischargers. The specifics of the application 
requirements and other conforming changes are explained in the April 7, 
1995, notice published at 60 FR 17950. EPA has not changed the 
regulatory text in today's final rule from that notice.

IV. Responses to Public Comment

    A comprehensive ``response to comment'' document is available in 
the administrative record for this rulemaking. Many significant 
comments, and EPA's responses, are summarized below.
    Many commenters disagreed with EPA's interpretation of section 
402(p) of the CWA in which EPA determined that section 402(p) sets a 
statutory deadline for the issuance of permits to phase II storm water 
dischargers. The commenters argued that 402(p) does not require permits 
for all discharges of storm water after October 1, 1994, rather it 
prohibits the need for such permits before this date.
    EPA disagrees. CWA section 301(a) states that it is illegal to 
discharge pollutants to waters of the U.S. except in compliance with 
Section 402. The current regulations under section 402 establish a 
permit program for point source discharges. In the 1987 amendments to 
the CWA, Congress added Section 402(p) to ensure the orderly evolution 
of the NPDES storm water program. Section 402(p)(1) did not alter the 
basic underlying prohibition in Section 301(a) as it applied to storm 
water discharges. Section 402(p)(1) did, however, establish temporary 
relief from permitting requirements for certain storm water discharges 
for a specified period of time. Section 402(p)(6) provided EPA with the 
authority to consider alternative control strategies for the phase II 
program. Because EPA had not established alternatives under section 
402(p)(6), the existing permitting requirements under section 402 
applied to phase II dischargers after October 1, 1994.
    The legislative history behind 402(p) supports EPA's position that 
when the date lapsed, phase II sources became subject to the pre-
existing statutory requirement to obtain a NPDES permit. The 
Congressional Record from October 15, 1986 includes the following 
statements from the House of Representatives:

    The relief afforded by this provision extends only to October 1, 
1992. After that date, all municipal separate storm sewers are 
subject to the requirements of 301 and 402.
    After October 1, 1992, the permit requirements of the Clean 
Water Act are restored for municipal separate storm sewer systems 
serving a population of fewer than 100,000.

132 Cong. Rec. H10532 (Oct. 15, 1986)

    More recent Congressional actions provide even clearer support for 
EPA's interpretation of Section 402(p). The original deadline for 
permits for phase II storm water discharges was October 1, 1992. At the 
time of this original deadline, the Agency was not ready to issue 
regulations for implementation of the phase II program. When Congress 
recognized the severe liability problem this would create for phase II 
discharges, Congress decided to extend the relief deadline in section 
402(p)(1) to October 1, 1994. At the same time, Congress extended the 
deadline for phase II regulations in section 402(p)(6) to October 1, 
1993, to allow EPA more time to develop phase II regulations. If phase 
II dischargers were not subject to enforcement for violations of 
section 301(a) until EPA promulgated the phase II regulations, Congress 
would not have extended sections 402(p)(1) and 402(p)(6) with differing 
deadlines. If Congress had not intended unregulated phase II sources to 
be liable for violations of section 301(a) on October 1, 1992, there 
would have been no need to amend section 402(p)(1) at all.
    In related comments, concern was expressed that if such statutory 
deadlines are valid, EPA does not have the authority to extend 
statutory permit deadlines. In response, EPA disagrees that this 
regulation extends statutory deadlines. The statutory deadline lapsed 
on October 1, 1994. EPA recognized that fact, as well as the 
consequences thereof, when it issued the October 18, 1994, guidance. 
The Agency's authority to act under these circumstances arises from the 
clear text of section 402(p)(6). That section directs EPA to issue 
regulations which (1) designate storm 

