[Federal Register Volume 74, Number 229 (Tuesday, December 1, 2009)]
[Rules and Regulations]
[Pages 62996-63058]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-28446]



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Part III





Environmental Protection Agency





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40 CFR Part 450



Effluent Limitations Guidelines and Standards for the Construction and 
Development Point Source Category; Final Rule

  Federal Register / Vol. 74, No. 229 / Tuesday, December 1, 2009 / 
Rules and Regulations  

[[Page 62996]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 450

[EPA-HQ-OW-2008-0465; FRL-9086-4]
RIN 2040-AE91


Effluent Limitations Guidelines and Standards for the 
Construction and Development Point Source Category

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: The Environmental Protection Agency is publishing final 
regulations establishing Clean Water Act (CWA) technology-based 
Effluent Limitations Guidelines and New Source Performance Standards 
for the Construction and Development (C&D) point source category. EPA 
expects compliance with this regulation to reduce the amount of 
sediment and other pollutants discharged from construction and 
development sites by approximately 4 billion pounds per year.

DATES: This final rule is effective on February 1, 2010, 60 days after 
publication in the Federal Register.

ADDRESSES: EPA has established a docket for this action under Docket ID 
No. EPA-HQ-OW-2008-0465. All documents in the docket are listed on the 
http://www.regulations.gov Web site. Although listed in the index, some 
information is not publicly available, e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, is not placed on the Internet and will be 
publicly available only in hard copy form. Publicly available docket 
materials are available either electronically through http://www.regulations.gov or in hard copy at the Office of Water Docket, EPA/
DC, EPA West, Room 3334, 1301 Constitution Ave., NW., Washington, DC. 
The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday 
through Friday, excluding legal holidays. The telephone number for the 
Public Reading Room is (202) 566-1744, and the telephone number for the 
Office of Water Docket is (202) 566-1752.

FOR FURTHER INFORMATION CONTACT: For technical information concerning 
today's rule, contact Mr. Jesse W. Pritts at 202-566-1038 
([email protected]). For economic information contact Mr. Todd Doley 
at 202-566-1160 ([email protected]). For information regarding 
environmental benefits, contact Ms. Ashley Allen at 202-566-1012 
([email protected]).

SUPPLEMENTARY INFORMATION:

Regulated Entities

    Entities potentially regulated by this action include:

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                                                                                                 North American
                                                                                                    industry
                   Category                            Examples of regulated entities            classification
                                                                                                 system (NAICS)
                                                                                                      code
----------------------------------------------------------------------------------------------------------------
Industry.....................................  Construction activities required to obtain
                                                NPDES permit coverage and performing the
                                                following activities:
                                               Construction of buildings, including building,                236
                                                developing and general contracting.
                                               Heavy and civil engineering construction,                     237
                                                including land subdivision.
----------------------------------------------------------------------------------------------------------------

    EPA does not intend the preceding table to be exhaustive, but 
provides it as 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 facility is regulated by this action, you should 
carefully examine the applicability criteria in Sec.  450.10 of today's 
final rule and the definition of ``storm water discharges associated 
with industrial activity'' and ``storm water discharges associated with 
small construction activity'' in existing EPA regulations at 40 CFR 
122.26(b)(14)(x) and 122.26(b)(15), respectively. If you have questions 
regarding the applicability of this action to a particular site, 
consult one of the persons listed for technical information in the 
preceding FOR FURTHER INFORMATION CONTACT section.

Supporting Documentation

    Several key documents support the final regulation:
    1. ``Development Document for Final Effluent Guidelines and 
Standards for the Construction and Development Category,'' EPA-821-R-
09-010. (``Development Document'') This document presents EPA's 
methodology and technical conclusions concerning the C&D category.
    2. ``Economic Analysis for Final Effluent Guidelines and Standards 
for the Construction and Development Category,'' EPA-821-R-09-011. 
(``Economic Analysis'') This document presents the methodology employed 
to assess economic impacts of the rule and the results of the analysis.
    3. ``Environmental Impact and Benefits Assessment for Final 
Effluent Guidelines and Standards for the Construction and Development 
Category,'' EPA-821-R-09-012 (``Environmental Assessment''). This 
document presents the methodology to assess environmental impacts and 
benefits of the rule and the results of the analysis.
    You can obtain electronic copies of this preamble and final rule as 
well as the technical and economic support documents for today's rule 
at EPA's Web site for the C&D rule, http://www.epa.gov/waterscience/guide/construction.

Overview

    This preamble describes the terms, acronyms, and abbreviations used 
in this document; the background documents that support these final 
regulations; the legal authority of this final rule; a summary of the 
final rule; background information; and the technical and economic 
methodologies used by the Agency to develop this final regulation.

Table of Contents

I. Legal Authority
II. Purpose & Summary of the Final Rule
III. Background on Existing Regulatory Program
    A. Clean Water Act
    B. Clean Water Act Stormwater Program
    1. NPDES Permits for Stormwater Discharges Associated With 
Construction Activity
    a. General NPDES Permits
    b. EPA Construction General Permit
    c. State Construction General Permits
    d. Individual NPDES Permits
    2. Municipal Stormwater Permits and Local Government Regulation 
of Stormwater Discharges Associated With Construction Activity
    a. NPDES Requirements
    b. EPA Guidance to Municipalities
    C. Other State and Local Stormwater Requirements
    D. Technology-Based Effluent Limitations Guidelines and 
Standards
    1. Best Practicable Control Technology Currently Available (BPT)

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    2. Best Available Technology Economically Achievable (BAT)
    3. Best Conventional Pollutant Control Technology (BCT)
    4. Best Available Demonstrated Control Technology (BADT) for New 
Source Performance Standards (NSPS)
    5. Pretreatment Standards
    6. EPA Authority to Promulgate Non-Numeric Effluent Limitations
    7. CWA Section 304(m) Litigation
IV. Overview of the Construction Industry and Construction 
Activities
V. Summary of the Proposed Regulation
VI. Summary of Major Comments Received
VII. Summary of Significant Decisions and Revisions to Analyses
    A. Regulatory Options
    B. Cost Analysis
    C. Pollutant Load Analysis
    D. Economic Analysis
    E. Benefits Estimation and Monetization
VIII. Characteristics of Discharges Associated With Construction 
Activity
IX. Description of Available Technologies
    A. Introduction
    B. Erosion Control Measures
    C. Sediment Control Measures
    D. Other Construction and Development Site Management Practices
    E. Performance Data for Passive Treatment Approaches
X. Development of Effluent Limitations Guidelines and Standards and 
Options Selection Rationale
    A. Description of the Regulatory Options Considered
    1. Options Considered in the Proposal
    2. Regulatory Options Considered for the Final Rule and 
Rationale for Consideration of Revisions to Options in the Proposed 
Rule
    B. Non-Numeric Effluent Limitations Included in All Regulatory 
Options
    1. Non-Numeric Effluent Limitations Contained in the Final Rule
    2. Changes to the Non-Numeric Effluent Limitations Since 
Proposal
    C. Numeric Effluent Limitations and Standards Considered
    D. Selected Options for BPT, BCT, BAT and BADT for NSPS
    E. Selection Rationale for BPT
    F. Selection Rationale for BCT
    G. Selection Rationale for BAT and BADT for NSPS
    1. Selection Rationale
    2. Numeric Limitations
    3. Rationale for Rejecting Options 1, 2 and 3 as the Technology-
Bases for BAT and BADT for NSPS
    4. Definition of ``New Source'' for the C&D Point Source 
Category
XI. Methodology for Estimating Costs to the Construction and 
Development Industry
XII. Economic Impact and Social Cost Analysis
    A. Introduction
    B. Description of Economic Activity
    C. Method for Estimating Economic Impacts
    1. Model Project Analysis
    2. Model Firm Analysis
    a. Assigning Projects and Costs to Model Firms
    b. Project-Level Cost Multiplier
    c. Cost Pass-through
    3. Housing Market Impacts
    4. Impacts on the National Economy
    D. Results
    1. Project-Level Impacts
    2. Firm-Level Impacts
    3. Impacts on Governments
    4. Community-Level Impacts
    5. Foreign Trade Impacts
    6. Impacts on New Firms
    7. Social Costs
    8. Small Business Impacts
XIII. Cost-Effectiveness Analysis
XIV. Non-Water Quality Environmental Impacts
    A. Air Pollution
    B. Solid Waste Generation
    C. Energy Usage
XV. Environmental Assessment
    A. Surface Water Impacts From Discharges Associated With 
Construction Activity
    B. Quantification of Sediment Discharges Associated With 
Construction Activity
    C. Quantification of Surface Water Quality Improvement From 
Reducing Discharges Associated With Construction and Development 
Activity
XVI. Benefit Analysis
    A. Benefits Categories Estimated
    B. Quantification of Benefits
XVII. Benefit-Cost Comparison
XVIII. Approach to Determining Effluent Limitations and Standards
    A. Definitions
    B. Percentile Basis for Limitations, not Compliance
XIX. Regulatory Implementation
    A. Monitoring Requirements
    B. Implementation
    C. Upset and Bypass Provisions
    D. Variances and Waivers
    E. Safe Drinking Water Act Requirements
    F. Other Clean Water Act Requirements
XX. Related Acts of Congress, Executive Orders, and Agency 
Initiatives
    A. Executive Order 12866: Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act (UMRA)
    E. Executive Order 13132: Federalism
    F. Executive Order 13175 (Consultation and Coordination With 
Indian Tribal Governments)
    G. Executive Order 13045: Protection of Children From 
Environmental Health Risks and Safety Risks
    H. Executive Order 13211 (Energy Effects)
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898: Federal Actions To Address 
Environmental Justice in Minority Populations and Low-Income 
Populations.
    K. Congressional Review Act (CRA)
    L. Judicial Review

I. Legal Authority

    EPA is promulgating these regulations under the authorities of 
sections 101, 301, 304, 306, 308, 402, 501 and 510 of the Clean Water 
Act (CWA), 33 U.S.C. 1251, 1311, 1314, 1316, 1318, 1341, 1342, 1361 and 
1370 and pursuant to the Pollution Prevention Act of 1990, 42 U.S.C. 
13101 et seq.

II. Purpose & Summary of the Final Rule

    EPA is today promulgating effluent limitations guidelines (ELG) and 
new source performance standards (NSPS) for the C&D point source 
category. EPA is promulgating a series of non-numeric effluent 
limitations, as well as a numeric effluent limitation for the pollutant 
turbidity. All construction sites will be required to meet the series 
of non-numeric effluent limitations. Construction sites that disturb 10 
or more acres of land at one time will be required to monitor 
discharges from the site and comply with the numeric effluent 
limitation. EPA is phasing in the numeric effluent limitation over four 
years to allow permitting authorities adequate time to develop 
monitoring requirements and to allow the regulated community time to 
prepare for compliance with the numeric effluent limitation. 
Construction sites that disturb 20 or more acres at one time will be 
required to conduct monitoring of discharges from the site and comply 
with the numeric effluent limitation beginning 18 months after the 
effective date of the final rule. Construction sites that disturb 10 or 
more acres at one time will be required to conduct monitoring of 
discharges from the site and comply with the numeric effluent 
limitation beginning four years after the effective date of the final 
rule.
    The total pollutant reductions, once fully implemented, will be 
approximately 4 billion pounds per year. The final rule will result in 
an extensive range of benefits. For some of those benefits EPA was able 
to estimate a monetized value of approximately $369 million per year, 
once fully implemented. EPA could not monetize the value of some 
benefit categories, such as increases in property value near water 
bodies, reduced flood damage, and reduced cost of ditch maintenance. 
For other benefits categories, such as swimming and fishing, EPA was 
able to partially monetize the benefits. The costs of the final rule in 
2010, which is the first year in which the rule must be incorporated 
into National Pollutant Discharge Elimination System (NPDES) permits, 
are estimated to be $8 million. Costs in 2011 are estimated to be $63 
million. Since this regulation will be implemented over time due to the 
schedule by which EPA and states will be issuing new or reissued 
permits, the annual cost of the rule will be $810 million after all 
states have incorporated the requirements of the final rule into their 
NPDES permits in 2014. EPA

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expects that after the rule is fully incorporated into EPA and state 
NPDES permits after the industry has returned to normal levels of 
construction activity, the annual cost of the rule will be $953 
million.
    The goal of the Clean Water Act is to restore and maintain the 
chemical, physical and biological integrity of the Nation's waters. CWA 
section 101, 33 U.S.C. 1251. Despite substantial improvements in the 
nation's water quality since the inception of the Clean Water Act, many 
of the nation's surface waters continue to be impaired. EPA's 
Assessment TMDL Tracking and Implementation System (ATTAINS) provides 
information on water quality conditions reported by the states to EPA 
under Sections 305(b) and 303(d) of the Clean Water Act. According to 
ATTAINS (as of September 17, 2009), 49 percent of assessed river and 
stream miles, 66 percent of assessed lake area, and 63 percent of 
assessed bay and estuary area is impaired by a wide range of sources. 
Improper control of stormwater discharges associated with construction 
activity is a contributor of sediment, turbidity, nutrients and other 
pollutants to surface waters in the United States. Sediment (both 
suspended and deposited) and turbidity are common construction site 
pollutants and are significant causes of surface water quality 
impairment. According to ATTAINS (as of September 17, 2009), turbidity 
contributes to impairment of 26,278 miles of assessed rivers and 
streams, 1,008,276 acres of assessed lakes, and reservoirs, and 240 
square miles of assessed bays and estuaries. These figures probably 
underestimate the extent of turbidity impairment since many waters have 
not yet been assessed. EPA's Wadeable Streams Assessment (2006) is a 
statistical survey of the smaller perennial streams and rivers that 
comprise 90 percent of all perennial stream miles in the coterminous 
United States. According to the survey, excess streambed sedimentation 
is one of the most widespread stressors, with 25 percent of streams in 
``poor'' streambed sediment condition.
    The sediment, turbidity, and other pollutants entrained in 
stormwater discharges associated with construction activity contribute 
to aquatic ecosystem degradation, increased drinking water treatment 
costs, and impairment of the recreational use and aesthetic value of 
impacted waters. Sediment can also accumulate in rivers, lakes, and 
reservoirs, leading to the need for dredging or other mitigation in 
order to prevent reduced water storage or navigation capacity.
    Construction activity typically involves site selection and 
planning, and land-disturbing tasks such as clearing, excavating and 
grading. Disturbed soil, if not managed properly, can be easily washed 
off-site during storm events. Stormwater discharges during construction 
activities containing sediment and turbidity can cause an array of 
physical, chemical and biological impacts on receiving waters. In 
addition to sediment and turbidity, a number of other pollutants (e.g., 
metals, organic compounds and nutrients) are preferentially absorbed or 
adsorbed onto mineral or organic particles found in fine sediment. 
These pollutants can cause an array of chemical and biological water 
quality impairments. The interconnected processes of erosion (i.e., 
detachment of soil particles by water), sediment transport, and 
delivery to receiving waters are the primary pathways for the addition 
of pollutants from construction and development sites (hereinafter C&D 
sites; construction sites; or sites) into aquatic systems.
    A primary concern at most C&D sites is the erosion and transport 
process related to fine sediment because rain splash, rills (small 
channels typically less than one foot deep) and sheetwash (thin sheets 
of water flowing across a surface) encourage the detachment and 
transport of sediment to water bodies. Although streams and rivers 
naturally carry sediment loads, discharges associated with construction 
activity can elevate these loads to levels above those in undisturbed 
watersheds. In addition, discharges from C&D sites can increase the 
proportion of silt, clay and colloidal particles in receiving streams 
because these fine-grained particles may not be effectively managed by 
conventional erosion and sediment controls utilized at C&D sites that 
rely on simple settling.
    Existing national stormwater regulations at 40 CFR 122.26 require 
dischargers engaged in construction activity to obtain NPDES permit 
coverage and to implement control measures to manage discharges 
associated with construction activity. This category is the largest 
category of dischargers in the NPDES program. However, there are 
currently no national performance standards or monitoring requirements 
for this category of dischargers. Today's regulation establishes a 
technology-based ``floor'' or minimum requirements on a national basis. 
This rule constitutes the nationally applicable, technology-based ELG 
and NSPS applicable to all dischargers currently required to obtain a 
NPDES permit pursuant to 40 CFR 122.26(b)(14)(x) and 122.26(b)(15). 
This rule focuses on discharges composed of stormwater but the ELGs and 
NSPSs also apply to other discharges of pollutants from C&D sites, such 
as discharges from dewatering activities. CWA section 301(a). The ELGs 
and NSPSs would require stormwater discharges from most C&D sites to 
meet effluent limitations designed to reduce the amount of sediment, 
turbidity, Total Suspended Solids (TSS) and other pollutants in 
stormwater discharges from the site.
    EPA acknowledges that many state and local governments have 
existing programs for controlling stormwater and wastewater discharges 
from construction sites. Today's ELGs and NSPS are intended to work in 
concert with these existing state and local programs and in no way does 
EPA intend for this regulation to interfere with existing state and 
local requirements that are more stringent than this rule or with the 
ability of state and local governments to promulgate new and more 
stringent requirements. Today's regulation requires all permittees to 
implement a range of erosion and sediment controls and pollution 
prevention measures at regulated construction sites. Today's regulation 
also establishes a numeric effluent limitation for turbidity in 
discharges from C&D sites that disturb ten or more acres of land at one 
time. Permittees would be required to sample stormwater discharges from 
the site and report the levels of turbidity present in the discharges 
to the permitting authority. These effluent limitations would, for many 
sites, require an additional layer of management practices and/or 
treatment above what most state and local programs are currently 
requiring. Permitting authorities are required to incorporate these 
turbidity limitations into their permits and permittees are required to 
implement control measures to meet a numeric turbidity limitation in 
discharges of stormwater from their C&D sites. EPA is not dictating 
that specific technologies be used to meet the numeric limitation, but 
is specifying the maximum daily turbidity level that can be present in 
discharges from C&D sites. EPA's limitations are based on its 
assessment of what specific technologies can reliably achieve. 
Permittees have the flexibility to select management practices or 
technologies that are best suited to site-specific conditions present 
on each individual C&D site if they are able to consistently meet the 
limitations and if they are consistent with requirements established by 
the permitting authority.

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Permittees also have the ability to phase their construction activities 
to limit applicability of the monitoring requirements and turbidity 
limitation.
    EPA expects that today's regulation will result in reductions in 
pollutant discharges and substantial improvements in receiving water 
quality nationally in areas where construction activities are occurring 
and downstream of areas where construction activities are occurring. In 
addition, the monitoring requirements contained in today's rule will 
significantly increase transparency and accountability for the largest 
category of NPDES dischargers and provide permittees, permitting 
authorities and the public with an important mechanism for gauging 
compliance with the regulations and standards.

III. Background on Existing Regulatory Program

A. Clean Water Act

    Congress passed the Federal Water Pollution Control Act of 1972 
(Pub. L. 92-500, October 18, 1972) (hereinafter the Clean Water Act or 
CWA), 33 U.S.C. 1251 et seq., with the stated objectives to ``restore 
and maintain the chemical, physical, and biological integrity of the 
Nation's waters.'' Section 101(a), 33 U.S.C. 1251(a). To achieve this 
goal, the CWA provides that ``the discharge of any pollutant by any 
person shall be unlawful'' except in compliance with other provisions 
of the statute. CWA section 301(a). 33 U.S.C. 1311. The CWA defines 
``discharge of a pollutant'' broadly to include ``any addition of any 
pollutant to navigable waters from any point source.'' CWA section 
502(12). 33 U.S.C. 1362(12). EPA is authorized under CWA section 402(a) 
to issue a NPDES permit for the discharge of any pollutant from a point 
source. These NPDES permits are issued by EPA regional offices or NPDES 
authorized state or tribal agencies. Since 1972, EPA and the states 
have issued NPDES permits to thousands of dischargers, both industrial 
(e.g., manufacturing, energy and mining facilities) and municipal 
(e.g., sewage treatment plants). As required under Title III of the 
CWA, EPA has promulgated ELGs and standards for many industrial point 
source categories, and these requirements are incorporated into the 
permits. The Water Quality Act (WQA) of 1987 (Pub. L. 100-4, February 
4, 1987) amended the CWA, adding CWA section 402(p), requiring 
implementation of a comprehensive program for addressing stormwater 
discharges. 33 U.S.C. 1342(p).

B. Clean Water Act Stormwater Program

    Prior to the WQA of 1987, there were numerous questions regarding 
the appropriate means of regulating stormwater discharges within the 
NPDES program due to the serious water quality impacts of stormwater, 
the variable nature of stormwater, the large number of stormwater point 
sources and permitting agency resources. EPA undertook numerous 
regulatory actions, which resulted in extensive litigation, in an 
attempt to address these unique discharges. Congress, with the addition 
of section 402(p), established a structured and phased approach to 
address stormwater discharges and fundamentally altered the way 
stormwater is addressed under the CWA as compared with process 
wastewater or other discharges of pollutants. Section 402(p)(1) created 
a temporary moratorium on NPDES permits for point source stormwater 
discharges, except for those listed in section 402(p)(2), including 
dischargers already required to have a permit and discharges associated 
with industrial activity. In 1990, pursuant to section 402(p)(4), EPA 
promulgated the Phase I stormwater regulations for those stormwater 
discharges listed in 402(p)(2). 55 FR 47990 (November 16, 1990). The 
Phase I regulations required NPDES permit coverage for discharges 
associated with industrial activity and from ``large'' and ``medium'' 
municipal separate storm sewer systems (MS4s). CWA section 402(p)(2). 
As part of that rulemaking, the Agency interpreted stormwater 
``discharges associated with industrial activity'' to include 
stormwater discharges associated with ``construction activity'' as 
defined at 40 CFR 122.26(b)(14)(x). As described in the Phase I 
regulations, dischargers must apply for and obtain authorization to 
discharge (or ``permit coverage''), and a permit is required for 
discharges associated with construction activity, including clearing, 
grading, and excavation, if the construction activity:
     Will result in the disturbance of five acres or greater; 
or
     Will result in the disturbance of less than five acres of 
total land area that is a part of a larger common plan of development 
or sale if the larger common plan will ultimately disturb five acres or 
greater.
    See 40 CFR 122.26(b)(14)(x) and (c)(1). These discharges associated 
with ``large'' construction activity are one of the categories of 
stormwater dischargers EPA defined as associated with industrial 
activity. See 40 CFR 122.26(b)(14).
    Section 402(p)(6) established a process for EPA to evaluate 
potential sources of stormwater discharges not included in the Phase I 
regulations and designation of those discharges for regulation in order 
to protect water quality. Section 402(p)(6) instructs EPA to ``issue 
regulations * * * which designate stormwater discharges, other than 
those discharges described in [section 402(p)(2)], to be regulated to 
protect water quality and shall establish a comprehensive program to 
regulate such designated sources.'' In 1999, pursuant to the broad 
discretion granted to the Agency under section 402(p)(6), EPA 
promulgated the Phase II stormwater regulations which designated 
discharges associated with ``small'' construction activity and 
``small'' MS4s. 64 FR 68722 (December 8, 1999). An NPDES permit is 
required for discharges associated with small construction activity, 
including clearing, grading, and excavation, if the construction 
activity:
     Will result in land disturbance of equal to or greater 
than one acre and less than five acres; or
     Will result in disturbance of less than one acre of total 
land area that is part of a larger common plan of development or sale 
if the larger common plan will ultimately disturb equal to or greater 
than one and less than five acres.
See 40 CFR 122.26(b)(15).
    EPA continues to have the authority to use section 402(p)(6) to 
designate additional stormwater discharges for regulation under the CWA 
in order to protect water quality. See 40 CFR 122.26(a)(9)(i)(C)-(D); 
see also Envt Defense Ctr. v. EPA, 344 F.3d 832, 873-76 (9th Cir. 
2003).
    In addition, as stated above, the Phase I and Phase II regulations 
require NPDES permits for ``large,'' ``medium,'' and ``small'' MS4s. 
Operators of these MS4s, typically local governments, must develop and 
implement a stormwater management program, including a requirement to 
address stormwater discharges associated with construction activity and 
discharges after construction activity. More details on the 
requirements of MS4 programs are described in section III.B.2.
1. NPDES Permits for Stormwater Discharges Associated With Construction 
Activity
    The NPDES regulations provide two options for obtaining 
authorization to discharge or ``permit coverage'': General permits and 
individual permits. A brief description of these types of permits as 
they apply to C&D sites follows.

[[Page 63000]]

a. General NPDES Permits
    The vast majority of discharges associated with construction 
activity are covered under NPDES general permits. EPA, states and 
tribes use general permits to cover a group of similar dischargers 
under one permit. See 40 CFR 122.28. General permits simplify the 
process for dischargers to obtain authorization to discharge, provide 
permit requirements for any discharger that files a notice of intent to 
be covered, and reduce the administrative workload for NPDES permitting 
authorities. General permits, including a fact sheet describing the 
rationale for permit conditions, are issued by NPDES permitting 
authorities after an opportunity for public review of the proposed 
general permit. Typically, to obtain authorization to discharge under a 
construction general permit, a discharger (the owner or operator of the 
C&D sites; typically, a developer, builder, or contractor) submits to 
the permitting authority a Notice of Intent (NOI) to be covered under 
the general permit. A NOI is not a permit or a permit application, see 
Texas Independent Producers and Royalty Owners Ass'n v. EPA, 410 F.3d 
964, 977-78 (7th Cir. 2005), but by submitting the NOI, the discharger 
acknowledges that it is eligible for coverage under the general permit 
and agrees to the conditions in the published general permit. 
Discharges associated with the construction activity are authorized 
consistent with the terms and conditions established in the general 
permit.
    EPA regulations allow NPDES permitting authorities to regulate 
discharges from small C&D sites under a general permit without the 
discharger submitting an NOI if the permitting authority determines an 
NOI is inappropriate and the general permit includes language 
acknowledging that an NOI is unnecessary (40 CFR 122.28(b)(2)(v)). To 
implement such a requirement, the permitting authority must specify in 
the public notice of the general permit any reasons why an NOI is not 
required. In these instances, any stormwater discharges associated with 
small construction activity are automatically covered under an 
applicable general permit and the discharger is required to comply with 
the terms, conditions and effluent limitations of such permit.
    Similarly, EPA, states and tribes have the authority to notify a 
C&D site operator that it is covered by a general permit, even if that 
operator has not submitted an NOI (40 CFR 122.28(b)(2)(vi)). In these 
instances, the operator is given the opportunity to request coverage 
under an individual permit. Individual permits are discussed in section 
III.B.1.d.
b. EPA Construction General Permit
    Since 1992, EPA has issued a series of ``national'' Construction 
General Permits (CGP) that cover areas where EPA is the NPDES 
permitting authority. At present, EPA is the permitting authority in 
four states (Idaho, Massachusetts, New Hampshire, and New Mexico), the 
District of Columbia, Puerto Rico, all other U.S. territories with the 
exception of the Virgin Islands, federal facilities in four states 
(Colorado, Delaware, Vermont, and Washington), most Indian lands and a 
couple of other specifically designated activities in specific states 
(e.g., oil and gas activities in Texas and Oklahoma). EPA's current CGP 
became effective on June 30, 2008 (see 74 FR 40338). EPA has proposed 
to modify the expiration date of the current 2008 CGP for one year, to 
June 30, 2011, in order to allow EPA adequate time to incorporate the 
ELGs and NSPS in this final rule and provide any necessary guidance to 
the regulated industry (see 74 FR 53494). At that time, EPA will issue 
a new CGP that includes the requirements of this final rule.
    The key components of EPA's current CGP are non-numeric effluent 
limitations and ``best management practices'' (BMP) that require the 
permittee to minimize discharges of pollutants in stormwater discharges 
using control measures that reflect best engineering practices based on 
EPA's best professional judgment. Dischargers must minimize their 
discharge of pollutants in stormwater using appropriate erosion and 
sediment controls and control measures for other pollutants such as 
litter, construction debris, and construction chemicals that could be 
exposed to stormwater and other wastewater. The 2008 EPA CGP requires 
dischargers to develop and implement a stormwater pollution prevention 
plan (SWPPP) to document the steps they will take to comply with the 
terms, conditions and effluent limitations of the permit. EPA's 
guidance manual, ``Developing Your Stormwater Pollution Prevention 
Plan: A Guide for Construction Sites,'' (EPA 833/R-060-04, May 2007; 
available on EPA's Web site at http://www.epa.gov/npdes/stormwater) 
describes the SWPPP process in detail. As detailed in EPA's CGP, the 
SWPPP must include a description of the C&D site with maps showing 
drainage patterns, discharge points, and locations of discharge 
controls; a description of the control measures used; and inspection 
procedures. A copy of the SWPPP must be kept on the construction site 
from the date of project initiation to the date of final stabilization. 
The CGP does not require permittees to submit a SWPPP to the permitting 
authority; however, a copy must be readily available to authorized 
inspectors during normal business hours. Other requirements in the CGP 
include conducting regular inspections and reporting releases of 
reportable quantities of hazardous substances.
c. State Construction General Permits
    Whether EPA, a state or a tribe issues the general permit, the CWA 
and EPA regulations require that NPDES permits must include technology-
based effluent limitations. 40 CFR 122.44. In addition, where 
technology-based effluent limitations are insufficient for the 
discharge to meet applicable water quality standards, the permit must 
contain water quality-based effluent limitations as necessary to meet 
those standards. See sections 301, 304, 303, 306, and 402 of the CWA. 
PUD No. 1 of Jefferson County v. Washington Department of Ecology, 511 
U.S. 700, 704-705 (1994).
    For the most part, state-issued general permits for stormwater 
discharges associated with construction activity have followed EPA's 
CGP format and content, starting with EPA's first CGP issued in 1992 
(57 FR 41176; September 9, 1992). Over time, some states have changed 
components of their permits to better address the specific conditions 
encountered at construction sites within their jurisdiction (e.g., soil 
types, topographic or climatic characteristics, or other relevant 
factors). For example, the States of Washington, Oregon, Georgia and 
Vermont's CGPs include discharge monitoring requirements for C&D sites 
applicable to all or a subset of construction sites. In addition, the 
State of California's current CGP contains monitoring requirements as 
well as numeric effluent limitations for a subset of construction sites 
within the state.
d. Individual NPDES Permits
    A permitting authority may require any C&D site to apply for an 
individual permit rather than using the general permit. Likewise, any 
discharger may request to be covered under an individual permit rather 
than seek coverage under an otherwise applicable general permit (40 CFR 
122.28(b)(3)). Unlike a general permit, an individual permit is 
intended to be issued to one permittee, or a few co-permittees. 
Individual permits for stormwater discharges from construction sites 
are

[[Page 63001]]

rarely used, but when done so, are most often used for very large 
projects or projects located in sensitive watersheds. EPA estimates 
that fewer than one half of one percent (< 0.5%) of all construction 
sites are covered under individual permits.
2. Municipal Stormwater Permits and Local Government Regulation of 
Stormwater Discharges Associated With Construction Activity
    Many local governments, as MS4 permittees, have a role to play in 
the regulation of construction activities. This section provides an 
overview of MS4 responsibilities associated with controlling stormwater 
discharges associated with construction activity.
a. NPDES Requirements
    A municipal separate storm sewer system (MS4) is generally a 
conveyance or system of conveyances owned or operated by a public body 
that discharges to waters of the United States and is designed or used 
for collecting or conveying stormwater. These systems are not combined 
sewers and not part of a Publicly Owned Treatment Works (POTW). See 40 
CFR 122.26(b)(8) for an exact definition. An MS4 is all large, medium, 
and small municipal storm sewers or those designated as such under EPA 
regulations. See 40 CFR 122.26(b)(18). The NPDES stormwater regulations 
require many MS4s to apply for permits. In general, the 1990 Phase I 
rule requires MS4s serving populations of 100,000 or more to obtain 
coverage under an MS4 individual permit. See 40 CFR 122.26(a)(3). The 
1999 Phase II rule requires most small MS4s located in urbanized areas 
also to obtain coverage. See 40 CFR 122.33. Regardless of the type of 
permit, MS4s are required to develop stormwater management programs 
that detail the procedures they will use to control discharges of 
pollutants in stormwater from the MS4.
    The Phase II regulations also provide permitting authorities or the 
EPA Regional Administrator with the authority to designate any 
additional stormwater discharges for permit coverage where he or she 
determines that stormwater controls are needed for the discharge based 
on wasteload allocations that are part of total maximum daily loads 
(TMDL) that address pollutants of concern or that the discharge, or 
category of discharges within a geographic area, contributes to a 
violation of a water quality standard or is a significant contributor 
of pollutants to waters of the United States. 40 CFR 122.26(9)(a)(i)(C) 
and (D).
    Both the Phase I and II rules require regulated municipalities to 
develop stormwater management programs which include, among other 
elements, the control of discharges from construction sites. The Phase 
I regulations require medium and large MS4s to implement and maintain a 
program to reduce pollutants in stormwater discharges associated with 
construction activities, including procedures for site planning, 
requirements for structural and non-structural BMPs, procedures for 
identifying priorities for inspecting sites and enforcing control 
measures, and development and dissemination of appropriate educational 
and training materials. In general, the Phase II regulations require 
small MS4s to develop, implement, and enforce a program to control 
pollutants in stormwater discharges associated with construction 
activities which includes developing an ordinance to require 
implementation of erosion and sediment control practices, to control 
waste and to have procedures for site plan review and site inspections. 
Thus, as described above, both the Phase I and Phase II regulations 
specifically anticipate a local program for controlling stormwater 
discharges associated with construction activity. See 40 CFR 
122.26(d)(2)(iv)(D) for Phase I MS4s and 40 CFR 122.34(b)(4) for Phase 
II MS4s. EPA has provided guidance materials to the NPDES permitting 
authorities and MS4s that recommend components and activities for a 
well-operated local stormwater management program.
    EPA promulgated two provisions intended to minimize potential 
duplication of requirements or inconsistencies between requirements. 
First, 40 CFR 122.35 provides that a small MS4 is allowed to rely on 
another entity's program to satisfy its NPDES permit obligations, 
including construction site control, provided the other entity 
implements a program that is at least as stringent as the corresponding 
NPDES permit requirements and the other entity agrees to implement the 
control measures on the small MS4's behalf. Thus, for example, where a 
county implements a construction site stormwater control program 
already, and that program is at least as stringent as the controls 
required by a small MS4's NPDES permit, the MS4 may reference that 
program in the Notice of Intent to be covered by a general permit, or 
in its permit application, rather than developing and implementing a 
new program to require control of construction site stormwater within 
its jurisdiction.
    Similarly, EPA or the state permitting authority may substitute 
certain aspects of the requirements of the EPA or state permit by 
incorporating by reference the requirements of a ``qualifying local 
program'' in the EPA or state CGP. A ``qualifying local program'' is an 
existing sediment and erosion control program that meets the minimum 
requirements as established in 40 CFR 122.44(s). By incorporating a 
qualifying local, state or tribal program into the EPA or state CGP, 
construction sites covered by the qualifying program in that 
jurisdiction would simply follow the incorporated local requirements in 
order to meet the corresponding requirements of the EPA or state CGP.
b. EPA Guidance to Municipalities
    EPA developed several guidance documents for municipalities to 
implement the NPDES Phase II rule.
     National Menu of BMPs (http://cfpub.epa.gov/npdes/stormwater/menuofbmps/index.cfm). This document provides guidance to 
regulated MS4s as to the types of practices they could use to develop 
and implement their stormwater management programs. The menu includes 
descriptions of practices that local programs can implement to reduce 
impacts of stormwater discharges from construction activities.
     Measurable Goals Guidance for Phase II MS4s (http://cfpub.epa.gov/npdes/stormwater/measurablegoals/index.cfm). This 
document assists small MS4s in defining performance targets and 
includes examples of goals for practices to control stormwater 
discharges from construction activities.
     Stormwater Phase II Compliance Assistance Guide (EPA 833-
R-00-002, March 2000). The guide provides an overview of compliance 
responsibilities for MS4s, small construction sites, and certain other 
industrial stormwater discharges affected by the Phase II rule.
     Fact Sheets on various stormwater control technologies, 
including hydrodynamic separators (EPA 832-F-99-017), infiltrative 
practices (EPA 832-F-99-018 and EPA 832-F-99-019), modular treatment 
systems (EPA 832-F-99-044), porous pavement (EPA 832-F-99-023), sand 
filters (EPA 832-F-99-007), turf reinforcement mats (EPA 832-F-99-002), 
vegetative covers (EPA 832-F-99-027), swales (EPA 832-F-99-006) and wet 
detention ponds (EPA 832-F-99-048). (Available at http://www.epa.gov/npdes/stormwater/; click on ``Publications.'')

