[Federal Register Volume 61, Number 237 (Monday, December 9, 1996)]
[Rules and Regulations]
[Pages 64816-64822]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-31007]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 131

[FRL-5659-9]
RIN 2040-AC78


Water Quality Standards for Pennsylvania

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: This rule establishes water quality standards applicable to 
waters of the United States in the Commonwealth of Pennsylvania. EPA is 
promulgating this rule pursuant to Section 303(c)(4) of the Clean Water 
Act (CWA). This rule establishes an antidegradation policy for 
Pennsylvania, making available additional water quality protection than 
currently provided by the Commonwealth's antidegradation policy 
including the ``Special Protection Waters Program,'' which EPA 
disapproved in part in 1994.

EFFECTIVE DATE: January 8, 1997.

ADDRESSES: This action's administrative record is available for review 
and copying at Water Protection Division, EPA, Region 3, 841 Chestnut 
Building, Philadelphia, PA 19107. For access to the docket materials, 
call Denise Hakowski at 215-566-5726 for an appointment. A reasonable 
fee will be charged for copies.

FOR FURTHER INFORMATION CONTACT: Evelyn S. MacKnight, Chief, PA/DE 
Branch, 3WP11, Office of Watersheds, Water Protection Division, EPA, 
Region 3, 841 Chestnut Building, Philadelphia, PA, telephone: 215-566-
5717.

SUPPLEMENTARY INFORMATION:

A. Potentially Affected Entities

    This action will establish a Federal antidegradation policy 
applicable to waters of the United States in the Commonwealth of 
Pennsylvania. Entities potentially affected by this action are those 
dischargers (e.g., industries or municipalities) that may request 
authorization for a new or increased discharge of pollutants to waters 
of the United States in Pennsylvania. This list is not intended to be 
exhaustive, but rather a guide for readers regarding entities 
potentially affected by this action. Other types of entities not listed 
could also potentially be affected. 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.

B. Background

    Under section 303 (33 U.S.C. 1313) of the Clean Water Act (CWA), 
States are required to develop water quality standards for waters of 
the United States within the State. States are required to review their 
water quality standards at least once every three years and, if 
appropriate, revise or adopt new standards. 33 U.S.C. 1313(c). States 
are required to submit the results of their triennial review of their 
water quality standards to EPA. EPA reviews the submittal and makes a 
determination whether to approve or disapprove any new or revised 
standards.
    Minimum elements which must be included in each State's water 
quality standards regulations include: use designations for all 
waterbodies in the State, water quality criteria sufficient to protect 
those designated uses, and an antidegradation policy consistent with 
EPA's water quality standards regulations (40 CFR 131.6). States may 
also include in their standards policies generally affecting the 
standards' application and implementation (40 CFR 131.13). These 
policies are subject to EPA review and approval (40 CFR 131.6(f), 40 
CFR 131.13).
    This rule involves antidegradation. 40 CFR 131.12 requires States 
to adopt antidegradation policies that provide three levels of 
protection of water quality, and to identify implementation methods. 
Under 40 CFR 131.12(a)(1), referred to as Tier 1, existing instream 
water uses and the level of water quality necessary to protect the 
existing uses are to be maintained and protected. Existing uses are 
those uses that existed on or since November 28, 1975. Tier 1 
represents the ``floor'' of water quality protection afforded to all 
waters of the United States. Under 40 CFR 131.12(a)(2), referred to as 
Tier 2 or High Quality Waters, where the quality of the waters exceed 
levels necessary to support propagation of fish, shellfish, and 
wildlife and recreation in and on the water, that quality shall be 
maintained and protected unless the State finds, after public 
participation and intergovernmental review, that allowing lower water 
quality is necessary to accommodate important economic or social 
development in the area in which the waters are located. In allowing 
such degradation or lower water quality, the State shall assure water 
quality adequate to protect existing uses fully. Further, the State 
shall assure that there shall be achieved the highest statutory and 
regulatory requirements for all new and existing point sources and all 
cost-effective and reasonable best management practices for nonpoint 
sources.
    Finally, under 40 CFR 131.12(a)(3), known as Tier 3 or Outstanding 
National Resource Waters (ONRWs), where a State determines that high 
quality waters constitute an outstanding National resource, such as 
waters of National and State parks and wildlife refuges and waters of 
exceptional recreational or ecological significance, that water quality 
shall be maintained and protected.
    Section 303(c)(4) (33 U.S.C. 1313(c)(4)) of the CWA authorizes EPA 
to promulgate water quality standards for a State when EPA disapproves 
the State's new or revised water quality standards, or in any case 
where the Administrator determines that a new or revised water quality 
standard is needed in a State to meet the CWA's requirements.
    In June 1994, EPA Region 3 disapproved portions of Pennsylvania's 
standards pursuant to Section 303 of the CWA and 40 CFR 
131.21, including portions of the antidegradation policy, known in 
Pennsylvania as the Special Protection Waters Program, relating to 
protection of existing uses, criteria used to define High Quality 
Waters and protection afforded to Exceptional Value Waters as 
equivalent to ONRWs. For a detailed review of the correspondence and 
discussions between the Pennsylvania Department of Environmental 
Protection (``Pennsylvania'' or ``the Department'') resulting from 
EPA's disapproval, see