[[Page 40232]]
water discharges to be regulated to protect water quality and (2) 
establish a comprehensive program to regulate those sources, including, 
among other things, expeditious deadlines. In today's rule, EPA relies 
on section 402(p)(6) to designate all phase II discharges for 
regulation under a comprehensive program which, for most of those 
dischargers, does not require permits for 6 years. During the six-year 
period, EPA will investigate alternative control strategies for the 
phase II program and will develop supplemental regulations through the 
FACA process.
    Commenters also raised concern regarding the potential for citizen 
suits. As explained above, today's final rule effectively protects most 
phase II dischargers from citizen suit liability for failure to have an 
NPDES permit for up to six years.
    A few commenters criticized EPA for the delay in publishing a 
Report to Congress on storm water discharges not covered under phase I. 
Further, they did not believe that President Clinton's Clean Water 
Initiative adequately addressed procedures and methods to control storm 
water discharges to the extent necessary to mitigate impacts on water 
quality. The Agency believes that the Storm Water Report to Congress, 
which incorporates the President's Initiative, fulfills the 
requirements of section 402(p)(5). The Report to Congress cites to data 
confirming the continuing threat to surface waters caused, in 
significant part, by unregulated storm water discharges. The 
Administration's Clean Water Initiative proposed a variety of 
procedures and methods through which permitting authorities could most 
flexibly address remaining unregulated discharges of storm water to the 
extent necessary to mitigate impacts on water quality.
    Several commenters questioned whether State and local officials had 
been consulted in developing the proposed rule as directed by CWA 
section 402(p)(6). In a September 9, 1992, Federal Register notice, EPA 
invited public comment on reasonable, alternative approaches for the 
phase II storm water program. Prior to publication of the direct final 
and proposed rules on April 7, 1995, EPA met with representatives of 
key municipal organizations to discuss the content of the rule and to 
gather feedback and input. EPA will continue its outreach efforts by 
seeking additional public input through FACA subcommittee 
participation, and other means, in developing supplemental regulations 
for the phase II program.
    Commenters expressed their opinion that the proposed rule should be 
considered an unfunded mandate as described under the Unfunded Mandate 
Reform Act of 1995. That is, the commenters believed that the estimated 
cost of the regulation to State, local, or tribal governments, or to 
the private sector, will be $100 million or more in any one year. EPA 
disagrees. This rulemaking actually reduces the immediate regulatory 
burden imposed on phase II facilities. EPA believes that the cost to 
phase II dischargers that are immediately designated under tier 1 will 
be small due to the extremely few designations that are anticipated. 
Furthermore, EPA has the authority to modify permit application 
requirements to require less information and alleviate unnecessary 
burden on all phase II facilities. Because of these reasons, costs are 
expected to be well below $100 million for each of the next six years. 
EPA believes that any costs that might be imposed after the sixth year 
will still be below $100 million because of the application 
flexibility, but in any event, those costs will not exceed existing 
costs (multiplied by the rate of inflation) because of the current 
statutory requirement that phase II dischargers apply for permits 
immediately, absent promulgation of today's rule.
    The costs of a ``comprehensive'' phase II program after the sixth 
year will be more fully characterized through additional rulemaking as 
a result of the FACA process. Under a judicial consent order in Natural 
Resources Defense Council, Inc. v. EPA, Civ. No. 95-0634 PLF (D.D.C. 
April 6, 1995), EPA is required to propose by September 1, 1997, and 
take final action by March 1, 1999, supplemental rules which clarify 
the scope of coverage and control mechanisms for the phase II program. 
The cost to potential dischargers of this action will be identified in 
the subsequent rulemaking and cannot be accurately predicted in today's 
final rule. However, EPA does not expect that regulation to cost over 
$100 million in any one year.
    Commenters questioned EPA's justification to designate all phase II 
dischargers to protect water quality. Many commenters argued that 
construction sites that disturb less than 5 acres should not be so 
designated because they do not present significant water quality 
concerns. In response, EPA relies on the Report to Congress to conclude 
that unregulated storm water discharges remain a significant threat to 
the health of surface water quality. While EPA recognizes that 
individual facilities within the total phase II universe may not 
represent equal threats, EPA believes that there is sufficient 
information concerning water quality problems to designate the entire 
class of phase II dischargers as an interim matter pending further 
study in the context of the rulemaking described above. EPA will make 
more specific designations in the context of that rulemaking. In 
response to comments about small construction sites, EPA notes that 
these commenters did not present any data to support a conclusion that 
small construction presents only negligible water quality concerns. As 
explained in the earlier notice, the FACA subcommittee will explore the 
appropriate scope of the phase II program.
    Today's rule states that permit applications are required within 
180 days from receipt of notice for those phase II discharges that the 
NPDES permitting authority determines are contributing to a water 
quality impairment or are a significant contributor of pollutants. 
Commenters requested and suggested further clarification on both of 
these determinations. EPA purposefully did not provide explicit 
definitions of these phrases in order to provide flexibility to 
permitting authorities. Interpretive flexibility is warranted due to 
climatic and geographic differences across the United States. EPA 
published guidance for designations under phase I of the storm water 
program. Such guidance is also applicable for the phase II program 
designations and is included in the record of this rulemaking.
    One commenter took issue with the 180-day deadline for permit 
applications, particularly for municipal separate storm sewer systems 
that are designated under tier 1. The commenter felt that such a short 
period of time would not be sufficient to prepare and submit a 
municipal application. In response, EPA reminds the commenter that the 
Director has the authority to grant permission to submit the 
application at a later date. Some municipalities may not need more time 
because they may be able to simply reference information already 
submitted for an adjacent or nearby large or medium municipality under 
phase I. Additionally, the permitting authority is able to modify the 
permit application requirements and may require much less information 
than what was required for phase I dischargers.
    Another commenter asked that the period during which a permitting 
authority may designate a facility be limited to one year. EPA is not 
limiting the time frame for designations because the permitting 
authority will need to account for changing conditions and new 
information that becomes available over time.

