[Federal Register Volume 61, Number 147 (Tuesday, July 30, 1996)]
[Proposed Rules]
[Pages 39804-39810]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-18658]



[[Page 39803]]


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Part VII





Environmental Protection Agency





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40 CFR Parts 403



Streamlined Procedures for Modifying Approved Publicly Owned Treatment 
Works Pretreatment Programs; Proposed Rule

  Federal Register / Vol. 61, No. 147 / Tuesday, July 30, 1996 / 
Proposed Rules  

[[Page 39804]]



ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 403

[FRL-5541-4]
RIN 2040-AC57


Streamlined Procedures for Modifying Approved Publicly Owned 
Treatment Works Pretreatment Programs

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: EPA is today proposing to revise the procedures for modifying 
the requirements of approved Publicly Owned Treatment Works (POTW) 
Pretreatment Programs incorporated into National Pollutant Discharge 
Elimination System (NPDES) permits issued to POTWs. The new regulations 
are designed to reduce the administrative burden and cost associated 
with maintaining approved pretreatment programs without affecting 
environmental protection.

DATES: Written comments on this proposed rule must be submitted on or 
before September 30, 1996. Comments provided electronically will be 
considered timely if they are submitted electronically by 11:59 P.M. 
(Eastern time) September 30, 1996.

ADDRESSES: Commenters are requested to submit three copies of their 
comments to the Comment Clerk for the Pretreatment Program Amendments; 
Water Docket; MC-4101, Environmental Protection Agency, 401 M Street, 
S.W., Washington, D.C. 20460. Commenters who would like acknowledgment 
of receipt of their comments should include a self-addressed, stamped 
envelope. No facsimiles (faxes) will be accepted.
    EPA will also accept comments electronically. Comments should be 
addressed to the following Internet address: [email protected].
    This document has also been placed on the Internet for public 
review and downloading at the following location: gopher.epa.gov.
    The public may inspect the administrative record for this 
rulemaking at EPA's Water Docket, 401 M Street, S.W., Washington, D.C. 
20460, Room L-102 between the hours of 9 a.m. and 3:30 p.m. on business 
days. For access to docket materials, please call (202) 260-3027 for an 
appointment during the aforementioned hours. A reasonable fee will be 
charged for copying.

FOR FURTHER INFORMATION CONTACT: Louis Eby, EPA, Office of Wastewater 
Management (OWM), Permits Division (4203), 401 M Street, S.W., 
Washington, D.C. 20460, (202) 260-6814.

SUPPLEMENTARY INFORMATION:

Electronic Submission of Comments

    As EPA is experimenting with electronic commenting, commenters may 
want to submit both electronic comments and duplicate paper comments. 
Electronic comments must be submitted as an ASCII file avoiding the use 
of special characters and any form of encryption. Electronic comments 
will be transferred into a paper version for the official record. EPA 
will attempt to clarify electronic comments if there is an apparent 
error in transmission.

Regulated Entities

    Entities potentially regulated by this action are governmental 
entities responsible for implementation of the National Pretreatment 
Program. Regulated entities include:

------------------------------------------------------------------------
                                                Examples of regulated   
                 Category                             entities          
------------------------------------------------------------------------
Local government..........................  Publicly Owned Treatment    
                                             Works with Approved        
                                             Pretreatment programs.     
State government..........................  States that act as          
                                             Pretreatment Program       
                                             Approval Authorities.      
Federal government........................  EPA Regional Offices that   
                                             act as Pretreatment Program
                                             Approval Authorities.      
------------------------------------------------------------------------

    This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be regulated by this 
action. This table lists the types of entities that EPA is now aware 
could potentially be regulated by this action. Other types of entities 
not listed in the table could also be regulated. To determine whether 
your organization is regulated by this action, you should carefully 
examine the applicability criteria in Sec. 403.18 and other applicable 
criteria in Part 403 of title 40 of the Code of Federal Regulations. If 
you have questions regarding the applicability of this action to a 
particular entity, consult the person listed in the preceding FOR 
FURTHER INFORMATION CONTACT section.
    Information in this preamble is organized as follows:

I. Background
    A. Existing Approved POTW Pretreatment Program Requirements
    B. Existing Sec. 403.18 Program Modification Requirements
    C. Concerns With Existing Procedures
    D. EPA Straw Proposal
II. Description of Proposed Rule
    A. Types of Modifications Considered Substantial
    B. Public Notice Procedures for Substantial Modifications
    C. Procedures for Non-substantial Modifications
    D. Time for Review of Non-substantial Modifications
    E. Changes to Industrial User Inventory
III. Regulatory Requirements
    A. Executive Order 12866
    B. Executive Order 12875
    C. Regulatory Flexibility Act
    D. Paperwork Reduction Act
    E. Unfunded Mandates Reform Act

I. Background

    EPA is today proposing to simplify the process for modifying the 
pretreatment program requirements included in POTW NPDES permits 
pursuant to Clean Water Act (CWA) sections 307 and 402 and 40 CFR Part 
403.