[[Page 64817]]

the August 29, 1996, Federal Register proposal of this rule. (61 FR 
45379).
    As a result of EPA's disapproval, Pennsylvania initiated a 
regulatory negotiation, or ``reg-neg,'' to reassess its antidegradation 
policy, or Special Protection Waters Program, while involving 
stakeholders in the process. EPA participated in the reg-neg process in 
an advisory capacity and informed the reg-neg group of this rulemaking 
action.
    Based on the reg-neg process and an interim report produced by the 
group, the Department announced in the Pennsylvania Bulletin, May 4, 
1996, the availability of proposed changes to the antidegradation 
provisions of the Commonwealth's water quality standards. The reg-neg 
group's final meeting was on August 1, 1996, where the stakeholders 
declared that a group consensus could not be reached, disbanded and 
issued two separate reports, representing the opinions of the 
conservation stakeholders and the regulated community stakeholders 
respectively. The Department is currently developing a new regulatory 
proposal using these reports and input it received in response to its 
May 4, 1996 Pennsylvania Bulletin notice.
    On April 18, 1996, concerned with the time that had elapsed since 
EPA's disapproval, the United States District Court for the Eastern 
District of Pennsylvania ordered EPA to prepare and publish proposed 
regulations setting forth revised or new water quality standards for 
the Commonwealth's antidegradation provisions disapproved in June 1994. 
Raymond Proffitt Foundation v. Browner, Civil Docket No. 95-0861 
(E.D.Pa). The court stated that EPA was not to delay its rulemaking any 
more to accommodate the Commonwealth's schedule.
    Consistent with the Court's order, on August 29, 1996, EPA 
published a Federal Register notice proposing standards related to 
Pennsylvania's antidegradation policy (61 FR 45379). Since the 
Commonwealth has not adopted revised water quality standards which EPA 
determined are in accordance with the CWA, an action that would have 
made EPA's rulemaking unnecessary, EPA is promulgating this rule in 
accordance with Section 303(c)(3) and (4) of the CWA.
    EPA's long-standing practice in the water quality standards program 
has been to withdraw the Federal rule if, and when, a State 
subsequently adopts rules that are then approved by EPA. Thus, 
notwithstanding today's action, EPA strongly encourages the 
Commonwealth to pursue its on-going effort to adopt appropriate 
standards which will make this Federally promulgated rule unnecessary.

C. Summary of Final Rule and Response to Major Comments

    A description of EPA's final action, and a summary of major 
comments regarding the proposal and EPA's response, are set forth 
below. Additional comments and responses to comments are in the 
administrative record.

1. Ensuring That Existing Uses Will Be Maintained and Protected as 
Required Under 40 CFR 131.12(a)(1)

    Pennsylvania's regulation at 25 PA Code Sec. 93.4 explicitly 
protects existing uses only through Pennsylvania's designated use 
process. That process requires that when an evaluation of technical 
data establishes that a waterbody attains the criteria for an existing 
use that is more protective of the waterbody than the current 
designated use, that waterbody will be protected at its existing use 
until the conclusion of a rulemaking action. After the rulemaking 
action the waterbody will be protected only at its designated use and 
in some cases the designated use will not adequately protect the 
existing use. For a more detailed discussion of EPA's disapproval of 
this provision and Pennsylvania's resulting actions, see the preamble 
discussion in the August 29, 1996, proposal, 61 FR 45379.
    In order to ensure that the standards governing Tier 1 
antidegradation protection in Pennsylvania are consistent with the CWA, 
EPA proposed to promulgate for Pennsylvania language that ensures 
existing uses shall be maintained and protected in accordance with 40 
CFR 131.12(a)(1). The comments EPA received regarding Federal Tier 1 
protection were generally supportive of EPA's proposed action and 
raised no significant issues. See the Response to Comments document in 
the Administrative Record to this rule for responses to specific 
comments.
    This final rule is promulgating our proposal without changes. This 
regulation will be the applicable Federal antidegradation Tier 1 policy 
in Pennsylvania for purposes of the CWA and, to the extent it is more 
stringent, supersedes Pennsylvania Regulations at 25 PA Code 
93.4(d)(1). EPA is taking this action to protect all existing uses, 
including providing protection for existing uses that may be more 
specific, or require more protection, than Pennsylvania's designated 
uses.
    Pennsylvania has recently proposed changes to its antidegradation 
policy that would protect existing uses without the limitations imposed 
by its use designation process. See 25 Pennsylvania Bulletin 2131-32 
(May 4, 1996). If Pennsylvania promulgates this proposal as a final 
rule and it is approved by EPA, EPA would expect to withdraw the part 
of the Federal rule relating to Tier 1.