[[Page 40233]]

    Some commenters stated that the ``direct final rule'' is not 
specifically provided for in the Administrative Procedure Act (APA) nor 
has EPA demonstrated ``good cause'' to issue a ``direct final rule'' 
under 5 U.S.C. section 553. This comment is no longer relevant because 
EPA is withdrawing the direct final rule and instead issuing a final 
rule that responds to comments received.
    One commenter disputed the assertion that urban storm water runoff 
is a cause of real water quality use impairment in the United States. 
The commenter also believed that it is inappropriate to base the 
implementation of phase II requirements on exceedance of water quality 
standards associated with urban storm water runoff. The commenter 
believed that water quality criteria were not developed to regulate 
many of the chemical constituents in urban storm water runoff. EPA 
disagrees. The fact that urban runoff is a real cause of water quality 
use impairment is very well supported throughout the literature and is 
summarized by EPA in the Water Quality Inventory: Reports to Congress 
prepared on a biannual basis under section 305(b) of the CWA. EPA 
believes that basing the implementation of phase II requirements on 
exceedance of water quality standards is appropriate because attainment 
of water quality standards is one of the explicit goals of the NPDES 
program. EPA further disagrees that water quality criteria have not 
been developed for many of the chemical constituents in urban storm 
water. To the contrary, water quality criteria exist for many such 
constituents, particularly heavy metals and oil and grease.
    A few commenters argued that comments received on the rule are 
unrepresentative of the groups affected because small cities and 
commercial establishments were unaware of the direct final and proposed 
rules. In response, EPA believes that the 60-day comment period was 
sufficient for small entities to formulate their comments and/or review 
those drafted by their representative associations. Many of the 
comments received were from national organizations representing such 
small cities and businesses, including, National Association of 
Counties, National Association of Convenience Stores, Society of 
Independent Gasoline Marketers of America, National Association of 
Flood and Stormwater Management Agencies, American Petroleum Institute, 
National Association of Home Builders, and American Car Rental 
Association.
    One commenter disagreed that this rulemaking significantly reduces 
the immediate regulatory burden imposed on phase II facilities because 
phase II municipalities would have the same burden imposed on phase I 
municipalities. In response, EPA points out that today's rule provides 
the Director with discretion to modify the application requirements for 
phase II dischargers. EPA expects Directors to exercise this discretion 
to reduce the application burden to both municipalities and individual 
facilities.
    Several commenters questioned the types of permits that will be 
available to dischargers in 2001. Currently, the permitting authority 
has the option of individual or general permits. However, EPA does not 
anticipate that permits will be necessary for all phase II dischargers 
in 2001. The Agency is committed to promulgate supplemental rules that 
further consider the scope of the phase II program as well as 
alternative control mechanisms.
    Many commenters made suggestions for the second tier of the phase 
II regulations such as to allow and encourage phase II municipalities 
to join phase I municipalities in the same watershed, standardize 
procedures across the United States, and delegate construction 
permitting to local governments. Such suggestions will be provided to 
the FACA subcommittee and will be taken into consideration when 
developing the subsequent phase II regulations. Commenters also made 
suggestions for representation on the FACA subcommittee. Such 
suggestions are being considered in formulating the subcommittee.