A. Existing Approved POTW Pretreatment Program Requirements

    POTWs that meet certain requirements must develop pretreatment 
programs to control industrial discharges into their sewage systems. 
CWA section 402(b)(8); 40 CFR 403.8(a). EPA or the State (in States 
approved by EPA to act as the pretreatment program ``Approval 
Authority'') must approve the POTW's pretreatment program request 
according to the procedures in 40 CFR 403.11.
    Regulations at 40 CFR 403.8 and 403.9 describe the substantive 
content of and documentation required for the POTW's pretreatment 
program submission. Under 40 CFR 403.8(f), the POTW pretreatment 
program submission must reflect specified legal authorities, compliance 
assurance procedures, adequate funding, a local limit development 
demonstration, an enforcement response plan (ERP), and a list of 
significant industrial users. The entire approved pretreatment program 
is then incorporated as an enforceable condition of the POTW's NPDES 
permit. 40 CFR 122.44(j)(2) and 403.8(c). Under CWA sec. 402(j) and 40 
CFR 403.11(f) and 403.14(c), the Approval Authority must ensure that 
the approved pretreatment program documentation is available to the 
public for inspection and copying.

B. Existing Sec. 403.18 Program Modification Requirements

    Regulations at 40 CFR 403.18 specify the procedures used to modify 
approved POTW programs. EPA promulgated

[[Page 39805]]

those procedures on October 17, 1988. 53 FR 40562, 40615. Section 
403.18(a) requires the POTW to follow program modification procedures 
whenever there is a ``significant change'' in the approved POTW 
pretreatment program. Section 403.18(b) outlines specific procedures 
for Approval Authority review and approval of ``substantial program 
modifications'' and other non-substantial program modifications. 
Section 403.18(c) contains a list of nine changes which are 
``substantial program modifications'' and gives the Approval Authority 
power to designate other modifications as substantial modifications. 
The nine specified substantial program modifications in the existing 
regulations are: (1) Changes to legal authorities, (2) changes 
resulting in less stringent local limits, (3) changes to the POTW's 
mechanism to control significant industrial users, (4) changes in the 
POTW's method for implementing categorical pretreatment standards, (5) 
decreases in the frequency of industrial user self monitoring or 
reporting, (6) decreases in the frequency of the POTW's inspection or 
sampling of the industrial user, (7) changes to the POTW's 
confidentiality procedures, (8) significant reduction in the POTW's 
resources, and (9) changes in the POTW's sewage sludge disposal and 
management practices.
    Section 403.18(b)(1) describes the procedure for Approval Authority 
approval of ``substantial program modifications.'' Under this section, 
the POTW submits specified documents; the Approval Authority uses the 
procedures in 40 CFR 403.11(b) through (f) to approve or disapprove the 
modification; and the approved modification is incorporated into the 
POTW's permit as a minor permit modification under 40 CFR 122.63(g).
    The procedures in 40 CFR 403.11(b) through (f) are the same 
procedures the Approval Authority uses to approve the POTW's original 
pretreatment program submission. Under these procedures, the Approval 
Authority determines whether the submission is complete, issues public 
notice of the complete request for substantial program modification, 
approves or denies the submission within 90 days, and publishes notice 
of approval or disapproval.
    To provide notice of the request for approval, the Approval 
Authority mails notices to specified individuals, publishes notice of 
the request in the largest daily newspaper within the jurisdiction 
served by the POTW, provides a 30-day public comment period, provides 
an opportunity to request a public hearing, and holds a public hearing 
at the POTW's request or if there is significant public interest in 
doing so. 40 CFR 403.11(b)(1). To provide notice of the approval or 
disapproval decision, the Approval Authority notifies all persons who 
submitted comments or participated in the public hearing if held, and 
publishes notice in the same newspaper as the original notice of 
request for approval was published. 40 CFR 403.11(e).
    Under the existing Sec. 403.18(b)(2) procedures for approval of 
non-substantial program modifications, the POTW must notify the 
Approval Authority at least 30 days prior to implementation of a non-
substantial modification. The modification is considered approved 
unless the Approval Authority decides within 90 days that the change is 
substantial and initiates the procedures for approval of substantial 
program modifications. Once again, the approved non-substantial change 
is incorporated into the NPDES permit as a minor permit modification 
under 40 CFR 122.63(g).
    The Agency pursued several goals in promulgating Sec. 403.18. One 
was to assure consistency with federal pretreatment requirements by 
requiring Approval Authorities to review ``substantial modifications'' 
and by providing opportunity for public comment. A second was to assure 
that changes are considered part of the Approved Pretreatment Program 
and, therefore, are enforceable. Under CWA section 309, EPA may enforce 
any requirement imposed in an approved pretreatment program.