C. Other State and Local Stormwater Requirements

    States and municipalities may have other requirements for flood 
control, erosion and sediment control, and in

[[Page 63002]]

many cases, stormwater management. Many of these provisions were 
enacted before the promulgation of the EPA Phase I stormwater rule 
although many have been updated since. EPA found that all states have 
laws for erosion and sediment control measures, with these laws 
implemented by state, county, or local governments. A summary of 
existing state requirements is provided in the Development Document.

D. Technology-Based Effluent Limitations Guidelines and Standards

    Effluent limitations guidelines and new source performance 
standards are technology-based effluent limitations required by CWA 
sections 301 and 306 for categories of point source discharges. These 
effluent limitations, which can be either numeric or non-numeric, along 
with water quality-based effluent limitations, if necessary, are 
incorporated into NPDES permits. ELGs and NSPSs are based on the degree 
of control that can be achieved using various levels of pollutant 
control technology as defined in Title III of the CWA and outlined 
below.
1. Best Practicable Control Technology Currently Available (BPT)
    In establishing effluent limitations guidelines for a point source 
category, the CWA requires EPA to specify BPT effluent limitations for 
conventional, toxic, and nonconventional pollutants. In doing so, EPA 
is required to determine what level of control is technologically 
available and economically practicable. CWA section 301(b)(1)(A). In 
specifying BPT, the CWA requires EPA to look at a number of factors. 
EPA considers the total cost of application of technology in relation 
to the effluent reduction benefits to be achieved from such 
application. The Agency also considers the age of the equipment and 
facilities, the process employed and any required process changes, 
engineering aspects of the application of the control technologies, 
non-water quality environmental impacts (including energy 
requirements), and such other factors as the Administrator deems 
appropriate. CWA section 304(b)(1)(B). Traditionally, EPA establishes 
BPT effluent limitations based on the average of the best performance 
of facilities within the category of various ages, sizes, processes or 
other common characteristics. Where existing performance is uniformly 
inadequate, EPA may require higher levels of control than currently in 
place in a category if the Agency determines that the technology can be 
practicably applied. See e.g., American Frozen Foods Inst. v. Train, 
539 F.2d 107, 117 (D.C. Cir. 1976).
    EPA assesses the cost-reasonableness of BPT limitations by 
considering the cost of treatment technologies in relation to the 
effluent reduction benefits achieved. This inquiry does not limit EPA's 
broad discretion to adopt BPT limitations that are achievable with 
available technology. This ``limited cost-benefit analysis'' is 
intended to ``limit the application of technology only where the 
additional degree of effluent reduction is wholly out of proportion to 
the costs of achieving such marginal level of reduction.'' See EPA v. 
National Crushed Stone Ass'n, 449 U.S. 64 71 (1980). Moreover, the 
inquiry does not require the Agency to quantify benefits in monetary 
terms. See, e.g., American Iron and Steel Institute v. EPA, 526 F.2d 
1027, 1051 (3rd Cir. 1975).
    In balancing costs against the effluent reduction, EPA considers 
the volume and nature of the expected discharges after application of 
BPT and the cost and economic impacts of the required level of 
pollution control. In past effluent limitation guidelines, BPT cost-
reasonableness comparisons ranged from $0.26 to $41.44 per pound 
removed (in 2008 dollars). This range is not inclusive of all 
categories regulated by BPT, but nonetheless represents a very broad 
range of cost-reasonableness values. About half of the cost-
reasonableness values represented by this range are less than $2.99 per 
pound (in 2008 dollars).
2. Best Available Technology Economically Achievable (BAT)
    BAT effluent guidelines are applicable to toxic (priority) and 
nonconventional pollutants. EPA has identified 65 pollutants and 
classes of pollutants as toxic pollutants, of which 126 specific 
substances have been designated priority toxic pollutants. 40 CFR 
401.15 and 40 CFR part 423, Appendix A. In general, BAT represents the 
best available performance of facilities through application of the 
best control measures and practices achievable including treatment 
techniques, process and procedure innovations, operating methods, and 
other alternatives within the point source category. CWA section 
304(b)(2)(A). The factors EPA considers in assessing BAT include the 
cost of achieving BAT effluent reductions, the age of equipment and 
facilities involved, the processes employed, the engineering aspects of 
the control technology, potential process changes, non-water quality 
environmental impacts (including energy requirements), and such factors 
as the Administrator deems appropriate. CWA section 304(b)(2)(B). The 
Agency retains considerable discretion in assigning the weight to be 
accorded to these factors. Weyerhaeuser Company v. Costle, 590 F.2d 
1011, (D.C. Cir. 1978). An additional factor, derived from the 
statutory phrase best available technology economically achievable, is 
``economic achievability.'' CWA section 301(b)(2)(A). EPA may determine 
the economic achievability of an option on the basis of the overall 
effect of the rule on the industry's financial health. See E.I. du Pont 
de Nemours & Co. v. Train, 430 U.S. 112, 129 (1977); American Frozen 
Food Inst. v. Train, 539 F.2d 107, 131 (D.C. Cir. 1976). The Agency may 
base BAT limitations upon effluent reductions attainable through 
changes in a facility's processes and operations. See Texas Oil & Gas 
Ass'n v. EPA, 161 F.3d 923, 928 (5th Cir. 1998) (citing ``process 
changes'' as one factor EPA considers in determining BAT); see also, 
American Meat Institute v. EPA, 526 F.2d 442, 464 (7th Cir. 1975). As 
with BPT, where existing performance is uniformly inadequate, EPA may 
base BAT upon technology transferred from a different subcategory or 
from another category. See CPC International Inc. v. Train, 515 F.2d 
1032, 1048 (8th Cir. 1975) (established criteria EPA must consider in 
determining whether technology from one industry can be applied to 
another); see also, Tanners' Council of America, Inc. v. Train, 540 
F.2d 1188 (4th Cir. 1976). In addition, the Agency may base BAT upon 
manufacturing process changes or internal controls, even when these 
technologies are not common industry practice. See American Frozen 
Foods Inst. v. Train, 539 F.2d 107, 132 (D.C. Cir. 1976); Reynolds 
Metals Co. v. EPA, 760 F.2d 549, 562 (4th Cir. 1985); California & 
Hawaiian Sugar Co. v. EPA, 553 F.2d 280 (2d Cir. 1977).
3. Best Conventional Pollutant Control Technology (BCT)
    The 1977 amendments to the CWA required EPA to identify effluent 
reduction levels for conventional pollutants associated with BCT 
technology for discharges from existing point sources. BCT is not an 
additional limitation, but replaces Best Available Technology (BAT) for 
control of conventional pollutants. In addition to other factors 
specified in CWA section 304(b)(4)(B), the Act requires that EPA 
establish BCT limitations after consideration of a two-part ``cost-
reasonableness'' test. EPA explained its methodology for the 
development of BCT limitations in July 1986. 51 FR 24974 (July 9, 
1986).

[[Page 63003]]

    Section 304(a)(4) designates the following as conventional 
pollutants: biochemical oxygen demand (BOD5), total 
suspended solids (TSS), fecal coliform, pH, and any additional 
pollutants defined by the Administrator as conventional. 40 CFR 401.16. 
The Administrator designated oil and grease as an additional 
conventional pollutant. 44 FR 44501 (July 30, 1979).
4. Best Available Demonstrated Control Technology (BADT) for New Source 
Performance Standards (NSPS)
    NSPS apply to all pollutants and reflect effluent reductions that 
are achievable based on the BADT. New sources, as defined in CWA 
section 306, have the opportunity to install the best and most 
efficient production processes and wastewater treatment technologies. 
As a result, NSPS should represent the greatest degree of effluent 
reduction attainable through the application of the best available 
demonstrated control technology. In establishing NSPS, CWA section 306 
directs EPA to take into consideration similar factors that EPA 
considers when establishing BAT, namely the cost of achieving the 
effluent reduction and any non-water quality, environmental impacts and 
energy requirements.
5. Pretreatment Standards
    The CWA also defines standards for indirect discharges, i.e. 
discharges into publicly owned treatment works (POTWs). These standards 
are known as Pretreatment Standards for Existing Sources (PSES) and 
Pretreatment Standards for New Sources (PSNS), and are promulgated 
under CWA section 307(b). EPA has no data concerning the discharge of 
pollutants from construction sites to POTWs and POTW treatment plants. 
Therefore, EPA did not propose PSES or PSNS for the C&D category and is 
not promulgating PSES or PSNS for the C&D category. EPA determined that 
the majority of construction sites discharge either directly to waters 
of the U.S. or through MS4s. In some urban areas, construction sites 
may discharge to combined sewer systems (i.e., sewers carrying both 
stormwater and domestic sewage through a single pipe) which lead to 
POTW treatment plants. Sediment and turbidity, which are the primary 
pollutants associated with construction site discharges, are 
susceptible to treatment in POTWs, using technologies commonly employed 
such as primary clarification. EPA has no evidence that construction 
site discharges to POTWs would cause interference, pollutant pass-
through or sludge contamination.
6. EPA Authority to Promulgate Non-Numeric Effluent Limitations
    The regulations promulgated today include non-numeric effluent 
limitations that will control the discharge of pollutants from C&D 
sites. It is well established that EPA has the authority to promulgate 
non-numeric effluent limitations in addition to, or in lieu of, numeric 
limitations. The CWA does not mandate the use of numeric limitations 
and EPA's position finds support in the language of the CWA. The 
definition of ``effluent limitation'' means ``any restriction * * * on 
quantities, rates, and concentrations of chemical, physical, 
biological, and other constituents * * *'' CWA section 502(11) 
(emphasis added). EPA regulations reflect the Agency's long standing 
interpretation that the CWA allows for non-numeric effluent 
limitations. EPA regulations explicitly allow for non-numeric effluent 
limitations for the control of toxic pollutants and hazardous 
substances from ancillary industrial activities; for the control of 
storm water discharges; when numeric effluent limitations are 
infeasible; or when the practices are reasonably necessary to achieve 
effluent limitations and standards or to carry out the purposes and 
intent of the CWA. See 40 CFR 122.44(k).
    Federal courts have recognized EPA's authority under the CWA to use 
non-numeric effluent limitations. In Citizens Coal Council v. U.S. EPA, 
447 F3d 879, 895-96 (6th Cir. 2006), the Sixth Circuit, in upholding 
EPA's use of non-numeric effluent limitations, agreed with EPA that it 
derives authority under the CWA to incorporate non-numeric effluent 
limitations for conventional and non-conventional pollutants. See also, 
Waterkeeper Alliance, Inc. v. U.S. EPA, 399 F.3d 486, 496-97, 502 (2d 
Cir. 2005) (EPA use of non-numerical effluent limitations in the form 
of best management practices are effluent limitations under the CWA); 
Natural Res. Def. Council, Inc. v. EPA, 673 F.2d 400, 403 (D.C. Cir. 
1982) (``section 502(11) [of the CWA] defines `effluent limitation' as 
`any restriction' on the amounts of pollutants discharged, not just a 
numerical restriction.'').
7. CWA Section 304(m) Litigation
    EPA identified the C&D point source category in its CWA section 
304(m) plan in 2000 as an industrial point source category for which 
EPA intended to conduct rulemaking. 65 FR at 53008 and 53011 (August 
31, 2000). On June 24, 2002, EPA published a proposed rule that 
contained several options for the control of stormwater discharges from 
construction sites, including ELGs and NSPSs. (67 FR 42644; June 24, 
2002). On April 26, 2004, EPA chose to rely on the range of existing 
programs, regulations, and initiatives that already existed at the 
federal, state and local level and withdrew the proposed ELGs and 
NSPSs. (69 FR 22472; April 26, 2004). On October 6, 2004, the Natural 
Resources Defense Council, Waterkeeper Alliance and the states of New 
York and Connecticut filed a complaint in federal district court 
alleging that EPA's decision not to promulgate ELGs and NSPSs for the 
C&D point source category violated a mandatory duty under the CWA. The 
district court, in NRDC v. EPA, 437 F.Supp.2d 1137, 1139 (C.D. Cal. 
2006), held that CWA section 304(m) imposes on EPA a mandatory duty to 
promulgate ELGs and NSPSs for new industrial point source categories 
named in a CWA section 304(m) plan. At that time EPA argued that the 
district court should enter an order providing for a four-year schedule 
for EPA to promulgate the ELGs and NSPSs in order to allow the Agency 
the opportunity to collect additional data on the construction 
industry, additional data on stormwater discharges associated with 
construction activity, and to be able to have the time to solicit 
additional data based on comments received on the proposed regulation. 
The district court rejected EPA's proposed schedule, forcing the Agency 
to proceed under an accelerated schedule by enjoining EPA in an order 
to propose and publish ELGs and NSPSs for the C&D industry by December 
1, 2008 and to promulgate and publish ELGs and NSPSs as soon as 
practicable, but in no event later than December 1, 2009. See NRDC, et 
al. v. EPA, No CV-0408307 (C.D. Cal.) (Permanent Injunction and 
Judgment, December 5, 2006). On appeal, the Ninth Circuit in NRDC v. 
EPA, 542 F.3d 1235 (9th Cir. 2008) affirmed the district court's 
decision. Consistent with the district court order, EPA published 
proposed ELGs and NSPSs on November 28, 2008 (see 73 FR 72562) and is 
publishing final ELGs and NSPSs today.

IV. Overview of the Construction Industry and Construction Activities

    The C&D point source category covers firms classified by the Census 
Bureau into two North American Industry Classification System (NAICS) 
codes.
     Construction of Buildings (NAICS 236) includes 
residential, nonresidential, industrial, commercial and institutional 
building construction.
     Heavy and Civil Engineering Construction (NAICS 237) 
includes utility systems construction (water and

[[Page 63004]]

sewer lines, oil and gas pipelines, power and communication lines); 
land subdivision; highway, street, and bridge construction; and other 
heavy and civil engineering construction.
    Other types of entities not included in this list could also be 
regulated.
    A single construction project may involve many firms from both 
subsectors. The number of firms involved and their financial and 
operational relationships may vary greatly from project to project. In 
typical construction projects, the firms identifying themselves as 
``operators'' under a construction general permit are usually general 
building contractors or developers. While the projects often engage the 
services of specialty contractors such as excavation companies, these 
specialty firms are typically subcontractors to the general building 
contractor and are not separately identified as operators in stormwater 
permits. Other classes of subcontractors such as carpentry, painting, 
plumbing and electrical services typically do not apply for, nor 
receive, NPDES permits. The types and numbers of firms in the 
construction industry are described in more detail in the Economic 
Analysis.
    Construction activity on any size parcel of land almost always 
calls for a remodeling of the earth. Therefore, actual site 
construction typically begins with site clearing and grading. Earthwork 
activities are important in site preparation because they ensure that a 
sufficient layer of organic material (ground cover and other 
vegetation, especially roots) is removed. The size of the site, extent 
of water present, the types of soils, topography and weather determine 
the types of equipment that will be needed during site clearing and 
grading. Material that will not be used on the site may be hauled away. 
Clearing activities involve the movement of materials from one area of 
the site to another or complete removal from the site. When grading a 
site, builders typically take measures to ensure that new grades are as 
close to the original grade as possible to reduce erosion and 
stormwater runoff, which can result in discharge of sediment, turbidity 
and other pollutants. Proper grade also ensures a flat surface for 
development and is designed to attain proper drainage away from the 
constructed buildings. A wide variety of equipment is often used during 
excavation and grading. The type of equipment used generally depends on 
the functions to be performed and on specific site conditions. Shaping 
and compacting of the earth is an important part of site preparation. 
Earthwork activities might require that fill material be used on the 
site. In such cases, the fill must be spread in uniform, thick layers 
and compacted to a specific density. An optimum moisture content must 
also be reached. Graders and bulldozers are the most common earth-
spreading machines, and compaction is often accomplished with various 
types of rollers. If rock is to be removed from the site, the 
contractor must first loosen and break the rock into small pieces using 
various types of drilling equipment or explosives. (Adapted from 
Peurifoy, Robert L. and Oberlender, Garold D. (1989). Estimating 
Construction Costs (4th ed.). New York: McGraw Hill Book Company.)
    Once materials have been excavated and removed and the ground has 
been cleared and graded, the site is ready for construction of 
buildings, roads, and/or other structures. During construction 
activity, the disturbed land can remain exposed without vegetative 
cover for a substantial period of time. Where the soil surface is 
unprotected, soil particles and other pollutants are particularly 
susceptible to erosion and may be easily washed away by rain or snow 
melt and discharged from the site. Permittees typically use a 
combination of erosion and sediment control measures designed to 
prevent mobilization of the soil particles and capture of those 
particles that do mobilize and become entrained in stormwater. In some 
cases permittees treat a portion of the discharge using filtration or 
other treatment technologies. Common erosion and sediment control 
measures and treatment technologies are described further in the 
Development Document.

V. Summary of the Proposed Regulation

    EPA published proposed regulations for the C&D category on November 
28, 2008. 73 FR 72562. The proposed rule contained several options. One 
option (Option 1), which is based on the requirements similar to those 
contained in past EPA CGPs, would have established a set of non-numeric 
effluent limitations requiring dischargers to provide and maintain 
effective erosion control measures, sediment control measures, and 
other pollution prevention measures to minimize, control or prevent the 
discharge of pollutants in stormwater and other wastewater from 
construction sites. In addition, reflecting current requirements in the 
EPA CGP, sediment basins would have been required for common drainage 
locations that serve an area with 10 or more acres disturbed at one 
time to contain and settle sediment from stormwater runoff before 
discharge. Option 1 would have required minimum standards of design for 
sediment basins; however, alternatives that control sediment discharges 
in a manner equivalent to sediment basins would have been authorized 
where approved by the permitting authority.
    Another option (Option 2) would have incorporated the same 
provisions as Option 1 and for sites of 30 or more acres located in 
areas of the country with the annual Revised Universal Soil Loss 
Equation (RUSLE) R-factor greater than 50 and that contained more than 
10% by mass of soil particles smaller than 2 microns, discharges of 
stormwater from the site would have been required to monitor and meet a 
numeric effluent limitation on the allowable level of turbidity. The 
numeric turbidity limitation proposed was 13 nephelometric turbidity 
units (NTUs). The technology basis for Option 2 was active or advanced 
treatment systems (ATS), which consisted of polymer-assisted 
clarification followed by filtration. A third option (Option 3) was 
similar to Option 2, except that it would have applied the 13 NTU 
limitation to all construction sites of 10 or more acres, regardless of 
location or soil type.
    In addition, the proposal presented and solicited comment on 
another option that would require compliance with a higher numeric 
turbidity effluent limitation (e.g., 50 to 150 NTU, or some other 
value) based on passive treatment technologies instead of ATS (see 73 
FR 72562, 72580-72582, 72610-72611). Passive treatment technologies 
include conventional erosion and sediment controls, polymer addition to 
sediment basins, fiber check dams with polymer addition, and other 
controls. At proposal, EPA sought additional data on the performance of 
passive treatment systems, and the cost and pollutant loading 
reductions that would be attainable from such an option.
    In the proposed rule, EPA selected Option 1 as the basis of BPT and 
BCT, and Option 2 as the basis of BAT and NSPS. At the time of 
proposal, EPA defined a ``new source'' as any source from which there 
will be a discharge associated with construction activity that will 
result in a building, structure, facility, or installation subject to 
new source performance standards elsewhere under 40 CFR subchapter N.
    A summary of the costs, estimated pollutant reductions, cost 
effectiveness and monetized environmental benefits of the proposed 
options are contained in the Federal Register notice for the proposed 
rule, in the support

[[Page 63005]]

documents for the proposed rule and in the record.

VI. Summary of Major Comments Received

    EPA received numerous comments on the proposed rule. The majority 
of comments centered on EPA's selection of ATS as the technology basis 
for BAT and NSPS and the data and assumptions used to estimate the 
numeric limitation, costs and pollutant load reductions of the proposed 
BAT and NSPS. ATS is no longer the technology basis for BAT and NSPS in 
the final rule.
    Some commenters argued that EPA's data used to estimate costs of 
the proposed option based on ATS did not accurately consider all of the 
costs, particularly for projects of longer duration. In response, EPA 
revised the model project analysis to consider projects of longer 
duration and utilized a unit-cost approach based on data contained in 
the record for the proposal.
    Some commenters argued that EPA's analysis of the amount of 
construction activity underestimated actual levels of construction 
activity, since EPA's estimates were based on land use change estimates 
from 1992 to 2001 using the National Land Cover Dataset (NLCD). In 
response, EPA revised estimates of annual acres subject to the 
regulation using industry economic data instead of the NLCD data.
    Some commenters argued that EPA's data and assumptions used to 
estimate loading reductions of the regulatory options did not 
accurately account for current controls in place nationwide. In 
response, EPA revised the assumptions used in the model to account for 
baseline controls. EPA also used data at the watershed level for some 
modeling parameters.
    Some commenters requested that numeric limitations be based on, or 
consider, the background levels of sediment and turbidity in receiving 
streams when establishing a turbidity limitation. EPA notes that BAT 
and NSPS are based on the capabilities of technology, not receiving 
water quality. It would not be appropriate in establishing technology 
based effluent limitations pursuant to CWA sections 301 and 306 for EPA 
to consider the water quality of specific water bodies. See 
Weyerhaeuser Co. v. Costle, 590 F.2d 1011, 1040-1044 (D.C. Cir. 1978). 
Permitting authorities have the ability to develop water-quality based 
effluent limitations to address receiving water concerns. Some states 
have set limitations for specific projects considering the background 
turbidity of the receiving waters. Commenters further argued that 
discharges of low turbidity water to streams that are naturally high in 
turbidity could contribute to stream instability. EPA does not agree 
with this comment. The particles contained in stormwater discharges 
from construction sites are primarily fine-grained, since sediment 
controls remove the bulk of the coarser particles. These fine-grained 
particles are not beneficial from a stream stability standpoint. 
Therefore, removal of these particles from the stormwater discharge 
would not be expected to further contribute to stream instability, if 
the receiving stream was already unstable. It is plausible that 
discharge of a large volume of stormwater over a short period of time 
to a small stream with a high natural sediment load could contribute to 
instability. If this condition were to exist, it could be alleviated 
simply by controlling the rate of discharge or by dispersing runoff to 
vegetated areas on site, if available (see also, comment by Dr. Britt 
Faucette, EPA-HQ-OW-2008-0465-0527 in the rulemaking record).
    Some commenters argued that some of the data EPA used to determine 
the numeric effluent limitation based on ATS should not be used because 
EPA lacked specific information on factors, such as type of 
construction project or treatment system configuration. Commenters also 
argued that the data was not representative, since these data were 
primarily from the Northwest United States. EPA does not agree with 
these comments. The data represent a variety of project types. Although 
EPA may not have detailed information about specific aspects of some 
projects (such as project size and treatment system flow rate), EPA has 
conducted an engineering review of the data and determined that the 
data is representative. EPA has excluded data, where appropriate, to 
account for factors such as treatment system startup and variation 
outside of the range that EPA would consider indicative of proper 
operation. Details of the engineering review of the data can be found 
in the Development Document. In addition, EPA received additional 
information on some of the data, such as project type and treatment 
configuration. EPA also received data from additional projects, 
including projects in New York and North Carolina. More details on the 
data can be found in the administrative record.
    Some commenters were concerned about the non-numeric effluent 
limitations proposed, and specifically questioned whether some of the 
proposed requirements could be implemented on all construction sites. 
EPA generally agrees that some of the requirements, as proposed, could 
not be implemented on all sites and made revisions to the non-numeric 
effluent limitations to make them applicable to all sites. For certain 
controls, EPA included ``unless infeasible'' to recognize that there 
may be some sites where a particular control measure cannot be 
implemented, thus allowing flexibility for permittees. (See Section 
X.B.)
    Some commenters questioned the stringency of the proposed soil 
stabilization requirements, and were concerned about the costs and 
feasibility of initiating stabilization of disturbed area 
``immediately'' when final grade is reached or any clearing, grading, 
excavating or other earth disturbing activities have temporarily or 
permanently ceased and will not resume for a period exceeding 14 
calendar days. EPA disagrees that this requirement is not feasible. 
Given the importance of soil stabilization techniques (see Chapter 5 of 
the Technical Development Document (TDD)), and the influence of soil 
cover on soil erosion rates, EPA has determined that initiating soil 
stabilization measures immediately is an important non-numeric effluent 
limitation. EPA sees no compelling reason why permittees cannot take 
action immediately to stabilize disturbed soils on their sites. Erosion 
control measures, such as mulch, are readily available and permittees 
need only plan accordingly to have appropriate materials and laborers 
present when needed. EPA has, however, modified this requirement for 
clarity (see the final requirement at Sec.  450.21(b).
    EPA received comments concerning applicability of the final rule to 
linear construction projects, including the numeric effluent 
limitation. EPA considered the unique characteristics of linear 
projects in determining the appropriate technology based effluent 
limitations for those sites. The final rule, in part based on the 
considerations of linear projects, no longer contains a requirement to 
install a sediment basin (See Section VII.A), the technology basis for 
the numeric effluent limitation is no longer ATS (See Section X.G.3), 
and revisions were made to the non-numeric effluent limitations based 
on comments concerning the feasibility at linear projects. (See Section 
X.B.2). EPA disagrees with comments that suggested EPA should either 
exempt all linear projects from the final rule or from the numeric 
effluent limitation. EPA has determined that numeric effluent 
limitations are feasible for linear projects and passive treatment 
systems provide flexibility to linear projects to

[[Page 63006]]

take into account site specific considerations. (See the TDD for 
specific examples of the utilization of passive treatment systems at 
linear projects). Additionally, EPA believes that the permitting 
authority should exercise discretion when determining the monitoring 
locations and monitoring frequency for linear construction projects. 
(See Section XIX.A).
    Based on the unique regulatory circumstances of interstate natural 
gas pipeline construction projects EPA has chosen not to have the 
numeric limitation and monitoring requirements at 40 CFR 450.22(a) 
apply to the discharges associated with the construction of natural gas 
pipelines. This exemption only applies to discharges associated with 
construction of interstate natural gas pipelines that are under the 
jurisdiction of the Federal Energy Regulatory Commission (FERC). EPA 
determined this was appropriate due to the comprehensive regulatory 
program that FERC requires and enforces for the construction of these 
projects. Through its program, FERC requires a variety of erosion and 
sediment controls to be implemented during construction, some of which 
are more stringent than those contained in today's rule. FERC conducts 
site-specific reviews to establish the allowable area of disturbance 
for project construction and dictates the manner in which construction 
of these projects can proceed. Typical requirements would include 
minimizing the amount of time that soils are allowed to be exposed, 
managing the discharges from trench dewatering, limiting the amount of 
vegetation that can be cleared adjacent to streams and wetlands, and 
requiring successful revegetation of project areas. FERC has been 
requiring these projects to implement its erosion and sediment control 
program since 1989. Thus, it is a well-developed regulatory program 
that includes stringent requirements, oversight, public participation, 
and onsite inspection. EPA does not want to limit the flexibility of 
FERC to implement its program by imposing numeric limitations on these 
unique projects.
    EPA received comments encouraging the Agency to include controls in 
the final rule on stormwater discharges that occur after construction 
activity has ceased or what they call ``post-construction'' stormwater 
discharges. These discharges are outside the scope of the final rule; 
however the Agency understands that there is a need to address 
discharges from newly developed and redeveloped sites, such as 
commercial buildings, roads, or parking lots, in order to protect the 
water quality of our nation's waters. As the urban, suburban and 
exurban human environment expands, there is an increase in impervious 
landcover and stormwater discharges. This increase in impervious 
landcover on developed property reduces or eliminates the natural 
infiltration of precipitation. The resulting stormwater flows across 
roads, rooftops and other impervious surfaces, picking up pollutants 
that are then discharged to our nation's waters. In addition, the 
increased volume of stormwater discharges results in the scouring of 
rivers and streams; degrading the physical integrity of aquatic 
habitats, stream function and overall water quality. In July 2006, EPA 
commissioned the National Research Council (NRC) to review the Agency's 
program for controlling stormwater discharges under the CWA and 
recommend steps the Agency should take to make the stormwater program 
more effective in protecting water quality. The NRC Report Urban 
Stormwater Management in the United States (DCN 42101) states that 
stormwater discharges from the built environment remain one of the 
greatest challenges of modern water pollution controls, ``as this 
source of contamination is a principal contributor to water quality 
impairment of waterbodies nationwide.'' The NRC report found that the 
current regulatory approach by EPA under the CWA is not adequately 
controlling all sources of stormwater discharges that are contributing 
to waterbody impairment. NRC recommended that EPA address stormwater 
discharges from impervious landcover and promote practices that 
harvest, infiltrate and evapotranspirate stormwater to prevent it from 
being discharged, which is critical to reducing the pollutant loading 
to our nation's waters.
    EPA has committed to and begun a rulemaking addressing stormwater 
discharges from newly developed and redeveloped sites under CWA section 
402(p). EPA has published a draft Information Collection Request, 74 FR 
56191 (October 30, 2009) for public comment that will seek information 
and data to support the rulemaking, and plans to complete this rule in 
the fall of 2012.
    Some commenters argued that turbidity is not a ``pollutant'' under 
the CWA. EPA disagrees with the commenters as turbidity is a 
``pollutant'' under the CWA and an indicator for other pollutants and 
is the appropriate pollutant in this rule to control, under the 
appropriate levels of technology, for discharges from C&D sites. In 
this rule, turbidity is being regulated as a nonconventional pollutant 
and as an indicator pollutant for the control of other pollutants in 
discharges from C&D sites including metals and nutrients. By providing 
a measure of sediment and other pollutants in discharges, turbidity is 
an indicator of the degree to which sediment and other pollutants found 
in discharges are reduced. Turbidity is also a more effective measure 
of the presence of fine silts and clays and colloids, which are the 
particles in stormwater discharges that EPA is primarily targeting in 
today's rule.
    Turbidity is a pollutant as that term is defined in the CWA. See 
e.g., Conservation Law Foundation v. Hannaford Bros. Co., 327 F.Supp.2d 
325, 326 (D.Vt. 2004), aff'd 139 Fed.Appx. 338 (2d.Cir. 2005). The CWA 
defines ``pollutant'' broadly to include ``dredged spoil, solid waste, 
incinerator residue, sewage, garbage, sewage sludge, munitions, 
chemical wastes, biological materials, radioactive materials, heat, 
wrecked or discarded equipment, rock, sand, cellar dirt and industrial, 
municipal and agricultural waste.'' CWA section 502(6). See NRDC v. 
EPA, 822 F.2d 104, 109 (D.C.Cir. 1987) (``The term `pollutant' is 
broadly defined[hellip]''); U.S. v. Hamel, 551 F.2d 107, 110 (6th Cir. 
1977) (noting that the definition is set forth in ``broad generic 
terms.''). EPA describes ``turbidity'' as ``an expression of the 
optical property that causes light to be scattered and absorbed rather 
than transmitted with no change in direction of flux level through the 
sample caused by suspended and colloidal matter such as clay, silt, 
finely divided organic and inorganic matter and plankton and other 
microscopic organisms.'' 40 CFR 136.3; 72 FR 11200, 11247 (March 12, 
2007). Turbidity fits easily into the broad definition of pollutant. 
The definition of pollutant is not limited to those terms that are 
specifically listed in the statute at section 502(6). See NWF v. 
Gorsuch, 693 F.3d 156, 174 n.56 (D.C. Cir. 1982); Sierra Club v. Cedar 
Point Oil Co., 73 F.3d 546, 565 (5th Cir. 1996).
    Turbidity is also an indicator or measurement of other pollutants 
in the water body; however merely because turbidity measures other 
pollutants or can be an expression of the condition of the water body, 
does not mean it is not itself a ``pollutant'' under the CWA. There are 
numerous other pollutants, some that Congress explicitly included in 
the CWA, that are also indicators or measurements of other pollutants. 
For example, the CWA lists biochemical oxygen demand (BOD) and pH as 
pollutants. CWA section 304(a)(4). BOD is the measure of the amount of 
oxygen required by bacteria for stabilizing

[[Page 63007]]

material that can be decomposed under aerobic conditions and pH is a 
measure of how acidic or basic a substance is. Additionally, chemical 
oxygen demand (COD) is a pollutant and a measurement of other 
pollutants. See BASF Wyandotte v. Costle, 598 F.2d 637, 651 (1st Cir. 
1979). Even total suspended solids (TSS) are a measure of the organic 
and inorganic particulate matter in wastewater. Like turbidity, there 
is no question BOD, pH, COD and TSS are pollutants and there is no 
conflict between a pollutant being a measurement of other pollutants 
and a pollutant itself under the CWA.
    One commenter argued that turbidity is a direct representation of 
TSS, thus, if anything, turbidity can only be used as a surrogate for 
TSS, and thus a conventional pollutant. In 1978 EPA interpreted 
``suspended solids,'' at section 304(a)(4), as ``total suspended solids 
(non-filterable) (TSS).'' EPA defined TSS as ``a laboratory measure of 
the organic and inorganic particulate matter in wastewater which does 
not pass through a specified glass filter disk.'' See 40 CFR 401.16; 43 
FR 32857, 32858 (July 28, 1978). The terms turbidity and TSS are 
related to sediment and are analogous, but they are not synonymous 
pollutants or measures of water quality. TSS and turbidity are measured 
differently, as turbidity is a measure of the light scattering 
properties of the sample measured as NTU and TSS is generally a measure 
of the concentration (i.e., milligrams per liter). The size, shape, and 
refractive index of suspended particulate matter are not directly 
related to the concentration and specific gravity of the suspended 
matter. Therefore, measurements of TSS and turbidity are not 
interchangeable. Pollutants that are not identified as either toxic or 
conventional pollutants are nonconventional pollutants under the CWA. 
See CWA section 301(b)(2)(F); 304(a)(4); 40 CFR 401.16; Rybacheck v. 
EPA, 904 F. 2d 1276, 1291-92 (9th Cir. 1990). CWA section 304(a)(4) 
identifies what pollutants are conventional pollutants under the CWA, 
namely biochemical oxygen demand, suspended solids, fecal coliform, and 
pH, with EPA adding oil and grease. See also, 40 CFR 410.16; 44 FR 
44501 (July 30, 1979). Turbidity is not identified as a conventional 
pollutant in the CWA or been identified as one by EPA. In the proposal, 
EPA cited to Rybachek v. EPA, 904 F.2d at 1291-92, to demonstrate an 
analogous situation where it was argued that ``settleable solids'' were 
a component of TSS, or in other words, they are the same pollutant, 
thus EPA should have classified settleable solids as a conventional 
pollutant rather than a nonconventional pollutant. Id. at 1291. The 
Ninth Circuit, agreeing with EPA's analysis in that case and the 
discussion above, concluded that ``because settleable solids were not 
designated by Congress as either conventional or a toxic pollutant, 
they should be considered a nonconventional pollutant under [section 
301(b)(2)(F)].'' Id. at 1292. EPA applied a similar analysis to 
turbidity to conclude that it is a nonconventional pollutant under the 
CWA.
    Commenters' focus on arguing that turbidity is not a pollutant, or 
at the very least a conventional pollutant, may be based on a desire 
for a different technology standard applied to this rulemaking (i.e., 
BCT). However, even if EPA did agree that turbidity is not a pollutant 
or is a conventional pollutant, TSS and turbidity are not the only 
pollutants of concern in discharges from C&D sites. Metals, nutrients, 
and other toxic and nonconventional pollutants are naturally present in 
soils, and can be contributed during construction activity or by 
activities that occurred at the site prior to the construction activity 
(see, e.g., comment from Dr. Britt Faucette, EPA-HQ-OW-2008-0465-0527 
in the rulemaking record. EPA recognizes that its understanding of the 
nature of stormwater discharges associated with construction activity 
has evolved. However, as early as 1990, in the Phase I stormwater 
rulemaking EPA identified nonconventional and toxic pollutants of 
concern in discharges from construction sites stating ``[c]onstruction 
sites can also generate other pollutants such as phosphorus, nitrogen, 
and nutrients from fertilizer, pesticides, petroleum products, 
construction chemicals and solid wastes.'' 55 FR at 48033. The National 
Academy of Sciences agrees with EPA and the NRC report states ``[t]he 
pollutant parameters of concern in stormwater discharges from 
construction activity are TSS, settleable solids, turbidity, and 
nutrients from erosion; pH from concrete and stucco; and a wide range 
of metallic and organic pollutants from construction materials, 
processes, wastes, and vehicles and other motorized equipment.'' NRC at 
541. EPA is making clear in this final rule that while conventional 
pollutants are a concern in discharges from construction sites, there 
are also nonconventional and toxic pollutants of concern in discharges 
from these sites. Many of these pollutants are present as particulates 
and will be removed with other particles. Dissolved forms of pollutants 
are often absorbed or adsorbed to particulate matter and can also be 
removed along with the particulates (i.e., sediment). See the 
Environmental Assessment document for additional discussion about 
pollutants found in discharges from C&D sites.
    Additionally, stormwater discharges from C&D sites in their 
entirety are ``industrial waste,'' a nonconventional pollutant under 
the CWA, thus EPA is not obligated to single out specific constituents 
or parameters in the discharge. See Northern Plains Resource Council v. 
Fidelity Exploration and Development Co., 325 F.3d 1155 (9th Cir. 
2003). Due to stormwater discharges being, or including, 
nonconventional or toxic pollutants, EPA is statutorily obligated to 
promulgate a BAT level of control for these point source discharges. 
CWA section 301(b)(2)(A). EPA is also statutorily obligated to 
promulgate a best available demonstrated control technology (BADT) for 
NSPS for all pollutants from new sources, even if the only pollutants 
from C&D sites were conventional pollutants.
    Some commenters urged EPA to establish numeric effluent limitations 
for pollutants other than turbidity (such as pH). While EPA agrees 
there are other pollutants of concern that are discharged from 
construction sites the Agency determined it is not necessary to 
establish any other numeric effluent limitations at this time. Many of 
the pollutants of concern are sediment-bound pollutants, such as metals 
and nutrients. The non-numeric effluent limitations in the final rule 
will address the mobilization of sediment and the discharge of these 
sediment-bound pollutants. The final rule includes a non-numeric 
effluent limitation that prohibits the discharge of wastewater from 
washout of concrete, unless managed by an appropriate control. 40 CFR 
450.21(3)(1). This requirement was included to specifically address 
concerns with pH. Additionally, the numeric effluent limitation, in 
addition to controlling the discharge of turbidity, will control the 
discharge of some of these other pollutants of concern. If permitting 
authorities have concerns regarding the discharge of other pollutants 
they may be addressed with numeric effluent limitations on case-by-case 
basis through NPDES permits.
    Some commenters noted that they believed there may be environmental 
risks of applying polymers during construction activity to control 
discharges of pollutants from C&D sites due to what commenters believed 
was the potential for the polymers to cause fish kills or otherwise 
cause an adverse