Supporting Documentation

A. Executive Order 12866

    Under Executive Order 12866, the Agency must determine whether the 
regulatory action is ``significant,'' and therefore subject to review 
by the Office of Management and Budget (OMB) and the requirements of 
the Executive Order. The Order defines ``significant regulatory 
action'' as one that is likely to lead to a rule that may:
    (1) Have an annual effect on the economy of $100 million or more, 
or adversely and materially affecting a sector of the economy, 
productivity, competition, jobs, the environment, public health or 
safety, or State, local, or tribal governments or communities;
    (2) Create a serious inconsistency or otherwise interfere with an 
action taken or planned by another agency;
    (3) Materially alter the budgetary impact of entitlements, grants, 
user fees, or loan programs, or the rights and obligations, of 
recipients thereof;
    (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
the Executive Order.
    EPA has determined that this rulemaking significantly reduces the 
current regulatory burden imposed on phase II facilities. The proposed 
rule was submitted to OMB for review. OMB cleared the proposed rule 
with minor changes. Review of this final rule was waived by OMB under 
the provisions of Executive Order 12866.

B. Executive Order 12875

    Under Executive Order 12875, entitled ``Enhancing the 
Intergovernmental Partnership'', issued by the President on October 26, 
1993, the Agency is required to develop an effective process to allow 
elected officials and other representatives of State and Tribal 
governments to provide meaningful and timely input in the development 
of regulatory proposals.
    EPA fully supports this objective and has initiated a consultation 
process with both States and Tribes which will be continued through the 
development of additional phase II rules. Specifically, EPA has 
discussed this action with the representatives of the States, local 
governments, the Agency's American Indian Environmental Office (AIEO), 
and parts of the regulated community.
    The reaction of the States is positive. The States and the 
Association of State and Interstate Water Pollution Control 
Administrators (ASIWPCA) support the approach that is being taken under 
existing law; the States and ASIWPCA also support concurrent changes to 
the law. ASIWPCA has submitted a letter to the Agency dated March 3, 
1995, which is included in the record for this matter. EPA has 
responded to many of ASIWPCA's comments in this preamble.
    The reaction of many municipalities is that they prefer a statutory 
change now to clarify the issue once and for all. Municipalities' 
representatives (National Association of Counties, National League of 
Cities, U.S. Conference of Mayors, and the National Association of 
Flood and Stormwater Management Agencies) have raised many issues to 
the Agency and have submitted a letter dated February 16, 1995, which 
is contained in the record for this matter. The municipalities believe 
that it is inappropriate for EPA to act now when Congress may act on 
this matter, that the action taken by EPA is not in conformance with 
the law, and that EPA did not consult with local officials on this 
matter. EPA has responded to many of the municipalities' concerns in 
this preamble. EPA did consult with various 

[[Page 40234]]
representatives of local governments early in the development of this 
regulation as well as more comprehensively in February 1995.
    This rule was also coordinated with EPA's American Indian 
Environment Office (AIEO). The Office of Water will work through the 
AIEO to provide for a Tribal representative to participate in the FACA 
process.
    EPA believes that it has developed an effective process to obtain 
input from State, Tribal and local governments before issuing this 
rule, as well as receiving comments on the direct final rule and 
accompanying proposed rulemaking, and has met the consultation 
requirements for States, federally recognized Tribes and localities 
under the terms of Executive Order 12875.

C. Paperwork Reduction Act

    The Paperwork Reduction Act, 44 U.S.C. 3501 et seq., is intended to 
minimize the reporting and record-keeping burden on the regulated 
community, as well as to minimize the cost of Federal information 
collection and dissemination. In general, the Act requires that 
information requests and record-keeping requirements affecting ten or 
more non-Federal respondents be approved by the Office of Management 
and Budget.
    EPA's existing information collection request (ICR) entitled 
``Application for NPDES Discharge Permit and Sewage Sludge Management 
Permit'' (OMB Number 2040-0086) contains information that responds to 
this issue for all storm water discharges, including those facilities 
designated into the program under this regulation as causing water 
quality problems. The burden of similar water quality designations, 
utilized under the phase I storm water program, were accounted for in 
the ICR and remain applicable to the designations that may be made 
under this rule. EPA will review and revise the estimates contained in 
this ICR, as appropriate, in its renewal process.