C. Concerns With Existing Procedures

    The existing procedures have created problems and raised concerns 
among Approval Authorities, POTWs, and industrial users. Concerns have 
been raised about the requirement for Approval Authorities to publish 
notice of the request to approve a modification and then a second 
notice of its approval. As described above, these notices are required 
to be in the largest daily newspaper within the jurisdiction served by 
the POTW and can be expensive. The notices have generally elicited 
little or no public comment.
    It has been EPA's experience that interested parties with relevant 
comments were generally already aware of, and involved in, the 
modification process at the local level. Thus, the required Approval 
Authority notices frequently duplicate notice that has already been 
given by POTWs. By the time modifications are forwarded to Approval 
Authorities for review, issues have generally been worked out at the 
local level. While notice given by POTWs may not be the same in every 
respect as that required by Sec. 403.18, EPA has little evidence that 
the Sec. 403.18 notices have resulted in a corresponding benefit.
    The existing approval process also places a resource burden on many 
Approval Authorities. Some Approval Authorities have experienced a 
backlog of program modifications awaiting review. POTWs may be 
reluctant to implement the submitted modifications until the 
modifications are incorporated into the POTW's NPDES permit.
    When program modifications have not been processed by the Approval 
Authority, there is also uncertainty about the requirements to which 
industrial dischargers are subject under federal law. As noted 
previously, EPA may enforce against industrial users any requirement 
included in an approved pretreatment program. The industrial user could 
be subject to state or federal enforcement action for the ``old'' 
requirements that are still part of the approved pretreatment program, 
while also being subject to enforcement by POTWs for ``new'' 
requirements that the POTW has implemented prior to processing by the 
Approval Authority. Modifications that result in new or more stringent 
local limits on industrial users that are developed pursuant to 40 CFR 
403.5(c) are immediately enforceable against the industrial users under 
40 CFR 403.5(d) regardless of whether 40 CFR 403.18 modification 
procedures have been commenced or completed.
    Today's proposal is intended to address these problems. The new 
procedures will expedite POTW implementation of many program changes, 
while providing for review and approval of modifications that relax the 
POTW's approved program.

D. EPA Straw Proposal

    EPA solicited preliminary input on a ``straw proposal'' from 
various stakeholders, including States, POTWs, trade associations and 
environmental groups. Today's proposals are an outgrowth of that 
process.
    The straw proposal would have streamlined the program modification 
process by taking most pretreatment program requirements out of POTW 
NPDES permits. Under the straw proposal, only the POTW's legal 
authority, local limits and Enforcement Response Plan would have been 
specifically identified in the POTW's permit.
    Other program requirements would have been incorporated by general 
reference to the pretreatment regulations in 40 CFR Part 403. The straw 
proposal would have required the POTW to

[[Page 39806]]

maintain a publicly available up-to-date Program Description of what it 
was doing to satisfy Part 403 rather than to submit modified program 
descriptions to the Approval Authority as is currently required. 
Several commenters objected strongly to the program description 
requirement.

II. Description of Proposed Rule

    While structured similar to the straw proposal, today's proposal 
would not remove the Approved Program from the POTW's NPDES permit and 
would not require the program description discussed above. Today's 
proposal addresses the concern that the Approved Program needs to 
remain in the permit because Part 403 standing alone may not be 
sufficiently specific to create objective, enforceable requirements 
that could be directly implemented by (and enforced against) the POTW 
as a permit condition. EPA is interested in comments on how it might 
implement the pretreatment regulations directly without the need to 
incorporate the entire Approved Programs in POTW permits. EPA is 
particularly interested in comments on how the regulations might be 
clarified or made more specific so that they could be directly 
implemented by and enforced against POTWs.
    Today's proposal would revise 40 CFR Part 403 in three ways: (1) 
The number of changes that are considered substantial modifications 
would be reduced; (2) substantial modifications could be implemented 
after one public notice in certain circumstances, provided that no 
substantive comments are received on the notice; and (3) the period of 
notice that POTWs must provide of non-substantial modifications and the 
time for review by Approval Authorities will both be 45 days. EPA is 
also soliciting comment on additional revisions. These proposals and 
alternatives are discussed below.