2. Ensuring That Pennsylvania's High Quality Designation Adequately 
Protects All Waters That Qualify for Protection Under the Federal Tier 
2 Set Forth in 40 CFR 131.12(a)(2)

    In order to afford equivalent protection to that afforded by Tier 2 
of the Federal policy set forth in 40 CFR 131.12(a)(2), Pennsylvania 
has developed a Special Protection Waters Program which utilizes the 
designational approach, i.e., designates specific waters as High 
Quality. The High Quality Waters Policy is set forth in 25 PA Code 
Secs. 93.3, 93.7, 93.9 & 95.1, and the Department's Special Protection 
Waters Handbook (November 1992). High Quality Waters are defined in 
Pennsylvania's water quality standards as ``[a] stream or watershed 
which has excellent quality waters and environmental or other features 
that require special water quality protection''. 25 Pa Code Sec. 93.3. 
Once designated as High Quality, those waters are afforded a level of 
protection consistent with EPA's Tier 2.
    EPA disapproved a portion of Pennsylvania's High Quality Waters 
Policy because the policy requires that a stream must possess 
``excellent quality waters and environmental or other features that 
require special water quality protection'' [emphasis added]. That 
definition may exclude waters that would be protected under the Federal 
Tier 2 policy which provides Tier 2 protection to all waters with water 
quality exceeding levels necessary to support propagation of fish, 
shellfish, and wildlife and recreation in and on the water regardless 
of any other feature. Additional details concerning EPA's disapproval 
and Pennsylvania's response to the disapproval are available in the 
preamble to the August 29, 1996, proposal. 61 FR 45379.
    EPA proposed language based on 40 CFR 131.12(a)(2) to make 
available Federal Tier 2 protection for Pennsylvania waters on the 
basis of water quality alone. That language would have the effect of 
making Tier 2 protection available to all waters whose quality 
``exceeds levels necessary to support propagation of fish, shellfish, 
and wildlife and recreation in and on the water.''

[[Page 64818]]

Discussion of major comments relating to Tier 2
    Comment: Two commenters stated that the EPA proposed language 
concerning social and economic justification for lowering water quality 
will weaken the present Pennsylvania program. Pennsylvania's program 
requires that a proposed project that will add a new or increased 
discharge into a Special Protection waters must be ``necessary'' and 
``of significant benefit to the public,'' whereas the Federal language 
requires that lowering of water quality be ``necessary'' and ``to 
support important social and economic benefit in the area in which the 
waters are located.''
    Response: Under the wording of 40 CFR Sec. 131.32(a)(2), the 
Commonwealth will be responsible for determining whether a particular 
lowering of water quality is ``necessary to support important social 
and economic benefit in the area in which the waters are located.'' In 
making that determination the Commonwealth may equate ``important 
social and economic benefit'' with ``of significant benefit to the 
public'' if that phrase as used by Pennsylvania is interpreted to be at 
least as stringent as EPA's wording. We note that the word 
``important'' was selected by EPA in 1983 because it was believed to be 
more protective than ``significant.'' Accordingly, EPA does not believe 
that the language of the Federal regulation will weaken the level of 
protection of Tier 2 waters.
    Comment: One commenter stated that the Federal Tier 2 designation 
should be strictly interpreted in Pennsylvania as disallowing the 
Commonwealth from designating a stream as high quality or Tier 2 if 
even one of the stream's water quality standards is violated.
    Response: EPA does not interpret 40 CFR 131.32(a)(2) as excluding a 
water from Tier 2 protection merely because one parameter exceeds water 
quality standards.
    For additional comments and responses, see the Response to Comments 
document in the Administrative Record to this rule.
    In the August 29, 1996, proposal, EPA also discussed another option 
of simply promulgating the definition of High Quality Water from 25 Pa 
Code Sec. 93.3 but without the phrase ``and environmental or other 
features which require special criteria.'' EPA sought comments on both 
of these options through the August 29, 1996, Federal Register 
proposal. Under either option, the current State process for 
establishing designations and reviewing proposals to lower water 
quality would remain in effect. The only comment supporting the second 
option was based on the concern that using the language of 131.12(a)(2) 
would weaken Pennsylvania's program. This concern is discussed above. 
Accordingly, the final rule retains the proposed approach.
    Pennsylvania has not yet satisfied EPA's disapproval of its High 
Quality waters policy. Therefore, promulgation of the rule is still 
necessary. EPA has decided to retain the proposed language in this 
final rule since the rule is still necessary, and EPA received no 
comments on the proposed rule that would necessitate modification.
    As discussed in the BACKGROUND section of this notice, Pennsylvania 
has considered enhancements to its High Quality Waters program through 
a regulatory negotiation process. As a result of this process, the 
Department indicated in the Pennsylvania Bulletin, May 4, 1996, that it 
may consider revising the High Quality Water definition to delete the 
requirements for additional ``environmental or other features.'' If 
Pennsylvania were to finalize this proposal and EPA approves it, EPA 
would expect to withdraw the portion of the Federal promulgation 
relating to Tier 2.