D. Regulatory Flexibility Act

    Under the Regulatory Flexibility Act (RFA), 5 U.S.C. 601 et seq., 
EPA must prepare a Regulatory Flexibility Analysis for regulations 
having a significant impact on a substantial number of small entities. 
The RFA recognizes three kinds of small entities, and defines them as 
follows:
    (1) Small governmental jurisdictions--any government of a district 
with a population of less than 50,000.
    (2) Small business--any business which is independently owned and 
operated and not dominant in its field, as defined by the Small 
Business Administration regulations under the Small Business Act.
    (3) Small organization--any not-for-profit enterprise that is 
independently owned and operated and not dominant in its field.
    EPA has determined that today's rule would not have a significant 
impact on a substantial number of small entities, and that a Regulatory 
Flexibility Analysis therefore is unnecessary. Through today's action 
EPA is benefiting small entities by (1) adopting a common sense 
approach to deal with the issue of storm water phase II requirements, 
(2) providing the ability for the permitting authority to manage for 
results by providing flexibility to deal with storm water phase II 
permitting at this time based on water quality violations or 
significant contribution of pollutants, and (3) clarifying and reducing 
applicable burdens for those facilities currently subject to phase II 
requirements. The rule provides additional time for EPA to work with 
all stakeholders, including small entities, to develop additional phase 
II regulations under a FACA process. The Agency is committed to issue 
these supplemental phase II regulations by March 1, 1999; in that 
rulemaking EPA will reconsider its Regulatory Flexibility Act analysis.

E. Unfunded Mandates

    Under section 202 of the Unfunded Mandates Reform Act of 1995 
(``Unfunded Mandates Act''), signed into law on March 22, 1995, EPA 
must prepare a written statement to accompany proposed rules where the 
estimated costs to State, local, or tribal governments, or to the 
private sector, will be $100 million or more in any one year. Under 
section 205, EPA must select the most cost-effective and least 
burdensome alternative that achieves the objective of such a rule and 
that is consistent with statutory requirements. Section 203 requires 
EPA to establish a plan for informing and advising any small 
governments that may be significantly and uniquely affected by any 
rule.
    EPA estimates that the costs to State, local, or tribal 
governments, or the private sector, from this rule will be less than 
$100 million. This rulemaking significantly reduces the immediate 
regulatory burden imposed on phase II facilities. EPA has determined 
that an unfunded mandates statement therefore is unnecessary.
    Although not required to make a finding under section 206, EPA 
concludes that this rule is cost-effective and a significant reduction 
in burden for State and local governments. In a September 9, 1992, 
Federal Register notice, EPA invited public consideration of and 
comment on reasonable alternative approaches for the phase II storm 
water program. Today's rule provides for the first step for many of 
those alternatives by providing for an orderly process for developing 
supplemental regulations. By establishing regulatory relief until 
development of those alternative approaches, today's rulemaking itself 
provides the most cost-effective and least burdensome alternative to 
achieve the objectives of the rule at this stage, consistent with 
statutory requirements.
    As discussed previously, EPA initiated consultation with 
representative organizations of small governments under Executive Order 
12875. In doing so, EPA provided notice to potentially affected small 
governments to enable them to provide meaningful and timely input. EPA 
plans to inform, educate, and advise small governments on compliance 
with any requirements that may arise in further development of the 
storm water phase II rules.

F. Procedural Requirements and Effective Date

    Today's rule is effective on August 7, 1995. Section 553 of the APA 
provides that the required publication or service of a substantive rule 
shall be made not less than 30 days before its effective date except, 
as relevant here, (1) for a substantive rule which grants or recognizes 
an exemption or relieves a restriction or (2) when the agency finds and 
publishes good cause for foregoing delayed effectiveness. Today's rule 
relieves phase II dischargers from the immediate requirement to obtain 
a permit. Additionally, the Agency has determined that good cause 
exists for making this regulation effective immediately because today's 
final rule does not differ from the withdrawn direct final rule which 
would have become effective on August 7, 1995.

List of Subjects

40 CFR Part 122

    Enviromental protection, Administrative practice and procedure, 
Confidential business information, Hazardous substances, Reporting and 
recordkeeping requirements, Water pollution control. 

[[Page 40235]]


40 CFR Part 124

    Administrative practice and procedure, Air pollution control, 
Hazardous waste, Indian lands, Reporting and recordkeeping 
requirements, Water pollution control, Water supply.