A. Types of Modifications Considered Substantial

    Under today's proposal, only modifications to the POTW's 
pretreatment program legal authority and local limits that relax the 
requirements applicable to industrial users in the POTW's existing 
approved program would continue to be processed as substantial 
modifications. This means that only for these modifications would 
Approval Authorities be required to follow the detailed public notice 
procedures of 40 CFR 403.11, prior to Approval Authority action on the 
proposed modification.
    EPA believes that the POTW's legal authority and local limits are 
the local pretreatment program elements of greatest interest because 
they are the federal requirements with which the industrial users of 
the POTW must comply. EPA is proposing that only changes that relax 
those requirements be subject to substantial modification procedures, 
because changes that are more stringent than the POTW's current permit 
requires do not require an immediate change to the POTW's permit and 
requiring public notice procedures might delay their implementation.
    To put this concept in perspective, it is important to understand 
that a POTW is always free to do more than is required by the Approved 
Pretreatment Program in its NPDES permit. Subject to any constraints of 
local law and the notice requirements of 40 CFR 403.5, it is free to 
impose more restrictive requirements on its industrial users. However, 
if a POTW modifies its legal authority or local limits so as to relax 
the requirements applicable to its industrial users, the modification 
would be considered substantial and subject to the corresponding 
approval procedures.
    Although most modifications that relax legal authority and local 
limits would continue to be substantial modifications, EPA is further 
proposing that three subsets of these categories be considered non-
substantial modifications. The first are changes to POTW legal 
authority that are less prescriptive but which directly reflect a 
revision to the federal pretreatment regulations (e.g., when the 
federal regulations are streamlined). These modifications would have 
already undergone public notice and comment when promulgated by EPA.
    The second category that EPA proposes be treated as non substantial 
modifications are revisions to local limits for the conventional 
pollutant pH down to the minimum of 5.0 specified in 40 CFR 403.5(b). 
Approval Authorities have generally not found grounds to object to 
POTWs changing their minimum pH limit to equal the federal minimum.
    The third category is modifications to local limits resulting from 
reallocations of the Maximum Allowable Industrial Loading (MAIL) for a 
given pollutant that do not increase the total MAIL for that pollutant. 
Some POTWs' local limits are expressed in terms of a MAIL for a 
pollutant, which is then allocated to individual industrial users as 
limits on the total mass of the pollutant that each user may discharge. 
Those mass limits are placed in the industrial users' permits or other 
individual control mechanisms and are enforceable under 40 CFR 
403.5(d). Under today's proposal, those POTWs could reallocate the MAIL 
to individual industrial users without seeking approval as long as the 
MAIL is not increased.
    Under today's proposal, therefore, a modification to a local limit 
would be a substantial modification only when it increases the 
pollutant loadings that industrial users are allowed to discharge to 
the POTW. This could be an increase in a concentration limit applicable 
to all industrial users, or an increase in the MAIL for a pollutant. 
When POTWs allocate the MAIL to individual industrial users, they 
generally maintain a safety factor so that new industrial users coming 
on line can be given a mass allocation out of the existing MAIL. Such 
an allocation to a new industrial user would not constitute a 
substantial modification. Today's rule would specify that a 
reallocation of an existing MAIL would not be a substantial 
modification. Only where the total mass of a pollutant that industrial 
users could be authorized to discharge is increased would the 
modification be considered substantial.
    Although today's proposal would authorize changes to Enforcement 
Response Plans (ERPs) to be processed as non-substantial modifications, 
the Agency is particularly interested in comment on this issue. EPA is 
also generally interested in comments on whether fewer or more 
categories of modifications should be processed as substantial 
modifications.

B. Public Notice Procedures for Substantial Modifications

    Section 403.18(b)(1) currently requires the issuance of one public 
notice of a proposed modification and a second public notice once the 
modification is approved. Both notices must comply with the procedures 
in Sec. 403.11 (b)-(f). Under today's proposed Sec. 403.18(b)(2), 
however, the Approval Authority would not need to publish a second 
notice of decision if the following conditions were met: (1) The first 
notice states that the modification will be approved without further 
notice if no comments are received; (2) the Approval Authority receives 
no substantive comments on that notice; and (3) the modification 
request is approved without change. EPA believes that, in such 
circumstances, the original request for approval would also serve as 
the ``notice of approval or disapproval'' required by Sec. 403.11(e). 
This provision would relieve the Approval Authority of the obligation 
to publish a second notice of approval in circumstances where it is 
clearly unnecessary.
    EPA issued guidance on the implementation of 40 CFR 403.18 in a 
Memorandum dated July 22, 1993, from

[[Page 39807]]

Cynthia Dougherty, then Director of the Permits Division in the Office 
of Wastewater Management. That guidance stated that modifications could 
be adopted without the second notice in the above described 
circumstances. Today's proposal would codify that guidance.
    The EPA guidance also suggested that Approval Authorities could 
consider local notice by the POTW to be adequate notice of receipt of 
request for approval and notice of decision under Sec. 403.11 (b)-(f). 
EPA is not proposing any regulatory changes covering local notice 
because the Agency continues to believe this option is available under 
the existing regulations.
    Approval Authorities are ultimately responsible for publishing the 
notice. EPA does not require POTWs to provide the notices. Today's 
proposal would leave POTWs and Approval Authorities free to negotiate 
arrangements for the publication of the required notice. In the absence 
of voluntary adequate notice by the POTW, the Approval Authority would 
still be required to provide the notice.
    In order for a local POTW public notice to eliminate the need for 
an Approval Authority notice, the local notice must meet the 
requirements of Sec. 403.11(b)(1). EPA is interested in receiving 
public comment on the sufficiency of this approach as well as any other 
comment concerning whether it is appropriate to consider local notice 
sufficient to satisfy the requirements of Sec. 403.11.
    EPA would appreciate comment on other ways that the Sec. 403.11 
procedures may be made more appropriate for pretreatment program 
modifications. In particular, EPA solicits comments on the 
appropriateness of the detailed public notice procedures in 
Sec. 403.11(b)(1).