[[Page 63008]]

effect in the receiving waters. At proposal EPA had no specific 
examples of the use of treatment chemicals causing fish kills or 
aquatic toxicity, although anecdotal evidence did exist (see DCN 
41110). In the proposal, EPA specifically requested information and 
data that quantified the number of instances where overuse of polymers 
occurred, the circumstances resulting in such overuse, and the actual 
or potential environmental impacts associated with such events. 73 FR 
at 72573; see also 73 FR at 72610. EPA received one specific comment 
regarding a fish kill associated with the use of ATS (see EPA-HQ-OW-
2004-0465-1287 in the rulemaking record) and one comment that 
referenced ``significant environmental harm'' resulting from the use of 
chitosan or other chemicals, although specific details were not 
provided (see EPA-HQ-OW-2008-0465-0973 in the rulemaking record). One 
commenter also stated that during pilot testing of two ATS systems that 
``chemical overuse and poor operation never purposefully occurred, but 
happened anyway.'' This commenter also noted, when comparing ATS usage 
during this pilot testing to ATS that is used in Washington State that 
``the treatment system used on the Idaho site was missing many features 
that made it easier and environmentally safer to operate. The operator 
did not have the level of training required in Washington. DEQ did not 
come close to the amount of staff time Washington spends overseeing the 
operation of these systems and DEQ did not have any staff trained to 
assess if the system was being operated correctly.'' (see EPA-HQ-OW-
2008-0465-1269 in the rulemaking record.
    A number of coagulant and flocculants, including polymers, are 
available on the market and are in wide use for the control of 
pollutants, not only on construction sites, but to reduce sediment from 
agricultural fields and to reduce pollutants in discharges from 
wastewater treatment plants to name a few. While successful in reducing 
sediment and turbidity in conveyance systems, polymers and other 
additives should be carefully utilized in passive treatment systems. 
Several states have approved specific formulations for use on 
construction sites and EPA will work with the permitting authorities 
and the construction industry to ensure the proper application of 
polymers and other additives, if necessary, before owners and operators 
of construction sites are required to meet the numeric effluent 
limitation. Knowledge from toxicity studies suggest that polymers are 
highly variable as to their toxic effects on aquatic organisms (see 
discussion of toxicity in the Environmental Assessment). States have 
approved the use of polymers and other additives at construction sites, 
for example, Washington State has approved chitosan, a cationic 
polysaccharide biopolymer, for certain uses and has seen wide use in 
water and stormwater treatment. Therefore, the use of specific 
compounds should be considered by the permitting authority and owners 
and operators of construction sites in light of various environmental 
influences. While EPA recognizes that there is the potential for 
problems due to improper application of polymers, EPA has determined 
that when properly used, environmental impacts from polymers or 
flocculants should not occur through the use of passive treatment 
systems. The dose ranges where polymers are utilized on construction 
sites are well below the chronic toxicity levels. The utilization of 
polymers on construction sites has occurred for a significant period of 
time and they are currently being used on construction sites throughout 
the nation. EPA recognizes the merits of ensuring that polymers or 
other chemical additives, if necessary, are properly used. Permitting 
authorities should carefully consider the appropriateness of usage of 
these materials where there are sensitive or protected aquatic 
organisms in the receiving waters, including threatened or endangered 
species and their critical habitat. NPDES permitting authorities may 
establish controls on dosage and usage, protocols for residual toxicity 
testing, require prior approval before the use of particular polymers, 
training requirements for site operators or other measures they deem 
appropriate. In addition, permittees can also specify, and permittees 
may choose to utilize, on-site infiltration or dispersion to vegetated 
areas in combination with, or in place of, polymer-based systems. See 
73 FR 72562, 72573-74. Based on the information in the record EPA has 
determined that when polymers are properly applied the risks of 
toxicity to aquatic life or adverse effects to the receiving water are 
minimal. However, it is important that permittees be properly trained 
in the use of polymers. Operators of C&D sites need to have expertise 
in a number of technical areas, including engineering, stormwater 
management and implementation of erosion and sediment controls. 
Technical specialists, such as engineers, hydrologists and soil 
scientists are involved in many aspects of site design and construction 
activity. Permittees typically have engineers on staff, or employ 
consultants to prepare plans, supervise construction and conduct 
inspections of various aspects of the project. Given that construction 
activities require rigorous attention to safety and engineering 
specifications, there is a reasonable basis for EPA to expect that 
operators can conform to proper operation and maintenance of controls 
and proper use of polymers and flocculants. The erosion and sediment 
control and stormwater management industries are large and composed of 
diverse specialties. There are several national trade and professional 
organizations whose members are engaged in various aspects of erosion 
and sediment control and stormwater management and who have an active 
role in conducting research and technical outreach. EPA believes that 
there is a range of expertise available across the industry to properly 
implement controls that may be required to meet a numeric limitation. 
Also, sampling and compliance with the turbidity limitation is not 
required until 18 months after the effective date of this final rule 
for sites with 20 or more acres of disturbed land at one time and four 
years after the effective date of the final rule for sites with 10 or 
more acres of disturbed land at one time. This will allow permittees 
time to obtain any necessary training if they do not already have 
trained personnel on staff and for the permitting authorities to 
provide guidance to permittees.

VII. Summary of Significant Decisions and Revisions to Analyses

    EPA solicited comments on a number of issues in the proposed rule. 
Two areas that EPA specifically requested comments on were the 
regulatory options proposed as well as the data used to estimate the 
costs, pollutant loading reductions, environmental benefits and 
economic impacts of various options. Based on comments received, EPA 
revised the regulatory options that were proposed and further developed 
a regulatory option that would establish a numeric limitation based on 
passive, rather than active, treatment at construction sites. EPA used 
data collected in support of the proposed regulation, data submitted 
during the public comment period and by the public after the close of 
the comment period, as well as additional data collected by EPA to 
estimate costs, environmental benefits and economic impacts for this 
option. EPA also updated its costs and economic analyses with these new 
data to revise the estimates for the proposed options. EPA

[[Page 63009]]

also revised what C&D sites may be new sources and covered by NSPS. 
This section summarizes the principle regulatory options considered for 
the final rule and the revisions that were made to EPA's analyses 
following proposal.

A. Regulatory Options

    In considering options for the final rule, EPA revised the proposed 
regulatory options in several ways. First, comments received by state 
environmental agencies, Departments of Transportation (DOTs), the U.S. 
DOT, and other members of the public indicated that sediment basins are 
not common practice on all larger construction sites, particularly on 
linear projects such as road and highway construction. The reasons 
provided by commenters included the lack of available space within the 
project right of way as well as the preference to use distributed 
controls on some sites instead of centralized drainage at sites. 
Commenters also stressed the need to allow engineers and other 
professionals that are designing erosion and sediment control plans to 
choose practices that reflect site-specific factors, and that mandating 
basins for larger sites would limit that flexibility. Commenters also 
suggested that active treatment, which typically involves construction 
of storage basins, was a disincentive to using distributed stormwater 
controls to manage long-term stormwater discharges from newly developed 
and redeveloped sites. If permittees construct sediment basins, 
according to commenters, they are more likely to retain these basins as 
part of the long-term stormwater management controls. EPA agrees with a 
number of these comments, particularly the need to give professionals 
the flexibility to design site-specific controls. Therefore, EPA 
deleted the sediment basin sizing requirements that were contained in 
the proposed Options 1, 2 and 3 when considering options for the final 
rule. Commenters also indicated that the soil clay content provisions 
proposed by EPA for Option 2 would be difficult to implement, given the 
variation in soils present at construction sites and the fact that 
imported soils are often used for fill material. A concern was also 
raised on the practical applicability of the clay content provision to 
linear construction projects that may exist over large geographic 
areas. Therefore, determination of whether or not a particular project 
would meet the soil clay content thresholds would be difficult for 
owners and operators of construction sites. EPA agrees with commenters 
on this issue. Therefore, EPA deleted the soil clay content threshold 
from Option 2. Commenters also suggested that the R-factor criteria 
proposed under Option 2 would represent one more unnecessary complexity 
to the regulation, and that the site size criteria should be based on 
the disturbed area of the site, not the total project size since 
stormwater discharges from disturbed areas are the primary discharges 
containing pollutants. EPA agrees with these suggestions. Therefore, 
EPA also deleted the R-factor criteria from Option 2. The revised 
Option 2 would apply to any site that met the disturbed acreage size 
threshold, regardless of soil type and R-factor.
    Comments from the potentially regulated industry and states on the 
proposal did not favor the use of ATS as the technology basis for a 
national turbidity limitation. There were a number of reasons given, 
but the most prominent included the costs, availability and feasibility 
of ATS. While EPA does not agree with all of these comments, the Agency 
further evaluated data available to support a numeric turbidity 
limitation based on technologies other than ATS, including techniques 
that incorporate either liquid or solid forms of polymer. Examples 
include liquid polymer dosing of sediment basins, passive dosing in 
channels through the use of polymer gel socks or floc-blocks or floc-
logs, and application of polymer to fiber check dams. EPA also 
evaluated data available for the placer mining industry. EPA determined 
that a numeric turbidity limitation based on these and other passive 
treatment techniques are technically available. As a result, EPA 
further explored this option and looked at site size thresholds of 1, 5 
and 10 acres of disturbed land at one time as potential applicability 
criteria for a technology-based numeric limitation based on passive 
treatment.
    EPA also received numerous comments about the feasibility of many 
of the erosion and sediment control and pollution prevention provisions 
contained in Options 1, 2 and 3. EPA generally agrees that some of 
these requirements, as proposed, could not be implemented on some 
construction sites. As a result, EPA made several changes to these 
provisions which are described in more detail in section X.B.

B. Cost Analysis

    EPA received several comments regarding the costs of ATS and the 
methodology used by EPA to determine costs of the regulatory options. 
While EPA believes some of these comments have technical merit, EPA 
found that some commenters greatly overestimated the likely actual 
costs to implement ATS. Key points made by commenters included (1) that 
the methodology used at proposal, which was based on a flat cost per 
gallon to treat, likely did not capture the actual costs of ATS in some 
applications and in some areas of the country; (2) that the methodology 
did not factor in the longer duration of some projects (particularly 
larger residential projects); and (3) the methodology for estimating 
the size of the industry, which was based on land use change data from 
1992 to 2001, likely did not accurately predict the level of 
construction activity in the near future that would be expected under 
normal business conditions (i.e., not reflective of the current 
downturn in the industry), which is the primary analysis case upon 
which EPA based costs and economic impacts (see discussion in Section 
XII). EPA has revised and updated the methodology used to estimate the 
costs of ATS and the expected amount of construction activity to 
reflect these and other points. The revised analysis significantly 
increased costs for the revised Options 2 and 3. In the updated 
methodology, EPA first used data submitted by vendors to develop a 
series of one-time and monthly costs for ATS. Secondly, EPA estimated 
the expected amount of construction activity using long-term industry 
economic data. EPA then estimated the expected duration of projects of 
varying site size and project types using permit Notice of Intent (NOI) 
data from approximately 22,000 permit applications from 4 States for 
construction activities occurring primarily between 2003 and 2009. The 
combination of all three of these factors (a unit costing approach, 
longer durations for some projects and a higher estimate of total acres 
being developed) resulted in significantly higher costs for the revised 
Options 2 and 3 than were estimated at the time of proposal. Moreover, 
the cost of the revised Option 2 increased over the proposed Option 2 
because EPA removed the R-factor and soil type criteria of proposed 
Option 2, thereby increasing the number of projects covered by revised 
Option 2. Additional details can be found in the Development Document 
and in the Economic Analysis.

C. Pollutant Load Analysis

    EPA received several comments on the pollutant loading analysis 
contained in the proposal, primarily stating that EPA overestimated 
baseline pollutant loadings and the reductions due to Options 2 and 3 
because the assumptions used in EPA's model did

[[Page 63010]]

not accurately account for current industry practices. EPA generally 
agrees with some of these comments, and has revised the assumptions 
used in the model. EPA also used a more detailed analysis of loads for 
the final rule that uses watershed-specific data for some of the model 
parameters. The result of these changes is that the load reduction 
estimates for Options 2 and 3 have decreased since proposal. Additional 
details on the new assumptions and the results of EPA's analysis can be 
found in Section XV and in the Development Document.

D. Economic Analysis

    The primary revisions to the economic analysis were updates to the 
approach to developing model projects and then the assignment of 
project costs to model firms. EPA revised the model projects to include 
a set of 288 model projects, based on 12 different size categories, 12 
duration categories, and two project types (building, transportation). 
EPA also accounted for the effect that different climate and soil 
conditions can have on control costs by considering variation in 
rainfall and runoff factors for each state. This resulted in 14,688 
model projects with potentially different costs. These model projects 
were then combined with activity estimates to develop an estimated 
84,000 individual model projects.
    Another revision to the economic analysis was the way in which 
project costs were assigned to firms. For the proposal, project costs 
were used to develop a weighted average cost per acre for each state. 
These weighted average costs were then assigned to model firms based on 
the estimated number of acres they construct on per year. For the final 
rule, each of the 84,000 projects and their associated costs were 
assigned to firms. This assignment was based on each category of model 
firm's capacity to perform projects of various size and duration.
    EPA also made changes to the adverse case analysis and the analysis 
of future costs. EPA received comments that the data used to represent 
adverse business conditions for the adverse case analysis did not 
adequately represent the most recent conditions for the industry, which 
are less favorable. EPA addressed this concern by updating the adverse 
analysis industry financial profile with 2008 Value Line financial 
data. For the future costs analysis, EPA was able to use future revenue 
projections published by Global Insights, to estimate year to year 
changes in acreage developed, the total number of projects and the 
number of projects subject to various rule requirements. This allowed 
for an assessment of changes in the number of firm and employment 
impacts from year-to-year.
    EPA made two adjustments to the housing affordability analysis. For 
the proposal, EPA evaluated the effect of the proposed options on the 
price of the median and lower quartile homes. For the final rule, EPA 
evaluated the impacts of potential price increases for a new home 
selling for $100,000 and $50,000 to better reflect the impact of price 
increases at the very low end of the market for new housing. For the 
proposal, all new home buyers were assumed to buy the most expensive 
house they could qualify to purchase. However, for the final rule EPA 
was able to use data from the American Housing Survey, to estimate the 
average percentage of household income typically spent on a home 
purchase, for various income ranges. This allowed for a more realistic 
assessment of the number of home buyers who may have difficulty 
affording a new home after a price increase.

E. Benefits Estimation and Monetization

    Although EPA is not required by statute to quantify environmental 
benefits for ELGs and NSPSs, EPA did quantify and monetize benefits of 
the regulatory options to comply with Executive Order 12866. EPA 
solicited comments on the proposed approach. EPA received comments on 
the approach and made revisions in order to improve upon the estimates 
prepared at proposal. Soil on construction sites contains a number of 
pollutants beyond sediment and turbidity. EPA estimated the degree to 
which the regulatory options would decrease nitrogen and phosphorus 
levels in receiving surface waters, and estimated associated water 
quality impacts using the nitrogen and phosphorus versions of the 
Spatially Referenced Regressions on Watershed Attributes (SPARROW) 
model. EPA used these estimates to inform the estimation of the degree 
to which the public is willing to pay for water quality improvements 
associated with the regulatory options, which in turn was utilized in 
EPA's monetized benefits analysis.
    EPA expanded the set of potentially impacted waters to include a 
subset of the nation's estuaries. This enabled the agency to analyze 
the degree to which the public is willing to pay for improvements in 
estuarine water quality. EPA utilized this information in conjunction 
with available data on improvements in estuarine water quality 
associated with each of the regulatory options in order to monetize 
benefits associated with those options.
    EPA also made refinements to the Water Quality Index (WQI) used for 
mapping pollution parameter changes to effects on human uses and 
support for aquatic and terrestrial species habitat. Implementation of 
the WQI involves transforming the measurements of parameter, such as 
TSS, nitrogen, and phosphorus, into sub-index values that express water 
quality conditions on a common scale of 0 to 100. For the pollutant 
TSS, a unique sub-index curve was developed for each of the 85 Level 
III ecoregions using baseline TSS concentrations calculated in SPARROW 
at the enhanced Reach File 1 (RF1) level (see Section XV). In addition, 
at proposal, EPA did not quantify projected reductions in nutrient 
loadings as a result of the rule, but these were included in the final 
rule analysis, including the assessment of changes in the WQI.

VIII. Characteristics of Discharges Associated With Construction 
Activity

    Construction activity typically involves clearing, grading, 
excavating and other land-disturbing activities. Prior to construction 
activity, these land areas may have been agricultural, forested or 
other undeveloped lands. Construction activity can also occur as 
redevelopment of existing rural or urban areas, or infill development 
on open space within existing developed areas. The nature of 
construction activity is that it changes, often significantly, many 
elements of the natural environment. As described earlier, construction 
activities typically involve clearing the land of vegetation, digging, 
and earth moving and grading, followed by the active construction 
period when the affected land is usually left denuded and the soil 
compacted, often leading to an increase in the peak discharge rate and 
the total volume of stormwater discharged and higher rates of erosion. 
During the land disturbance period, affected land is generally exposed 
after removal of grass, rocks, pavement and other protective ground 
covers. Where the soil surface is unprotected, colloids, silt, clay and 
sand particles may be easily picked up by wind and/or washed away by 
rain or snow melt.
    Stormwater discharges can have variable levels of pollutants. 
Available data show that turbidity levels in discharges from 
construction sites range from as low as 10-50 NTU to tens of thousands 
of NTU. When the denuded and exposed areas contain nutrients, 
pathogens, metals or organic compounds, these other pollutants are 
carried at increased rates (relative to

[[Page 63011]]

discharges from undisturbed areas) to surrounding waterbodies via 
stormwater and other discharges (e.g., inadequately controlled 
construction equipment wash water). Discharges of these pollutants from 
construction activities can cause changes in the physical 
characteristics of waterbodies, such as pH or water temperature as well 
as changes in biological characteristics such as aquatic species 
abundance, health and composition. Changes in stream flow regime can 
also occur due to deposition of sediment, as well as the altered 
watershed hydrology resulting from soil compaction and loss of 
infiltrative capacity.
    Discharges from C&D sites associated with construction activity 
have been documented to increase the loadings of several pollutants in 
the receiving water bodies. The most prominent and most widespread 
pollutants of concern discharged from C&D sites are turbidity, 
suspended solids, total suspended solids (TSS), and settleable solids. 
Each of these pollutants are indicators of solids contained in the 
discharge (which, in the case of stormwater discharges associated with 
construction activities, are primarily due to soil particles), and each 
of these measures quantify different fractions of these solids.
    Discharges associated with construction activity are also expected 
to contain varying concentrations of metals and toxic organic 
compounds, some of which may be contributed by equipment used onsite 
for grading and other construction activities, as well as various 
construction materials used on-site (such as asphalt sealants, copper 
flashing, roofing materials, adhesives, and concrete admixtures). 
Metals are also naturally present in soils and, by removing vegetative 
cover and increasing erosion and sediment loss, there will likely be an 
increase in the amount of metals discharged from the C&D site. Metals 
can also be present as a contaminant from previous activity on the site 
(such as may occur in redevelopment of industrial areas) or as a 
contaminant or additive in fertilizers and other soil amendments. Fuels 
and lubricants are maintained onsite to refuel and maintain vehicles 
and equipment used during construction activities. These products, 
should they come in contact with stormwater and other site discharges, 
could contribute toxic organic pollutants. Pathogenic pollutants can be 
present in stormwater that comes into contact with sanitary wastes 
where portable sanitation facilities are poorly located or maintained. 
Also, trash and other municipal solid waste can be carried away by 
stormwater.
    Nutrients can be present in construction site discharges, either as 
naturally-occurring components of the soil or due to previous 
activities on the site, such as enrichment due to agricultural 
activities. In addition, activities during construction activity, such 
as hydroseeding, can increase nutrients levels in the soil.

IX. Description of Available Technologies

A. Introduction

    As described in Section VIII, construction activity results in the 
discharge of pollutants to waters of the U.S. These discharges can be 
controlled by applying site design techniques that preserve or avoid 
areas prone to erosion and through the effective use of a combination 
of erosion and sediment control and pollution prevention measures. 
Construction activities should be managed to reduce erosion and retain 
sediment and other pollutants in the soil at the C&D site. Erosion and 
sedimentation are two separate processes and the practices to control 
them differ. Erosion is the process of wearing away of the land surface 
by water, wind, ice, gravity, or other geologic agents. Sedimentation 
is the deposition of soil particles, both mineral and organic, which 
have been transported by water, wind, air, gravity or ice (adapted from 
North Carolina Erosion and Sediment Control Planning and Design Manual, 
September 1, 1988).
    Erosion control measures are intended to minimize dislodging and 
mobilizing of sediment particles. Sediment control measures are 
controls that serve to capture particles that have mobilized and are 
entrained in stormwater, with the objective of removing sediment and 
other pollutants from the stormwater discharge. An overview of 
available technologies and practices is presented below; see the 
Development Document for more complete descriptions. Many states and 
local governments and other entities have also published detailed 
manuals for erosion and sediment control measures, and other stormwater 
management practices.

B. Erosion Control Measures

    The use of erosion control measures is widely recognized as the 
most important means of limiting soil detachment and mobilization of 
sediment. The controls described in this preamble are designed to 
reduce mobilization of soil particles and minimize the amount of 
sediment and other pollutants entrained in discharges from construction 
activity. Erosion can be minimized by a variety of practices. The 
selection of control measures that will be most effective for a 
particular site is dictated by site-specific conditions (e.g., 
topography, soil type, rainfall patterns). The main strategies used to 
reduce erosion include minimizing the time bare soil is exposed, 
preventing the detachment of soil and reducing the mobilization and 
transportation of soil particles off-site.
    Decreasing the amount of land disturbed can significantly reduce 
sediment detachment and mobilization directly from ground disturbance 
or indirectly through changes in overland flows. Minimizing site 
disturbance by minimizing the extent of grading and clearing is the 
most effective means of reducing sediment yield. This approach not only 
maintains some site vegetative cover but also minimizes the temporary 
and permanent alteration of the natural hydrology of the site and the 
receiving waters, thereby reducing the susceptibility of the receiving 
waters to long-term changes in channel incision and expansion which 
affects the basin's sediment regime. Short term reductions in sediment 
yield can also be accomplished by phasing construction so that only a 
portion of the site is disturbed at a time. Another effective approach 
is to schedule clearing and grading events to reduce the probability 
that bare soils will be exposed to rainfall. Many areas of the country 
have defined times during the year when the majority of rainfall (and 
hence erosion) occurs. By scheduling major earth disturbing activities 
outside of the rainy season, erosion can be significantly reduced.
    Managing stormwater flows on the site can be highly effective at 
reducing erosion. Typical practices include actively managing off-site 
and on-site stormwater using diversion berms, conveyance channels and 
slope drains to avoid stormwater contact with disturbed areas. In 
addition, stormwater should be managed using energy dissipation 
approaches to prevent high runoff velocities and concentrated flows 
that are erosive. Vegetative filter strips are often considered as 
sediment controls, but they can also be quite effective at dissipating 
energy and reducing the velocity (and thus erosive power) of 
stormwater. Stormwater that is directed to vegetated areas can 
infiltrate, thus reducing or even eliminating the amount of stormwater 
discharged from a site, particularly for smaller storm events.
    After land has been disturbed and construction activity has ceased 
on any portion of the site, exposed soils should

[[Page 63012]]

be covered and stabilized immediately. Simply providing some sort of 
soil cover on these areas can significantly reduce erosion rates, often 
by an order of magnitude or more. Vegetative stabilization using annual 
grasses is a common practice used to control erosion. Physical barriers 
such as geotextiles, straw, rolled erosion control products and mulch 
and compost are other common methods of controlling erosion. Polymers 
(such as PAM) and soil tackifiers are also commonly used. These 
materials and methods are intended to reduce erosion where soil 
particles can be initially dislodged on a C&D site, either from 
rainfall, snow melt or up-slope runoff.
    The effectiveness of erosion control measures is dependent on 
periodic inspection and identification and correction of deficiencies 
(e.g., after each storm event). Erosion control measures alone will not 
eliminate the mobilization of soil particles and such controls must 
often be used in conjunction with sediment control measures.

C. Sediment Control Measures

    Despite the proper use of erosion control measures, some sediment 
detachment and movement is inevitable. Sediment control measures are 
used to control and trap sediment that is entrained in stormwater 
runoff. Typical sediment controls include perimeter controls such as 
silt fences constructed with filter fabric and compost filter berms. 
Trapping devices such as sediment traps and basins, inlet protectors 
and check dams are examples of in-line sediment controls. Sediment 
traps and basins are commonly used approaches for settling out sediment 
eroded from small and large disturbed areas. Their performance can be 
enhanced using baffles and skimmers, and additional removal can be 
accomplished by directing trap or basin discharges to a sand filter or 
to a vegetated area. Basin and trap performance can also be enhanced by 
using chemically-enhanced settling (e.g., polymer or flocculant 
addition). Typical chemicals used on construction sites include 
polyacrylamide (or PAM), chitosan, alum, polyaluminum chloride and 
gypsum. Polymers or flocculants are available in either liquid or solid 
form, and can be introduced at several points in the treatment train in 
order to increase sediment removal. Liquid chemicals can be introduced 
via a metering pump in a channel upstream of a basin, or can be sprayed 
onto the surface of a basin. Rainfall-driven systems can also be used 
to introduce liquid forms of chemicals into channels or basins. This 
configuration allows for operation on nights or weekends when 
construction personnel may not be present on-site.
    Conveyances are often used to channelize and manage stormwater on 
construction sites, and check dams are often placed in channels to 
control flow velocities and to remove sediment through settling and 
filtration. Sediment removal by check dams can be enhanced by applying 
polymer to the check dam, or by placing a polymer enclosed in a 
permeable material, such as a gel sock, or solid forms sometimes 
referred to as a floc-block, in the channel. Floc-blocks and gel socks 
are effective when placed in channels just prior to a basin, a check 
dam or other structure or conveyance, where the water velocity will be 
slowed allowing the turbidity, sediment and other pollutants, along 
with the polymer, to settle out.
    Sediment removal can be further enhanced by directing discharges 
from basins and channels, or by directing discharges through silt 
fences or filter berms into vegetation or other buffers between the 
site and surface waters to promote filtration and infiltration. Also, 
stormwater in basins or other impoundments can be dispersed to 
vegetated areas using spray or drip irrigation systems, allowing for 
filtration and infiltration.
    Active treatment processes such as electrocoagulation and 
filtration can also be used to increase sediment removal. 
Electrocoagulation uses an electrical charge to destabilize particles, 
allowing removal by settling or filtration. Filtration can be 
accomplished by directing stormwater to a sand filter bed, or by 
pumping water through vessels filled with sand or other media. Tube 
settlers and weir tanks can also be utilized to aid in sediment 
removal. When discharges from sediment controls or active treatment 
processes are directed to vegetated areas and stormwater is dispersed 
and allowed to infiltrate, the amount of stormwater discharged from the 
site can be reduced, and in some cases the discharge can be eliminated.
    More detailed descriptions of sediment and erosion control 
measures, use of polymers and flocculants and active treatment 
processes can be found in the Development Document.

D. Other Construction and Development Site Management Practices

    Construction activity generates a variety of wastes and wastewater, 
including concrete truck rinsate, construction and demolition waste, 
municipal solid waste (MSW), trash, and other pollutants. Construction 
materials and chemicals should be handled, stored and disposed of 
properly to avoid contamination of runoff that is discharged from the 
site. While mobilization by stormwater is one mechanism by which these 
wastes may be discharged from C&D sites, pollutants may also be 
discharged if wastes or wastewaters are dumped into streams or storm 
drains. Pollutants, trash and debris may also be carried away by wind. 
Control of these wastes can be accomplished using a variety of 
techniques.
    Site planning, sequencing of land-disturbing activities and phasing 
of construction activities are also important management practices. 
Limiting the amount of land disturbed at one time, as well as during 
the entire construction project, are perhaps some of the most effective 
practices to reduce the amount of sediment, turbidity and other 
pollutants in discharges. The longer exposed soil areas are left 
unprotected, the greater the chance of rainfall-induced erosion. Proper 
planning such that soil stabilization activities can occur in quick 
succession after grading activities have been completed on a portion of 
a site can greatly reduce the amount of sediment and turbidity 
discharged. In addition, limiting the amount of land that is ``opened 
up'' at one time to the minimum amount that is needed, as well as 
limiting soil compaction and retaining natural vegetation on the site, 
can greatly reduce erosion rates and help maintain the natural 
hydrology. Also, grading of the site to direct discharges to vegetated 
areas and buffers that have the capacity to infiltrate runoff can 
reduce the volumes of stormwater requiring management in sediment 
controls.

E. Performance Data for Passive Treatment Approaches

    Passive treatment systems (PTS), as described in this notice, 
include a variety of practices that rely on settling and filtration to 
remove sediment, turbidity and other pollutants. Where necessary, PTS 
includes the use of polymers or other flocculants. Data in the 
literature indicate that PTS are able to provide a high level of 
turbidity reduction at a significantly lower cost than active treatment 
systems. Details on PTS used as a basis for developing the numeric 
effluent limitation are contained in the Development Document as well 
as in the administrative record. Several studies and data sources are 
also summarized here.