3. Ensuring That Pennsylvania's Highest Quality Waters May Be Provided 
a Level of Protection Fully Equivalent to Tier 3 of the Federal Policy

    Pennsylvania considers its Exceptional Value Waters designation as 
part of the Special Protection Waters Program to be equivalent to Tier 
3. The Exceptional Value Policy is set forth in 25 PA Code Secs. 93.3, 
93.7, 93.9 & 95.1, and the Department's Special Protection Handbook, 
which contains implementation procedures for Exceptional Value 
protection. The Code and the Handbook must be read together to 
understand the effect of the Exceptional Value policy.
    As described in the Handbook, Pennsylvania requires Exceptional 
Value Waters to be protected at their existing quality to the extent 
that no adverse measurable change in existing water quality would occur 
as a result of a point source permit. A change is considered measurable 
``if the long-term average in-stream concentration of the parameter of 
concern can be expected, after complete mix of stream and wastewater, 
to differ from the mean value established from historical data 
describing background conditions in the receiving stream'' or at 
selected Pennsylvania reference sites.
    EPA disapproved the Commonwealth's Exceptional Value designation 
because it is not convinced that this level of protection is sufficient 
to assure that water quality shall be maintained and protected as 
required by the Federal Tier 3 requirement at 40 CFR 131.12(a)(3). EPA 
believes that, in practice, Pennsylvania's policy of ``no adverse 
measurable change'' could allow potentially significant discharges and 
loading increases from point and nonpoint sources. See the August 29, 
1996, Federal Register proposal of this rule (61 FR 45382).
    EPA proposed promulgating language derived from 40 CFR 131.12(a)(3) 
(see 61 FR 45379). The language states that where waters are identified 
by the Commonwealth as ONRWs, their water quality shall be maintained 
and protected. It is EPA's recommendation that, while not required by 
EPA's regulation, ``no new or increased discharges'' to Tier 3 waters 
is the best and most reliable method to assure that water quality is 
fully maintained and protected in ONRWs. In the preamble to the 
proposed rule, and consistent with the recommended interpretation in 
its National guidance, EPA Water Quality Standards Handbook at 4-8 (2nd 
ed. 1994), EPA interpreted the proposed language at 40 CFR 131.32(a)(3) 
to prohibit, in waters identified by the Commonwealth as ONRWs, new or 
increased dischargers, aside from limited activities which have only 
temporary or short-term effects on water quality.
    Despite EPA's position that Pennsylvania's Exceptional Value 
designation is not as protective as EPA's Tier 3 regulation, EPA 
recognized that the Commonwealth's success in having so many waters 
designated Exceptional Value might not have occurred if new or 
increased discharges were strictly prohibited. In light of this 
situation, rather than modify the Exceptional Value policy, EPA 
proposed in the August 29, 1996 Federal Register notice to promulgate 
language to provide Pennsylvania the opportunity to designate 
appropriate Pennsylvania waters as ONRWs, to which no new or increased 
discharges would be allowed. The intent of this ONRW proposal was not 
to replace or supplant the Exceptional Value category and designations 
already in place in Pennsylvania, but rather to supplement them. It 
would give the citizens of the Commonwealth the opportunity to request 
the highest level of protection be afforded to particular waters where 
appropriate. Under the proposal, EPA will not designate waters as 
ONRWs; that will be the Commonwealth's prerogative.