C. Procedures for Non-substantial Modifications

    As a consequence of reducing the number of substantial 
modifications, today's proposal would expand the category of non-
substantial modifications. Under the existing regulation, non-
substantial modifications are deemed approved unless, within 90 days 
from their submission, the Approval Authority decides to review them as 
substantial modifications. Under today's proposal, non-substantial 
modifications would not be deemed approved but would require 
affirmative approval by the Approval Authority. The proposal would not 
require the Approval Authority to comply with any specific public 
notice procedures prior to approving or disapproving a non-substantial 
modification.
    EPA is soliciting comment on whether specific public notice 
requirements should be required for non-substantial modifications. For 
example, evidence of notice by the POTW might be required. Regardless 
of the public notice provided at the time of the modification, the 
public could still challenge an inadequate program when the POTW's 
NPDES permit is proposed for renewal. One commenter has suggested that 
the public should be educated as to the importance of Pretreatment 
Program requirements, so that public input will occur in response to 
notice of program modifications. EPA is interested in receiving 
comments on how this could be accomplished.
    EPA is also soliciting comment on whether some modifications should 
be reported retroactively by the POTW to the Approval Authority in the 
POTW's annual report rather than in advance. Modifications that would 
not need to be submitted in advance might include, for example, 
modifications that do not result in the POTW doing less than its 
existing NPDES permit specifically requires.

D. Time for Review of Non-substantial Modifications

    Under today's proposal, the time period for submittal of non-
substantial program modifications to the Approval Authority prior to 
implementation would be extended from 30 to 45 days. The Approval 
Authority would be directed to notify the POTW within this 45-day 
period of its decision to approve or disapprove the modification, 
rather than the 90 days currently allowed under existing 
Sec. 403.18(b)(2).
    EPA is proposing this change in response to comments that the 
existing procedure for submittal of non-substantial program changes can 
be disruptive to approved pretreatment program operations. Because the 
Approval Authority has a longer period of time in which to decide 
whether to initiate substantial modification procedures, POTWs have 
chosen to wait until the 91st day to implement the change to avoid the 
risk that the Approval Authority may seek review of a change the POTW 
considered non-substantial. To avoid these results, EPA proposes to 
require the Approval Authority to approve or disapprove a proposed non-
substantial modification within the same 45 day period of time the POTW 
must wait to implement the program change.
    EPA solicits comment on the issue of whether non-substantial 
modifications should continue to be deemed approved if not disapproved 
within 45 days. Under the existing regulations, non-substantial 
modifications submitted by the POTW are deemed approved unless the 
Approval Authority disapproves them within the specified time. 40 CFR 
403.18(b)(2). Because the proposed list of non-substantial 
modifications includes categories that were previously considered 
substantial, it might not be appropriate for them to be deemed approved 
if the Approval Authority does not act upon them.
    In the alternative, only certain categories of non-substantial 
modifications could be deemed approved if not disapproved by the 
Approval Authority within 45 days. For example, decreases in frequency 
of industrial self-monitoring and reporting, and decreases in the 
frequency of industrial user inspections and sampling could be 
implemented only after they are actually approved by the Approval 
Authority. Other modifications could be implemented after 45 days if 
the Approval Authority does not respond. (This approach, however, would 
not change any applicable public notice requirements of local law 
otherwise applicable to the POTW.)

E. Changes to Industrial User Inventory

    EPA is proposing today to allow POTWs to submit changes to their 
industrial user inventory at the time they submit their Annual Report. 
Current regulations require that such changes be submitted as non-
substantial modifications, and also require that the industrial user 
inventory be updated in the POTW's Annual Report to the Approval 
Authority.
    EPA believes that it is appropriate to eliminate the double 
reporting currently required by the regulation. There is little value 
in requiring Approval Authorities to approve changes to SIU 
designations in advance. All industrial users that are subject to 
national categorical pretreatment standards currently must be 
designated as Significant Industrial Users (SIUs), so there is no 
flexibility in such designations. On the other hand, POTWs already have 
considerable flexibility in designating non-categorical industrial 
users as SIUs, and should be able to exercise that flexibility without 
receiving prior approval. Moreover, most requirements relative to POTW 
regulation of SIUs are annual requirements, so Approval Authorities 
should be able to provide adequate oversight even if notification of 
the changes to the IU inventory is not immediate. EPA invites comment 
on this approach.