[[Page 63013]]

    For example, McLaughlin (see DCN 41005) evaluated several 
modifications to standard sediment trap designs at the North Carolina 
State University Sediment and Erosion Control Research and Education 
Facility (SECREF). He evaluated standard trap designs as contained in 
the North Carolina Erosion and Sediment Control Manual utilizing a 
stone outlet structure as well as alternative designs utilizing a 
skimmer outlet and various types of porous baffles. Baffle materials 
tested included silt fence, jute/coconut and tree protection fence 
tripled over. Tests were conducted using simulated storm events in 
which sediment was added to stormwater at flows of 10 to 30 liters per 
second. McLaughlin found that a standard gravel outlet did not 
significantly reduce turbidity values. Average turbidity values in the 
basin were 843 NTUs, while average turbidity in the effluent was 758 
NTUs using the standard outlet. Use of a skimmer instead of a standard 
gravel outlet reduced turbidity to an average of 353 NTUs. Additional 
tests were conducted to evaluate the addition of polyacrylamide (PAM) 
through the use of floc-blocks. Floc-blocks are a solid form of PAM 
which are designed to be placed in flowing water. They are typically 
anchored by a rope or by placing them in a mesh bag or cage either in 
open channels or in pipes. As the water flows over the floc-blocks, the 
PAM dissolves somewhat proportional to flow. The floc-blocks typically 
have substantial amounts of non-PAM components, which are intended to 
improve PAM release, maintain the physical integrity of the blocks and 
enhance PAM performance (McLaughlin--Soil Facts; Chemical Treatments to 
Control Turbidity on Construction Sites). McLaughlin found that 
addition of PAM to sediment traps resulted in average effluent 
turbidities of 152 NTUs using a rock outlet and 162 NTUs using a 
skimmer outlet. For one set of tests, use of a standard stone outlet 
along with PAM was able to attain an average effluent turbidity of 51 
NTUs, while tests with jute/coconut mesh baffles with PAM were only 
slightly higher, at 71 NTUs.
    Warner and Collins-Camargo (see DCN 43071) evaluated several 
innovative erosion and sediment controls at a full-scale demonstration 
site in Georgia as part of the Erosion and Sedimentation Control 
Technical Study Committee (known as ``Dirt II''). The Dirt II project 
consisted, among other things, of field monitoring as well as modeling 
of erosion and sediment control effectiveness at construction sites. 
The demonstration site was a 50-acre lot in a suburban area near 
Atlanta where a school was being constructed. In total, 22.5 acres of 
the site was disturbed. A comprehensive system of erosion and sediment 
controls were designed and implemented to mimic pre-developed peak flow 
and runoff volumes with respect to both quantity and duration. The 
system included perimeter controls that were designed to discharge 
through multiple outlets to a riparian buffer, elongated sediment 
controls (called seep berms) designed to contain runoff volume from 3- 
to 4-inch storms and slowly discharge to down-gradient areas, multi-
chambered sediment basins designed with a siphon outlet that discharged 
to a sand filter, and various other controls. Extensive monitoring was 
conducted at the site. For one particularly intense storm event of 1.04 
inches (0.7 inches of which occurred during one 27-minute period), the 
peak sediment concentration monitored prior to the basin was 160,000 
mg/L while the peak concentration discharged from the passive sand 
filter after the basin was 168 mg/L. Effluent turbidity values ranged 
from approximately 30 to 80 NTUs. Using computer modeling, it was shown 
that discharge from the sand filter, which flowed to a riparian buffer, 
was completely infiltrated for this event. Thus, no sediment was 
discharged to waters of the state from the sand filter for this event. 
For another storm event, a 25-hour rainfall event of 3.7 inches 
occurred over a 2-day period. Effluent turbidity from one passive sand 
filter during this storm ranged from approximately 50 to 375 NTU, with 
20 of the 24 data points below 200 NTU. For a second passive sand 
filter, effluent turbidity ranged from approximately 50 to 330 NTU, 
with nine of 11 data points below 200 NTU. In estimating compliance 
costs for the rule, EPA assumed that most operators would use sediment 
basins or check dams with polymer addition to enhance settling, rather 
than a passive sand filter. The Warner study indicates that using a 
comprehensive suite of erosion and sediment controls, including a basin 
with a surface outlet coupled with an in-ground passive sand filter may 
be able to achieve comparable turbidity control to the technologies 
that EPA costed without relying upon the use of polymers or 
flocculants. EPA has not costed this approach for the rule, nor 
included this data in calculation of the numeric limitation.
    There are other references in the literature describing the various 
types of PTS and the efficacy of these systems. One application of a 
PTS is to add liquid polymer, such as PAM, to the influent of a 
conventional sediment basin. This can be accomplished by using a small 
metering pump to introduce a pre-established dose of polymer in the 
influent pipe or channel. If the polymer is added in a channel far 
enough above the basin, then turbulent mixing in the channel can aid in 
the flocculation process. Otherwise, some sort of provision may need to 
be made to provide mixing in the basin to produce flocs. Polymers 
typically used in this particular application include PAM, chitosan, 
polyaluminum chloride (PAC), aluminum sulfate (alum) and gypsum.
    The Auckland (New Zealand) Regional Council conducted several 
trials to evaluate the effectiveness of chemical flocculants and 
coagulants in improving settling of suspended sediment contained in 
sediment laden runoff from earthworks sites (DCN 42112). Trials were 
conducted using both liquid and solid forms of flocculants. Trials were 
initially conducted on two projects: a highway project and residential 
development. A follow-on study evaluated passive basin dosing at an 
additional site (see DCN 42102).
    The highway project (ALPURT) evaluated both a liquid polymer system 
and solid polymers. Liquid polymers evaluated were alum and PAC and 
solid polymers evaluated were all polyacrylamide products (Percol AN1, 
Percol AN2 and Percol CN1). Bench tests indicated that AN2 performed 
best among the solid polymers and that both PAC and alum were effective 
in flocculating the soils present on the site.
    Following bench testing of the polymers, liquid and solid dosing 
systems were developed. For the liquid dosing system, initial 
consideration was given to a runoff proportional dosing system which 
would include a weir or flume for flow measurement, an ultrasonic 
sensor and signal generating unit, and a battery-driven dosing pump. 
These components, together with costs for necessary site preparatory 
work, chemical storage tanks and a secure housing, were estimated to 
cost approximately $12,000 (1999 NZ $) per installation. An alternative 
system was developed that provided a chemical dose proportional to 
rainfall. This rainfall-driven system, which did not require either a 
runoff flow measurement system or a dosing pump, had a total cost of 
$2,400 (1999 NZ $) per installation.
    The rainfall-driven system operated by collecting rainfall in a 
rainfall catchment tray that was designed

[[Page 63014]]

proportional to the watershed area. Rainfall into this tray was used to 
displace the liquid treatment chemical from a storage tank into the 
stormwater diversion channel prior to entering the sediment basin. The 
size of the catchment tray was determined based on the size of the 
catchment draining to the basin, taking into consideration the desired 
chemical dosage rate obtained from the bench tests. Accumulated 
rainfall from the catchment tray fills a displacement tank that floats 
in the chemical storage tank. As the displacement tank fills with 
rainfall and sinks, liquid chemical is displaced from the chemical 
storage tank and flows via gravity to the dosing point.
    Field trials of the liquid treatment system using alum were 
conducted at the ALPURT site. The authors report that the system 
performed ``satisfactorily in terms of reduction of suspended solids 
under a range of rainfall conditions varying from light rain to a very 
high intensity, short duration storm, where 24mm of rainfall fell over 
a period of 25 minutes.'' Suspended solids removal for the intense 
storm conditions was 92% with alum treatment. For a similar storm on 
the same catchment with the same retention pond without alum treatment, 
suspended solids removal was about 10%.
    Field trials at the ALPURT site were also conducted using PAC. In 
total, 21 systems were used with contributing catchments ranging 
between 0.5 and 15 hectares (approximately 1 to 37 acres). The overall 
treatment efficiency of the PAC-treated basins in terms of suspended 
sediment reduction were reported to be between 90% and 99% for ponds 
with good physical designs. The authors noted that some systems did not 
perform as well due to mechanical problems with the system or physical 
problems such as high inflow energy (which likely caused erosion or 
sediment resuspension) or poor separation of basin inlets and outlets. 
The suspended solids removal for all ponds incorporating PAC ranged 
from 77% to 99.9%, while the removal in a pond not incorporating PAC 
ranged from 4% to 12%. Influent suspended solids concentrations for the 
systems incorporating PAC ranged from 128 to 28,845 mg/L while effluent 
concentrations ranged from 3 to 966 mg/L. In comparison, influent 
suspended solids concentrations for the untreated ponds were 
approximately 1,500 mg/L while effluent concentrations were 
approximately 1,400 mg/L. The authors also noted that dissolved 
aluminum concentrations in the outflow from the basins treated with 
PAC, in most cases, were actually less than the inflow concentrations, 
and were also less than the outflow concentrations from the untreated 
ponds. Outflow aluminum concentrations in the PAC treated ponds ranged 
from 0.01 to 0.072 mg/L. The ALPURT trials indicate that a relatively 
simple PTS using liquid polymers can result in significant reductions 
in suspended sediment concentrations, even with influent concentrations 
in excess of 25,000 mg/L. Although some effluent concentrations were as 
high as several hundred mg/L, the majority were below 100 mg/L. This 
indicates that a passive liquid polymer system can be used to meet a 
numeric effluent limitation for turbidity at a capital cost on the 
order of several thousand dollars per sediment basin. Coupling a system 
such as this with a gravity sand filter or distributed discharge to a 
vegetated buffer (as described by Warner and Collins-Camargo, DCN 
43071) or dispersion would reduce discharge turbidity levels even 
further, and for certain storm events would eliminate the discharge 
altogether.
    Field trials of polymer treatment using solid forms of PAM by the 
Auckland Regional Council were conducted at the ALPURT site as well as 
a residential project (Greenhithe). Trials at the ALPURT site were 
conducted by placing the floc-blocks in plastic mesh bags in plywood 
flumes through which the runoff from the site was directed. Initial 
trials encountered problems due to the high bedload of granular 
material, which accumulated against and stuck to the floc-blocks 
inhibiting solubility of the polymer. The system was reconfigured to 
incorporate a forebay before the flumes in order to facilitate removal 
of the bedload fraction. The authors noted that while this system was 
generally effective at low flow rates, it was difficult to control 
dosage rates and sediment accumulation in the flumes continued to be a 
problem. The authors concluded that ``Floc Block treatment has a high 
potential for removal of suspended solids from stormwater with 
consistent quality, particularly for small catchments; when flow 
balancing can be achieved prior to treatment.''
    Field trials were also conducted at the Greenhithe site, which was 
a 4-hectare (approximately 10-acre) residential project. As with the 
ALPURT trial, a flume was constructed and placed in the flow path 
immediately before the sediment basin. Results of the trials were 
mixed. The authors noted several problems with the floc-blocks, such as 
drying and breakdown of the blocks due to prolonged exposure to the air 
and softening and breakdown during periods of prolonged submergence. 
Sediment accumulation around the blocks and breakdown continued to be a 
problem. Incorporating an effective sediment forebay and limiting 
bedload are suggestions for increasing performance. In addition, the 
authors recommended soaking the floc-blocks in water to allow hydration 
before use and periodic spraying with water as ways to limit drying of 
the floc-blocks. EPA notes that similar problems with floc-blocks have 
been noted by some construction site field inspectors (see DCN 41109) 
and by McLaughlin (see DCN 43082). Because of the additional operation 
and maintenance requirements associated with the use of floc-blocks, a 
field inspection and maintenance program should be part of proper 
application of this technology.
    Results of the PAC studies at the ALPURT sites have led the 
Auckland regional council to require chemical treatment for any site 
that produces more than 1.5 metric tons of (net) sediment as determined 
by the Universal Soil Loss Equation. Sites that exceed this threshold 
require chemical treatment in accordance with a site chemical treatment 
plan. Exceptions include projects of less than one month duration and 
sites with granular volcanic soils and sand areas. Chemical treatment 
may also not be required if bench testing indicates that chemical 
treatment will provide no improvement in sediment removal efficiency 
(see DCN 41111).
    In addition to (or in place of) adding polymers to sediment basins, 
polymers can be introduced on other areas of the site as a soil 
stabilization measure or as components of other BMPs. For example, 
McLaughlin (DCN 41005) evaluated adding polymer to check dams on 
highway projects. McLaughlin noted significant reductions in turbidity 
from the use of fiber check dams coupled with PAM application. 
Significant reductions were even noted when PAM was added to rock check 
dams. Other research done by McLaughlin with other researchers includes 
studying the effectiveness of using PAM dosing systems for turbidity 
reduction in stilling basins (EPA-HQ-OW-2008-0465-0984.4), and using 
polymer blocks for turbidity control (EPA-HQ-OW-2008-0465-0984.7 and 
0984.10). McLaughlin, Hayes et al. also studied modified sediment 
control practices including polymer dosing at a transportation 
construction site (EPA-HQ-OW-2008-0465-0984.3)
    Various other researchers evaluated PAM as a soil stabilization 
agent. There are a number of documents in the administrative record for 
this

[[Page 63015]]

rulemaking describing the use of PAM in this manner.
    The data from these sources, as well as other data in the record, 
indicate that various types of PTS that utilize both solid and liquid 
forms of polymers have been reported to be effective in reducing 
turbidity levels in discharges from construction and development sites.
    EPA also considered the results of a three-year study conducted in 
Georgia (Warner & Collins-Comargo, DCN 43071) which developed and 
demonstrated cost-effective erosion prevention and sediment control 
systems. These controls did not rely on the use of polymer, instead 
they demonstrate the effectiveness of ponds, passive sand filters and 
seep berms.

X. Development of Effluent Limitations Guidelines and Standards and 
Options Selection Rationale

    In developing this final rule, EPA considered all the available 
information, including information, data and analyses conducted in 
support of the proposed rule, public comments received and additional 
information and data collected by EPA following proposal which is 
contained in the record. EPA evaluated a range of options for reducing 
pollutant discharges associated with construction activity. The options 
evaluated by EPA are intended to control the discharge of turbidity, 
sediment and other pollutants in stormwater and other wastewater from 
C&D sites.

A. Description of the Regulatory Options Considered

1. Options Considered in the Proposal
    In developing today's final rule, EPA evaluated several regulatory 
options. The proposal discussed a wide range of options and presented a 
detailed analysis for several options. As discussed earlier, Option 1 
would have required implementation of erosion and sediment controls and 
pollution prevention measures for all sites and the installation of a 
sediment basin with a surface outlet for certain sites and other non-
numeric effluent limitations or BMPs; Option 2, would have added to the 
requirements of Option 1 by establishing a requirement to monitor for a 
numeric limitation for turbidity (13 NTU) based on the application of 
ATS at sites of 30 or more acres with soil clay content of 10 percent 
or more and an R-factor of 50 or larger; Option 3 would have expanded 
the application of the turbidity limitation based on ATS to all sites 
which disturb 10 or more acres. The proposal also presented and 
solicited comment on another option that would require compliance with 
a higher numeric turbidity effluent limitation (e.g., 50 to 150 NTU, or 
some other value) based on passive treatment technologies (see 73 FR 
72562, 72580-72582, 72610-72611). At proposal, EPA sought additional 
data on the performance of PTS, and the cost and pollutant loading 
reductions that would be attainable from such an option.
2. Regulatory Options Considered for the Final Rule and Rationale for 
Consideration of Revisions to Options in the Proposed Rule
    In developing the final rule, EPA considered the wide range of 
options considered in the proposed rule, and some revisions to those 
options, based on comments received and additional information obtained 
by EPA. EPA considered a revision to Option 1 to remove the requirement 
for a sediment basin in response to concerns raised by commenters about 
the appropriateness and availability of a basin at all construction 
sites with 10 or more disturbed acres draining to one location. An 
example includes areas where excavation is precluded due to the 
presence of shallow bedrock. In addition to the sediment basin 
requirements, EPA also considered modifying some of the erosion and 
sediment control and pollution prevention requirements to make them 
broadly applicable and compatible with all types of potentially 
regulated construction activity, and considered deleting certain 
proposed requirements. These changes to the non-numeric effluent 
limitations are detailed in Section X.B of this notice.
    EPA considered a revision to Option 2 to remove the soil clay 
content criteria as part of the basis for determining if a site would 
be subject to the numeric limitation. Numerous commenters expressed 
concern about difficulties associated with implementation of this soil 
clay content criterion. Commenters raised questions, for example, about 
how sites would measure soil content and to what depth would the soil 
have to be sampled to determine the clay content (e.g., to a depth to 
which excavation will occur, or only the top several inches). Also, 
questions were raised as to the number of soil samples that would be 
required of sites of different size. Also, commenters raised the 
question of how to account for fill brought onto the site and the 
variation in soil types present at different depths and at different 
areas within the site. EPA also considered that adding complexity to 
the applicability section generally makes it more difficult to comply 
with, implement and enforce a rule. EPA agrees that the implementation 
of a soil clay content criterion for determining whether a site would 
be subject to a numeric limitation would be difficult to implement and 
therefore considered removing this criterion from Option 2.
    EPA similarly considered modifying Option 2 to remove the RUSLE R-
factor criterion as part of the basis for determining if a site would 
be subject to the numeric limitation. EPA received numerous comments 
about the potential practical difficulties associated with this 
criterion. Particularly, R-factor data is not readily available for all 
areas of the country, including the entire state of Alaska. Also, in 
certain areas of the country, the annual R-factor may be low, but soil 
erosion rates may still be very high during certain time periods (such 
as during spring thawing). Therefore, EPA determined that an annual R-
factor criterion, as proposed, would not be easily implementable, nor 
necessarily target those sites with greater potential for soil erosion.
    EPA also considered revising Options 2 and 3 so that the monitoring 
requirements and turbidity limitation would not apply to interstate 
natural gas pipeline construction activity (see discussion in Section 
VI).
    EPA also considered changing Option 2 so that the applicability of 
the turbidity limitation would be a function of disturbed area of the 
site, as opposed to the total size of the site. In addition, EPA 
considered revising the non-numeric effluent limitations of Option 2 
(as well as Option 3) to be consistent with the Option 1 requirements 
discussed above.
    EPA also considered the option discussed in the proposal (Option 4) 
that would establish a numeric limitation for turbidity based on the 
application of PTS for the final rule. This option would require all 
construction sites to implement the non-numeric effluent limitations 
described for Option 1, as well as requiring sites equal to or greater 
than a specified number of acres disturbed at one time to meet a 
numeric limitation to control turbidity and other pollutants in 
stormwater discharges from C&D sites. EPA considered thresholds of 1, 5 
and 10 acres disturbed at one time for this option. The technology 
basis for Option 4 consists of a suite of passive treatment 
technologies and erosion and sediment controls that are currently used 
at construction sites across the United States and abroad, as well as 
in other industries, such as drinking water treatment and mining. 
Examples of passive treatment technologies include sediment basins, 
sediment traps and

[[Page 63016]]

other impoundments (with and without polymer or flocculant dosing), 
polymer addition to fiber check dams, sand filtration, and dispersion 
of stormwater to vegetated areas. PTS can substantially reduce the 
amount of turbidity, sediment and other pollutants discharged from 
construction sites. See Section IX for additional discussion of passive 
treatment approaches.

B. Non-Numeric Effluent Limitations Included in All Regulatory Options

    Today's final rule, as well as the other options EPA considered, 
includes a suite of non-numeric effluent limitations that apply to all 
permitted C&D sites. This suite of non-numeric effluent limitations 
makes up Option 1 and is also a component of Options 2, 3 and 4. These 
non-numeric effluent limitations are structured to require permittees 
to first prevent the discharges of sediment and other pollutants 
through the use of effective planning and erosion control measures; and 
second, to control discharges that do occur through the use of 
effective sediment control measures. Permittees are also required to 
implement a range of pollution prevention measures to limit or prevent 
discharges of pollutants including those from dry weather discharges.
    The non-numeric effluent limitations that are included in all 
options are designed to prevent the mobilization and discharge of 
sediment and sediment-bound pollutants, such as metals and nutrients, 
and to prevent or minimize exposure of stormwater to construction 
materials, debris and other sources of pollutants on construction 
sites. In addition, these non-numeric effluent limitations limit the 
generation of dissolved pollutants. Soil on construction sites can 
contain a variety of pollutants such as nutrients, organics, 
pesticides, herbicides and metals. These pollutants may be present 
naturally in the soil, such as arsenic or selenium, or they may have 
been contributed by previous activities on the site such as agriculture 
or industrial activities. These pollutants, once mobilized by rainfall 
and stormwater, can detach from the soil particles and become dissolved 
pollutants. Once dissolved, these pollutants would not be removed by 
down-slope sediment controls. Source control through minimization of 
soil erosion is therefore the most effective way of controlling the 
discharge of these pollutants. Therefore, the non-numeric effluent 
limitations are important components of the final rule not only for the 
purposes of limiting sediment generation and discharge, but also to 
minimize the discharge of dissolved pollutants.
    The non-numeric effluent limitations in the final rule apply to all 
permitted C&D sites including the sites that are subject to the numeric 
effluent limitation and monitoring requirements at 40 CFR 450.22. (See 
Section X.G.) EPA has the authority under the CWA to establish non-
numeric effluent limitations as supplemental to a numeric effluent 
limitation or in place of a numeric effluent limitation. See Citizens 
Coal Council v. EPA, 447 F.3d 879, 896 (6th Cir. 2006). The non-numeric 
effluent limitations in this rule are necessary for those sites that 
are also subject to the numeric effluent limitation for turbidity 
because the non-numeric effluent limitations may address different 
pollutants or the same pollutants differently, the numeric effluent 
limitation is not applicable on days when total precipitation on that 
day is greater than the local 2-year, 24-hour storm event (See Section 
XIX.A), and the fact that sites may fluctuate above and below ten acres 
of disturbed land. Thus there will be times when sites are discharging 
pollutants in excess of the numeric effluent limitation and the non-
numeric effluent limitations will be the only applicable effluent 
limitation and are thus essential to the control of discharges from the 
site. Also, some of the non-numeric effluent limitations are addressing 
discharges unrelated to the discharge of turbidity, for example, 40 CFR 
450.21(e)(1) which prohibits the discharge of ``wastewater from washout 
of concrete, unless managed by an appropriate control'' addresses 
pollutants such as pH and can occur during precipitation related events 
or dry weather discharges. The structure of the final rule, including 
the requirement that the non-numeric effluent limitations apply to all 
sites, was supported by state permitting authorities and is similar to 
the structure of the newly issued California CGP (see DCN 42104).
    The final rule contains non-numeric effluent limitations that 
require the permittee to minimize the discharge of pollutants. Under 
the regulatory structure of the final rule the permitee can minimize 
the discharge of pollutants from construction sites by utilizing non-
numeric effluent limitations or BMPs such as the erosion and sediment 
controls listed below at (i) through (vii) and at 40 CFR 450.21(a)(1) 
through (7). The erosion and sediment controls at (i) through (vii) 
below are what EPA has determined are the required non-numeric effluent 
limitations that are necessary for owners or operators of construction 
sites to utilize in order to minimize the discharge of pollutants from 
the site. This is true for the other non-numeric effluent limitations 
at 40 CFR 450.21 as they are what EPA has determined are the required 
controls necessary to minimize, control or prohibit discharges of 
pollutants from construction sites. The permitting authority may 
determine that additional non-numeric effluent limitations or specific 
BMPs are necessary in order to minimize the discharge of pollutants and 
EPA has structured 40 CFR 450.21 to allow the permitting authority that 
discretion. Due to geographic differences or other variable factors a 
permitting authority may choose to require additional or more stringent 
non-numeric effluent limitations in its individual or general NPDES 
permits for discharges associated with construction activity. For 
example, the permitting authority may determine that it is necessary 
for permitees to initiate soil stabilization measures when construction 
activity has permanently or temporarily ceased and will not resume for 
a period exceeding 7 calendar days, as opposed to 14 calendar days at 
X.B.1.b below or that additional erosion and sediment controls are 
necessary. EPA purposefully drafted the non-numeric effluent 
limitations to allow for flexibility in how the permitting authority 
implements the requirement in NPDES permits. For example, in the 
erosion and sediment control section below at section X.B.1.a.iv EPA 
simply required that permitees ``minimize the disturbance of steep 
slopes'' leaving it up to the permitting authority to determine the 
specific requirements applicable to owners or operators of C&D sites to 
minimize disturbance of steep slopes in order to minimize the discharge 
of pollutants from the site. This flexibility built into the final rule 
will also benefit permittees by allowing the owners or operators of 
construction sites discretion to choose BMPs that will minimize the 
discharge of pollutants based on the unique nature of the particular 
site. For example, at 40 CFR 450.21(a)(5), the final rule states that 
construction sites must design, install and maintain controls to 
``minimize sediment discharges from the site.'' Absent specific 
requirements from the permitting authority the final rule gives the 
permittee discretion to choose what practices and controls to use to 
minimize the discharge of sediment from the site based on the site 
specific nature of the construction activity.
    The non-numeric effluent limitations are required for all sites, 
but there are

[[Page 63017]]

site-specific considerations that may make one or more of the 
provisions infeasible on a particular site. EPA has specifically 
qualified some of the requirements to state that the requirement must 
be implemented unless infeasible. By infeasible, EPA means that there 
is a site-specific constraint that makes it technically infeasible to 
implement the requirement, or that implementing the requirement would 
be cost-prohibitive. The burden is on the permittee to demonstrate to 
the permitting authority that the requirement is infeasible.
    With respect to the soil stabilization language at Sec.  450.21(b), 
EPA has qualified the soil stabilization requirements such that 
vegetative stabilization may be delayed in arid or semi-arid areas, or 
if an area is experiencing a drought such that vegetative stabilization 
practices cannot be initiated. In such cases, the permittee should 
consider non-vegetative stabilization practices. In addition, EPA would 
generally not expect permitting authorities to require vegetative 
stabilization in areas that are excessively rocky or infertile, that 
have non-erodible soils (such as sands), certain coastal areas, or 
during periods when snow or ice are covering the ground and generally 
in areas where vegetative stabilization would not be appropriate. 
Permitting authorities should incorporate this requirement into permits 
with consideration of appropriate stabilization measures for various 
areas within their jurisdiction.
    EPA made several revisions to the non-numeric effluent limitation 
since proposal. Some of these revisions were made in response to 
comments, while others were made as a result of EPA re-evaluating the 
feasibility and appropriateness of some of the proposed requirements. 
Section X.B.1 describes the non-numeric effluent limitations contained 
in the final rule while Section X.B.2 describes how the non-numeric 
effluent limitations in final rule differ from those in the proposal.
1. Non-Numeric Effluent Limitations Contained in the Final Rule
    The non-numeric effluent limitations contained in the final rule 
are as follows:
a. Erosion and Sediment Controls
    Permittees are required to design, install and maintain effective 
erosion controls and sediment controls to minimize the discharge of 
pollutants. At a minimum, such controls must be designed, installed and 
maintained to:
    i. Control stormwater volume and velocity within the site to 
minimize soil erosion;
    ii. Control stormwater discharges, including both peak flowrates 
and total stormwater volume, to minimize erosion at outlets and to 
minimize downstream channel and streambank erosion;
    iii. Minimize the amount of soil exposed during construction 
activity;
    iv. Minimize the disturbance of steep slopes;
    v. Minimize sediment discharges from the site. The design, 
installation and maintenance of erosion and sediment controls must 
address factors such as the amount, frequency, intensity and duration 
of precipitation, the nature of resulting stormwater runoff, and soil 
characteristics, including the range of soil particle sizes expected to 
be present on the site;
    vi. Provide and maintain natural buffers around surface waters, 
direct stormwater to vegetated areas to increase sediment removal and 
maximize stormwater infiltration, unless infeasible; and
    vii. Minimize soil compaction and, unless infeasible, preserve 
topsoil.
b. Soil Stabilization Requirements
    Permittees are required to, at a minimum, initiate soil 
stabilization measures immediately whenever any clearing, grading, 
excavating or other earth disturbing activities have permanently ceased 
on any portion of the site, or temporarily ceased on any portion of the 
site and will not resume for a period exceeding 14 calendar days. 
Stabilization must be completed within a period of time determined by 
the permitting authority. In arid, semiarid, and drought-stricken areas 
where initiating vegetative stabilization measures immediately is 
infeasible, vegetative stabilization measures must be initiated as soon 
as practicable.
c. Dewatering Requirements
    Permittees are required to minimize the discharge of pollutants 
from dewatering trenches and excavations. Discharges are prohibited 
unless managed by appropriate controls.
d. Pollution Prevention Measures
    Permittees are required to design, install, implement, and maintain 
effective pollution prevention measures to minimize the discharge of 
pollutants. At a minimum, such measures must be designed, installed, 
implemented and maintained to:
    i. Minimize the discharge of pollutants from equipment and vehicle 
washing, wheel wash water, and other wash waters. Wash waters must be 
treated in a sediment basin or alternative control that provides 
equivalent or better treatment prior to discharge;
    ii. Minimize the exposure of building materials, building products, 
construction wastes, trash, landscape materials, fertilizers, 
pesticides, herbicides, detergents, sanitary waste and other materials 
present on the site to precipitation and to stormwater; and
    iii. Minimize the discharge of pollutants from spills and leaks and 
implement chemical spill and leak prevention and response procedures.
e. Prohibited Discharges
    The following discharges from C&D sites are prohibited:
    i. Wastewater from washout of concrete, unless managed by an 
appropriate control;
    ii. Wastewater from washout and cleanout of stucco, paint, form 
release oils, curing compounds and other construction materials;
    iii. Fuels, oils, or other pollutants used in vehicle and equipment 
operation and maintenance; and
    iv. Soaps or solvents used in vehicle and equipment washing.
f. Surface Outlets
    When discharging from basins and impoundments, permittees are 
required to utilize outlet structures that withdraw water from the 
surface, unless infeasible.
2. Changes to the Non-Numeric Effluent Limitations Since Proposal
    EPA made a number of changes to the non-numeric effluent 
limitations for the final rule. EPA does not view these changes as 
making the final rule requirements less stringent than those contained 
in the proposal, but rather views these changes as necessary 
adjustments that make the requirements applicable to all types of 
construction activities. EPA has determined that many of the 
requirements, as proposed, could not be implemented on every 
construction site due to technical reasons. In general, some 
requirements were eliminated, while others were revised to include 
``unless infeasible'' language, recognizing that not every site will be 
able to implement every one of the proposed requirements. Also, the 
requirements were re-arranged to separate erosion and sediment control 
requirements from soil stabilization and pollution prevention 
requirements. However, EPA believes that most practices can be 
implemented on most sites, and where a practice is feasible and 
necessary for effective control of pollutant discharges from stormwater

[[Page 63018]]

runoff, this rule requires that it be implemented. The changes made, by 
section of the proposed rule text, along with the rationale for the 
changes are as follows:
    Section 450.21(a): The definition of when erosion controls are 
considered effective has been deleted since effectiveness varies based 
on site-specific parameters. In addition, the proposed language was 
limiting in that there may be other objective measures of effectiveness 
that were not described by EPA. The requirement to stabilize exposed 
soils has been incorporated into a ``Soil Stabilization'' section in 
the final rule at Sec.  450.21(b).
    Section 450.21(a)(4): The requirement to minimize the amount of 
soil exposed at any one time has been removed as the soil stabilization 
language at Sec.  450.21(b) requires immediate stabilization.
    Section 450.21(a)(5): The requirement to preserve natural 
vegetation was removed as there are cases where preserving the natural 
vegetation may not be compatible with the ultimate land use. The 
requirement to preserve topsoil was changed to include ``unless 
infeasible,'' recognizing that it may not always be feasible to 
preserve topsoil depending on the ultimate land use.
    Section 450.21(a)(6): The language regarding minimizing soil 
compaction was simplified and now includes ``unless infeasible,'' and 
the requirements for deep ripping and decompaction and incorporation of 
organic matter to restore infiltrative capacity were deleted because 
the use of these techniques is dependent upon the ultimate land use.
    Section 450.21(a)(7): The requirement for providing and maintaining 
natural buffers around surface waters was combined with the requirement 
to direct discharges to vegetated areas found in Sec.  450.21(b)(9) and 
now includes ``unless infeasible.''
    Section 450.21(a)(8): The requirement to minimize the construction 
of stream crossings was deleted as the construction of stream crossings 
on a particular project is determined by consideration of a number of 
factors, and simply minimizing the number based on erosion and sediment 
control considerations may conflict with other considerations. EPA has 
determined that this requirement is best left to the discretion of the 
permitting authority.
    Section 450.21(a)(9): The requirement to sequence/phase 
construction activities was deleted. EPA believes that permittees 
should consider sequencing or phasing for projects, particularly for 
larger or longer-duration projects. Phasing construction so that less 
than 10 acres of land are disturbed at any one time is one way for 
owners or operators of construction sites to comply with the rule 
without having to sample discharges and meet the numeric limitation in 
Option 4. EPA believes that this is appropriate because of the 
environmental benefits of such sequencing. However, EPA has determined 
that this is a site-specific consideration best addressed by the 
permitting authority.
    Section 450.21(a)(11): The requirement to implement erosion 
controls on slopes was deleted as the soil stabilization requirements 
encompasses all types of stabilization, not just on slopes.
    Section 450.21(a)(12): The requirement to establish temporary or 
permanent vegetation to stabilize exposed soils was deleted as 
vegetative controls may not always be the most appropriate 
stabilization measures. The selection of appropriate stabilization 
techniques is best left to the discretion of the permitting authority.
    Section 450.21(a)(13): The requirement to divert stormwater that 
runs onto the site away from disturbed areas of the site was deleted as 
this may not always be feasible, or, in certain instances, may increase 
off-site erosion.
    Section 450.21(b): The sediment control requirements were combined 
with the erosion control requirements into a new section titled 
``Erosion and Sediment Controls'' at Sec.  450.21(a) in the final rule 
regulatory text. The requirement to install sediment controls prior to 
commencement of construction and to maintain during all phases of 
construction activity was deleted as the timing of implementation of 
controls is site-specific. Maintenance of controls is inherent in 
permits and it is not necessary to include this requirement in the 
national rule.
    Section 450.21(b)(1): The requirement to establish and maintain 
perimeter controls was deleted, as the need for perimeter controls is 
dictated by site topography. The requirement to discharge stormwater 
from perimeter controls through vegetated buffers and functioning 
stream buffers was deleted. This requirement now applies to all 
discharges, unless infeasible, as described at Sec.  450.21(a)(6).
    Section 450.21(b)(2): The requirement to control discharges from 
silt fences using a vegetated buffer or filter strip was deleted as 
this may not always be feasible, depending on the site location or 
climate.
    Section 450.21(b)(3): The requirement to minimize slope length and 
to install linear sediment controls and slope breaks on erodible slopes 
was deleted as the need for these controls is dictated by site-specific 
considerations and is best left to the discretion of the permitting 
authority.
    Section 450.21(b)(4): The requirements to establish construction 
entrances and exits and to utilize wheel wash stations were deleted as 
it may not always be feasible to utilize wheel wash stations (for 
example, in remote areas). The need for construction entrances and 
exits are dependent on site configuration.
    Section 450.21(b)(5): The requirement to remove sediment from paved 
surfaces daily and the prohibition on washing sediment and other 
pollutants into storm drains were deleted. The need for these 
requirements depend on site configuration (i.e., if storm drains 
discharge to a sediment control or discharge off-site).
    Section 450.21(b)(6): The requirement to implement controls to 
minimize the introduction of sediment and other pollutants to storm 
drain inlets was deleted (for the same reason as Sec.  450.21(b)(5) 
above).
    Section 450.21(b)(7): The language regarding dewatering was changed 
to be specific to dewatering trenches and excavations. This language is 
now found at Sec.  450.21(c).
    Section 450.21(b)(8): All language regarding sediment basins was 
deleted (see Section VII.A).
    Section 450.21(b)(9): The requirement to direct discharges from 
sediment controls to seep berms and level spreaders and to utilize 
spray or drip irrigation systems was changed. This requirement now 
applies to all discharges, but is more general in that it does not 
specify techniques, but rather requires all discharges to be directed 
to vegetated areas, unless infeasible (now found at Sec.  
450.21(a)(6)). This provides more flexibility for permittees to select 
appropriate techniques.
    Section 450.21(c): The language describing examples of effective 
pollution prevention measures was deleted and instead the new 
requirement at Sec.  450.21(d) is to ``design, install, implement and 
maintain effective pollution prevention measures'' as this language is 
not limiting to those measures described in the proposal. In addition, 
pollution prevention requirements in the final rule are presented 
separately from a series of ``prohibited discharges''. At proposal, 
these two concepts were presented together.
    Section 450.21(c)(1): Discharges of construction waste, trash and 
sanitary wastes are not prohibited in the final rule, but rather the 
requirement is to minimize the exposure of a variety of

[[Page 63019]]

materials to precipitation and stormwater (now found at Sec.  
450.21(d)(2)). EPA has determined that a requirement to minimize 
exposure to precipitation and stormwater, rather than a strict 
prohibition on the discharge of these materials, is a more appropriate 
requirement as it may not always be feasible to prevent these materials 
from being discharged from the site.
    Section 450.21(c)(2): Concrete washout is now addressed separately 
at Sec.  450.21(d)(1), and discharges are allowed if managed by 
appropriate controls. The concrete washout provision is not a 
prohibition, as are discharges from other sources, because there are 
technologies available to treat concrete washout. Therefore, discharges 
of wastewaters from concrete washout are allowed if managed by 
appropriate controls. Wastewater from washout of form release oils and 
curing compounds have been added to the list of prohibited discharges 
at Sec.  450.21(d)(2).
    Section 450.21(c)(4): The requirement was changed to clarify that 
the prohibition is on the discharge of soaps and solvents.
    Section 450.21(c)(5): The requirement was changed so as not to 
prohibit the discharge of wash waters but rather to control discharges 
from equipment and vehicle washing and wheel wash, recognizing that 
wash waters can be managed using appropriate controls.
    Section 450.21(c)(6): ``Building products'' were added to the list 
of materials, and spills and leaks are addressed in a separate 
requirement (Sec.  450.21(d)(3)).
    Section 450.21(c)(7): The requirement to prevent runoff from 
contacting areas with uncured concrete was deleted, as this may not be 
feasible on some sites (such as bridges, roads, etc.).

C. Numeric Effluent Limitations and Standards Considered

    EPA considered numeric effluent limitations based on primarily two 
suites of technologies for the final rule. The first, advanced 
treatment systems or ATS, were described in the proposed rule under 
Options 2 and 3. For the final rule, EPA considered effluent 
limitations for turbidity based on ATS for site size thresholds of 10 
acres and 30 acres of disturbed land. As described earlier, these 
options are similar to those contained in the proposal, except the soil 
clay content and R-factor criteria have been removed from Option 2. In 
addition, Option 2 would apply to sites of 30 or more disturbed acres. 
At proposal, Option 2 would have applied if the site was 30 or more 
acres, regardless of the amount of land disturbed on the project
    The second technology suite, passive treatment systems or PTS, 
constitutes the technology basis for today's final rule. In the 
proposal, EPA considered the establishment of numeric turbidity 
limitations based on PTS and solicited comment and additional 
information and data on this option. For the final rule, EPA considered 
numeric limitations for turbidity based on PTS for a site size 
threshold of 10 or more acres disturbed at one time (Option 4). EPA 
also evaluated site size thresholds of 1 and 5 acres disturbed at one 
time.
    Additional information on both PTS and ATS is presented in Section 
IX of today's notice, the development document and in the 
administrative record. The nomenclature presented in Table X-1 is used 
to describe these options throughout today's notice.