[[Page 64819]]

Discussion of Major Comments Relating to Tier 3
    Comment: While some comments supported the creation of a new tier 
of protection, a number of comments requested that Pennsylvania's EV 
category be upgraded to be equivalent to Federal Tier 3 protection.
    Response: EPA proposed a new tier, rather than a modification of 
Pennsylvania's Exceptional Value category because this seemed least 
disruptive to the state and most protective of the environment. The 
Exceptional Value category, which is not quite as protective as Tier 3, 
but still better than Tier 2, covers more waters than are likely to be 
designated ONRWs. Had EPA proposed to modify the Exceptional Value 
category, the State might have felt the need to reconsider the 
inclusion of some of the currently designated Exceptional Value waters.
    Comment: Several commenters asserted that Section 131.12(a)(3) does 
not require a prohibition against new or increased discharges.
    Response: The literal Federal regulatory requirement is that the 
water quality of designated ONRWs ``be maintained and protected.'' For 
the reasons explained in the preamble to the proposed rule (see 61 FR 
45382), EPA believes that prohibition of new or increased discharges is 
a reasonable interpretation of its regulatory language and is the most 
dependable way of ensuring that ONRWs will be maintained and protected. 
There is no Federal requirement for states to adopt such a prohibition 
as a water quality standard regulation. EPA notes that there may be 
other formulations that States may adopt to meet the requirements of 40 
CFR 131.12(a)(3) and provide a level of protection substantially 
equivalent for maintaining and protecting water quality in ONRWs. 
However, with respect to Pennsylvania, the Commonwealth's level of 
protection falls short of ``maintaining and protecting'' water quality 
in ONRWs and hence fails to meet Federal requirements. Because EPA is 
promulgating a Federal regulation for Pennsylvania, EPA wishes to make 
it clear how it will interpret today's regulation.
    Comment: One commenter stated that EPA improperly considered 
Pennsylvania's implementation of its antidegradation procedures, as the 
Commonwealth is not required by the CWA to submit water quality 
standards implementation procedures to EPA for review and approval.
    Response: This is incorrect. In reviewing those elements of water 
quality standards that have been submitted as required in 40 CFR 131.6, 
EPA may use any information available in determining what the State 
actually means by its water quality standards language. EPA's water 
quality standards regulation also requires in 40 CFR 131.12(a) that 
``the State shall develop and adopt a statewide antidegradation policy 
and identify the methods for implementing such policy pursuant to this 
subpart.'' In this case, EPA disapproved Pennsylvania's antidegradation 
policy based on the Commonwealth's interpretation of its policy as 
reflected in the Special Protection Waters Handbook.
    See the Response to Comments document, which is part of the 
Administrative Record to this rule, for additional comments and 
responses concerning Tier 3.
    Today's final rule is identical to the rule as proposed on August 
29, 1996. Federal promulgation is still necessary since the 
Commonwealth has not yet satisfied EPA's disapproval of its Exceptional 
Value designation. EPA received no comments that necessitated changes 
to the proposal and believes that promulgation of the language as 
proposed is the most effective way to provide to Pennsylvania the level 
of protection equivalent to the Federal Tier 3.
    Pennsylvania's reg-neg group discussed this issue but did not reach 
an agreement to recommend that Pennsylvania create a new Tier 3 ONRW 
category of protection. If Pennsylvania adopts either EPA's recommended 
interpretation or an appropriate alternative formulation for 
maintaining and protecting water quality in ONRWs, and it is approved 
by EPA as meeting the requirements of 40 CFR 131.12(a)(3), EPA would 
expect to propose to withdraw the portion of its rule relating to Tier 
3.

D. Relationship of This Rulemaking to the Great Lakes Water Quality 
Guidance

    On March 23, 1995, pursuant to section 118(c)(2) of the CWA, EPA 
published Final Water Quality Guidance for the Great Lakes System (60 
FR 15366), which applies to the Great Lakes System, including a small 
portion of Pennsylvania waters. The Guidance includes water quality 
criteria, implementation procedures and antidegradation policies which 
are intended to provide the basis for consistent, enforceable 
protection for the Great Lakes System. In particular, the 
antidegradation requirements are more specific than those set out in 40 
CFR 131.12. Pennsylvania and the other Great Lakes States and Tribes 
must adopt provisions into their water quality programs which are 
consistent with the Guidance, or EPA will promulgate the provisions for 
them.
    This rulemaking, which is being undertaken pursuant to section 303 
of the Act, is independent of, and does not supersede, the Guidance. 
Regardless of this rulemaking, Pennsylvania must still adopt an 
antidegradation policy for its waters in the Great Lakes Basin 
consistent with the Guidance, or EPA will promulgate such provisions 
for them. At that time, EPA will withdraw any portion of this rule 
which is inconsistent with such Great Lakes provisions and which 
applies to Pennsylvania waters within the Great Lakes basin.