[[Page 39808]]

III. Regulatory Requirements

A. Executive Order 12866

    Under Executive Order 12866 [58 FR 51735 (October 4, 1993)], 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 result in a 
rule that may:
    (1) Have an annual effect on the economy of $100 million or more or 
adversely affect in a material way the economy, 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; or
    (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.''
    It has been determined that this rule is not a ``significant 
regulatory action'' under the terms of Executive Order 12866 and is 
therefore not subject to OMB review.

B. Executive Order 12875

    Under Executive Order 12875 [58 FR 58093 (October 28, 1993)], 
entitled ``Enhancing the Intergovernmental Partnership,'' the Agency is 
required to develop an effective process to permit elected officials 
and other representatives of State, local, and tribal governments to 
provide meaningful and timely input in the development of regulatory 
proposals.
    EPA sought the involvement of those persons who are intended to 
benefit from or expected to be burdened by this proposal before issuing 
a notice of proposed rulemaking. Following informal consultation, in 
May 1994, EPA circulated a draft proposal to interested persons, 
including States, POTWs and organizations. EPA received approximately 
20 comments, which have been addressed in today's rule. Several 
presentations outlining possible revisions to the pretreatment 
regulations were made to a number of stakeholder groups, including 
Regional, State and POTW personnel. These groups were encouraged to 
provide formal input to the proposed regulatory streamlining process. 
In addition, notice of the availability of the draft proposal for 
review and comment was provided in the September, 1994 issue of the 
``Water Environment & Technology,'' the principal publication of the 
Water Environment Federation. Copies of all comments received, relating 
to this rulemaking, will be included in the docket to the proposed 
rule.

C. Regulatory Flexibility Act

    Under the Regulatory Flexibility Act (RFA), 5 U.S.C. 601 et seq., 
EPA must prepare a Regulatory Flexibility Analysis for all regulations 
that have a significant impact on a substantial number of small 
entities. The RFA recognizes three kinds of small entities and defines 
them as follows:

--Small governmental jurisdictions--any government of a district with a 
population of less than 50,000.
--Small business--any business which is independently owned and 
operated and not dominant in its field as defined by Small Business 
Administration regulations under section 3 of the Small Business Act.
--Small organization--any not-for-profit enterprise that is 
independently owned and operated and not dominant in its field (e.g., 
private hospitals and educational institutions).

    Under section 605(b) of the Act, if an agency can certify that a 
rule will not have a ``significant impact on a substantial number of 
small entities,'' then no further analysis under the Act is required.
    The only ``small entity,'' as defined under the Regulatory 
Flexibility Act (RFA), potentially affected by the proposed rulemaking 
would be a small governmental jurisdiction having a population of less 
than 50,000. Most POTWs with Approved Pretreatment Programs serve 
communities with populations greater than 50,000 citizens. There is no 
known negative impact that will be imposed by this rulemaking on any 
small communities and their subordinate POTWs. Therefore, I certify 
that this rule, if promulgated, will not have a significant economic 
impact on a substantial number of small entities.

D. Paperwork Reduction Act

    The proposed regulations are designed specifically to streamline 
the regulatory process and will not impose any additional information 
collection requirements on either the Approval Authorities or the 
POTWs. Therefore, EPA did not prepare an Information Request document 
for approval by the Office of Management and Budget.
    Should any reviewers feel that the proposed rulemaking will require 
additional information collection activities, they should send their 
comments regarding the burden estimate or any other aspect pertaining 
to collection of information, including suggestions for reducing this 
burden to Director, Regulatory Information Division; EPA; 401 M St., 
S.W. (Mail Code 2137); Washington, DC 20460; and to the Office of 
Information and Regulatory Affairs, Office of Management and Budget, 
Washington, DC 20503, marked ``Attention: Desk Officer for EPA.'' The 
final rule will respond to any OMB or public comments on any 
information collection requirements generated by this proposal.

E. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), P.L. 
104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under section 202 of the UMRA, EPA 
generally must prepare a written statement, including a cost-benefit 
analysis, for proposed and final rules with ``Federal mandates'' that 
may result in expenditures to State, local, and tribal governments, in 
the aggregate, or to the private sector, of $100 million or more in any 
one year. Before promulgating an EPA rule for which a written statement 
is needed, section 205 of the UMRA generally requires EPA to identify 
and consider a reasonable number of regulatory alternatives and adopt 
the least costly, most cost-effective or least burdensome alternative 
that achieves the objectives of the rule. The provisions of section 205 
do not apply when they are inconsistent with applicable law. Moreover, 
section 205 allows EPA to adopt an alternative other than the least 
costly, most cost-effective or least burdensome alternative if the 
Administrator publishes with the final rule an explanation why that 
alternative was not adopted. Before EPA establishes any regulatory 
requirements that may significantly or uniquely affect small 
governments, including tribal governments, it must have developed under 
section 203 of the UMRA a small government agency plan. The plan must 
provide for notifying potentially affected small governments, enabling 
officials of affected small governments to have meaningful and timely 
input in the development of EPA regulatory proposals with significant 
Federal intergovernmental mandates, and informing, educating, and 
advising small governments on compliance with the regulatory 
requirements.