 Table X-1--Main Options Considered for Numeric Effluent Limitations and
                                Standards
------------------------------------------------------------------------
                                                           Site size
             Option                Technology basis    threshold  (acres
                                                          disturbed)
------------------------------------------------------------------------
2..............................  Active Treatment...  30 or more.
3..............................  Active Treatment...  10 or more.
4..............................  Passive Treatment..  10 or more.
------------------------------------------------------------------------

    For all of these options, the numeric turbidity limitation would 
apply to all discharges from the site except on days when total 
precipitation during the day exceeded the local 2-year, 24-hour storm. 
If the total precipitation in any one day is greater than the local 2-
year, 24-hour storm event, then permittees would still need to sample 
(because they wouldn't know in advance whether the precipitation on 
that day was going to exceed the storm size threshold) but the numeric 
effluent limitation would not apply to discharges for that day. 
However, the numeric effluent limitation is applicable to all 
discharges from the site on subsequent days if there is no 2-year, 24-
hour storm event during those days. Even when total precipitation 
during the day exceeds the local 2-year, 24-hour storm permittees must 
comply with the non-numeric effluent limitations Sec.  450.22(c) 
through Sec.  450.22(h). (See Section XIX.A for EPA's rationale for 
selecting the 2-year, 24-hour storm event).
    Under all the options considered that contain a numeric limitation, 
the limitation applies so long as the total amount of disturbed area on 
the project, at any one time, is at or above the specified acreage 
threshold (i.e., 10, 20 or 30 acres). For example, under Option 4, if a 
project initially disturbs 10 or more acres of land at one time during 
construction activity, but after completion of clearing and grading and 
infrastructure installation the site is stabilized prior to or during 
commencement of vertical construction, then the sampling requirements 
and turbidity limitation would cease to apply at the point where the 
total disturbed land area at the site is less than 10 acres at one 
time. So long as the total disturbed land area at one time remains 
below 10 acres for the remainder of the construction activity, the 
sampling requirements and turbidity limitation would not apply. If, 
however, at some point during the remainder of the project 10 or more 
acres were to be disturbed at one time, then the sampling requirements 
and turbidity limitation would again apply to all discharges from the 
C&D site. This 10 acre threshold also applies to projects that are part 
of a larger common plan of development. If an individual portion of a 
project disturbs less than 10 acres at one time, but the amount of land 
disturbed at one time under the larger common plan of development is 10 
or more acres, then sampling of discharges from the entire project is 
required during the period when the total disturbed land for the whole 
project is 10 or more acres.
    EPA has also found it is reasonable to allow time for permitting 
authorities to develop monitoring requirements and to allow the 
regulated community time to prepare for compliance with a numeric 
limitation. Compliance with the numeric limitation and the associated 
monitoring requirements are not required until 18 months after the 
effective date of this rule for sites with 20 or more acres of land 
disturbed at one time and four years after the

[[Page 63020]]

effective date for sites with 10 or more acres of land disturbed at one 
time. EPA's rationale for this decision is described in Section XIX.B.
    In addition to the issue discussed above regarding EPA's 
determination that turbidity is the appropriate end point for today's 
rule because of its applicability to more than simply conventional 
pollutants, EPA evaluated the advantages and disadvantages of 
establishing a limitation on turbidity rather than total suspended 
solids (TSS). Turbidity is more appropriate because turbidity can be 
easily measured in the field while TSS requires collection of a sample 
and analysis in a laboratory. Demonstrating compliance with a turbidity 
limitation is relatively easy and inexpensive for construction site 
owners or operators to implement. Hand-held turbidity meters 
(turbidimeters) can be used to measure turbidity in discharges, or data 
loggers coupled with in-line turbidity meters can be used to 
automatically measure and log turbidity measurements reducing labor 
requirements associated with sampling. Since most controls and 
treatment systems are flow-through systems, the use of TSS would not 
allow permittees to gauge performance in the field and take any 
correction action if they are in danger of violating the limitation. 
With the limitation based on the pollutant turbidity, permittees can 
measure turbidity levels in discharges continuously, with immediate, 
real-time information on the efficacy of their controls, and take 
immediate action if they are in danger of exceeding the turbidity 
limitation. For these reasons, EPA has determined that turbidity is a 
more appropriate measure of the effectiveness of the PTS and the 
technology can be implemented more easily by utilizing turbidity rather 
than TSS.

D. Selected Options for BPT, BCT, BAT and BADT for NSPS

    EPA has selected Option 1 as the basis for BPT and BCT and EPA has 
selected Option 4 as the basis for BAT and BADT for NSPS. Option 1 
requires all C&D sites to implement a range of non-numeric effluent 
limitations. Option 4 requires all C&D sites to implement the same 
range of non-numeric effluent limitations as in Option 1 and requires 
sites with 10 or more acres of disturbed land at one time to meet a 
numeric limitation based on PTS to control pollutants in stormwater 
discharges.

E. Selection Rationale for BPT

    EPA is establishing BPT effluent limitations on the basis of the 
technologies described under Option 1. EPA has determined that the non-
numeric effluent limitations in Option 1 represent a level of control 
that is technologically available and economically practicable and 
represents the average of the best performance of construction sites in 
the C&D point source category considering the factors in CWA section 
304(b)(1)(B). The requirements established by Option 1 are well-
established for construction activities in all parts of the country. 
The Option 1 requirements are generally consistent with the 
requirements currently in place under the existing Construction General 
Permits issued by EPA and most states. Many of these types of effluent 
limitations have been in place in NPDES permits for discharges 
associated with construction activity since at least the early 1990s. 
Prior to the issuance of the 1990 NPDES Phase I regulations, many 
existing state laws and regulations required the implementation of 
erosion and sediment controls. Many of these controls were first used 
beginning in the 1960s and 1970s, and they are well-established 
industry practices. In Option 1, EPA has taken this established 
approach to controlling stormwater discharges from construction sites 
and established minimum requirements for owners or operators of the 
site. In some cases the narrative limitations of Option 1 are more 
stringent than past EPA general permit requirements, e.g., the soil 
stabilization requirements are more stringent than the 2008 EPA CGP. 
These requirements represent the average of the best performance of the 
industry because they are being used effectively by construction 
operators and/or EPA's analysis indicates that the costs are small in 
relation to the effluent reduction benefits to be achieved from such 
requirements, traditionally measured in terms of cost per pound of 
pollutant removed. As stated in Section III.D., EPA assesses cost-
reasonableness of BPT effluent limitations by considering the cost of 
treatment in relation to the effluent reduction benefits achieved, 
typically in dollars/pounds of pollutants reduced. EPA has determined 
that the costs in relation to the pollutant reduction benefits of the 
selected option for BPT are reasonable. The costs per pound of sediment 
removed expressed as TSS for Option 1 is $0.10 per pound ($ 2008). The 
range of costs per pound removed for other industrial categories is 
$0.26 to $41.44 per pound in year 2008 dollars.
    EPA considered the non-water quality environmental impacts of 
Option 1 including energy usage, air emissions and solid waste handling 
associated with the non-numeric effluent limitations. Energy usage 
associated with the non-numeric effluent limitations includes fuel 
consumption for construction equipment to excavate and install erosion 
and sediment controls and excavation and placement or disposal of 
accumulated sediment (see Section XIV.C). Air emissions associated with 
the non-numeric effluent limitations would be emissions generated from 
the burning of fuel by construction equipment (see Section XIC.A). 
Solid waste generated from stormwater treatment includes the polymer-
laden sediment settled out during treatment, if polymers or flocculant 
are utilized, though they are not part of the technology-basis for BPT 
(see Section XIV.B). EPA found the non-water quality environmental 
impacts associated with Option 1 to be minimal and acceptable. The non-
water quality environmental impacts associated with the BPT effluent 
limitations are negligible as there is little incremental energy 
expended in the implementation of the erosion and sediment controls, 
since these types of controls are already being implemented by the 
majority of construction sites nationwide. Selecting Option 1 as BPT 
for this point source category is consistent with the CWA and 
regulatory determinations made for other point source categories, in 
that the Option 1 requirements represent limitations based on the 
average of the best performance of facilities within the C&D point 
source category. See Weyerhauser Co. v. Costle, 590 F. 2d 1011, 1053-54 
(D.C. Cir. 1978).
    EPA rejected Options 2, 3 and 4 as the basis for BPT because EPA 
views BPT as the first level of technology-based control representing 
the average of the best performance on a national basis. Although 
meeting a numeric limitation represents BAT and BADT for NSPS, as 
discussed below, meeting a numeric effluent limitation is a substantial 
change for most owners or operators engaged in construction activity 
nationwide. EPA's record does not indicate that meeting a numeric 
turbidity limitation, even for the subset of facilities identified in 
Option 4, represents today's average of the best performance and 
therefore it does not represent the BPT level of control for this point 
source category.

F. Selection Rationale for BCT

    EPA is establishing BCT equivalent to BPT, based on Option 1. BCT 
represents the best control technology for conventional pollutants 
which is primarily TSS for the construction and development point 
source category. As discussed in X.E above, the

[[Page 63021]]

requirements of Option 1have been demonstrated to be technologically 
available and EPA's analyses show that the requirements are 
economically practicable. Establishing BCT effluent limitations for a 
point source category begins by identifying technology options that 
provide additional conventional pollutant control beyond that provided 
by application of BPT effluent limitations. Conventional pollutants 
under the CWA are biochemical oxygen demand (BOD5), TSS, 
fecal coliform, pH, and oil and grease. CWA section 304(a); 40 CFR 
401.16. Stormwater discharges, if not adequately controlled, can 
contain very high levels of TSS. In addition, many of the construction 
materials used at the site can contribute BOD or oil and grease. Fecal 
coliform can also be present at elevated levels, due to natural sources 
(contributed by animal wastes) or if stormwater is not segregated from 
sanitary waste facilities. See Section VIII for additional discussion 
of pollutant sources.
    EPA evaluates the candidate BCT options by applying the two-part 
BCT cost test. The first part of the BCT cost test is the POTW test. To 
``pass'' the POTW test, the cost per pound of conventional pollutant 
discharges removed in upgrading from BPT to the candidate BCT must be 
less than the cost per pound of conventional pollutant removed in 
upgrading POTWs from secondary treatment to advanced secondary 
treatment. Using the RS Means Historical Cost Indices, the inflation-
adjusted POTW benchmark (originally calculated to be $0.25 in 1976 
dollars) is $0.92 (2008 $). To examine whether an option passes this 
first test, EPA calculates incremental values of the candidate option 
relative to the selected BPT (Option 1). EPA calculated the incremental 
cost per pound of conventional pollutants removed ($/lb TSS) for Option 
2 to be $2.50. Since this result is more than the POTW benchmark, 
Option 2 fails the first part of the two-part BCT cost test. EPA also 
calculated the incremental cost per pound of conventional pollutants 
removed for Option 3, which is $3.22. Therefore, Option 3 also fails 
the first part of the BCT cost test. EPA also calculated the 
incremental cost per pound of conventional pollutants removed for 
Option 4, which is $0.35. Therefore, Option 4 passes the first part of 
the BCT cost test.
    To pass the second part of the BCT cost test, the industry cost 
effectiveness test, EPA computes a ratio of two incremental costs. The 
numerator is the cost per pound of conventional pollutants removed by 
the BCT candidate technology relative to BPT. The denominator is the 
cost per pound of conventional pollutants removed by BPT relative to no 
treatment (i.e., raw wasteload). As in the POTW test, the ratio of the 
numerator divided by the denominator is compared to an industry cost 
benchmark. The industry cost benchmark is the ratio of two incremental 
costs: The cost per pound to upgrade a POTW from secondary treatment to 
advanced secondary treatment, divided by the cost per pound to 
initially achieve secondary treatment from raw wasteload. If the 
calculated ratio is lower than the industry cost benchmark of 1.29 
(i.e., the normalized cost increase must be less than 29 percent), then 
the candidate technology passes the industry cost test. Since both 
Option 2 and 3 fail the first part of the BCT cost test, it is not 
necessary to compute the ratio for the second part. The calculated 
ratio for Option 4 is 5.47; therefore, Option 4 fails the second part 
of the BCT cost test. Therefore, EPA is setting BCT equal to Option 1.

G. Selection Rationale for BAT and BADT for NSPS

1. Selection Rationale
    EPA is selecting Option 4 as the basis for BAT and BADT for NSPS. 
The requirements of the selected Option have been demonstrated to be 
technologically available, economically achievable, pose no barrier to 
entry and have acceptable non-water quality environmental impacts (see 
section XIV) and thus represent BAT and BADT for NSPS. As described 
above in Section III.D of this notice, the CWA requires EPA to consider 
several of the same factors when establishing BAT and NSPS. Both levels 
of control are based on the best technology, considering the cost of 
achieving such effluent reduction and any non-water quality 
environmental impacts (including energy requirements). See CWA sections 
304(b)(2)(B) and 306(b)(1)(B). The principle difference between the two 
technology standards is the potential for new sources under NSPS to 
install the best available demonstrated control technology without the 
cost to retrofit new technology into an existing site. In both cases, 
the Agency must determine that the requirement will not cause 
unacceptable economic impacts to the industry as a whole or by 
presenting a barrier to entry to new facilities.
    The construction industry is different from other industries when 
considering closures and barriers to entry. For this industry, the 
permitted activity is a temporary project rather than ongoing 
operations at a permanent facility. This is an important distinction, 
in that it provides construction firms with greater flexibility in how 
they respond to the rule. Not only can they elect to use one or more 
technologies to ensure compliance with the rule for a project they can 
also plan the dimensions and timing of the project in such a way as to 
minimize the effects of the rule on project profitability. As all new 
construction projects are new and impermanent, there is no meaningful 
distinction between new and existing sources, from the standpoint of 
economic affordability. As such, EPA is discussing the basis for both 
BAT and NSPS together.
    EPA has determined that a numeric limitation as well as non-numeric 
effluent limitations for sites with 10 or more acres disturbed at one 
time is technically available as that term is used in the CWA. The 
technologies used to meet the limitation in Option 4 are non-numeric 
effluent limitations or BMPs, the use of polymer-aided settling, and 
site planning techniques such as limiting the amount of land disturbed 
at any one time or phasing construction activities. These technologies 
are currently being utilized throughout the country and EPA has 
determined that the use of these technologies will result in stormwater 
discharges from C&D sites consistently meeting the requirements of 
Option 4. EPA has determined that a numeric effluent limitation is 
achievable based on the performance of these technologies measured by 
the information and data described in Section IX.E and by information 
concerning similar treatment systems used in the placer mining 
industrial point source category.
    Passive treatment systems are currently used at a range of 
construction sites as evidenced by the information contained in the 
record. EPA has determined that a numeric limitation is achievable 
based on the performance of PTS measured by the data described in 
Section IX.E and in the Development Document and the record. Multiple 
studies performed by McLaughlin in North Carolina have demonstrated the 
effectiveness of passive approaches in reducing turbidity in stormwater 
discharges from construction sites. Many of McLaughlin's studies were 
performed on linear transportation projects for the North Carolina 
Department of Transportation in piedmont areas of the State. Another 
researcher, Warner, evaluated several erosion and sediment controls at 
a full-scale demonstration construction site in Georgia. Additionally, 
there were several studies conducted in New

[[Page 63022]]

Zealand on the effectiveness of flocculants and coagulants at improving 
settling at transportation and residential projects. See Section IX.E 
for a more detailed discussion of these studies. Adding flocculants or 
polymers to aid in sediment removal are also routinely used a drinking 
water plants to treat their source water. Polymer aided settling has 
also been used in placer mining to treat effluent.
    In the proposal, EPA provided data on PTS and solicited comments on 
the pollutant removal effectiveness, effluent quality attainable and 
the technical basis for establishing a particular numeric turbidity 
limitation for C&D sites based on passive treatment. See 73 FR 72562, 
72580-82, 72610-11. Commenters provided additional data and papers on 
PTS and EPA identified additional data on PTS (see the chapter 6 of the 
TDD for a description of the data EPA has used as a basis for the 
numeric limitation). EPA also obtained additional data from vendors on 
ATS, the first component of which, namely polymer-assisted settling, 
has been used, in combination with data available at the time of 
proposal, as a basis for the numeric limitation (see Chapter 6 of the 
TDD). A technology is ``available'' even if it is not widely or 
routinely used as long as the technology is used at some facilities, a 
pilot plant or is adequately available. See e.g., American Frozen Foods 
v. Train, 539 F.2d 109 (D.C. Cir. 1976) (BAT was based on two exemplary 
plants); Ass'n of Pacific Fisheries v. EPA, 615 F.2d 794, 816 (9th Cir. 
1980) (legislative history indicates BAT can be established based on 
statistics from one plant); FMC Corp v. Train, 539 F.2d 973 (4th Cir. 
1976) (BAT limitations based on single pilot plant and a few exemplary 
plants); Kennecott v. EPA, 780 F.2d at 458 (Congress required EPA to 
search out BAT and to strive for zero discharge. BAT was based on two 
plants). The data and information in the record on the use of these 
technologies to control stormwater discharges support EPA's 
determination that a well designed and maintained PTS on varying types 
of construction sites in several areas of the country will consistently 
achieve a numeric limitation and is thus technologically available. The 
data and studies in the record show that these technologies have been 
used in areas of the country with different rainfall patterns and soil 
types. Locations of the studies include the Pacific Northwest, North 
Carolina, and Georgia, as well as outside the U.S. (including New 
Zealand). In addition, these technologies have been implemented on 
different project types, including transportation, institutional and 
residential construction.
    The Agency also examined the use of these technologies to control 
sediment, turbidity and other pollutants in other industries. At least 
six federal circuit courts have upheld EPA's use of transfer of 
technology in the context of the CWA when promulgating ELGs and NSPSs, 
concluding that effluent limitations may be based on a technology which 
has been demonstrated outside the industry, if that technology is 
transferable to it. See e.g., CPC International v. Train, 515 F.2d 
1032, 1048 (8th Cir. 1975); Kennecott v. EPA, 780 F.2d 445, 453 (4th 
Cir. 1986); CHS v. EPA, 553 F.2d 280, 285-287 (2d. Cir. 1977); Ass'n. 
of Pacific Fisheries v. EPA, 615 F.2d 794, 817 (9th Cir. 1980).
    EPA examined the use of polymer-aided settling that is used in the 
placer mining industry to treat effluent from the mining facilities. 
Placer mining extracts gold from alluvial deposits. Excavation often 
uses water as the means to disturb the sediments allowing the gold to 
be extracted. The wastewater generated with placer mining contains the 
sediment that has been separated from the gold. Though the water used 
during the gold extraction process is not ``stormwater,'' the water 
during the mining process acts in a similar manner as stormwater as it 
detaches, erodes and dislodges the soil and discharges sediment, 
turbidity and other pollutants from the facility. The placer mining 
effluent guidelines (40 CFR part 440 subpart M) established limitations 
for settleable solids based on simple settling for a minimum of 4 
hours. While developing the placer mining effluent limitations 
guidelines, EPA conducted treatability studies on the effectiveness of 
simple settling and chemically-aided settling (polyethylene oxide (PEO) 
and PEO with polyelectrolyte). Settleable solids, TSS and turbidity 
were measured in these studies. EPA has examined the data from these 
studies to evaluate the effectiveness of settling and polymer aided 
settling applicable to the C&D point source category. EPA considers 
this treatment performance data to be appropriate because both placer 
mining and C&D involve significant disturbance of soils and placer 
mining process wastewater has similar characteristics to stormwater 
from construction sites. Untreated wastewater in the tests contained 
concentrations of TSS ranging from 3,585 mg/L to 161,700 mg/L with 
turbidity ranging from 2,450 to >80,000 NTU. After simple settling for 
6 hours the concentrations of TSS dropped to between 28 mg/L and 26,235 
mg/L while turbidity decreased to between 35 to 35,000 NTU. In the 
tests where polyelectrolyte was added, initial TSS concentrations 
ranged from 869 to 55,340 mg/L while turbidity ranged from 1,680 to 
42,500 NTU. After 6 hours of settling, the TSS in the polyelectrolyte 
samples ranged from 2 to 23 mg/L while turbidity ranged from 5 to 78 
NTU. Notable also was that turbidity had decreased to between 13 and 97 
NTU after only one hour of settling in these samples. Similar results 
were reported for PEO with initial turbidity ranging from 1,235 to 
39,500 and results after 6 hours ranging from 51 to 140 NTU (See DCN 
42103, 1986 Alaskan Placer Mining Study Field Testing Program Report).
    EPA acknowledges that the placer mining treatment data was specific 
to that industry. There may be other distinctions between the treatment 
evaluated there and the technology in today's rule (e.g., the placer 
mining data is based on enhanced settling using a polyelectrolyte and a 
polyelectrolyte with a polymer only, as opposed to a full range of 
passive treatment techniques relied upon in today's rule). Nonetheless, 
the technology (chemically-enhanced settling) and the materials (water 
containing dirt, rock, sand and similar materials) are fundamentally 
similar and support EPA's conclusion that this type of well-
demonstrated treatment technique can reliably achieve low turbidity 
levels in sediment bearing waste streams. This data demonstrates that 
simple settling or enhanced settling is capable of achieving the 
limitation.
    The data in the record on the use of PTS at construction sites 
supports EPA's determination that a well designed and maintained 
passive treatment system will consistently achieve the limitation and 
is thus technologically available. The data in the record on the use of 
enhanced settling at placer mining facilities supports EPA's 
determination that PTS will consistently achieve the limitation in 
discharges associated with construction activity and supports PTS being 
technologically available.
    Besides the use of PTS, owners and operators will often times be 
able to rely on non-numeric effluent limitations or BMPs, without the 
use of polymers of flocculants, to meet the limitation. For example, 
Horner et al. (see NRC at pg. 445 and DCN 01350) showed that a 
turbidity limitation of 25 to 75 NTUs can be consistently met on 
highway construction sites in Washington. See also discussion of Warner 
and Collins-Camargo earlier (DCN 43071). Owners or operators can also 
choose to modify their site planning, construction

[[Page 63023]]

operations or the processes in which the construction activity occurs, 
such as changing the way the site is graded so that stormwater is 
directed to areas where it can infiltrate. Also, if a vegetated area is 
available, owners or operators can choose to utilize this area for 
dispersion of the stormwater. The Agency may base BAT and NSPS 
limitations and standards upon effluent reductions attainable through 
changes in a facility's processes and operations, as are available to 
owners and operators of construction sites. See Texas Oil & Gas Ass'n 
v. EPA, 161 F.3d 923, 928 (5th Cir.1998). In addition, owners or 
operators have the option to phase their construction activity or limit 
the amount of land disturbed at one time in a manner such that the 
numeric limitation would not apply to their construction activity. 
Construction site owners or operators can avoid the application of the 
numeric limitation in Option 4 to their discharges altogether if they 
limit construction activity so that less than 10 acres are disturbed at 
any one time.
    EPA's analysis shows that the technologies that form the basis of 
Option 4 can consistently meet the limitation.
    In addition, the non-numeric effluent limitations of Option 4 are 
technically available. These non-numeric effluent limitations represent 
the average of the best performance of construction sites across the 
country. See discussion of BPT in section III.D.1. As BAT represents 
best available technology, they are also technologically available.
    In considering economic impacts, EPA's analyses show that the 
requirements of Option 4 are economically achievable (BAT) and will not 
pose a barrier to entry (NSPS). Under the CWA, in the effluent 
guidelines program, EPA traditionally assesses the economic impact on 
the industry as a whole, by looking at what percentage of facilities 
would close or face a barrier to entry as a result of the costs of the 
regulatory requirements and any resulting loss of employment.
    EPA estimates that out of the 82,000 firms expected to be affected 
by this regulation, 147 firms or 0.2 percent, may close as a result of 
the requirements. This closure estimate is based on the assumption that 
some of the costs associated with this regulation will be passed on to 
the customers of these firms. Based on the typical number of employees 
working for these firms, EPA estimates 7,257 job losses associated with 
these closures, out of total in-scope employment of 1.85 million. As 
discussed in section XII.D, construction firms routinely expand and 
contract their workforce in response to work load and as a result many 
workers laid off when a firm closes are rehired by new and other 
existing more financially healthy firms. Therefore, job losses due to 
firm closures are in many cases a temporary displacement of the 
workforce as compared to other industrial point source categories. The 
construction industry is a highly dynamic industry that is 
characterized by many small firms with a relatively high turnover that 
expand and contract their level of activity readily in response to 
changes in market conditions.
    The relatively high rate of entry and exit in the construction 
industry, compared to other industries, suggests barriers to entry are 
normally low. Option 4 is not likely to put new firms at a disadvantage 
as both existing and new firms will need to meet the same requirements 
for each new project begun. Existing firms are likely to have more 
assets than new firms and therefore may be able to use more of their 
own financial resources to finance a new project. The greater the 
compliance costs in comparison to baseline assets the more likely the 
rule would pose a barrier to new entrants. EPA assessed the increase in 
financing requirements in relation to typical baseline assets for the 
different firm revenue categories, and under Option 4 no firm category 
would face financing requirements greater than 4.1% of baseline assets. 
EPA does not consider Option 4 to pose a barrier to entry for new firms 
into the marketplace. For a more detailed discussion see Section XII 
below.
    Option 4 is projected to have a total industry compliance cost, 
once fully implemented in NPDES permits and the industry has returned 
to normal levels of construction activity, of $953 million per year 
(2008 $). Most C&D sites are permitted under general permits, so this 
rule will not be fully implemented until all state and EPA general 
permits have expired and new general permits are issued that 
incorporate the Option 4 requirements, which will take approximately 5 
years after the effective date of this rule. Costs in the first year 
(2010) are estimated to be approximately $8 million, and annualized 
costs for the first 10 years after promulgation are estimated to be 
$577 million (see Table X-2). Given the size of the industry and the 
current annual value of construction activity of $960 billion (July, 
2009), EPA has determined that this cost, which represents less than 
one tenth of one percent of the current total value of annual 
construction activity, can be reasonably borne by the industry.

                                                   Table X-2--Option 4 Annual Compliance Cost by Year
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                     Compliance year
---------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                  2010     2011     2012     2013     2014     2015     2016     2017     2018     2019
--------------------------------------------------------------------------------------------------------------------------------------------------------
Annual Compliance Cost (Millions).............................       $8      $63     $204     $538     $810     $834     $859     $885     $911     $938
--------------------------------------------------------------------------------------------------------------------------------------------------------

    These economic impacts are well within the range of impacts EPA has 
imposed on other industries subject to ELG and NSPS rulemakings. 
Congress expressly considered BAT and NSPS to be technology-forcing and 
that in striving towards the ambitious goals of the CWA either BAT or 
NSPS may, and likely will, result in some economic impacts to a portion 
of an industry. See e.g., American Iron & Steel v. EPA, 526 F.2d 1027, 
1052 (3d. Cir. 1975); Weyerhaeuser v. Costle, 590 F.2d 1011, 1026 (D.C. 
Cir. 1978). Based on the traditional factors EPA considers under the 
CWA when promulgating effluent limitations guidelines and standards the 
Agency determined that Option 4 is economically achievable and will not 
pose a barrier to entry. For a more complete discussion of EPA's 
economic impact analysis see Section XII of this notice.
    Under the Regulatory Flexibility Act (RFA), EPA also considered the 
impact to firm revenues for Option 4, at full implementation under 
normal levels of construction activity. EPA evaluated impacts of the 
rule on small firms. EPA considers the number of firms where the costs 
to those firms exceed 1 percent and 3 percent of revenue. Under Option 
4, there are no firms, either small or large, that are expected to 
incur compliance costs exceeding 3 percent of their revenues, while 
only 230 small firms (0.03% of in-scope firms and 0.84% of those 
incurring costs) are expected to incur costs exceeding 1

[[Page 63024]]

percent of their revenues. Another measure of economic stress 
considered by EPA is the estimated change in important firm financial 
metrics, such as the ratio of pretax income to total assets. For this 
option, a total of 169 out of 82,000 firms expected to be affected by 
this regulation are estimated to incur financial stress as a result of 
regulatory requirements, which represents 0.2 percent of in-scope 
firms. These impacts are not necessarily additive with estimated 147 
firm closures, mentioned previously, as they evaluate different aspects 
of a firm's financial viability, and the same firm may experience more 
than one measure.
    EPA found the non-water quality environmental impacts associated 
with Option 4 to be minimal and acceptable. The non-water quality 
environmental impacts associated with the BPT effluent limitations are 
negligible as there is little incremental energy expended in the 
implementation of the erosion and sediment controls, since these types 
of controls are already being implemented by the majority of 
construction sites nationwide. Depending on the particular polymer or 
flocculant used, these solids are typically utilized as fill material 
on the construction site. If they cannot be used as fill, then they 
would be treated as municipal solid waste. However, EPA would expect 
permittees to choose polymers or flocculants that would allow for use 
of removed solids on-site
    EPA considered site size thresholds smaller than 10 acres for the 
applicability of passive treatment systems and a numeric effluent 
limitation and associated monitoring requirements. While EPA does not 
have information to indicate a numeric effluent limitation for 
stormwater discharges is not feasible for smaller construction sites, 
EPA has determined that a site size threshold below 10 acres disturbed 
at one time does not at this time represent BAT and NSPS in recognition 
of other relevant factors, such as the fact that this is the first time 
EPA has required an enforceable numeric effluent limitation for 
stormwater discharges from construction sites nationwide, the increased 
burden on the permitting authorities, and that construction sites less 
than 10 acres are more likely to be operated by small businesses.
    EPA recognizes that meeting a numeric limitation is a significant 
change for this industry. A 10-acre threshold of land disturbed at one 
time will result in the numeric effluent limitation for turbidity and 
the associated monitoring requirements applying to a very substantial 
number of constructed acres of land per year. EPA has estimated that at 
a threshold of 10 acres disturbed at one time, 623 thousand acres and 
more than 21,000 projects annually will be subject to the numeric 
effluent limitation. Thus, EPA has determined the final rule would 
result in the numeric effluent limitation and monitoring requirements 
applying to an estimated 73% of the constructed acres per year. If EPA 
were to lower the threshold of land disturbed at one time to below 10 
acres, the final rule would significantly increase the number of 
projects subject to the numeric effluent limitation. As stated above, 
at a 10-acre threshold, about 21,000 projects are subject to the 
numeric effluent limitation; however, if the Agency were to lower the 
threshold to, for example, 5 acres, the number of construction projects 
climbs to 37,000 projects; and at 1 acre, the number of construction 
projects would jump to 84,000 projects, a four-fold increase in covered 
projects compared to a 10-acre threshold. EPA received comments from 
state permitting authorities concerned about the potential increased 
burden a numeric effluent limitation may have if it were applied to all 
construction sites. State permitting authorities must oversee 
incorporation of the final rule into their NPDES permits, in addition 
to providing logistical and technical support to permittees subject to 
the new requirements. While the final rule is not mandating specific 
reporting requirements, EPA expects permitting authorities to develop 
requirements in their NPDES permits for frequent reporting to assist in 
compliance monitoring and program development. The permitting authority 
will have to manage the reported effluent data and discharge monitoring 
reports. EPA considered the significant further progress that applying 
a numeric effluent limitation based on passive treatment systems to 73% 
of the constructed acres would have in meeting the goals of the CWA in 
combination with the likely increased workload to permitting 
authorities, especially during a unique period of time when resources 
may be an issue for permitting authorities.
    Additionally, EPA considered that construction sites less than 10 
acres are more likely to be operated by small businesses. Larger 
construction firms, who tend to operate on larger sites, will likely 
have in-house expertise, while smaller construction firms may need to 
rely on hiring consultants to implement the passive treatment systems 
in order to meet the numeric effluent limitation. Based on comments EPA 
received, the Agency has some concerns regarding the expertise at the 
small construction firm level and, given the size of the construction 
industry, the availability of the support industries for small 
construction sites. The concern is that the support industries for 
small construction sites, such as consulting firms and erosion and 
sediment control service providers, will not be available, especially 
as the entire industry adjusts to the new requirements, to provide the 
level of support needed for these smaller sites to effectively 
implement passive treatment systems to meet the numeric effluent 
limitation. If the threshold was below 10 acres disturbed at one time, 
an additional 63,000 sites, under a 1-acre threshold, or an additional 
15,000 sites, under a 5-acre threshold, may need outside support for 
passive treatment systems. EPA considered the issue of small 
businesses' operation of small sites, the availability of expertise for 
small sites that is necessary to meet a numeric effluent limitation and 
the resulting questions raised as to whether passive treatment systems 
are available for construction sites with less than 10 acres disturbed 
at one time.
    In sum, after consideration of all the relevant factors in CWA 
sections 304(b) and 306(b), EPA has determined that the selected option 
is technologically available, economically achievable for the industry 
as a whole, poses no barrier to entry, has acceptable non-water quality 
environmental impacts and is BAT and NSPS for this point source 
category. The selected option accommodates the concerns of the 
regulated community and permitting authorities about the practicalities 
of meeting a numeric effluent limitation. This rule reflects a new 
generation of controls and approach to managing stormwater discharges 
from C&D sites, with objective and enforceable limitations based upon 
demonstrated technologies that this industry as a whole can achieve and 
afford.
2. Numeric Limitations
    Numeric effluent limitations are feasible for discharges associated 
with construction activity. Numeric effluent limitations are 
appropriate on a nationwide basis for some construction sites and in 
this case are the best way to quantifiably ensure industry compliance 
and to make reasonable further progress toward the CWA goal of 
eliminating pollutants into the nation's waters. Numeric effluent 
limitations are an objective and effective way for the permitting 
authority to implement, and the regulated industry to comply with, the 
technology based requirements for

[[Page 63025]]

this point source category. Numeric limitations put the owner and 
operator, the permitting authority and the public on notice as to what 
is required, thereby facilitating effective permit development and 
management of stormwater discharges associated with construction 
activity, in order to further the objectives of the CWA.
    EPA has in the past indicated that numeric limitations for 
discharges from C&D sites might not be feasible. Over the last several 
years, additional data and information has become available indicating 
that a numeric limitation is technically available and is appropriate 
for some sites. Several states have recognized that current BMPs used 
at construction sites are not always able to meet water quality 
objectives. Therefore, several researchers (such as McLaughlin, Warner 
and Horner) have investigated improved approaches to managing 
construction site stormwater. Their research has demonstrated that the 
performance of current BMPs can be improved and that effluent quality 
can be substantially improved. In addition, several states have 
incorporated action levels into their permits, so owners and operators 
of construction sites have experience with sampling stormwater 
discharges and analyzing for turbidity. In addition, California has 
recently established effluent limitations for some sites within the 
State, and dischargers within the Lake Tahoe basin have been subject to 
numeric limitations for some time. The industry in general has become 
more aware of the importance of turbidity control and has developed a 
number of innovative approaches to improve turbidity removal. Also, a 
substantial vendor base has developed in recent years that offer a 
range of expertise and approaches for controlling turbidity. In 
addition, permittees have many choices regarding when land disturbing 
activities take place and how they decide to conduct land disturbing 
activities on a particular site that have a pronounced effect on the 
amount of sediment generated, and subsequently the amount of sediment 
and other pollutants requiring management. Consideration of these 
factors during the planning phases of projects will significantly 
influence the level of control needed, and the feasibility of meeting a 
limitation.
    Not withstanding a heavy reliance on non-numeric limitations in the 
past, the use of numeric effluent limitations by EPA in national 
rulemakings to control stormwater discharges has precedent in a number 
of contexts. Industries that have exposed areas devoted to production 
or material storage often have numeric limitations that apply to 
stormwater discharges from these areas. EPA has promulgated at least 
eight different effluent limitations guidelines for industrial point 
source categories that address stormwater or a combination of 
stormwater and process wastewater with numeric effluent limitations.\1\
---------------------------------------------------------------------------

    \1\ See 40 CFR part 411 (Cement Manufacturing); 40 CFR part 418 
(Fertilizer Manufacturing); 40 CFR part 419 (Petroleum Refining); 40 
CFR part 422 (Phosphate Manufacturing); 40 CFR part 423 (Steam 
Electric); 40 CFR part 434 (Coal Mining); 40 CFR part 440 (Ore 
Mining and Dressing); and 40 CFR part 443 (Asphalt Emulsion).
---------------------------------------------------------------------------

    In addition to numeric limitations being utilized for stormwater 
discharges in other industrial categories, several states have effluent 
limitations or action levels or benchmarks (hereinafter, benchmarks) 
for stormwater discharges associated with construction activity. A 
benchmark is a numeric monitoring requirement where discharges must be 
sampled to determine whether they meet a certain level of pollutant(s) 
in the discharge. For example, the State of Oregon requires 
construction sites to monitor, and the permit contains a 160 NTU 
benchmark for sites discharging to a CWA section 303(d) listed 
waterbody or a waterbody with a TMDL for sediment and turbidity. The 
State of Georgia has turbidity benchmarks that are a function of the 
construction site size in relationship to the watershed size.
    The only practical difference between a numeric effluent limitation 
and a benchmark is that a violation of a benchmark, in and of itself, 
is not a violation of a NPDES permit. If a benchmark is exceeded, 
generally, the enforceable requirement is for the discharger to contact 
the permitting authority, examine its BMPs, and implement additional 
controls, if necessary. A benchmark requires similar types of site 
planning, employee education, firm resources, monitoring and sampling, 
design, installation and maintenance of erosion and sediment controls 
and compliance with other non-numeric effluent limitations, and 
application of other passive treatment technologies as are necessary to 
meet a numeric limitation.
    Some commenters argued for a benchmark as opposed to a numeric 
turbidity limitation due to the variable nature of stormwater and after 
the comment period industry stakeholders stated that they were 
supportive of a benchmark approach, albeit at a higher NTU level. EPA 
believes that benchmarks can be an important tool for permitting 
authorities and for permittees. However, numeric limitations are 
feasible and appropriate for larger C&D sites on a nationwide basis and 
the feasibility of using a benchmark approach is comparable to the 
feasibility of meeting a numeric effluent limitation. EPA does not 
believe that a benchmark approach would represent BAT and NSPS at the 
national level. Technologies and practices that can achieve numeric 
effluent limitations for stormwater discharges are technologically 
available and the Agency finds no reason to rely on benchmarks as 
opposed to numeric effluent limitations in this case. EPA recognizes 
and has considered the issue of variability of stormwater discharges at 
C&D sites and has included several provisions in the rule to address 
this issue. First, today's numeric limitation does not apply on days 
when total precipitation in that day is greater than the local 2-year, 
24-hour storm event. As stated below in Section XIX.A, the reasoning 
behind this exemption is that for larger storm events, controls may be 
overwhelmed by the large amount of stormwater and a numeric limitation 
may be more difficult to meet. Additionally, as discussed below, the 
numeric turbidity limitation is a daily maximum, meaning an owner or 
operator will not be in violation of the limitation if individual 
samples of their discharges exceed the limitation, as long as the 
average of the samples taken over the course of a day are below the 
limitation.
    In addition to the use of benchmarks, at least one state has state-
wide numeric effluent limitations for discharges associated with 
construction activity. The State of California has an enforceable 
numeric effluent limitation of 500 NTU in its construction general 
permit for high risk sites. Also, states have set numeric turbidity 
limitations for specific areas (such as the Lake Tahoe Basin), or for 
specific projects.
3. Rationale for Rejecting Options 1, 2 and 3 as the Technology-Basis 
for BAT and BADT for NSPS
    EPA rejected Option 1 as the basis for BAT and BADT for NSPS 
because there are technologies that remove greater levels of pollutants 
from stormwater discharges from C&D sites than Option 1 that are 
technologically available, economically achievable, pose no barrier to 
entry and have acceptable non-water quality environmental impacts, thus 
Option 1 is not BAT and BADT for NSPS.
    EPA rejected Options 2 and 3 for numerous reasons. For Option 2 and 
3 EPA believes that the use of ATS is likely to influence the ability 
of site planners to select stormwater management controls that can 
infiltrate