E. Endangered Species Act

    Pursuant to section 7 of the Endangered Species Act (16 U.S.C. 
Sec. 1656 et seq.), Federal agencies must assure that their actions are 
unlikely to jeopardize the continued existence of listed threatened or 
endangered species or adversely affect designated critical habitat of 
such species.
    EPA initiated section 7 informal consultation under the Endangered 
Species Act with the U. S. Fish and Wildlife Service (FWS) regarding 
this rulemaking, and requested concurrence from the FWS that this 
action is unlikely to adversely affect threatened or endangered 
species. The FWS originally responded in a letter dated July 31, 1996, 
that they could not concur with a finding of no adverse affect to 
threatened or endangered species, but proposed five options that would 
facilitate a ``not likely to adversely affect'' determination. In EPA's 
August 29, 1996 proposal of this rule (61 FR 45379), EPA sought comment 
on these five options, which were available in the administrative 
record.
    Since that proposal, EPA and FWS have continued to consult 
informally, and have reached agreement on an alternative approach. 
Under that approach, EPA will make every effort to ensure that, prior 
to the final Commonwealth rulemaking pertaining to antidegradation (but 
no later than June 30, 1997), the State will draft an antidegradation 
policy which accords full antidegradation protection, including Tier 1 
requirements, for threatened and endangered species and that, by 
December 31, 1997, the State will identify implementation methods for 
this policy. The policy and implementation methods must fully protect 
threatened and endangered

[[Page 64820]]

species as existing uses of the waterbody. EPA will request that 
Pennsylvania submit both the policy and implementation methods to EPA 
and the FWS by the dates listed above to allow for review and early 
coordination prior to the final State rulemaking. EPA will encourage 
the State to develop the draft regulatory language and implementation 
methods in close coordination with the Service and EPA. In any case, 
EPA will consult with FWS on any revisions to Pennsylvania's water 
quality standards which are submitted to EPA for review and approval 
and welcomes the State as a partner in this process.
    Also, as part of EPA's role in overseeing Pennsylvania's 
implementation of the National Pollutant Discharge Elimination System 
(NPDES) program, where EPA finds (based on analysis conducted by EPA or 
FWS) that issuance of a PADEP NPDES permit, as drafted, is likely to 
have an adverse effect on Federally-listed species or critical habitat, 
EPA will require changes to a State-issued draft permit under Section 
402(d)(4) of the CWA, or take other appropriate actions.
    By letter to the FWS dated November 7, 1996, EPA offered to 
implement this alternative approach, explained our concerns with the 
other options, and again sought FWS's concurrence. Based upon EPA's 
commitment to fully implement the approach outlined above, the FWS 
provided concurrence with EPA's finding of no adverse affect to 
threatened or endangered species by letter dated November 7, 1996.
Discussion of Major Comments Concerning the Endangered Species Act
    Comment: EPA received comment that EPA lacks authority or 
obligation to consult with the FWS on the proposed antidegradation 
rule, since EPA has taken no action that would jeopardize listed 
species, as the rule would have a beneficial effect on listed species.
    Response: EPA agrees that issuance of the antidegradation rule will 
improve water quality in Pennsylvania. Nonetheless, EPA had an 
obligation to consult FWS under the controlling regulations.
    The commenters' view that issuance of the rule is not an ``action'' 
under the ESA ignores FWS's definition of agency action. That 
definition expressly includes ``actions intended to conserve listed 
species or their habitat * * * the promulgation of regulations * * *. 
or actions directly or indirectly causing modifications to the * * * 
water.'' 50 CFR Sec. 402.02. Issuance of the rule is agency ``action'' 
under this broad definition.
    In addition, under the FWS' regulations, the fact that the effect 
of an action may be beneficial does not exempt EPA from the obligation 
to consult. EPA agrees that the antidegradation rule will have a 
positive effect, but that effect triggers consultation under FWS's 
regulatory interpretation of section 7(a)(2), 16 U.S.C. 
Sec. 1536(a)(2)--i.e., whether an agency's action ``may affect'' listed 
species. See 50 CFR Sec. 402.14(a). FWS interprets this standard to 
require consultation even when an action will have ``beneficial'' 
effects. 51 Fed. Reg. 19,949. Thus, although the rule will improve 
water quality in Pennsylvania, this beneficial effect is sufficient, 
under FWS's regulations, to trigger the consultation obligation. See 
also TVA v. Hill, 437 U.S. 153, 178 (1978) (``the heart of'' the ESA is 
the ``institutionalization of * * * caution'').
    Comment: EPA received several comments that EPA should not adopt 
any of the five options proposed by the FWS for resolving Sec. 7 
consultation.
    Response: To the extent that this objection is based on a general 
belief that the FWS lacked authority to require anything in connection 
with this rule, see the response to the previous comment. With respect 
to the specifics of the five options, EPA agrees that the particular 
options, as formulated by the FWS in its letter of July 31, 1996, were 
inappropriate and has not adopted them. As indicated above, as a result 
of further discussions with the FWS, EPA offered an alternative 
approach consisting of a modification of two of the options, and on 
that basis the FWS concurred that the rule is not likely to adversely 
affect listed species. See the Response to Comments document for this 
rule for further discussion of comments related to the Endangered 
Species Act.