[[Page 39809]]

    Today's rule contains no Federal mandates (under the regulatory 
provisions of Title II of the UMRA) for State, local, or tribal 
governments or the private sector. The proposed rulemaking is basically 
``deregulatory'' in nature and does not impose any additional burdens 
on the affected State, local or tribal governments. As the preceding 
preamble language clearly demonstrates, EPA actively is soliciting 
comments on any and all alternatives to the proposed changes in the 
regulations governing modification of a POTW's pretreatment program. To 
the extent enforceable duties arise as a result of today's proposed 
rule, such enforceable duties do not result in a significant regulatory 
action being imposed upon governmental entities or the private sector.
    EPA has determined that this rule contains no regulatory 
requirements that might significantly or uniquely affect small 
governments. As previously stated, EPA believes that the rule will 
reduce the regulatory burden on all governmental agencies operating 
POTWs. This overall reduction will be applied across the board to all 
POTWs, with attendant benefits being provided to both large and small 
governments. Although EPA can not document the effects for each and 
every POTW, smaller governments may benefit the most from the proposed 
modifications as the avoided compliance costs attendant with modifying 
their programs may be a larger percent of their total operating budget 
than those costs borne by the larger POTWs.
    In compliance with E.O. 12875 and section 203 of the UMRA, EPA 
conducted a wide outreach effort and actively sought the input of 
representatives of state, local and tribal governments in the process 
of developing the proposed regulation. Agency personnel have 
communicated with State and local representatives in a number of 
different forums.
    This proposed rule will provide flexibility to the regulated 
community. It does not impose any new requirements so costs to the 
regulated community should remain unchanged or be minimal. Therefore, 
EPA has determined that an unfunded mandates statement is unnecessary.

List of Subjects in 40 CFR Part 403

    Environmental protection, Confidential business information, 
Reporting and recordkeeping requirements, Waste treatment and disposal, 
Water pollution control.

    Dated: July 16, 1996.
Fred Hansen,
Acting Administrator.

    For the reasons set out in the preamble, chapter I of title 40 of 
the Code of Federal Regulations is proposed to be amended as follows:

PART 403--GENERAL PRETREATMENT REGULATIONS FOR EXISTING AND NEW 
SOURCES OF POLLUTION

    1. The authority citation for part 403 continues to read as 
follows:

    Authority: Sec. 54(c)(2) of the Clean Water Act of 1977, (Pub. 
L. 95-217) sections 204(b)(1)(C), 208(b)(2)(C)(iii), 
301(b)(1)(A)(ii), 301(b)(2)(A)(ii), 301(b)(2)(C), 301(h)(5), 
301(I)(2), 304(e), 304(g), 307, 308, 309, 402(b), 405, and 501(a) of 
the Federal Water Pollution Control Act (Pub. L. 92-500) as amended 
by the Clean Water Act of 1977 and the Water Quality Act of 1987 
(Pub. L. 100-4).
    2. Section 403.3 is amended by redesignating paragraphs (j) through 
(u) as paragraphs (k) through (v) and by adding a new paragraph (j) to 
read as follows:


Sec. 403.3  Definitions.

* * * * *
    (j) The term Maximum Allowable Industrial Load means the total mass 
of a pollutant that all industrial users of a POTW may discharge 
pursuant to a limit developed under Sec. 403.5(c).
* * * * *
    2a. In addition Sec. 403.3 is amended in newly designated paragraph 
(u)(1) introductory text by removing the reference ``(t)(2)'' and 
adding in its place ``(u)(2)''; and in newly designated paragraph 
(l)(2) by removing the references ``(k)(1)(ii), or (k)(1)(iii)'' and 
adding in its place ``(l)(1) (i) or (iii)''; and in newly designated 
paragraph (u)(2) by removing the reference ``(t)(1)(ii)'' and adding in 
its place ``(u)(1)(ii)''.
    3. Section 403.8 is amended by revising paragraphs (c) and (f)(6) 
to read as follows:


Sec. 403.8  Pretreatment Program Requirements: Development and 
Implementation by POTW.