[[Page 63026]]

and manage stormwater on-site through green infrastructure practices 
because ATS typically requires the use of a centralized drainage system 
and large stormwater basins. Option 3 would present an even larger 
disincentive to the use of infiltration and retention practices because 
of the larger number of sites that may need to use larger basins.
    EPA is concerned that basing a numeric limitation on ATS is likely 
to present a disincentive for site planners to select controls that may 
be more effective from a hydrologic standpoint to maintain the 
predevelopment hydrology of the site. In particular, ATS would require 
larger basins than what may be required under existing state permits. 
For example, EPA estimates that a construction project on a 17-acre 
site in Alabama would need a basin providing approximately 200,000 
cubic feet of storage to support application of ATS. This is almost 
three times larger than the sediment basin that EPA estimates may be 
required on this same project under the Alabama CGP. Since it would be 
much more expensive to decommission this larger basin, this presents an 
incentive for the developer to retain this basin as part of the 
permanent stormwater management controls because the cost of 
retrofitting this basin would likely be cheaper than installing 
distributed runoff controls, such as rain gardens, which EPA views as 
significantly more effective at managing stormwater on the development 
after construction activity has ceased. As discussed at length in the 
NRC report noted above, the use of retention, infiltration and other 
low-impact development techniques is preferable from a hydrologic 
standpoint to maintain predevelopment hydrology than detention through 
the use of a sediment basin. Passive treatment systems do not have 
these same limitations as ATS, since there is more flexibility in the 
selection of controls. By utilizing passive treatment systems, a 
sediment basin may not be required, and the site planner may be more 
inclined to use distributed runoff controls, such as rain gardens, 
instead of converting the sediment basin into a permanent stormwater 
management pond. Even where a basin is needed, it may be a smaller 
basin than would be needed for a full ATS. As discussed in Section 
VII.A, there is also a concern that was raised by commenters on the 
reliance on ATS due to the unique characteristics of linear projects. 
Similar to what was discussed above, passive treatment systems will 
provide owners and operators of construction sites the flexibility in 
the selection of controls to include site specific conditions, 
including right-of-way constraints.
    Many states and municipalities are moving in the direction of 
requiring stormwater discharges from newly developed and redeveloped 
sites to mimic the hydrology that would have occurred on the site prior 
to the site being developed. These techniques not only eliminate or 
reduce stormwater discharges from newly developed or redeveloped sites, 
they can be designed to prevent stream bank and bed erosion, help 
recharge groundwater, conserve energy, and mitigate urban heat island 
impacts. As these practices can provide various environmental benefits, 
these important environmental outcomes have been factored into EPA's 
options selection process. As discussed in Section VI, EPA recognizes, 
as the NRC report concluded, that the current regulatory approach by 
EPA under the CWA is not adequately controlling all sources of 
stormwater discharges that are contributing to waterbody impairment. As 
a result, EPA has committed to and begun a rulemaking addressing 
stormwater discharges from newly developed and redeveloped sites under 
CWA section 402(p). EPA has published a draft Information Collection 
Request, 74 FR 56191 (October 30, 2009) for public comment seeking 
information and data to support the rulemaking.
    Passive treatment systems are able to provide a high level of 
pollutant reduction at a significantly lower cost than active treatment 
systems. In particular, Option 2 would have cost about $4.9 billion and 
removed 70% of the sediment discharged from construction sites. This is 
in contrast with a $0.95 billion cost with 77% sediment removals for 
Option 4. While Option 3 achieves somewhat greater removals (87%) it 
comes at a very high cost ($9 billion).
    In rejecting ATS as BAT and NSPS in the final rule, EPA also 
considered the fact that as discussed above EPA is conducting a 
rulemaking to address stormwater discharges from development that is 
likely to impose additional costs on the construction industry. EPA has 
just begun the rulemaking process for that rule, thus the Agency has 
not quantified the costs, but the Agency is concerned about the 
potential additive costs of choosing ATS as BAT and NSPS in this final 
rule in combination with the potential costs of this new stormwater 
rule. This was a similar consideration by EPA in the Offshore Oil & Gas 
ELG where EPA rejected the most stringent option in part because of the 
potential for the same industry to be required to bear additional costs 
in a subsequent rule. See 58 FR 12454, 12483 (March 4, 1993).
    Although EPA is rejecting ATS as a basis for BAT and NSPS 
nationally, ATS is an effective and important technology that has broad 
applicability for construction sites. ATS was applied to construction 
site discharges initially as a means of addressing water-quality 
concerns, such as discharging stormwater to high-quality receiving 
waters with low background turbidity. Indeed, in many areas where ATS 
use has been most prevalent (such as in the States of California, 
Washington and Oregon), construction activities are taking place in 
areas where the receiving waters have background turbidity of only a 
few NTUs and where sensitive or endangered species are present. In 
these cases, the use of ATS has allowed construction activity to occur 
so that discharges are at or below the background turbidity levels in 
the receiving waters. If not for ATS, it is unlikely that many of these 
projects would have met water quality requirements if forced to rely on 
conventional erosion and sediment controls.
    As stated above, EPA acknowledges that many state and local 
governments have existing programs for controlling stormwater and 
wastewater discharges from construction sites. Today's rule is intended 
to work in concert with these existing state and local programs and in 
no way does EPA intend for this regulation to interfere with existing 
state and local requirements that are more stringent than this rule or 
with the ability of state and local governments to promulgate new and 
more stringent requirements. Today's rule is a floor, not a ceiling. To 
make this point clear EPA included ``at a minimum'' language in the 
regulation to highlight the fact that EPA does not want to prevent more 
stringent state technology-based or other effluent limitations from 
serving as CWA requirements in NPDES permits. This rule is establishing 
the minimum technology required by construction operators. States and 
EPA can also require more stringent limitations that are necessary to 
meet water quality standards. CWA section 301(b)(1)(C). Where TMDLs for 
sediment or turbidity are established, the use of ATS may be an 
important tool to ensure water quality standards are met. States also 
have the authority to require more stringent requirements under state 
law under CWA section 510. Permitting authorities may establish more 
stringent effluent limitations subsequent to promulgation of today's 
regulation

[[Page 63027]]

based on the application of ATS, or other technologies, where 
appropriate.
4. Definition of ``New Source'' for the C&D Point Source Category
    As stated above, EPA is selecting Option 4 as the best available 
demonstrated control technology (BADT) for NSPS under section 306. At 
proposal, EPA stated that it interpreted ``new source'' at CWA section 
306 to not include stormwater discharges associated with construction 
activity from C&D sites. EPA stated that it is a reasonable 
interpretation of section 306 to exclude C&D sites from the definition 
of ``new source'' because a construction site cannot itself be 
constructed. The Agency found that if construction sites were intended 
to be ``new sources'' it is illogical that there would be a separate 
definition for ``construction'' or that there would be a requirement in 
section 306 that ``sources'' be constructed prior to becoming ``new 
sources.'' See 73 FR 72583. The result of this interpretation is that 
no C&D sites would ever be new sources. However, the 2006 district 
court order enjoins EPA to promulgate ELGs and NSPSs.
    In order to comply with the district court order, EPA proposed a 
specialized definition of ``new source'' for purposes of part 450 as 
any source of stormwater discharge associated with construction 
activity that itself will result in an industrial source from which 
there will be a discharge of pollutants regulated by a new source 
performance standard in subchapter N. (All new source performance 
standards promulgated by EPA for categories of point sources are 
codified in subchapter N.) See 73 FR 72583. The definition of new 
source would mean that the land-disturbing activity associated with 
constructing a particular facility would itself constitute a ``new 
source'' when the facility being constructed would be a ``new source'' 
regulated by NSPSs under section 306 of the CWA. For example, 
construction activity that builds a new pharmaceutical plant whose 
process wastewater is covered by 40 CFR 439.15 would be subject to the 
NSPS under 40 CFR 450.24, as proposed, for its stormwater discharges 
associated with the construction activity.
    Commenters raised numerous objections to the proposed ``new 
source'' definition, arguing that the proposed definition is overly 
narrow and there is no rational explanation for treating a C&D site for 
a commercial facility as an existing source, while treating a C&D site 
for a new iron and steel facility that happens to have NSPSs for its 
process wastewater as a new source. EPA's proposed definition of ``new 
source'' was the result of the difficult application of section 306 to 
the unique nature of the C&D point source category compared to other 
industrial categories. Section 306 was part of the 1972 amendments to 
the CWA, when the focus was on industrial facilities that are 
traditionally considered ``plants'' or ``factories,'' such as petroleum 
refineries, power plants and heavy manufacturing. See e.g., 118 Cong. 
Rec. 10201, 10208, 33747, 33760, 33763 (1972); A Legislative History of 
the Water Pollution Control Act Amendments of 1972, 93d Cong., 1st 
Sess. (Comm. Print 1973). However, the CWA has evolved since 1972, most 
notably through the WQA of 1987 and the addition of a comprehensive 
program to address stormwater discharges under section 402(p). As a 
result, the nature and characteristics of the sources that EPA now 
regulates under the NPDES program may not, and in the case of C&D 
sites, do not, necessarily align themselves plainly with the provisions 
of section 306: however EPA does not believe that this results in C&D 
sites not being subject to section 306.
    After a careful review, based on comments received, EPA has decided 
to reconsider its proposed definition of ``new source.'' EPA agrees 
with commenters that it is not the best reading of section 306 for the 
definition of ``new source'' for C&D sites to be dependent upon the 
result of the construction activity or the activity that occurs on the 
developed site. EPA recognizes there is difficulty in treating a C&D 
site for a commercial facility not as a new source, while treating a 
C&D site for a new iron and steel facility that happens to have NSPSs 
for its process wastewater as a new source. Even within similarly 
situated industrial categories, there may be facilities that have NSPSs 
for their process wastewater and other facilities that do not, and that 
fact is removed from the concerns of this rule regarding discharges of 
turbidity, sediment and other pollutants associated with construction 
activity. The concerns of this rulemaking and the nature of C&D sites 
exist notwithstanding and independently of the nature of the developed 
site and the activity on that site that leads to discharges of 
pollutants after completion of construction activity.
    While EPA believes it is a reasonable interpretation of the CWA to 
exclude C&D sites from the definition of ``new source'' based on the 
text of section 306, the Agency has determined the better reading of 
the statute is that C&D sites may be new sources. The term ``source'' 
is defined in 306(a)(3) of the CWA to mean ``any building, structure, 
facility, or installation from which there is or may be the discharge 
of pollutants.'' While it is not clear that a C&D site would be a 
``building,'' ``structure,'' or ``installation,'' the regulatory 
definition of ``facility'' means ``any NPDES `point source' or any 
other facility * * * (including land or appurtenances thereto) that is 
subject to regulation under the NPDES program.'' 40 CFR 122.2. Based on 
the WQA of 1987, EPA promulgated the Phase I and Phase II stormwater 
regulations which required NPDES permits for stormwater discharges 
associated with construction activity. See 40 CFR 122.26(b)(14)(x) and 
122.26(b)(15). C&D sites are point sources and subject to regulation 
under the NPDES program due to their discharge of pollutants. Based on 
EPA's regulatory definition, C&D sites are ``facilities,'' thus EPA 
interprets them to be ``sources,'' as that term is defined under 
section 306. The term ``construction'' is defined as any ``placement, 
assembly, or installation of facilities or equipment (including 
contractual obligations to purchase such facilities and equipment) at 
premises where such equipment will be used, including preparation work 
at such premises.'' CWA section 306(a)(5). The definition of 
``construction'' is broad to include activities that occur, including 
preparation work, placement of equipment and signing of contracts, 
before actual construction activity, such as clearing, grading and 
excavation occurs on the site. This broad, encompassing definition, 
would allow an owner or operator to begin ``construction'' of the C&D 
site without actually beginning construction activity. While it is 
reasonable, based on a common sense understanding of the term, that an 
owner or operator cannot construct a construction site as that term is 
commonly used, ``construction'' is specifically defined in the CWA and 
based on that broad definition it is a better interpretation of 
``construction,'' that owners or operators of a C&D site can 
``construct'' a C&D site within the meaning of the CWA as interpreted 
by EPA. See 40 CFR 122.29(a)(4). Given the evolution of the CWA, as 
discussed above and the focus of the CWA in 1972, it is not illogical 
that there would be a separate definition for ``construction'' or that 
there would be a requirement in section 306 that ``sources'' be 
constructed'' prior to becoming ``new sources.'' EPA did not regulate 
discharges associated with construction activity at that time, thus 
there would be nothing illogical with including a separate definition 
of

[[Page 63028]]

``construction.'' While section 306 and EPA's regulations on new source 
determinations appear to emphasize permanent facilities as opposed to 
relatively temporary sources like C&D sites, EPA is taking into 
consideration this evolution of the CWA and viewing the statute as 
whole in determining a reasonable and appropriate reading of section 
306 and EPA regulations. ``New source'' means ``any source, the 
construction of which is commenced after publication of proposed 
regulations prescribing a standard of performance under this section 
which will be applicable to such source * * *'' CWA section 306(a)(2); 
40 CFR 122.2. As outlined above, C&D sites are ``sources'' and owners 
and operators can construct C&D sites given the broad definition of 
``construction,'' thus a C&D site may be a ``new source'' under section 
306 and subject to NSPS.
    For purposes of this rule, EPA has defined ``new source'' as ``any 
source, whose discharges are defined in 40 CFR 122.26(b)(14)(x) and 
(b)(15), that commences construction activity after the effective date 
of this rule.'' Under this definition, the only construction sites that 
will not be ``new sources'' are those sites that commenced construction 
activity before the effective date of this rule. The definition aligns 
itself with the nature of construction sites, the opportunities to 
utilize the most effective control technologies and Congress' 
``recognition of the significantly lower expense of attaining a given 
level of effluent control in a new facility as compared to the future 
cost of retrofitting a facility.'' A Legislative History of the Water 
Pollution Control Act Amendments of 1972, 93d Cong., 1st Sess. (Comm. 
Print 1973) at 797. Congress ``recognized that new sources could attain 
discharge levels more easily and at less cost than existing sources 
which must be retrofitted * * * [and Congress] clearly expressed [a] 
belief that it would be easier for new sources to attain a particular 
level of effluent control than it would be for existing sources.'' 
American Iron & Steel v. EPA, 526 F.2d 1027, 1058 (3d Cir. 1975).
    EPA has the authority to provide specialized definitions of ``new 
source'' to particular point source categories. See 40 CFR 122.29(b); 
401.10. As stated above, the substantive standards for BAT and NSPS are 
based on the best available technology or best available demonstrated 
control technology which consider both the cost of achieving such 
effluent reduction and any non-water quality environmental impacts and 
energy requirements. See CWA sections 304(b)(2)(B) and 306(b)(1)(B). 
For this final rule BAT is equal to NSPS.
    Some commenters raised the issue of the National Environmental 
Policy Act of 1969 (NEPA) 33 U.S.C. section 4321 et seq. and its 
relationship to ``new sources.'' Pursuant to CWA section 511(c) the 
issuance of a NPDES permit under section 402 for the discharge of any 
pollutant by a ``new source'' as defined under section 306 may be 
deemed a major Federal action significantly affecting the quality of 
the human environment within the meaning of NEPA and would be subject 
to the environmental review provisions of NEPA. The issuance of a NPDES 
permit to a new source by an NPDES-approved state is not a federal 
action; therefore, issuance of these permits is not subject to NEPA. 
Forty-six (46) states have NPDES authorization. For the remaining four 
states, tribal lands, territories, and other areas where EPA is the 
permitting authority the issuance of any NPDES permit to a new source 
is subject to the environmental review provisions of NEPA as set out in 
40 CFR part 6. The vast majority construction sites in these remaining 
jurisdictions obtain NPDES permit coverage for discharges associated 
with construction activity under the EPA CGP. EPA intends to comply 
with NEPA, as necessary, pursuant to the issuance of the EPA CGP.

XI. Methodology for Estimating Costs to the Construction and 
Development Industry

    In developing today's final rule, EPA used numeric models to 
estimate the costs of compliance with various regulatory options. This 
approach was used to estimate the incremental costs associated with the 
regulatory options at the state and national level. This approach is 
the same as that used at proposal; however, EPA has updated various 
models and estimates of costs as well as estimates of annual 
construction activity, based on comments received as well as other 
factors.
    For the proposal, EPA developed a series of nine model projects (3 
site size categories and 3 project types). EPA estimated incremental 
compliance costs for each of these model projects under the various 
regulatory options and scaled costs to the national level. EPA used a 
fixed project duration of nine months for each of the model projects as 
a basis for estimating compliance costs. The annual amount of 
construction activity was estimated based on the 1992 and 2001 National 
Land Cover Dataset (NLCD) available at the time of proposal.
    For the final rule analysis, EPA also estimated project-level costs 
for a series of model projects. The models vary by size (disturbed 
acres), duration, and type of construction to establish the baseline 
conditions for factors that can directly influence compliance costs and 
firm impacts. EPA developed a set of model projects that includes 12 
size categories and 12 duration categories. For costing purposes, EPA 
made a distinction between building and transportation projects. The 
linear configuration of many transportation projects requires 
additional considerations for managing stormwater. However, EPA did not 
consider residential and nonresidential projects of the same size and 
duration to have appreciably different costs. These two project types 
(building and transportation) were combined with the size and duration 
categories to create 288 different model projects. These model projects 
were then combined with a set of geographic conditions unique to each 
state, based on a representative metropolitan area within the state, 
resulting in 14,688 model projects (288 x 51). There were many factors 
affecting model project cost for each option. The primary factor was 
the set of applicable technologies and practices considered necessary 
for meeting each option's regulatory requirements. The costs associated 
with each set of technologies and practices varied by project size, but 
they also vary by duration, state, and construction sector. For all 
four options, the costs for projects under 10 acres were based on non-
numeric effluent limitations or BMPs and only varied by size. For 
Option 1, projects above 10 acres were also assumed to rely upon non-
numeric effluent limitations or BMPs and costs only varied by size. For 
Options 2, 3, and 4, projects that were required to meet numeric 
limitations had costs that also varied by duration to reflect either 
the application of PTS or ATS, as well as O&M costs and costs for 
monitoring.
    In developing unit costs for each model project, EPA refined the 
approach used at proposal. At proposal, EPA estimated annual rainfall 
and runoff volumes on a per-acre basis for one indicator city in each 
state. EPA estimated ATS treatment costs using an estimate of $0.02 per 
gallon. For the final rule analysis, EPA again used rainfall data from 
one indicator city in each state to estimate annual rainfall and runoff 
volumes and determined ATS treatment system sizes (based on a design 
flowrate) needed in each state for each of the model project site 
sizes. Using data supplied from vendors on the unit cost of various ATS 
treatment system components contained in the proposed rule record (see 
DCNs 41130

[[Page 63029]]

and 41131), as well as the Development Document EPA estimated the one-
time and monthly recurring costs for deploying ATS in each state. 
Monthly recurring costs included costs for operator labor, treatment 
chemicals and fuel usage. Using the distribution of projects by site 
size and duration in each state, EPA was then able to estimate the 
costs to implement ATS for Options 2 and 3. EPA also estimated 
incremental storage requirements to impound runoff prior to treatment 
from the 2-year, 24-hour storm for each indicator city and added 
additional storage costs if existing state sediment basin sizing 
requirements were smaller than these volumes. EPA intended to use this 
analysis at the time of proposal in order to compare results with the 
$0.02 per gallon approach, but was unable to complete this analysis 
prior to publication of the proposed rule. The information that EPA 
used for this approach was, however, included in the docket (see DCN 
51201) and commenters provided comment on this approach (See EPA-HQ-OW-
2008-0465-1360 in the rulemaking record).
    In developing costs for Option 4, EPA estimated the costs for 
deploying liquid polymer dosing systems and for implementing fiber 
check dams with PAM addition on sites. EPA also estimated monthly labor 
needs for sampling personnel, as well as monthly operation and 
maintenance costs for polymer dosing systems and for fiber check dam 
replacement and PAM application. EPA then scaled costs to the state and 
national level. EPA also estimated costs for firms to purchase 
turbidity meters. Detailed results of this analysis are presented in 
the Development Document.
    From Table XI-1 it is apparent that there was a wide range of 
project costs. The $490 project cost reflects the use of BMPs on the 
smallest model project, estimated to be 1.9 acres in size. The model 
project with the highest cost, for options 2, 3, and 4 are all based on 
the largest model project with the longest duration, 145 acres over 
three years. The $390 thousand, under Option 4, represents a 145 acre 
transportation project in Florida lasting three years, and the $5.5 
million project, under Options 2 and 3, represents a three year 145 
acre project in Louisiana.

                             Table XI-1--Range of Project Costs for the Four Options
----------------------------------------------------------------------------------------------------------------
                                                   Average cost     Median cost    Minimum cost    Maximum cost
----------------------------------------------------------------------------------------------------------------
Option 1........................................          $8,026          $5,296            $490         $44,832
Option 2........................................         328,322           5,296             490       5,501,864
Option 3........................................         399,371         224,541             490       5,501,864
Option 4........................................          42,207          28,330             490         389,786
----------------------------------------------------------------------------------------------------------------

    For estimating the total annual construction acreage in-scope, EPA 
relied on industry economic data rather than the NLCD because recent 
NLCD data is not yet available. EPA used historical construction 
spending data to derive a long-term trend for construction activity. 
This allowed EPA to base its estimates on normal industry conditions 
rather than large fluctuations in activity seen in recent years. Next 
EPA used data from the U.S. Housing Census, Reed Construction, and the 
Federal Highway Administration to estimate the relationship between 
construction spending levels and the average annual quantity of acres 
developed. This relationship was then combined with the long-term trend 
to project expected construction acreage for 2008 under normal 
conditions (see Section XII for additional discussion of this 
analysis).

XII. Economic Impact and Social Cost Analysis

A. Introduction

    EPA's Economic Analysis (see ``Supporting Documentation'') 
describes the impacts of today's final rule in terms of firm closures 
and employment losses, in addition to firm financial performance and 
market changes. In addition, the report provides information on the 
impacts of the rule on sales and prices for residential construction. 
The results from the small business impact screening analysis support 
EPA's implementation of the Regulatory Flexibility Act (RFA), as 
amended by the Small Business Regulatory Enforcement Fairness Act 
(SBREFA). Results from the government costs analysis support the 
implementation of the Unfunded Mandate Reform Act (UMRA). The report 
also presents identified, quantified, and monetized benefits of the 
rule as described in Executive Order 12866.
    This notice includes related sections such as the cost-
effectiveness analysis in Section XIII, benefits analysis in Section 
XVI, and benefit-cost analysis in Section XVII. In their entirety, 
these sections comprise the economic analysis (referred to collectively 
as the ``C&D economic analysis'') for the final rule. EPA's 
Environmental Assessment provides the framework for the monetized 
benefits analysis. See the complete set of supporting documents for 
additional information on the environmental impacts, social costs, 
economic impact analysis, and benefit analyses.
    The C&D economic analysis, covering subsectors that disturb land 
(NAICS 236 and 237), uses information from, and builds upon, the 2002 
final rule (67 FR 42644; June 24, 2002), the 2004 withdrawal of the 
final rule (69 FR 22472; April 26, 2004), and the 2008 proposed rule 
(73 FR 72562). In addition to CWA requirements, EPA has followed OMB 
guidance on the preparation of the economic analyses for Federal 
regulations to comply with Executive Order 12866. See Section XX.A of 
today's notice.

B. Description of Economic Activity

    The construction sector is a major component of the United States 
economy as measured by the gross domestic product (GDP), a measure of 
the output of goods and services produced domestically in one year by 
the U.S. economy. Historically, the construction sector has directly 
contributed about five percent to the GDP. Moreover, one indicator of 
the economic performance in this industry, housing starts, is also a 
``leading economic indicator,'' one of the indicators of overall 
economic performance for the U.S. economy. Several other economic 
indicators that originate in the construction industry include 
construction spending, new home sales, and home ownership.
    During most of the 1990s, the construction sector experienced a 
period of relative prosperity along with the overall economy. Although 
cyclical, the number of housing starts increased from about 1.2 million 
in 1990 to almost 1.6 million in 2000, with annual cycles during this 
period. (U.S. Census Bureau, ``Current Construction Reports, Series 
C20--Housing Starts,'' 2000, available at http://www.census.gov/const/www). At the beginning of the 21st century, the

[[Page 63030]]

economy began to slow relative to previous highs in the 1990s. This 
slower economic growth had a negative impact on construction starts for 
new commercial and industrial projects. Driven in part by low mortgage 
interest rates, consumer spending for new homes continued to remain 
strong through 2005. However, in 2006 the U.S. residential construction 
market began a rapid decline in activity that continued all the way 
through 2008. (Global Insights, ``U.S. Economic Outlook; Executive 
Summary,'' January 2009). In June of 2009, the single-family housing 
market began to show signs of recovery, while multi-family construction 
is still in decline. Government spending increased in the first half of 
2009, and is expected to accelerate in the near future as the bulk of 
the infrastructure projects, funded by the 2009 Stimulus bill, will 
begin in 2010 and 2011. Conversely, the outlook for nonresidential 
construction is poor as spending on new commercial and industrial 
properties is decreasing due to the current recession. Overall 
construction spending is expected to decline through the first quarter 
of 2010, as declines in private nonresidential and multi-family housing 
construction is predicted to outweigh the gains from infrastructure and 
single-family home construction. (Global Insight, ``An Update on U.S. 
Construction Spending,'' August 2009.) However, overall construction 
spending is expected to return to positive growth by 2011 and continue 
this positive trend through 2014, approximately when this rule will be 
fully implemented in EPA and state NPDES permits. (Global Insight, 
``U.S. Economic Service,'' July, 2009.)
1. Industry Profile
    The C&D point source category is comprised of sites engaged in 
construction activity, including clearing, grading and excavation 
operations. The projects that fall under this category are performed by 
business establishments (the Census Bureau uses the term 
``establishment'' to mean a place of business; ``Employer 
establishment'' means an establishment with employees) that are 
involved in building construction (NAICS 236) as well as heavy and 
civil engineering construction (NAICS 237). As a starting point, Table 
XII-1 shows the number of business establishments whose projects are in 
the C&D point source category in 1992, 1997, and 2002. Only a portion 
of these establishments would be covered by the final regulation, 
because some of these establishments are house remodelers and others 
who build on sites with less than one acre of disturbed land each year. 
The NAICS classification system changed between the issuance of the 
1997 and 2002 Economic Census.
    Table XII-1 shows a sharp decline in the number of developers 
between 1992 and 1997. The decrease in the number of developers may 
have been a response to changes in tax laws and the Financial 
Institutions Reform, Recovery, and Enforcement Act (FIRREA) of 1989 
(Pub. L. 101-73, August 9, 1989) and the 1993 implementing regulations. 
The objective of FIRREA and the implementing regulations was to correct 
events and policies that led to a high rate of bankruptcies in the 
thrift industry in the late 1980s. The regulations changed lending 
practices by financial institutions, requiring a higher equity position 
for most projects, with lower loan-to-value ratios, and more 
documentation from developers and builders. (Kone, D. L. ``Land 
Development 9th ed.,'' Home Builder Press of the National Association 
of Home Builders, Washington, DC 2000).

         Table XII-1--Number of C&D Industry Establishments, 1992, 1997, and 2002, Economic Census Data
----------------------------------------------------------------------------------------------------------------
                                                              1992       1997       2002      Change     Change
              NAICS                     Description          (No.)      (No.)      (No.)     92-97(%)   97-02(%)
----------------------------------------------------------------------------------------------------------------
236.............................  Construction of            168,407    191,101    211,629      13.50      10.70
                                   Buildings, except all
                                   other Heavy
                                   Construction \a\.
237 except 2372.................  Heavy Construction,         37,180     42,554     49,433      14.50      16.20
                                   except Land
                                   Subdivision.
2372............................  Land Subdivision.......      8,848      8,185      8,403      -7.50       2.70
----------------------------------------------------------------------------------------------------------------
    Total.......................  .......................    214,435    241,840    269,465      12.80     11.30
----------------------------------------------------------------------------------------------------------------
\a\ In the 2002 NAICS classification framework, All Other Heavy Construction was assigned among NAICS 236, 237,
  and 238. To maintain relevant comparisons, 2002 All Other Heavy Construction data were reassigned back into
  NAICS 237 (Heavy Construction).
Figures do not necessarily add to totals due to rounding.
Source: U.S. Census Bureau (2005).

    Building upon Table XII-1, Table XII-2 shows the number of firms 
that are expected to be covered under the C&D final regulation. 
Construction establishments are relatively permanent places of business 
where the usual business conducted is construction related. 
Construction firms are an aggregation of construction establishments 
owned by a parent company that share an annual payroll. EPA estimates 
that for approximately 99 percent of construction firms there is only 
one establishment, and those that do have more than one establishment 
tend to be in the highest revenue categories.
    For Table XII-2, EPA subtracted out firms that are engaged in home 
remodeling (NAICS 236118) from the total of about 269,000 firms in 
2002, as they would not be subject to the final regulations. The 
elimination of remodelers is based on the fact that remodeling and 
renovation activities generally disturb less than one acre of land, if 
at all. Thus, the total number of C&D firms would be 178,835.
    EPA used data from the Economic Census and other sources to define 
an average housing density for the nation as a whole (average number of 
housing units per acre), then used this figure to identify firms to be 
excluded from regulation based on their likelihood of disturbing less 
than one acre on a per project basis. EPA believes that these estimates 
(of firms unaffected by the final options) are conservative, meaning 
that they potentially overestimate the actual number of firms that will 
be affected. First, while the regulatory threshold for NPDES regulation 
applies to each site, EPA excluded firms only if the estimated number 
of acres disturbed in a whole year falls below the regulatory threshold 
for needing permit coverage under the NPDES regulations. In addition, 
the analysis was not adjusted for the portion of a site that is 
potentially left undisturbed, such as open space and buffers. 
Furthermore, EPA assumes that all of the housing units built by a firm 
during a year are covered by NPDES stormwater permits, while in reality 
the firm could build houses on lots not covered by NPDES

[[Page 63031]]

permits. However, the Agency does not have information on the amount of 
houses that are built within subdivisions, rather than on discrete 
lots, by these firms.
    Based upon these adjustments of the total number of firms, EPA 
believes there currently are about 81,655 firms that would be covered 
under the rule. However, the Agency has insufficient data to make any 
further adjustments to the population of developers and builders 
covered by the rule.

           Table XII-2--Number of Firms Covered by the Construction and Development Final Regulations
----------------------------------------------------------------------------------------------------------------
                                                                                               Firms
                                                                                 -------------------------------
                   NAICS                               Industry sector                              Percent of
                                                                                      Number           total
----------------------------------------------------------------------------------------------------------------
2361.......................................                   Residential Building Construction
----------------------------------------------------------------------------------------------------------------
236115.....................................  New Single-family Housing                    18,269              22
                                              Construction (except operative
                                              builder).
236116.....................................  New Multifamily Housing                       2,148               3
                                              Construction (except operative
                                              builder).
236117.....................................  New Housing Operative Builder......          16,040              20
----------------------------------------------------------------------------------------------------------------
2362.......................................                  Nonresidential Building Construction
----------------------------------------------------------------------------------------------------------------
236210.....................................  Industrial Building Construction...           1,752               2
236220.....................................  Commercial and Institutional                 33,399              41
                                              Building Construction.
----------------------------------------------------------------------------------------------------------------
237........................................                Heavy and Civil Engineering Construction
----------------------------------------------------------------------------------------------------------------
237310.....................................  Highway, Street, and Bridge                  10,047              12
                                              Construction.
----------------------------------------------------------------------------------------------------------------
    Total..................................  ...................................          81,655
----------------------------------------------------------------------------------------------------------------
Source: Economic Analysis.

2. Consideration of Current Economic Conditions
    EPA received numerous comments expressing concern regarding the 
effect the rule may have on the construction industry during the 
current economic downturn. Although, EPA considers the rule to be 
affordable even under the current adverse circumstances, EPA recognizes 
that full immediate implementation of the rule could be disruptive to 
the industry, and potentially slow the pace of the industry's return to 
normal levels of activity.
    The construction industry is distinguishable from other industries 
in that it has a comparatively large number of firms, the majority of 
which are small, that operate on many sites, which are temporary and 
widely dispersed over a broad geographic area. EPA recognizes that 
these characteristics could pose potentially greater obstacles to 
mobilizing the necessary resources for compliance, than those normally 
faced by industries dealing with a new regulation. By phasing in the 
regulation starting with a smaller number of larger sites, EPA believes 
that this will minimize the chance of bottlenecks of resources, and 
reduce the start-up burden for firms as they plan for implementation 
and learn new techniques. When new methods or techniques are introduced 
into the production process and employees gain more experience with the 
technique it is common for there to be a corresponding increase in the 
efficiency of performing the new technique. This efficiency gain, often 
referred to as an experience or learning curve, is likely to occur with 
both the application of passive treatment systems and the monitoring of 
performance. The gradual phase-in of the regulation, gives the firms 
and groups such as industry trade associations time to disseminate 
information on how to meet requirements in the more cost-effective 
ways.
    Construction is a keystone industry of the economy, comprising 10 
percent of U.S. businesses and 6.6 percent of total employment. The 
steep decline in construction activity since 2006 is considered a major 
factor in precipitating the recent economic recession. However, the 
four-year phasing process is expected to give the industry sufficient 
time to experience several years of growth, before all rule 
requirements are in effect. In 2014, the year that all projects greater 
than 10 acres will need to comply with the numeric limit, the economic 
forecasting firm Global Insights predicts that the industry will 
experience its fifth consecutive year of positive growth. Forecasts of 
future activity are always uncertain and Global Insights has tried to 
provide baseline, positive and pessimistic predictions for several 
important economic indicators. Housing starts are a considered a key 
measure of industry health and they are estimated to steadily increase 
during the five years after promulgation. Table XII-3 shows that even 
the pessimistic forecast predicts sustained growth albeit at a slower 
pace.

                                            Table XII-3--Global Insight Five-Year Forecast of Housing Starts
                                                            [Seasonally adjusted annual rate]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                   Year                        2009         2010         2011         2012         2013         2014
-----------------------------------------------------------------------------------------------------------------------
Pessimistic Forecast (20% probability)...      556,000      701,000    1,044,000    1,296,000    1,472,000    1,566,000
Baseline Forecast........................      556,000      865,000    1,294,000    1,563,000    1,659,000    1,665,000
Optimistic Forecast (20% probability)....      556,000    1,096,000    1,542,000    1,785,000    1,882,000   1,886,000
--------------------------------------------------------------------------------------------------------------------------------------------------------
Source: Global Insights, U.S. Economic Outlook, July 2009.