F. 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 Office of Management and Budget (OMB) review 
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 of 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.
    Because the annualized cost of this final rule would be 
significantly less than $100 million and the rule would meet none of 
the other criteria specified 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.
    Comment: Comment was received that, in light of the options raised 
by the FWS in the context of the rulemaking, EPA was incorrect in its 
finding that the proposed rule is not a significant regulatory action 
under Executive Order 12866, particularly the FWS option that would 
extend Tier 3 protection to streams that contain listed species, and 
another that would federalize NPDES permits on waterbodies that contain 
Federally listed species, and grant the FWS a role in each permit 
action on those waters.
    Response: In making its determination under Executive Order 12866 
that the proposed rule was not a significant regulatory action, EPA 
evaluated the rule as proposed. EPA did not adopt any of the Service's 
options, and therefore stands by its original assessment.

G. Submission to Congress and the General Accounting Office

    Under section 801(a)(1)(A) of the Administrative Procedures Act 
(APA) as amended by the Small Business Regulatory Enforcement Fairness 
Act of 1996, EPA submitted a report containing this rule and other 
required information to the U.S. Senate, the U.S. House of 
Representatives and the Comptroller General of the General Accounting 
Office prior to publication of the rule in today's Federal Register. 
This rule is not a ``major rule'' as defined by section 804(2) of the 
APA as amended.

H. Regulatory Flexibility Act, as Amended by the Small Business 
Regulatory Enforcement Fairness Act of 1996

    The Regulatory Flexibility Act (RFA) provides that, whenever an 
agency promulgates a final rule under 5 U.S.C. 553, after being 
required to publish a general notice of proposed rulemaking, an agency 
must prepare a final regulatory flexibility analysis unless the

[[Page 64821]]

head of the agency certifies that the proposed rule will not have a 
significant economic impact on a substantial number of small entities. 
5 U.S.C. 604 & 605. The Administrator is today certifying, pursuant to 
section 605(b) of the RFA, that this rule will not have a significant 
impact on a substantial number of small entities. Therefore, the Agency 
did not prepare a regulatory flexibility analysis.
    Under the Clean Water Act water quality standards program, States 
must adopt water quality standards for their waters that must be 
submitted to EPA for approval. If the Agency disapproves a state 
standard, EPA must promulgate standards consistent with the statutory 
requirements. These State standards (or EPA-promulgated standards) are 
implemented through the NPDES program that limits discharges to 
navigable waters except in compliance with an EPA permit or permit 
issued under an approved state program. The CWA requires that all NPDES 
permits must include any limits on discharges that are necessary to 
meet State water quality standards.
    Thus, under the CWA, EPA's promulgation of water quality standards 
where state standards are inconsistent with statutory requirements 
establishes standards that the state implements through the NPDES 
permit process. The state has discretion in deciding how to meet the 
water quality standards and in developing discharge limits as needed to 
meet the standards. While the state's implementation of federally-
promulgated water quality standards may result in new or revised 
discharge limits being placed on small entities, the standards 
themselves do not apply to any discharger, including small entities.
    Today's rule imposes obligations on the Commonwealth of 
Pennsylvania but, as explained above, does not itself establish any 
requirements that are applicable to small entities. As a result of 
EPA's action here, the Commonwealth of Pennsylvania will need to ensure 
that permits it issues comply with the antidegradation provisions in 
today's rule. In so doing, the Commonwealth will have a number of 
discretionary choices associated with permit writing. In addition, the 
Commonwealth has the threshold choice whether to designate particular 
waters as Outstanding National Resource Waters. While Pennsylvania's 
implementation of today's rule may ultimately result in some new or 
revised permit conditions for some dischargers, including small 
entities, EPA's action today does not impose any of these as yet 
unknown requirements on small entities.
    The RFA requires analysis of the impacts of a rule on the small 
entities subject to the rules' requirements. See United States 
Distribution Companies v. FERC, 88 F.3d 1105, 1170 (D.C. Cir. 1996). 
Today's rule establishes no requirements applicable to small entities, 
and so is not susceptible to regulatory flexibility analysis as 
prescribed by the RFA. (``[N]o [regulatory flexibility] analysis is 
necessary when an agency determines that the rule will not have a 
significant economic impact on a substantial number of small entities 
that are subject to the requirements of the rule,'' United Distribution 
at 1170, quoting Mid-Tex Elec. Co-op v. FERC, 773 F.2d 327, 342 (D.C. 
Cir. 1985) (emphasis added by United Distribution court).) The Agency 
is thus certifying that today's rule will not have a significant 
economic impact on a substantial number of small entities, within the 
meaning of the RFA.
    Although the statute does not require EPA to prepare an RFA when it 
promulgates water quality standards for Pennsylvania, EPA has 
undertaken a limited assessment, to the extent it could, of possible 
outcomes and the economic effect of these on small entities. Given the 
fact that any economic impact on small entities is dependent on a 
number of currently unknown factors, EPA's quantitative consideration 
of possible effects is necessarily restricted. The final version of 
that evaluation is available in the administrative record for today's 
action.
    Comment: One commenter stated that EPA's proposed regulation fails 
to comply with the RFA because it reaches the conclusion that this rule 
would not have a significant economic impact on a substantial number of 
small entities without providing a factual basis for this 
certification, and it is incorrect in its assumption that this rule 
would not impact small business in Pennsylvania.
    Response: The commenter is incorrect in asserting that EPA has no 
basis for its Section 605(b) certification. Further, as explained 
above, though not required by the RFA, EPA prepared with contractor 
assistance an assessment which identified and evaluated, as best it 
could given the unknown, the potential costs to small entities that 
might follow state implementation of today's standards. The assessment 
is based on data developed by the contractor from a variety of sources 
including data from the U.S. Department of Commerce, EPA reports, and 
telephone surveys of industrial and municipal dischargers and each 
Commonwealth regional office. EPA referenced this assessment in the 
proposal (61 FR 45379, 45384), made it available in the administrative 
record, and specifically invited comment on it. No comments were 
received pointing out errors in this assessment, or the data on which 
it was based. With regard to the impact to small businesses, EPA stands 
by its assessment.

I. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 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 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.
    As noted above, this rule is limited to antidegradation 
designations within the Commonwealth of Pennsylvania. EPA has 
determined that this rule contains no regulatory requirements that 
might significantly or uniquely affect small governments. EPA has also 
determined that this rule does not contain a Federal mandate that may 
result in expenditures of $100 million or more for State, local, and 
tribal governments, in the aggregate, or the private sector in any one 
year.

[[Page 64822]]

Thus, today's rule is not subject to the requirements of section 202, 
203, or 205 of the UMRA.
    Comment: One commenter stated that EPA failed to comply with UMRA 
in that it did not provide the basis for conclusions that this rule 
will not significantly or uniquely affect small governments, that this 
rule will not result in expenditure of $100 million or more for State, 
local and tribal governments, in the aggregate, or the private sector 
in any one year, or develop a small government agency plan.
    Response: EPA disagrees. EPA has assessed the effects of this 
regulatory action on State and local governments and the private 
sector, and based its conclusions on the report entitled Economic 
Analysis of the Potential Impact of the Proposed Antidegradation 
Requirements for Pennsylvania.

J. Paperwork Reduction Act

    This action requires no information collection activities subject 
to the Paperwork Reduction Act, and therefore no Information Collection 
Request (ICR) will be submitted to the Office of Management and Budget 
(OMB) for review in compliance with the Paperwork Reduction Act, 44 
U.S.C. 3501 et seq.

List of Subjects in 40 CFR Part 131

    Environmental protection, Water pollution control, Water quality 
standards.

    Dated: November 27, 1996.
Carol M. Browner,
Administrator.

    For the reasons set out in the preamble, part 131 of title 40 of 
the Code of Federal Regulations is amended as follows:

PART 131--WATER QUALITY STANDARDS

    1. The authority citation for part 131 continues to read as 
follows:

    Authority: 33 U.S.C. 1251 et seq.

Subpart D--[Amended]

    2. Section 131.32 is added to read as follows:


Sec. 131.32  Pennsylvania.

    (a) Antidegradation policy. This antidegradation policy shall be 
applicable to all waters of the United States within the Commonwealth 
of Pennsylvania, including wetlands.
    (1) Existing in-stream uses and the level of water quality 
necessary to protect the existing uses shall be maintained and 
protected.
    (2) Where the quality of the waters exceeds levels necessary to 
support propagation of fish, shellfish, and wildlife and recreation in 
and on the water, that quality shall be maintained and protected unless 
the Commonwealth finds, after full satisfaction of the inter-
governmental coordination and public participation provisions of the 
Commonwealth's continuing planning process, that allowing lower water 
quality is necessary to accommodate important economic or social 
development in the area in which the waters are located. In allowing 
such degradation or lower water quality, the Commonwealth shall assure 
water quality adequate to protect existing uses fully. Further, the 
Commonwealth shall assure that there shall be achieved the highest 
statutory and regulatory requirements for all new and existing point 
sources and all cost-effective and reasonable best management practices 
for nonpoint sources.
    (3) Where high quality waters are identified as constituting an 
outstanding National resource, such as waters of National and State 
parks and wildlife refuges and water of exceptional recreational and 
ecological significance, that water quality shall be maintained and 
protected.
    (b) (Reserved)

[FR Doc. 96-31007 Filed 12-6-96; 8:45 am]
BILLING CODE 6560-50-P