* * * * *
    (c) Incorporation of approved programs in permits. A POTW may 
develop an appropriate POTW Pretreatment Program any time before the 
time limit set forth in paragraph (b) of this section. The POTW's NPDES 
Permit will be reissued or modified by the NPDES State or EPA to 
incorporate the approved Program as enforceable conditions of the 
Permit. The modification of a POTW's NPDES Permit for the purposes of 
incorporating a POTW Pretreatment Program approved in accordance with 
the procedures in Sec. 403.11 shall be deemed a minor Permit 
modification subject to the procedures in 40 CFR 122.63.
* * * * *
    (f) * * *
    (6) The POTW shall prepare a list of its industrial users meeting 
the criteria in Sec. 403.3(u)(1). The list shall identify the criteria 
in Sec. 403.3(u)(1) applicable to each industrial user and, for 
industrial users meeting the criteria in Sec. 403.3(u)(1)(ii), shall 
also indicate whether the POTW has made a determination pursuant to 
Sec. 403.3(u)(2) that such industrial user should not be considered a 
significant industrial user. The initial list shall be submitted to the 
Approval Authority pursuant to Sec. 403.9 or as a non-substantial 
modification pursuant to Sec. 403.18(b)(2). Modifications to the list 
shall be submitted to the Approval Authority pursuant to 
Sec. 403.12(i)(1).
* * * * *
    4. Section 403.12 is amended by redesignating paragraph (i)(4) as 
paragraph (i)(5), revising paragraph (i)(3), and adding a new paragraph 
(i)(4) to read as follows:


Sec. 403.12  Reporting requirements for POTW's and industrial users.

* * * * *
    (i) * * *
    (3) A summary of compliance and enforcement activities (including 
inspections) conducted by the POTW during the reporting period;
    (4) A summary of changes to the POTW's pretreatment program that 
have not been previously reported to the Approval Authority; and
* * * * *
    5. Section 403.18 is revised to read as follows:


Sec. 403.18  Modification of POTW Pretreatment Programs.

    (a) General. Either the Approval Authority or a POTW with an 
approved POTW Pretreatment Program may initiate program modification at 
any time to reflect changing conditions at the POTW. Program 
modification is necessary whenever there is a significant change in the 
operation of a POTW Pretreatment Program that differs from the 
information in the POTW's submission, as approved under Sec. 403.11.
    (b) Approval procedures. POTW Pretreatment Program modifications 
shall be accomplished as follows:
    (1) Substantial modifications. (i) Substantial modifications mean:
    (A) Modifications that relax POTW legal authorities (as described 
in

[[Page 39810]]

Sec. 403.8(f)(1)), except for modifications that directly reflect a 
revision to this part 403 and are reported pursuant to paragraph (b)(2) 
of this section; or
    (B) Modifications that relax local limits, except for the 
following, which are reported pursuant to pargraph (b)(2) of this 
section: Modifications to local limits for pH, and reallocations of the 
Maximum Available Industrial Loading of a pollutant that do not 
increase the total headworks loadings for the pollutant.
    (ii) For substantial modifications:
    (A) The POTW shall submit to the Approval Authority a statement of 
the basis for the desired program modification, a modified program 
description (see Sec. 403.9(b)), or such other documents the Approval 
Authority determines to be necessary under the circumstances.
    (B) The Approval Authority shall approve or disapprove the 
Modification based on the requirements of Sec. 403.8(f) and using the 
procedures in Sec. 403.11(b) through (f), except as provided in 
paragraph (b)(1)(ii)(C) of this section.
    (C) The Approval Authority need not publish a notice of decision 
under Sec. 403.11(e) provided: The notice of request for approval under 
Sec. 403.11(b)(1) states that the request will be approved if no 
comments are received by a specified date notice; no substantive 
comments are received; and the request is approved without change.
    (2) Non-substantial modifications. (i) Non-substantial 
modifications mean:
    (A) Modifications to legal authorities as described in 
Sec. 403.9(f)(1)) not subject to paragraph (b)(1)(i)(A) of this 
section;
    (B) Modifications to local limits not subject to paragraph 
(b)(1)(i)(B) of this section;
    (C) Modifications to the POTW's control mechanism (as described in 
Sec. 403.8(f)(l)(iii));
    (D) Modifications to the POTW's Enforcement Response Plan;
    (E) A decrease in the frequency of self-monitoring or reporting 
required of industrial users;
    (F) A decrease in the frequency of industrial user inspections or 
sampling by the POTW;
    (G) Modifications to the POTW's confidentiality procedures;
    (H) Significant reductions in the POTW's Pretreatment Program 
resources (including personnel commitments, equipment, and funding 
levels);
    (I) Changes in the POTW's sludge disposal and management practices; 
and
    (J) Any other modifications not specified in paragraph (b)(1) of 
this section that would result in the POTW not being in compliance with 
its Approved Program.
    (ii) For non-substantial modifications:
    (A) The POTW shall notify the Approval Authority of the non-
substantial modification at least 45 days prior to implementation by 
the POTW, in a statement similar to that provided for in paragraph 
(b)(1)(ii)(A) of this section.
    (B) Within 45 days after the submission of the POTW's statement, 
the Approval Authority shall notify the POTW of its decision to approve 
or disapprove the non-substantial modification.
    (3) All modifications shall be incorporated into the POTW's NPDES 
permit upon approval. The permit will be modified to incorporate the 
approved modification in accordance with 40 CFR 122.63(g).

[FR Doc. 96-18658 Filed 7-29-96; 8:45 am]
BILLING CODE 6560-50-P