[[Page 63032]]

C. Method for Estimating Economic Impacts

    EPA has conducted economic impact analyses to examine the economic 
achievability of each of the four ELG and NSPS options presented in 
this rule. The analyses used to assess economic achievability are based 
on conditions of both full implementation of the rule requirements and 
an estimate of normal business conditions. These normal business 
conditions reflect the long-term trend based on construction activity 
data from 1990 through 2008. For more information see the Chapter 4: 
Analysis Baseline of the Economic Analysis.
    An important aspect of the economic impact analysis is an 
assessment of how incremental costs would be shared by developers and 
home builders, home buyers, and society. This method is called ``cost 
pass-through'' analysis or CPT analysis. Details of this method may be 
found in Chapter 6 of the Economic Analysis.
    The economic analysis conducted for this rule also uses another 
method called partial equilibrium analysis that builds upon analytical 
models of the marketplace. These models are used to estimate the 
changes in market equilibrium that could occur as a result of the final 
regulation. In theory, incremental compliance costs would shift the 
market supply curve, lowering the supply of construction projects in 
the market place. This would increase the market price and lower the 
quantity of output, i.e., construction projects. If the demand schedule 
remains unchanged, the new market equilibrium would result in higher 
costs for finished construction and lower quantity of output. The 
market analysis is an important methodology for estimating the impacts 
of the options presented in today's notice.
    The economic analysis also reflects comments in the October 2001 
final report from the Small Business Advocacy Review (SBAR) Panel 
submitted to the EPA Administrator as part of the requirements under 
SBREFA. The SBAR Panel was convened as part of the 2002 rulemaking 
effort and EPA considers the information in the 2001 report to still be 
relevant to today's C&D final rule. EPA also voluntarily convened a 
SBAR Panel on September 10, 2008 in order to gather more information on 
the potential impacts of the rule on small businesses and held an 
outreach meeting with Small Entity Representative (SERs) on September 
17, 2008. The current economic analysis contains changes to the initial 
economic analysis done for the proposed rule, which are based on SER 
comments and comments received during the proposed rule public comment 
period. A summary of the changes can be found in section VII.D.
    EPA estimated the incremental compliance costs for the regulatory 
options using an engineering cost model that accounts for cost factors 
such as treatment costs, labor, materials, and operation and 
maintenance costs. Because some of the erosion and sediment controls 
considered have design requirements that take into account 
meteorological and soil conditions, EPA developed compliance costs that 
take into account regional differences. EPA also took into 
consideration the additional monitoring and reporting costs that would 
be incurred by construction permit holders.
    EPA estimated both the incremental compliance costs and the 
economic impacts of each regulatory option at the project, firm, and 
industry (national) level. The economic impact analysis considered 
impacts on both the firms in the construction industry, and on 
consumers who purchase the homes, and buy or rent industrial buildings 
and commercial and office space. In the case of public works projects, 
such as roads, schools, and libraries, the economic impacts would 
accrue to the final consumers, who, in most circumstances, are the 
taxpaying residents of the community. The sections below summarize each 
modeling effort. Detailed information on the data, models, methods, and 
results of the economic impact analyses are available in the Economic 
Analysis.
1. Model Project Analysis
    EPA estimated project-level costs and impacts for a series of model 
projects. The models vary by size (disturbed acres), duration, 
geography, and type of construction to establish the baseline 
conditions for factors that can directly influence compliance costs and 
firm impacts. Numerous comments by small business representatives and 
public comments received by the agency suggested that the approach to 
modeling projects used for the proposal did not sufficiently account 
for many of the project characteristics that could affect the 
feasibility and cost of compliance. Characteristics most often sighted 
were project size, duration, and geographic conditions. As a result, 
EPA refined the analysis to use a more refined set of model projects 
that includes 12 different size categories and 12 different duration 
categories. To account for how project type can affect control costs, 
EPA partitioned these categories between building and transportation 
projects to create 288 model project categories. These 288 different 
model projects were then combined with a set of geographic conditions 
unique to each state, based on a representative metropolitan area 
within the state. This resulted in 7,344 model projects (144 x 51) with 
distinct size, duration, type and geographic characteristics. EPA used 
these characteristics to determine what the likely compliance costs 
would be for each model project under each option considered.
    Next EPA determined the frequency of occurrence for each of these 
144 model projects within each state. This requires state level 
information on the distribution of construction projects by size, 
duration, and type. A comprehensive national data set with this 
information does not exist. However, this information can be derived 
for some states based on Notice of Intent (NOI) data. An NOI is 
submitted to a state permitting authority, by each owner or operator of 
the C&D site seeking coverage for their project under the state's 
construction general permit. The information required under an NOI 
varies from state to state, and state permitting authorities are not 
required to submit their NOI information to EPA. However, some states 
have voluntarily submitted their NOI data to the Agency. The Agency 
identified data sets from four states (California, New York, South 
Carolina, and South Dakota) containing detailed information on the type 
of project, the size of the disturbed area, and the period of active 
construction, which could be used to develop distributions of project 
size and duration for the residential, commercial & industrial 
building, and transportation sectors. The Agency used the distribution 
from each of these states to represent the typical distribution for the 
region of the country they are in. These four regions were delineated 
based on similar geography and demographic trends. Table XII-4 shows 
which representative distribution was assigned to each state. These 
distributions are then combined with state value of construction data, 
for each of the three sectors, and revenue per acre estimates to 
predict how many actual projects are represented by each of the 288 
size/duration/type categories. Given the fact there is no comprehensive 
national data set with this information EPA believes this is a 
reasonable approach. For more information on this approach see the 
Technical Development Document.

[[Page 63033]]



      Table XII-4--Assignment of Regionally Representative Project
            Distributions Based on NOI Data From Four States
------------------------------------------------------------------------
    States with regionally     States assigned regionally representative
   representative NOI data                project distribution
------------------------------------------------------------------------
California...................  Arizona, Colorado, Nevada, New Mexico,
                                Oregon, Texas, Utah, Washington.
New York.....................  Connecticut, Delaware, Dist. of Columbia,
                                Hawaii, Illinois, Indiana, Maine,
                                Maryland, Massachusetts, Michigan,
                                Minnesota, New Hampshire, New Jersey,
                                Ohio, Pennsylvania, Rhode Island,
                                Vermont, Wisconsin.
South Carolina...............  Arkansas, Florida, Georgia, Kentucky,
                                Louisiana, Mississippi, Missouri, North
                                Carolina, Oklahoma, Tennessee, Virginia,
                                West Virginia.
South Dakota.................  Alaska, Idaho, Iowa, Kansas, Montana,
                                Nebraska, North Dakota, Wyoming.
------------------------------------------------------------------------

2. Model Firm Analysis
    EPA analyzed the impacts of the regulations at the level of the 
firm by building financial models of representative construction firms. 
Model firms are broken out by seven revenue ranges for each of the six 
NAICS sectors aligning with the principal construction business 
segments expected to be affected by the regulation (See Table XII-2). 
These revenue ranges and sector breakouts are based on data reported by 
the Statistics of U.S. Business (SUSB) and the Economic Census. Within 
each business sector and revenue range model firms are further 
differentiated based on median, lower quartile, and upper quartile 
measures of baseline financial performance and condition (i.e., capital 
returns, profit margins, levels of debt and equity to capital, etc.). 
Firms in the upper quartile have better than normal financial metrics, 
while the metrics for firms in the lower quartile are worse than 
normal. Baseline financing costs (cost of debt and equity) was varied 
over revenue ranges, with firms in higher revenue ranges having access 
to more favorable terms. However, the financial data was not 
sufficiently disaggregated to allow financing terms to vary over the 
three quartiles. These model firms are used in combination with 
compliance cost estimates to examine the potential for financial 
stress, firm closures, employment effects, and increased barriers to 
the entrance of new firms to the industry. EPA did not base its 
analysis, as it has for many past ELGs, on actual firm-specific data 
because the Agency was not provided the time necessary by the district 
court order to survey the industry through an Information Collection 
Request and gather such data.
    The financial statements for the model firms are constructed to 
capture two business condition cases for the firm-level analysis: 
General Business Conditions case that reflects the financial 
performance and condition of construction industry businesses during 
normal economic conditions; and Adverse Business Conditions case that 
is meant to reflect financial performance during weak economic 
conditions. The two business condition cases are differentiated by the 
baseline operating financial circumstances of the model firms as well 
as other important factors in firm financial performance, including 
cost of debt and equity capital.
a. Assigning Projects and Costs to Model Firms
    For a given sector of construction activity, model projects are 
assigned to model firms based on the each model firm's capacity to 
perform projects. This capacity is measured in terms of annual acreage 
of construction and is determined by multiplying the firm's estimated 
revenue by an average acreage per million dollars of construction. For 
residential construction activity, the acreage per million dollars was 
derived from the Census Bureau's Census of Housing. For nonresidential 
construction activity, information on project acreage and estimated 
project value from Reed Construction Data is used to derive an average 
number of acres developed per million dollars of value (Reed 
Construction, March 2008; see DCN 51017). So for each construction 
sector within each state, model projects were systematically assigned 
to the firms with the most capacity for performing the work, until all 
projects and their associated costs had been assigned. For more 
information on the methodology for assigning projects to firms see 
Section 6.1 of the Economic Analysis.
    EPA was then able to assess the impact of the annual compliance 
costs on key business ratios and other financial indicators. 
Specifically, EPA examined impacts on the following measures: (1) Costs 
to Revenue Ratio, (2) Pre-Tax Income to Total Assets Ratio, (3) 
Earnings before Interest and Taxes (EBIT) to Interest Ratio, and (4) 
change in business value. The first is a simple screening level measure 
which is used for measuring the impact on small entities. The second 
and third are financial measures reported by Risk Management Associates 
(RMA) for median, lower and upper quartiles by sector and business size 
that were used in constructing the baseline financial statements for 
the model firms. The change in business value measure is based on 
application of compliance costs to the model firm financial statements, 
both as the estimated absolute dollar change in value and the fraction 
of firms whose net business value becomes negative because of 
compliance outlays. The impacts of the compliance costs were examined 
by calculating the values of each ratio with and without the compliance 
costs.
b. Project-Level Cost Multiplier
    EPA accounted for the additional costs incurred by firms for 
financing the compliance costs via debt and equity over the duration of 
the project. For the firm-level impact analysis, these financing costs 
are explicitly accounted for by each model firm's estimated cost of 
debt and cost of equity, and then by the duration of the individual 
projects that are assigned to it. However, for the housing 
affordability analysis, and the estimation of social costs, EPA does 
not go through the process of assigning projects to firms, so a 
project-level cost multiplier was developed. This multiplier represents 
how direct compliance costs translate into the change in the cost of 
the final product being constructed. To develop this multiplier, EPA 
created a baseline scenario that incorporated assumptions concerning 
the costs incurred and revenue earned at each stage of land development 
and construction. EPA has included the following three principal 
development stages in developing the project-level multiplier.
    (1) Land acquisition. The starting point is usually acquisition of 
a parcel of land deemed suitable for the nature and scale of 
development envisioned. The developer-builder puts together the 
necessary financing to purchase the parcel.
    (2) Land development. The developer-builder obtains all necessary 
site approvals and prepares the site for the construction phase of the 
project. Costs

[[Page 63034]]

incurred during this stage are divided among ``soft'' costs for 
architectural and engineering services, legal work, permits, fees, and 
testing, and ``hard'' costs such as land clearing, installing utilities 
and roads, and preparing foundations or pads. The result of this phase 
is a parcel with one or more finished lots ready for construction.
    (3) Construction. The developer-builder undertakes the actual 
construction activity. A substantial portion of this work may be 
subcontracted out to specialty subcontractors (foundation, framing, 
roofing, plumbing, electrical, painting, etc.). In the case of a 
housing subdivision, marketing often begins prior to the start of this 
phase, hence, the developer-builder may also incur some marketing costs 
at this time.
    The general approach used in establishing the baseline scenario is 
to assume normal returns on invested capital and normal operating 
profit margins to arrive at the sales price for the final product (for 
example, completed new single-family homes in a residential housing 
complex, or office space in a new office park). This multiplier was 
then used to adjust the compliance cost estimates used for the housing 
affordability analysis and the social cost analysis.
c. Cost Pass-Through
    EPA analyzed the impact of today's final rule by adding in the 
regulatory costs at the appropriate stage of the project life cycle. An 
important consideration for assessing who ultimately bears the 
financial burden of a new regulation is the ability of the regulated 
entity to pass the incremental costs of the rule on to its customers. 
If the developer-builder can pass all of its costs through to the 
buyer, the impact of the rule on developer-builders is negligible and 
the buyer bears all the impact. Conversely, if they are unable to pass 
any of the cost to buyers through higher prices, then they must assume 
the entire cost. For the economic impact analysis EPA uses three pass-
through cases: zero cost pass-through; full cost pass-through; and 
partial cost pass-through (85% for residential and 71% for non-
residential).
    Under the first case, the zero (0%) cost pass-through assumption, 
the incremental regulatory costs are assumed to accrue entirely to the 
builder-developer, and appear as a reduction in per-project profits. 
The sale price of the constructed unit and surrounding lot remains the 
same as the asking price in the baseline. Using the full (100%) cost 
pass-through assumption, all incremental regulatory costs are passed 
through to end consumers. Under this approach, the compliance costs are 
also adjusted to reflect the developer's cost of debt, equity, and 
overhead. Consumers experience the impact of the final regulatory 
options in the form of a higher price for each new building or housing 
unit. For the partial cost pass-through case, firms are assumed to pass 
on part of the compliance outlay to other parties. For the partial cost 
pass-through case, EPA assumes a cost pass-through rate of 85% for 
residential sectors and 71% for non-residential and non-building 
sectors. This is the expected average long-term level of cost pass-
through based on observed response of market supply and demand to 
changes in prices for new construction. For more on the method used for 
determining the level of cost pass-through see Section 8.2 of the 
Economic Analysis, Analysis of Social Cost of the Economic Analysis. 
When a sector is stressed, cost pass-through will tend to be below this 
long-term average (i.e., more costs being borne by builders). 
Conversely, when a sector is booming, most costs are likely to be 
passed through.
    Information in the record indicates that builders do pass through 
much of the regulatory costs to customers. This is supported by the 
academic literature and industry publications. However, the financial 
impact analysis also calculates results under the two bounding cases, 
no cost pass-through for firms and full cost pass-through for 
customers, to assess the ability of these groups to absorb the impact 
of the regulation under a worst case scenario. The two bounding cases 
also provide an approximation of the sensitivity of impact estimates to 
the partial cost pass-through assumptions used for the primary case.
    EPA notes that under certain conditions developers might also 
attempt to pass regulatory costs back to land sellers. For example, in 
a depressed market, builders may argue successfully that a regulatory 
cost increase would make a particular project unprofitable unless the 
land costs can be reduced. If the land seller is convinced that a 
residential subdivision project would not proceed, they may be willing 
to accept a lower price for undeveloped land. The ability of developers 
to pass such costs back would likely depend on the sophistication of 
the land owner, their experience in land development projects, 
knowledge of the local real estate market, and, in particular, their 
understanding of the regulations and their likely cost. While evidence 
of cost pass-back to land owners exists for fixed and readily 
identifiable regulatory costs such as development impact fees, it is 
unclear whether a builder's claim that costs would be higher due to 
construction site control regulations would induce land owners to make 
concessions.
3. Housing Market Impacts
    EPA developed models to assess the potential impacts of the 
regulations on the national housing market. Buyers of new 
nonresidential properties will also be impacted as costs are passed 
through to them. However, they account for a minority of the 
construction projects considered and EPA assumes that this group of 
customers is not as vulnerable to changes in prices as are households 
in the market for new homes. Therefore, impacts to purchasers of new 
nonresidential construction sites were not highlighted as part of the 
financial impact assessment and are accounted for on a more general 
basis as part of the analysis of impacts on the national economy.
    To analyze the impacts of compliance costs on housing 
affordability, EPA estimated the level of income that would be 
necessary to purchase both the median and lower quartile priced new 
home without the final regulation, and the change in income needed to 
purchase the median and lower quartile priced new home under each of 
the regulatory options. To assess how low-income home purchasers might 
be affected, EPA also looked at the change in income needed for a 
$100,000 priced home. The Agency then used income distribution data to 
estimate the change in the number of households that would qualify to 
purchase the median, lower quartile, and $100,000 priced new home under 
each of the regulatory options. In this way, EPA attempted to estimate 
the number of households that may not be able to afford the exact same 
new home they could under baseline conditions. The housing market 
analysis was performed at the level of the metropolitan statistical 
area (MSA) to account for regional differences in housing prices and 
income. The housing market analysis uses the full cost pass-through 
assumption, to estimate the worst-case impacts on new single-family 
home buyers.
    When assessing the impact of the rule on housing affordability, EPA 
acknowledges that even those buyers who are able to afford the same 
newly built home at the new price may still experience an impact. Many 
households would continue to qualify to purchase (or rent) a housing 
unit of approximately the same price (or rent)

[[Page 63035]]

as before the C&D regulation, but might instead experience a reduction 
in some desirable housing attributes.
4. Impacts on the National Economy
    The market model generates an estimate of the change in the total 
value of construction produced by the industry, i.e., industry output. 
Two effects of the regulation are acting on the market value of 
construction output. First, the cost of construction activity 
increases, leading to a price rise and an increase in market value of 
final projects. Second, the quantity of houses sold is reduced because 
of the higher price due to compliance costs. The net effect on market 
value may be either positive or negative, depending on whether the 
elasticity of demand for housing is less than or greater than 1. There 
are also secondary impacts in other markets, caused by the shift in 
consumer spending, necessitated by the increased housing costs, from 
other goods to housing.
    Construction markets vary in the level of activity, structure of 
the industry, and ultimately cost pass-through potential, from state-
to-state and region-to-region. The modeling approach used for the 
national impact analysis captures such regional variation in the 
impacts of the final regulatory options by estimating partial 
equilibrium models at the state level for four major building 
construction sectors (single-family, multi-family, commercial, and 
industrial). EPA assumes that all costs for transportation projects are 
passed through to governmental entities, and therefore there is no 
reduction in overall construction activity in the transportation 
sector. The analysis of state- and national-level economic impacts is 
based on estimating changes to economic output, employment, and welfare 
measures that result from the estimated baseline market equilibrium to 
the estimated post-compliance market equilibrium for each construction 
sector in each state.
    A partial equilibrium analysis assumes that the final regulation 
will only directly affect a single industry; in this case, the four 
major construction sectors that were considered. Holding other 
industries ``constant'' in this way is generally appropriate since the 
compliance costs of the final regulatory options are expected to result 
in only marginal changes in prices and quantities and the rule does not 
directly affect the other industries (HUD, 2006; see DCN 52105).
    For the partial equilibrium analysis, EPA uses estimated 
elasticities of market supply and demand to calculate the impact of 
incremental costs on the supply curve and, thus, on prices and 
quantities of construction products under post-compliance conditions.
    Economic impacts in the directly affected construction industry can 
trigger further shifts in output and employment losses in the set of 
broader U.S. industrial sectors as these changes pass through the 
economy. The U.S. Department of Commerce uses input-output techniques 
to derive ``multipliers'' which indicate, for a given change in one 
industry's output, how output and employment in the whole U.S. economy 
will respond. EPA has applied the multipliers from the Regional Input-
Output Modeling System, version 2 (RIMS II) to the change in output 
estimated from the market model to estimate some of the anticipated 
impacts on national output and employment.

D. Results

1. Project-Level Impacts
    For most industries the closure of existing facilities and 
impediments to the opening of new facilities are a good indication of 
the impact of a regulation on overall industry activity. However, for 
the construction industry, the permitted activity is a temporary 
project rather than ongoing operations at a permanent facility. This is 
an important distinction, in that it provides construction firms with 
greater flexibility in how they respond to the rule. Not only can they 
elect to use one or more technologies to ensure compliance with the 
rule they can also choose to modify the dimensions and timing of the 
project to further minimize the effects of the rule on project 
profitability. Potential projects that are not profitable after 
considering compliance costs will either be modified to avoid or lessen 
compliance costs, or they will not be performed. Although EPA cannot 
predict the number or characteristics of future projects that may not 
occur due to today's rule, the agency has estimated the percent 
reduction in total construction activity resulting from the rule, 
expressed in terms of acreage. Under Option 4 the reduced level of 
construction activity is 231 acres or 0.03% of the total estimated 
level of activity. EPA does expect the rule to have an effect on 
overall project characteristics by providing an incentive to minimize 
disturbed areas, disturb them for shorter durations, and possibly 
separating the activity into more phases so that fewer acres are 
disturbed at any one time.
2. Firm-Level Impacts
    EPA has estimated the economic impacts of the final rule at the 
firm level by estimating the traditional factors considered by EPA 
under the CWA in determining economic achievability: the number of firm 
closures, and the number of lost jobs. Since in-scope firms are 
predominantly small businesses EPA also thought it informative to 
consider the effects on firm profitability, which is typically 
considered as part of the RFA analysis. EPA also considered it 
informative to assess the impact of the rule on the financial health of 
firms. The construction industry is highly reliant on raising capital 
to fund projects. A firm's ability to raise capital is based in large 
part on its credit worthiness and the productivity of its assets. Both 
of these factors can be affected by an increase in compliance costs. 
Difficulty raising capital resulting from increased costs may not cause 
a firm to close but it may cause its business to grow more slowly or 
actually contract.
    The economic impact analysis at the firm level looks at two cases. 
The first, which is the worst-case scenario, assumes that none of the 
incremental costs would be passed through to the final consumer, i.e., 
zero cost pass-through. The second, which is the primary analysis case, 
considered pass-through. The Agency examined the economic achievability 
of options assuming zero-pass through, because it presents the worst-
case scenario (i.e., the largest impacts to the firm). The second case 
(partial cost pass-through) is the primary analysis case because EPA 
believes this is more reflective of typical circumstances based on 
EPA's review of the academic literature and its discussions with 
industry officials who indicate that under normal business conditions 
most costs are passed through to the final consumer and are not 
absorbed by firms in the industry.
    EPA analyzed economic impacts at the firm level. The firm is the 
entity responsible for managing financial and economic information. 
Moreover, the firm is responsible for maintaining and monitoring 
financial accounts. For the C&D category, most of the business 
establishments, as defined by the Census Bureau, are firms. Likewise, a 
small number of establishments are entities within a larger firm. A 
small percentage of firms have multiple establishments and some firms 
are regional or national in scope.
    Table XII-5 presents two economic indicators that measure impacts 
to firms. These indicators are presented using the partial cost pass-
through case,

[[Page 63036]]

which represents the firms' expected ability to pass costs through to 
buyers, and the no cost pass-through case.

                              Table XII-5--Firms Expected To Incur Financial Stress
----------------------------------------------------------------------------------------------------------------
                                                                Option 1     Option 2     Option 3     Option 4
----------------------------------------------------------------------------------------------------------------
               Firms Incurring Deterioration in Financial Performance (Partial Cost Pass-through)
----------------------------------------------------------------------------------------------------------------
Number Incurring Effect.....................................           31        1,181        5,398          169
% of All In-scope Firms.....................................         0.0%         1.4%         6.6%         0.2%
% of Firms Incurring Cost...................................         0.1%         3.9%        17.7%         0.6%
----------------------------------------------------------------------------------------------------------------
                  Firms Incurring Deterioration in Financial Performance (No Cost Pass-through)
----------------------------------------------------------------------------------------------------------------
Number Incurring Effect.....................................          123        2,448       18,461          534
% of All In-scope Firms.....................................         0.2%         3.0%        22.6%         0.7%
% of Firms Incurring Cost...................................         0.4%         8.0%        60.5%         1.8%
----------------------------------------------------------------------------------------------------------------
                Potential Closures Due to Negative Net Business Value (Partial Cost Pass-through)
----------------------------------------------------------------------------------------------------------------
Number Incurring Effect.....................................           30          430        1,254          147
% of All In-scope Firms.....................................         0.0%         0.5%         1.5%         0.2%
% of Firms Incurring Cost...................................         0.1%         1.4%         4.1%         0.5%
Number of Jobs..............................................        1,464       33,044       67,443        7,257
% of In-scope Firm Employees................................         0.1%         1.8%         3.6%         0.4%
----------------------------------------------------------------------------------------------------------------
                  Potential Closures Due to Negative Net Business Value (No Cost Pass-through)
----------------------------------------------------------------------------------------------------------------
Number Incurring Effect.....................................          172        2,251        7,449          840
% of All In-scope Firms.....................................         0.2%         2.8%         9.1%         1.0%
% of Firms Incurring Cost...................................         0.6%         7.4%        24.4%         2.8%
Number of Jobs..............................................        7,010      155,364      319,030       35,450
% of In-scope Firm Employees................................         0.4%         8.4%        17.2%         1.9%
----------------------------------------------------------------------------------------------------------------
Source: Economic Analysis.

    The first measure estimates the potential decrease in the number of 
firms considered financially fit. Deterioration of firm financial 
performance is based on assessing the impact of costs on two financial 
measures (Pre-Tax Income/Total Assets and Earnings before Interest and 
Taxes/Interest). EPA estimated the fraction of firms in the various 
sector and revenue ranges whose financial indicators decline below the 
lower quartile for these two measures, as reported by Risk Management 
Associates (RMA). For each sector and revenue category, whichever of 
the two measures have the greatest decline is used to represent the 
impact on financial performance. For additional information on EPA's 
analysis of the change in financial position, see Section 6.2, 
Estimating the Change in Model Firm Financial Performance and 
Condition, from the Economic Analysis.
    The second measure indicates the number of firms who are no longer 
profitable as a result of the rule. This is an indicator of the number 
of likely firm closures and is a commonly used measure of economic 
impacts under the CWA. These numbers represent the impact on firms with 
thin profit margins who are most vulnerable to impacts from cost 
increases, and they do not represent the effects of a reduction in the 
overall quantity of construction activity as a result of the C&D rule. 
Both phenomena can result in reduced activity and job losses, but they 
are two separate measures of impact that are not necessarily wholly 
additive or overlapping.
    Construction is a highly competitive industry that is characterized 
by many small firms with a relatively high turnover and low barriers to 
entry. Firms routinely expand and contract their workforce in response 
to work load and as a result many workers laid off when a firm closes 
are rehired by new and other existing more financially healthy firms. 
Therefore, job losses due to firm closures are in many cases a 
temporary displacement of the workforce. By contrast, job losses due to 
market contraction result from an overall reduction in the volume of 
construction and not necessarily from the closure of a firm. Table XII-
6 shows the estimated number of job losses within the construction 
industry resulting from a reduction in overall construction activity 
due to each of the options considered. These job losses can be 
considered a more lasting effect until market conditions change again.

 Table XII-6--Change in Employment Levels Due to Decreased Industry Activity, Assuming Partial Cost Pass-Through
----------------------------------------------------------------------------------------------------------------
                                                                Option 1     Option 2     Option 3     Option 4
----------------------------------------------------------------------------------------------------------------
                               Employment Effect from Reduced C&D Industry Output
----------------------------------------------------------------------------------------------------------------
Estimated Permanent Reduction in Construction Jobs..........           83        3,370        5,802          560
----------------------------------------------------------------------------------------------------------------
Source: Economic Analysis.


[[Page 63037]]

For more information on job losses due to market contraction, see 
Chapter 9 Economy-wide Analysis in the Economic Analysis.
    Table XII-7 presents one economic indicator, the relationship of 
compliance cost to firms' annual revenue. A comparison between costs 
and revenues is typically done prior to any consideration of the pass-
through of costs to buyers. This comparison provides a simple measure 
of possible impacts on firm profitability and it is used under the RFA 
to determine if a rule has the potential to have a significant impact 
on a substantial number of small entities. Even under the more severe 
No Cost Pass-through case, firms whose costs exceed 1% of revenue are 
only 0.3 percent of the approximately 82 thousand in-scope firms for 
the selected Option 4. Furthermore, there are no firms whose costs 
exceed 3% of revenue for the selected Option 4.

                                                              Table XII-7--Cost to Revenue
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                    Costs exceeding 1% revenue                      Costs exceeding 3% revenue
                                                         -----------------------------------------------------------------------------------------------
                                                                                            Percent of                                      Percent of
                         Option                              Number of      Percent of         firms         Number of      Percent of         firms
                                                               firms      firms in-scope     incurring         firms      firms in-scope     incurring
                                                                                               costs                                           costs
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Partial Cost Pass-through Case
--------------------------------------------------------------------------------------------------------------------------------------------------------
Option 1................................................               0             0.0             0.0               0             0.0             0.0
Option 2................................................             873             1.1             2.9              81             0.1             0.3
Option 3................................................           3,573             4.4            11.7             225             0.3             0.7
Option 4................................................               0             0.0             0.0               0             0.0             0.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                No Cost Pass-through Case
--------------------------------------------------------------------------------------------------------------------------------------------------------
Option 1................................................               0             0.0             0.0               0             0.0             0.0
Option 2................................................           4,717             5.8            15.5           2,399             2.9             7.9
Option 3................................................          14,021            17.2            46.0           9,126            11.2            29.9
Option 4................................................             276             0.3             0.9               0             0.0            0.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
Source: Economic Analysis.

    The construction industry has historically been a relatively 
volatile sector, and is subject to wider swings of economic performance 
than the economy as a whole. EPA has used historical financial and 
census data for the construction industry to discern long-term trends 
within the market fluctuations. EPA based its primary economic analysis 
on data that reflects average long-term performance rather than a 
temporary high or low. The industry is currently experiencing a period 
of weakness that is likely to persist until residential markets work 
through the current inventory of unsold homes, credit markets improve, 
and the general economy returns to a better condition. As such, there 
will continue to be considerable uncertainty regarding the likely 
length and severity of the current slump in the construction industry. 
EPA realizes that the rule will be promulgated during this low period 
for the industry, and there may be concerns that additional compliance 
costs, associated with the rule, could have a greater than normal 
impact on construction firms and potentially slow the industry 
recovery. To some degree, this will be offset, by the four year phase 
in of the numeric limitation and monitoring requirements, which is part 
of today's rule. Additionally, the rule will not be fully implemented, 
with the associated costs to the industry, until 5 years after the 
effective date of this rule, sometime in 2015, when all EPA and state 
construction general permits have gone through their five year permit 
cycle and new permits are issued incorporating the requirements of this 
rule. See CWA section 402(b)(1)(B). The time period could be longer if 
it takes permitting authorities more time to issue revised permits. 
However, using historical census and financial data for the industry 
EPA identified periods of weakness for various industry sectors and 
used them to develop a secondary analysis that represents potential 
impacts of additional compliance costs during a period of adverse 
economic circumstances. Three key assumptions EPA used to represent 
adverse conditions for the industry were that there would be a 
contraction in overall market activity, firms would finance projects 
under less favorable terms and no costs incurred by the firm as a 
result of compliance would be passed through to the buyer. Table XII-8 
below shows the results of the adverse analysis case. The number of 
firms experiencing impacts reflects the market contraction, so they are 
not directly comparable to the primary analysis case, since they 
represent differing levels of regulated activity. However, the adverse 
case analysis shows that the percentage of in-scope firms incurring 
financial stress is 0.5% of in-scope firms and the percentage of in-
scope firms at risk of closure in the adverse case is 0.9%. However, 
even with the greater impacts seen under the adverse analysis case, the 
percentage of total firms experiencing financial hardship is very small 
under any of the metrics considered, with respect to the final option. 
Another important consideration for the adverse analysis case is that 
under the no-cost pass through assumption, there are no secondary 
impacts on small builders or affordability effects for buyers.

                                  Table XII-8--Adverse Impact Analysis Results
----------------------------------------------------------------------------------------------------------------
          Impact analysis concept                      Option 1              Option 2     Option 3     Option 4
----------------------------------------------------------------------------------------------------------------
Costs Exceeding 1 Percent of Revenue:
    Number of Firms.......................  0............................        2,037        6,960          105
    % of Firms In-Scope...................  0.0%.........................         3.5%        11.8%         0.2%

[[Page 63038]]

 
    % of Firms Incurring Cost.............  0.0%.........................        11.6%        39.8%         0.6%
Costs Exceeding 3 Percent of Revenue:
    Number of Firms.......................  0............................          751        3,401            0
    % of Firms In-Scope...................  0.0%.........................         1.3%         5.8%         0.0%
    % of Firms Incurring Cost.............  0.0%.........................         4.3%        19.4%         0.0%
Firms Incurring Financial Stress:
    Number of Firms.......................  71...........................        3,163        8,168          315
    % of Firms In-Scope...................  0.1%.........................         5.4%        13.9%         0.5%
    % of Firms Incurring Cost.............  0.4%.........................        18.1%        46.7%         1.8%
Firms With Negative Business Value
 (Potential Closures):
    Number of Firms.......................  180..........................        1,041        2,966          547
    % of Firms In-Scope...................  0.3%.........................         1.8%         5.0%         0.9%
    % of Firms Incurring Cost.............  1.0%.........................         6.0%        17.0%        3.1%
----------------------------------------------------------------------------------------------------------------
Source: Economic Analysis.

    Since EPA expects that the effluent guidelines requirements will be 
implemented over time as states revise their general permits (EPA 
expects full implementation within five years of the effective date of 
the final rule, in 2015), EPA has used macroeconomic forecasts of 
construction activity to assess when the industry is likely to return 
to its long-term trend. (Global Insight, ``U.S. Economic Service,'' 
July, 2009) Based on these forecasts, EPA anticipates that the industry 
activity will have recovered to the long-term trend during the period 
when the rule is being fully implemented.
3. Impacts on Governments
    EPA has analyzed the impacts of today's final rule on government 
entities. This analysis includes the cost to governments for compliance 
at government-owned construction project sites (construction-related). 
For construction-related costs, EPA assumed that 100 percent of the 
incremental compliance costs that contractors incur at government-owned 
construction sites are passed through to the government. EPA also 
estimated the additional administrative costs that government entities 
would incur for reviewing the additional monitoring reports associated 
with the turbidity monitoring requirements of Options 2, 3, and 4. 
Table XII-9 shows the costs that government entities are expected to 
incur at federal, state, and local levels.

                                   Table XII-9--Total Costs by Government Unit
                                                [Millions 2008 $]
----------------------------------------------------------------------------------------------------------------
                                                                Option 1     Option 2     Option 3     Option 4
----------------------------------------------------------------------------------------------------------------
Compliance Costs
    Federal.................................................         $3.8        $87.1       $166.9        $17.7
    State...................................................          8.1        178.1        323.0         35.3
    Local...................................................         46.2      1,022.3      1,854.0        202.4
Administrative Costs
    Federal.................................................          0.0          0.0          0.0          0.0
    State...................................................          0.0          2.2          6.2          6.2
    Local...................................................          0.0          0.0          0.0          0.0
Total Costs
    Federal.................................................          3.8         87.1        166.9         17.7
    State...................................................          8.1        180.3        329.2         41.5
    Local...................................................         46.2      1,022.3      1,854.0        202.4
    State Government Total Revenues.........................    1,097,829    1,097,829    1,097,829    1,097,829
    Total Costs as % of Total Revenues......................         0.00         0.02         0.03         0.00
    Local Government Total Revenues.........................    1,083,129    1,083,129    1,083,129    1,083,129
    Total Costs as % of Total Revenues......................         0.00         0.09         0.17         0.02
----------------------------------------------------------------------------------------------------------------
Source: Economic Analysis.

     The additional government costs associated with today's rule are 
not expected to have a significant impact on state and local 
governments as they account for less than a tenth of a percent of state 
government revenues and less than a tenth of a percent of estimated 
local government revenues. For additional information on the effect of 
the rule on government entities see the UMRA analysis in Chapter 14 of 
the Economic Analysis.
4. Community-Level Impacts
    EPA has estimated community-level impacts based upon the 
incremental costs of the final rule at the household level. The 
household impacts are those that would affect local communities in 
terms of the costs of housing. EPA's analysis considers the impacts on 
the price of housing based on the increase/decrease in the price of 
three representative houses (median, lower quartile, and $100,000). 
Table XII-10 shows the change by selected option in the price per 
house. It is important to note that these costs would not apply to all 
new houses built in the U.S., but rather only to those houses that are 
part of construction projects that are subject to the given regulatory 
option. Each of the options are assumed to affect all new homes sales, 
which are approximately 12.6 percent of total annual home sales. This 
is a slight over estimate because it includes those new

[[Page 63039]]

houses built in projects less than 1 acre and those that are built in 
localities where erosion and sediment controls are more stringent than 
the ones being promulgated today.
    The table also provides estimates of the expected change in monthly 
payments under each option for the median and lower quartile priced 
home. The monthly mortgage payments were calculated using the median 
and lower quartile priced house for each Metropolitan Statistical Area 
(MSA) in the country. For the MSA's, the weighted average median price 
for a home is $356,000, the 5th percentile is $117,000, and the 95th 
percentile is $498,000. For the lower quartile priced home, the 
weighted average is $251,000, the 5th percentile is $70,000, and the 
95th percentile is $371,000. The U.S. Census does not report lot sizes 
for the upper or lower quartile. Instead the Census reports the median 
for all new single-family homes and the median for new single-family 
homes that are attached (townhomes). Housing census data indicates that 
lower-priced homes have a greater likelihood of having a smaller lot 
size (U.S. Census Characteristics of New Housing, 2006). To account for 
this factor, EPA performed the affordability analysis for the lower-
quartile price home twice, using both the median lot size for all 
single family homes and the median lot size for attached single family 
homes. To assess the impacts on those households that were just able to 
afford a house at the low end of the housing market, EPA also included 
an analysis of the expected change in monthly payments for a new house 
valued at $100,000.