    Dated: July 31, 1995.
Carol M. Browner,
Administrator.

    For the reasons set forth in this preamble, parts 122 and 124 of 
Title 40 of the Code of Federal Regulations are amended as follows:

PART 122--[AMENDED]

    1. The authority citation for part 122 continues to read as 
follows:

    Authority: Clean Water Act, 33 U.S.C. 1251 et seq.

    2. Section 122.21 is amended by adding a sentence to the end of 
paragraph (c)(1) to read as follows:


Sec. 122.21  Application for a permit (applicable to State programs, 
see 123.25).

* * * * *
    (c) Time to apply.
    (1) * * * New discharges composed entirely of storm water, other 
than those dischargers identified by Sec. 122.26(a)(1), shall apply for 
and obtain a permit according to the application requirements in 
Sec. 122.26(g).
    3. Section 122.26(a)(1) is amended as follows:
    a. In paragraph (a)(1) the introductory text is amended by revising 
the date ``October 1, 1992'' to read ``October 1, 1994'';
    b. By adding paragraph (a)(9) as set forth below;
    c. By revising the title of paragraph (e) as set forth below;
    d. In paragraph (e)(1)(ii), by revising the phrase ``permit 
application requirements are reserved'' to read ``permit application 
requirements are contained in paragraph (g) of this section''; and
    e. By adding paragraph (g) as set forth below.


Sec. 122.26  Storm water discharges (applicable to State NPDES 
programs, see Sec. 123.25).

    (a) * * *
    (9) On and after October 1, 1994, dischargers composed entirely of 
storm water, that are not otherwise already required by paragraph 
(a)(1) of this section to obtain a permit, shall be required to apply 
for and obtain a permit according to the application requirements in 
paragraph (g) of this section. The Director may not require a permit 
for discharges of storm water as provided in paragraph (a)(2) of this 
section or agricultural storm water runoff which is exempted from the 
definition of point source at Secs. 122.2 and 122.3.
* * * * *
    (e) Application deadlines under paragraph (a)(1). * * *
* * * * *
    (g) Application requirements for discharges composed entirely of 
storm water under Clean Water Act section 402(p)(6). Any operator of a 
point source required to obtain a permit under paragraph (a)(9) of this 
section shall submit an application in accordance with the following 
requirements.
    (1) Application deadlines. The operator shall submit an application 
in accordance with the following deadlines:
    (i) A discharger which the Director determines to contribute to a 
violation of a water quality standard or is a significant contributor 
of pollutants to waters of the United States shall apply for a permit 
to the Director within 180 days of receipt of notice, unless permission 
for a later date is granted by the Director (see 40 CFR 124.52(c)); or
    (ii) All other dischargers shall apply to the Director no later 
than August 7, 2001.
    (2) Application requirements. The operator shall submit an 
application in accordance with the following requirements, unless 
otherwise modified by the Director:
    (i) Individual application for non-municipal discharges. The 
requirements contained in paragraph (c)(1) of this section.
    (ii) Application requirements for municipal separate storm sewer 
discharges. The requirements contained in paragraph (d) of this 
section.
    (iii) Notice of intent to be covered by a general permit issued by 
the Director. The requirements contained in 40 CFR 122.28(b)(2).

PART 124--[AMENDED]

    4. The authority citation for part 124 continues to read as 
follows:

    Authority: Resource Conservation and Recovery Act, 42 U.S.C. 
3901 et seq.; Safe Drinking Water Act, 42 U.S.C. 300(f) et seq.; 
Clean Water Act, 33 U.S.C. 1251 et seq.; Clean Air Act, 42 U.S.C. 
7401 et seq.

    5. Section 124.52(c) is amended by revising the parenthetical 
statement and the next to the last sentence to read as follows:


Sec. 124.52  Permits required on a case-by-case basis.

* * * * *
    (c) * * * (see 40 CFR 122.26 (a)(1)(v), (c)(1)(v), and (g)(1)(i)) * 
* * The discharger must apply for a permit under 40 CFR 122.26 
(a)(1)(v) and (c)(1)(v) within 60 days of notice or under 40 CFR 
122.26(g)(1)(i) within 180 days of notice, unless permission for a 
later date is granted by the Regional Administrator. * * *

[FR Doc. 95-19191 Filed 8-4-95; 8:45 am]
BILLING CODE 6560-50-P