      Table XII-10--Change in Monthly Mortgage Payment for New Single-Family Home (Full Cost Pass-Through)
----------------------------------------------------------------------------------------------------------------
                                                                Option 1     Option 2     Option 3     Option 4
----------------------------------------------------------------------------------------------------------------
                            New Single-Family Median Priced Home on Median Sized Lot
----------------------------------------------------------------------------------------------------------------
Price Change New Single-Family Home on Median Sized Lot.....          $59       $2,231       $4,093         $415
Baseline Mortgage Payment ($/month).........................       $1,953       $1,953       $1,953       $1,953
New Mortgage Payment ($/month)..............................       $1,954       $1,969       $1,982       $1,956
% Change....................................................        0.02%        0.80%        1.45%        0.14%
----------------------------------------------------------------------------------------------------------------
                        New Single-Family Lower Quartile Priced Home on Median Sized Lot
----------------------------------------------------------------------------------------------------------------
Price Change New Single-Family Home on Median Sized Lot.....          $59       $2,231       $4,093         $415
Baseline Mortgage Payment ($/month).........................       $1,352       $1,352       $1,352       $1,352
New Mortgage Payment ($/month)..............................       $1,352       $1,367       $1,380       $1,355
% Change....................................................        0.03%        1.15%        2.10%        0.21%
----------------------------------------------------------------------------------------------------------------
                    New Single-Family Lower Quartile Priced Home on Median Sized Attached Lot
----------------------------------------------------------------------------------------------------------------
Price Change New Single-Family Home on Median Sized Attached          $20         $745       $1,367         $139
 Lot........................................................
Baseline Mortgage Payment ($/month).........................       $1,352       $1,352       $1,352       $1,352
New Mortgage Payment ($/month)..............................       $1,352       $1,357       $1,361       $1,353
% Change....................................................        0.01%        0.38%        0.70%        0.07%
----------------------------------------------------------------------------------------------------------------
           New Single-Family $100,000 Priced Home on Median Sized Lot for Attached Single-Family Home
----------------------------------------------------------------------------------------------------------------
Price Change New Single-Family Home on Median Sized Attached          $20         $745       $1,367         $139
 Lot........................................................
Baseline Mortgage Payment ($/month).........................         $681         $681         $681         $681
New Mortgage Payment ($/month)..............................         $681         $686         $691         $682
% Change....................................................        0.02%        0.76%        1.39%        0.14%
----------------------------------------------------------------------------------------------------------------
Source: Economic Analysis.

    The increase in mortgage payments attributable to the final options 
compared to the estimated mortgage payment for the median price of a 
new house in the U.S., currently about $1,953, is a small percentage of 
the overall payment. For these costs, the average monthly mortgage 
payment would increase by $1, $16, $29, and $3 per month for Options 1, 
2, 3, and 4, respectively. For the analysis, EPA assumes that buyers 
finance approximately 80% of the home purchase price using a 30-year 
conventional fixed rate mortgage with an interest rate of 7.39%.
    EPA also estimated how the change in home prices would affect 
mortgage availability. EPA estimated that 1,249 prospective home 
purchasers seeking to buy a new median priced single-family home would 
be affected by the final rule, of which 354 would no longer qualify 
using a 29% housing payment-to-income ratio. At the lower end of the 
housing market, 518 prospective home purchasers seeking to buy a new 
$100,000 priced single-family attached home would be affected by the 
final rule, of which 246 would no longer qualify using a 29% housing 
payment-to-income ratio. However, these are only specific points along 
the spectrum of housing prices and therefore do not represent the total 
number of households that would have to make a different homebuying 
decision as a result of the rule. For more information on the 
affordability analysis see Section 7, Analysis of Single-Family Housing 
Affordability Impacts, of the Economic Analysis.
5. Foreign Trade Impacts
    As part of its economic analysis, EPA has evaluated the potential 
for changes in U.S. trade (imports, exports) of construction-related 
goods and services. A significant component of the U.S. C&D category 
operates internationally, and, in addition, numerous foreign firms that 
participate in this category also operate in the U.S. EPA judged that 
the potential for U.S. construction firms to be differentially affected 
by the final rule is negligible. The final rule will be implemented at 
the project level, not the firm level, and will affect projects within 
the U.S. only. All firms undertaking such projects, domestic or

[[Page 63040]]

foreign, will be subject to the final rule. U.S. firms doing business 
outside the U.S. will not be differentially affected compared to 
foreign firms, nor will foreign firms doing business in the U.S.
    This final rule could theoretically stimulate or depress demand for 
some construction-related goods. To the extent that the final rule acts 
to depress the overall construction market, demand for conventional 
construction-related products may decline. This decline may be offset 
by purchase of goods and services related to erosion and sediment 
control. Overall, EPA does not anticipate that any shifts in demand for 
such goods and services resulting from the rule would have a 
significant implication for U.S. and foreign trade.
6. Impacts on New Firms
    The construction sector is a relatively fluid industry, as 
documented in the industry profile, with low barriers to entry and 
considerable entry and exit activity from year to year. As a result, 
the potential employment losses or capital idling effects of weakness 
in a specific firm are likely to be offset by changing levels of 
activity in other existing firms or entry of new firms into the local 
market. In addition, existing firms would need to meet the same 
requirement, and therefore would not obtain a competitive advantage 
over new entrants.
    EPA conducted an analysis to assess the impacts on new firms that 
choose to enter the C&D point source category. This analysis uses a 
method called ``barrier to entry'' and is relevant to determining BADT 
for NSPS. EPA examined the ratio of compliance costs to current and 
total assets to determine if new market entrants could find it more 
difficult to assemble the capital requirements to start a project than 
would existing firms. The methodology is conservative, because it 
doesn't account for the fact that a firm would typically be expected to 
finance 20 percent of the incremental compliance costs from their own 
financial resource to obtain the loan, not the full amount as assumed 
here.
    For the selected regulatory option (Option 4), the increase in 
financing requirement varies from approximately 0.0 percent to 4.1 
percent of baseline assets depending on the firms size and business 
sectors. This comparison assumes that the new firm's compliance outlay 
would be financed and recorded on its balance sheet. To the extent that 
the compliance outlay is financed and recorded not on the firm's 
baseline sheet but as part of a separate project-based financing for 
each individual project, this comparison is likely to be overstated, 
perhaps substantially. EPA does not consider the increase in financing 
requirements to pose a significant barrier to entry for potential 
businesses and projects.
    This analysis likely overstates the costs that will need to be 
financed by new entrants to the industry. For the economic analysis, 
industry firms were grouped into one of seven revenue ranges. Firms 
with higher revenues are considered to be more capable of performing 
larger projects. This assumption formed the basis for assigning model 
projects and their associated compliance costs to model firms. Under 
Option 4, compliance costs for projects under 10 acres are considerably 
less than they are for projects 10 acres and above. EPA believes that 
most new entrants will likely be small firms starting in one of the 
lower revenue ranges considered for the economic analysis, and so they 
will likely be performing projects less than 10 acres.
7. Social Costs
    EPA's analysis of social costs for each option contains three cost 
components: (1) Firm compliance costs; (2) incremental increase in 
government administrative costs; and (3) deadweight loss (loss of 
economic efficiency in the construction market). When summed, these 
three cost categories comprise the total social costs for each option.
    EPA has conducted a social cost analysis for each option. The 
Economic Analysis provides the complete social cost analysis for the 
final regulation. The firm-level estimate compliance cost, however, 
does not account for the potential affect of the final options on the 
quantity of construction activity/units performed in the various 
construction markets. Compliance costs for each final option have the 
effect of increasing builder/developer costs, which can cause a 
leftward shift in the market's supply curve. Part of the increased 
costs may raise the price of new housing, with the balance of increased 
costs being absorbed by the builder, depending on the relative 
elasticities of supply and demand. The resulting shift in market 
equilibrium may also reduce the quantity of construction units produced 
in a given market.
    EPA has estimated a state-by-state linear partial equilibrium 
market model for each construction building sector to estimate this 
potential market effect on the quantity of output. The estimated change 
in the quantity of output produced in each construction market segment 
is then used to not only adjust the firm-level resource cost of 
compliance, but also to compute the economic value of the reduction in 
construction output, and estimate the total loss of consumer and 
producer surplus, referred to as the deadweight loss. Table XII-11 
shows the change in cost due to the quantity effect (i.e. reduction in 
market activity), the dead weight loss, and their combined effect on 
total costs.

                         Table XII-11--Total Social Cost of Options [Millions of $2008]
----------------------------------------------------------------------------------------------------------------
                                                                Option 1     Option 2     Option 3     Option 4
----------------------------------------------------------------------------------------------------------------
Total Costs, Unadjusted for Quantity Effect.................         $176       $4,866       $9,090         $953
Change in Costs Due to Quantity Effect......................         0.01           10           31         0.29
Total Costs, Adjusted for Quantity Effect...................          176        4,856        9,059          952
Total Dead Weight Loss......................................          0.0          5.0         15.5         0.15
Additional Government Administrative Costs..................          0.0          2.2          6.2          6.2
Total Social Cost of the Regulation.........................        175.7      4,863.1      9,081.1        958.7
----------------------------------------------------------------------------------------------------------------

8. Small Business Impacts
    Section XX.C of today's notice provides EPA's Regulatory 
Flexibility Analysis (RFA) analyzing the effects of the rule on small 
entities. For purposes of assessing the economic impacts of today's 
final rule on small entities, small entity is defined by the US Small 
Business Administration (SBA) size standards for small businesses and 
RFA default definitions for small governmental jurisdictions. The small 
entities regulated by this final rule are small land developers, small 
residential construction firms, small commercial, institutional, 
industrial and manufacturing building firms, and small heavy 
construction firms.

[[Page 63041]]

    Table XII-12 shows the impacts of the final rule using the one 
percent and three percent revenue tests, a method used by EPA to 
estimate the impacts on small businesses for the regulatory options.

                   Table XII-12--Small Business Analysis for Options, 1% and 3% Revenue Tests
----------------------------------------------------------------------------------------------------------------
                                                          1% revenue test                 3% revenue test
                                                 ---------------------------------------------------------------
                     Option                          Number of      Percent of       Number of      Percent of
                                                    small firms     small firms     small firms     small firms
----------------------------------------------------------------------------------------------------------------
                                         Partial Cost Pass-through Case
----------------------------------------------------------------------------------------------------------------
;Option 1.......................................               0             0.0               0             0.0
Option 2........................................             593             0.8              60             0.1
Option 3........................................           3,008             3.9             187             0.2
Option 4........................................               0             0.0               0             0.0
----------------------------------------------------------------------------------------------------------------
                                            No Cost Pass-through Case
----------------------------------------------------------------------------------------------------------------
Option 1........................................               0             0.0               0             0.0
Option 2........................................           3,454             4.5           1,843             2.4
Option 3........................................          11,889            15.4           8,106            10.5
Option 4........................................             230             0.3               0             0.0
----------------------------------------------------------------------------------------------------------------
Source: Economic Analysis.

    Under the No Cost Pass-through case, Table XII-12 shows that for 
the selected option (Option 4), less than a thousand small firms would 
be likely to incur direct costs exceeding one percent of revenue, which 
accounts for less than one percent of the approximately 78 thousand 
small in-scope firms. Therefore, EPA does not consider the selected 
option to have the potential to cause a significant economic impact on 
a substantial number of small entities. EPA acknowledges that 
additional small builders may experience secondary impacts in the form 
of higher lot prices as larger developers attempt to pass some of their 
compliance costs through to them. The ability of large developers to 
pass-through costs to builders will vary based on market conditions in 
the same manner that the pass-through rate to the purchaser of the 
finished construction can vary. Additionally, as noted above, some of 
these small builders may also be copermittees who are required to be in 
compliance with these standards. To the extent they are copermittees, 
they are not accounted for in the firms incurring costs. However, all 
costs have been attributed to firms. Allocating costs over a broader 
number of firms may or may not increase the estimated impacts, but 
spreads the costs over a larger number of firms.

XIII. Cost-Effectiveness Analysis

    For many effluent limitations guidelines, EPA performs a cost-
effectiveness (C-E) analysis using toxic-weighted pound equivalents. 
The C-E analysis is useful for describing the relative efficiency of 
different technologies. The pollutant removals estimated for today's 
final rule are all based on sediment and sediment bound nutrients. 
While EPA expects that today's rule would also result in a significant 
reduction of other pollutants associated with sediment at construction 
sites, such as turbidity, metals, organics, oil and grease, pesticides 
and herbicides, the Agency has not quantified these reductions. The 
Agency does not have a methodology for converting sediment, measured as 
TSS or turbidity, into toxic-weighted pound equivalents for a C-E 
analysis. Instead, EPA compared the cost of each regulatory option to 
the pounds of sediment removed. This unweighted pollutant removal 
analysis is meaningful because it allows EPA to compare the cost 
effectiveness of one option against another, and to other sediment 
reduction efforts. Table XIII-1 shows a comparison of the cost-
effectiveness of the options for controlling sediment discharges. 
Details on the estimates of sediment reductions can be found in Section 
XV.B.

                                   Table XIII-1--Cost-Effectiveness of Options
----------------------------------------------------------------------------------------------------------------
                                                                Option 1     Option 2     Option 3     Option 4
----------------------------------------------------------------------------------------------------------------
Compliance Cost (millions 2008$)............................         $176       $4,866       $9,090         $953
Sediment Removed (million lbs/yr)...........................        1,743        3,616        4,507        3,971
Cost per Pound Removed ($/lb)...............................         0.10         1.35         2.02         0.24
----------------------------------------------------------------------------------------------------------------
Source: Economic Analysis.

XIV. Non-Water Quality Environmental Impacts

    Under sections 304(b) and 306(b) of the CWA, EPA is to consider the 
``non-water quality environmental impacts'' (NWQEI) when promulgating 
ELGs and NSPSs. EPA used various methods to estimate the NWQEI for each 
of the options considered for today's final rule.

A. Air Pollution

    EPA estimates that today's final rule would have no significant 
effect on air pollution because the final rule would not significantly 
alter the use of heavy equipment at construction sites. Accordingly, 
the levels of exhaust emissions from diesel-powered heavy construction 
equipment and fugitive dust emissions generated by construction 
activities would not change substantially from current conditions as a 
result of the final rule. The final rule, which relies on the use of 
passive treatment, typically does not utilize large diesel-powered or 
gasoline pumps. The only anticipated use of pumps would be due to the 
use of small metering pumps to introduce polymer in certain situations. 
These pumps

[[Page 63042]]

would only use a trivial amount of energy and would produce only a 
trivial amount of air emissions. On certain sites, it may be necessary 
to remove accumulated sediment from basins and traps. In these cases, 
construction equipment may need to periodically remove accumulated 
sediment. In these cases, additional emissions due to construction 
equipment may occur. EPA estimates that the final rule will result in 
the removal of approximately 1,986,000 tons of sediment annually. EPA 
estimates that increased emissions from construction equipment to 
remove this quantity of sediment would be approximately 0.0009 percent 
of current industry emissions. Table XIV-1 shows the expected emissions 
due to the final rule.

              Table XIV-1--Air Emissions Due to Final Rule
------------------------------------------------------------------------
                                                             Emissions
                        Parameter                          (pounds/year)
------------------------------------------------------------------------
Reactive organic gases..................................           4,707
Carbon monoxide.........................................          15,335
Nitrogen oxides.........................................          43,970
Sulfuric oxides.........................................              45
Particulate matter......................................           1,809
Carbon dioxide..........................................       4,167,800
Methane.................................................             424
------------------------------------------------------------------------

B. Solid Waste Generation

    Generation of solid waste could be affected under today's final 
rule because of the large volumes of sediment containing polymers or 
other chemicals that may accumulate in sediment basins and traps and 
behind check dams and other sediment control structures. Where 
permittees are using polymers or other chemicals to treat stormwater, 
then sediment accumulated in sediment basins, traps or in drainage 
channels may need to be handled as solid waste, depending on the nature 
of the chemical used. However, most permittees using chemical additives 
are expected to select polymers that would enable the operator to apply 
solids (i.e., sediment) on-site as fill material to avoid the 
transportation and disposal costs associated with hauling off-site.

C. Energy Usage

    The consumption of energy as a result of today's final rule is not 
expected to be significant because the operations that currently 
consume energy (both direct fossil fuel use and electricity) will not 
be changing to any substantial degree during land disturbance. PTS 
utilize little or no energy, hence no significant increase in fuel 
consumption by the industry is anticipated. However, removal of 
accumulated sediment would require use of construction equipment, which 
would increase diesel fuel and gasoline consumption by the industry. 
However the additional fuel consumption for these activities is 
expected to be small compared to current consumption for this industry. 
EPA estimates that gasoline and diesel fuel consumption due sediment 
removal would be approximately 76,000 gallons per year as a result of 
the final rule. This represents an increase in fuel usage by the 
industry of approximately 0.0009 percent over current usage, which was 
estimated at approximately 8.3 billion gallons per year in 2002 (2002 
Economic Census, U.S. Census Bureau). In addition, polymers such as 
polyacrylamide are produced from petroleum, so additional 
polyacrylamide usage to treat construction site stormwater discharges 
would result in increased petroleum consumption. However, usage on 
construction sites is not expected to significantly increase demand for 
acrylamide. U.S. acrylamide demand in 2001 was estimated to be 
approximately 253 million pounds, and additional usage on construction 
sites would be approximately 4.56 million pounds per year if all 
discharges from all regulated sites were to use PAM at a dosage of 2 
mg/L. Therefore, additional petroleum and energy consumption due to PAM 
production and usage is expected to be small. See section 11 of the TDD 
for additional discussion.

XV. Environmental Assessment

A. Surface Water Impacts From Discharges Associated With Construction 
Activity

    In its Environmental Assessment (see ``Supporting Documentation''), 
EPA evaluated environmental impacts from stormwater discharges 
associated with construction activity.
    As discussed in Section VIII, stormwater discharges associated with 
construction activity have been documented to increase the loadings of 
several pollutants to receiving surface waters. The most prominent and 
widespread pollutant discharges from construction sites are turbidity 
and sediment. Discharges of metals, nutrients, and petroleum 
hydrocarbons have also been documented. Other pollutants discharged 
from construction sites include polycyclic aromatic hydrocarbons (PAHs) 
and other toxic organic compounds.
    Pollutants other than sediment and turbidity derive from 
construction equipment and materials, natural soil constituents, and 
contamination existing prior to the start of construction activity at a 
site. Construction activities mobilize sediments and other pollutants 
by disturbing soil and altering stormwater discharge quantity and 
patterns during precipitation events and from exposure of rainfall and 
runoff to construction materials. Excavation dewatering and irrigation 
of revegetation areas, if not properly managed, can mobilize pollutants 
during dry weather.
    Surface water effects from construction site discharges include 
physical, chemical and biological changes. Physical and chemical 
changes include modified stream flow and elevated levels of turbidity, 
suspended solids and other pollutants. Biological changes include 
reduced organism abundance, modified species composition, and reduced 
species diversity.
    Sediment and turbidity are the primary pollutants in discharges 
associated with construction activity and are also significant sources 
of water quality impairment. Nitrogen and phosphorus, also present in 
construction site discharges, contribute significantly to water quality 
impairment as well. EPA's Wadeable Streams Assessment (2006) is a 
statistical survey of the smaller perennial streams and rivers that 
comprise 90 percent of all perennial stream miles in the coterminous 
United States. Excess nitrogen, phosphorus, and streambed sedimentation 
are among the most widespread stressors examined in the survey. 
According to the survey, 25 percent of streams have ``poor'' streambed 
sediment condition, 31 percent have ``poor'' phosphorus condition, and 
32 percent have ``poor'' nitrogen condition relative to reference 
streams. The risk of having poor biological condition was two times 
greater for streams scoring ``poor'' for nutrient or streambed sediment 
condition than for streams that scored ``good.''
    In addition, EPA's Assessment TMDL Tracking and Implementation 
System (ATTAINS) provides information on water quality conditions 
reported by the states to EPA under Sections 305(b) and 303(d) of the 
Clean Water Act. According to ATTAINS (as of September 17, 2009), 
turbidity contributes to impairment of 26,278 miles of assessed rivers 
and streams, 1,008,276 acres of assessed lakes, and reservoirs, and 240 
square miles of assessed bays and estuaries. The total area of impaired 
surface waters due to turbidity is probably underestimated due to the 
low percentage of surface waters that have been assessed. See the 
Environmental Assessment for

[[Page 63043]]

additional information on the Wadeable Streams Assessment and ATTAINS.
    Discharges from construction sites impair or place additional 
stress on already impaired surface waters. Multiple states have 
identified construction activity as a source of impairment for surface 
waters within their jurisdiction.
    Ecological impacts from sediment and turbidity discharges to 
surface waters can be acute or chronic and vary in severity depending 
on the quantity of sediment and turbidity discharged, the nature of the 
receiving waterbody and aquatic community, and the length of time over 
which discharges take place. Sediment and turbidity can depress aquatic 
organism growth, reproduction, and survival, leading to declines in 
organism abundance and changes in community species composition. 
Threatened and Endangered (T&E) and other special status species are 
particularly susceptible to adverse habitat impacts. According to the 
United States Fish and Wildlife Service, increased sedimentation is one 
of the main contributors to the demise of some fish, plants, and 
invertebrates.
    There are numerous ways in which sediment and turbidity affect 
aquatic communities. Sediment deposition on waterbody beds can bury 
benthic communities, smothering fish eggs and other benthic organisms 
and severing connections to organisms in the water column. 
Sedimentation also modifies some benthic habitats by filling crevices 
and burying hard substrates, making recolonization by the previously 
existing community difficult unless the sediment is removed.
    In the water column, elevated turbidity levels block light needed 
for photosynthesis by submerged aquatic vegetation (SAV), resulting in 
its reduced growth or death. Because SAV is a primary producer depended 
upon by many other organisms in aquatic ecosystems, its loss or 
reduction can create a cascade of impacts through aquatic communities, 
lowering community health and productivity. Increased turbidity also 
impairs the ability of visual predators (e.g., many fish species) to 
forage successfully. Increased sediment concentrations in the water 
column can impair fish gill function, reducing the ability of fish to 
breathe. These and other processes by which sediment and turbidity 
discharges impair aquatic ecosystems are discussed in more detail in 
the Environmental Assessment.
    Increased sediment and turbidity levels in surface waters also 
adversely affect direct human uses of water resources. These uses 
include navigation channels, reservoirs, drinking water supply, 
industrial process water supply, agricultural water supply, and 
recreational use. Property values also depend in part on the quality of 
nearby surface waters, though these may reflect the values already 
discussed and not necessarily represent a separate benefit.
    Sediment deposition on riverbeds and in harbors can fill and impede 
use of navigable channels. Between 1995 and 2008, the U.S. Army Corps 
of Engineers (USACE) funded nearly 3,400 dredging projects at a cost of 
more than $9 billion (2008 dollars) to remove more than 2.6 billion 
cubic yards of sediment from U.S. navigable waters (United States Army 
Corps of Engineers Dredging Database 2009). Reservoirs and lakes serve 
a variety of functions, including drinking water storage, hydropower 
supply, flood control, and recreation. Sediment deposition on reservoir 
and lake beds reduces their capacity to serve these functions. An 
increase in sedimentation rate reduces the useful life of these waters 
unless measures are taken to reclaim their capacity. In waters serving 
as a drinking water source, elevated turbidity, suspended sediment, and 
other pollutants degrade water quality, and may require increased 
treatment levels.
    Sediment can also have negative effects on industrial activities. 
Suspended sediment increases the rate at which hydraulic equipment, 
pumps, and other equipment wear out, causing accelerated depreciation 
of capital equipment. Sediment can also clog water intakes at power 
plants and other industrial facilities and drinking water intakes.
    Elevated levels of sediment and other pollutants in irrigation 
water used for agriculture can harm crops and reduce agricultural 
productivity. Suspended sediment can form a crust over a field, 
reducing water absorption, inhibiting soil aeration, and preventing 
emergence of seedlings. Sediment can also coat plant leaves, inhibiting 
plant growth and reducing crop value and marketability. Other 
pollutants can damage soil quality.
    Sediment deposition in river channels, ditches, stormwater basins 
and culverts reduces their capacity and can increase flood levels and 
frequency, increasing the level of adjoining property damage from 
flooding. Sediment and turbidity can degrade surface water appearance, 
lowering property values near impacted surface waters and the 
desirability of surface waters for recreational activities such as 
boating, fishing, and swimming.
    Sediment and turbidity are the primary pollutants known to be 
associated with construction activity, but as stated earlier in this 
section, other pollutants such as nitrogen, phosphorus and metals are 
also discharged from construction sites. These pollutants can also harm 
aquatic ecosystems. Additional qualitative information on the 
environmental impacts associated with all pollutants from construction 
sites is provided in the Environmental Assessment. The remaining 
discussion in this section describes EPA's quantitative analysis of 
discharge levels and water quality impacts associated with sediment, 
nitrogen, and phosphorus from construction sites.

B. Quantification of Sediment Discharges Associated With Construction 
Activity

    EPA used a model project approach to estimate baseline sediment 
loads and to estimate loading reductions for the C&D industry under the 
regulatory options evaluated. EPA used RUSLE to estimate loads and load 
reductions at the RF1 scale. This approach consisted of the following 
steps:
     Developing a series of model projects of differing sizes, 
durations and types based on an analysis of NOI data;
     Determining RF1-level estimates for RUSLE and hydrologic 
parameters using national GIS data layers, supplemented with BPJ 
estimates of parameters for which data were not available;
     Estimating baseline and option-specific estimates of 
sediment loads for each RF1. For Option 1, estimates were developed 
based on changes in the RUSLE practice factors and cover factors from 
baseline. For Options 2, 3 and 4, estimates were developed using a 
concentration approach for acres subject to turbidity limitations, and 
the Option 1 approach for acres not subject to turbidity limitations; 
and
     Summing RF1 loads to the national level.
    For Options 2 and 3, EPA used a TSS value of 25 mg/L as an 
approximation of the level of sediment contained in discharges 
following ATS. For Option 4, EPA used a TSS value of 250 mg/L as an 
approximation of the level of sediment contained in discharges 
following the application of passive treatment. EPA calculated removals 
based on the change in concentration between baseline conditions and 
the respective level under the regulatory options. Under baseline 
conditions, modeled TSS concentrations for RF1s ranged from 
approximately 8 to 8,200 mg/L, with a median value of approximately 
1,550 mg/L. Estimated

[[Page 63044]]

sediment loading reductions for the options can be found in Table XIII-
1.

C. Quantification of Surface Water Quality Improvement From Reducing 
Discharges Associated With Construction and Development Activity

    This section describes the methodology EPA used to quantitatively 
assess national water quality impacts from construction activity 
sediment, nitrogen, and phosphorus discharges and the water quality 
benefits expected from today's rule. This analysis has been revised 
since the proposed rule in that it expands the quantitative analysis of 
the water quality benefits beyond sediment reductions to include 
reductions in nitrogen and phosphorus discharges from construction 
sites. Other pollutant discharges associated with construction activity 
(e.g., toxic organic compounds and metals) also create water quality 
impacts, but the information available to EPA on their discharge is 
insufficient to quantitatively analyze their impacts. These pollutants 
are instead discussed qualitatively in the Environmental Assessment 
document.
    The water quality impact analysis utilized estimates of sediment 
discharges from construction sites throughout the coterminous United 
States. EPA estimated discharges under current conditions as well as 
under the requirements set forth in today's rule.
    To estimate improvements to water quality from reducing 
construction site discharges, EPA used SPARROW models. SPARROW is a 
statistically-based modeling approach developed by the United States 
Geological Survey that relates surface water quality component levels 
to attributes of contributing watersheds. EPA used national versions of 
the models that allow quantification of water quality in the RF1 
surface water network which encompasses approximately 700,000 miles of 
the largest, perennial rivers and streams and associated lakes, 
reservoirs, and estuarine waters in the coterminous United States. The 
sediment, nitrogen, and phosphorus versions of SPARROW allowed EPA to 
estimate baseline concentrations of suspended sediment, nitrogen, and 
phosphorus, respectively, in these surface waters, as well as levels of 
sediment accumulation in reservoirs.
    Following estimation of baseline water quality conditions, EPA used 
the SPARROW sediment model to quantify the reductions in surface water 
suspended sediment concentrations and sediment accumulation in 
reservoirs associated with reducing sediment discharges from 
construction sites under today's rule. To quantify water quality 
improvements from reducing nitrogen and phosphorus discharges, EPA used 
results from the SPARROW sediment, nitrogen, and phosphorus models' 
estimation of baseline water quality conditions to estimate watershed-
level relationships between suspended sediment and nitrogen and 
phosphorus loading from land-related sources. EPA used these 
relationships to estimate the surface water reductions in nitrogen and 
phosphorus associated with surface water sediment reductions as 
estimated by the SPARROW sediment model for conditions under today's 
rule. Additional description of this analysis is provided in the 
Environmental Assessment.
    For certain estuarine waters, EPA also used the Dissolved 
Concentration Potential (DCP) approach developed by the National 
Oceanic and Atmospheric Administration (NOAA) to estimate suspended 
sediment concentrations. This model estimates ambient concentrations of 
conserved contaminants that are subject to mixing and dilution when 
introduced to estuaries. EPA used the DCP approach for those estuarine 
waters for which available data on flow was insufficient to estimate 
suspended sediment concentrations. NOAA has provided DCP factors for 
most major estuaries in the coterminous United States. These factors 
allow estimation of estuarine TSS concentrations without detailed 
numerical simulation modeling. Additional description of this analysis 
is provided in the Environmental Assessment.
    Construction activity in the United States is unevenly distributed 
among watersheds. It is highly concentrated in some areas and is sparse 
or absent in others. For this reason, EPA presents in this discussion 
the results of its water quality analysis for two different sets of 
watersheds. The first set includes all RF1 watersheds containing more 
than 1 acre of annual construction activity, or 93% of all construction 
acres. This set contains all RF1 watersheds for which EPA estimated 
reductions in construction site sediment discharges and encompasses 
approximately 412,000 RF1 surface water miles (``All''). The second set 
contains the 10 percent of RF1 watersheds in ``All'' with the highest 
number of construction acres (``Top 10%''). This set encompasses 58 
percent of all construction activity and therefore reflects conditions 
associated with the majority of construction activity in the 
coterminous United States. This set encompasses approximately 64,000 
RF1 surface water network miles.
    EPA estimates that construction sites in ``All'' RF1 watersheds 
discharge approximately 5.2 billion pounds of sediment per year under 
current conditions. Construction discharges elevate suspended sediment, 
nitrogen, and phosphorus levels, on average, 2.4 mg/L, 0.02 mg/L, and 
0.0060 mg/L, respectively, beyond what they would otherwise be in 
412,000 RFI surface water miles. They also cause deposition of 1.7 
million cubic yards of sediment in reservoirs each year.
    The rule will reduce construction site sediment discharges from 
``All'' RF1 watersheds by approximately 4 billion pounds per year. TSS, 
nitrogen, and phosphorus concentrations in affected surface waters are 
expected to decrease approximately 2 mg/L, 0.015 mg/L, and 0.0058 mg/L 
respectively, on average. Sediment deposition in reservoirs is expected 
to fall by more than 1.3 million cubic yards annually. In the ``Top 
10%'' set of watersheds, TSS, nitrogen, and phosphorus levels are 
expected to decrease approximately 4 mg/L, 0.049 mg/L, and 0.024 mg/L 
respectively, on average. Average TSS, nitrogen, and phosphorus 
concentration reductions are greater for ``Top 10%'' watersheds because 
construction sites exert a stronger influence on water quality in these 
areas. Current median concentrations of TSS, nitrogen, and phosphorus 
in RF1 reaches receiving construction site discharges are 289 mg/L, 
1.65 mg/L, and 0.25 mg/L, respectively.
    Because surface waters transport pollutants downstream, water 
quality will also improve in additional reaches downstream of those 
reaches directly receiving construction site pollutants. EPA's analysis 
indicates that today's rule will improve water quality in more than 
431,000 miles of surface waters, or approximately 69% of the more than 
627,000 miles in the RF1 surface water network for the coterminous 
United States assessed in EPA's analysis.
    The numbers above reflect average surface water conditions over 
very large geographic areas and long time scales. They do not convey 
the spatial and temporal variability in pollutant concentrations seen 
in actual surface waters. Construction sites are dispersed throughout 
the United States, but they comprise only approximately 0.04% of total 
land area in the coterminous United States on an annual basis. In 
addition, as described earlier in this section, construction acreage 
concentrates in a relatively small number of watersheds. It is notable 
that, despite their small land area, construction sites impact a large 
proportion of the nation's surface

[[Page 63045]]

waters. Temporally, most construction site discharges are driven by 
precipitation events and are therefore highly episodic. In-stream 
turbidity, TSS, nitrogen, phosphorus and other pollutant concentrations 
in surface waters deriving from construction site discharges are 
typically higher during and shortly after precipitation events and 
lower during periods in between precipitation events. For these 
reasons, the most highly visible impacts from construction sites are 
observed in surface waters immediately downstream of construction sites 
during and immediately following precipitation events. During these 
periods, suspended sediment levels can rise from several to hundreds of 
milligrams per liter above those observed immediately upstream of 
construction sites. Likewise, turbidity levels can rise from tens to 
hundreds of NTUs. With the cessation of precipitation and movement and 
dilution of pollutants as water flows downstream, suspended pollutant 
concentrations decline (deposited sediment and associated pollutants, 
however, can persist). EPA's quantification of water quality impacts 
from construction site discharges reflects an averaging of these 
discharge events both over time and over the 412,000 miles of surface 
waters directly impacted by construction site discharges in today's 
rule.
    EPA did not attempt to quantify pollutant discharges from other 
construction site sources, such as discharges from dewatering 
activities, vehicle and equipment washing, and erosion and deposition 
by wind. Since these discharges may occur at any time during the 
construction project and are not necessarily tied to storm events, EPA 
expects that these discharges would influence receiving water quality 
during inter-event periods and that benefits would accrue if these 
discharges were reduced from baseline levels. EPA, however, lacked data 
and an appropriate methodology for quantifying the nature and extent of 
these potential discharges.
    Estimates from EPA's national quantitative analysis of water 
quality impacts were used for a quantitative analysis of the economic 
benefits of today's rule. This analysis is discussed in Section XVI.

XVI. Benefit Analysis

    EPA has assessed the potential benefits associated with the final 
rule by identifying various types of benefits that can result from 
reducing the level of turbidity, sediment and other pollutants being 
discharged from construction sites. Where possible, EPA has attempted 
to quantify and monetize benefits attributable to the regulatory 
options. Section III of the Environmental Impact and Benefits 
Assessment, describes in more detail the analytical framework for the 
benefits analysis.

A. Benefits Categories Estimated

    Discharges of turbidity, sediment, nutrients, and other pollutants 
from construction activity can have a wide range of effects on down 
stream water resources. As discussed in Section XV, there are numerous 
potential impacts to local aquatic environments, but there are also 
consequences for human welfare, which are discussed here. Human 
activities and uses affected by construction discharge-related 
environmental changes include recreation, commercial fishing, public 
and private property values, navigation, and water supply and use. 
Sediments, nutrients, and other pollutants in discharges from C&D sites 
can also cause environmental changes that affect the non-use values 
(values that do not depend on use of the resource) that individuals 
have from knowing that environmental resources are in good condition. 
These existence services, sometimes described as ``ecological 
benefits,'' are reflected under the Clean Water Act as aquatic life, 
wildlife, and habitat designated uses.
    Stormwater control measures reduce the amount of sediment that 
reaches waterways from C&D sites. As sediment loads are reduced, TSS, 
nutrient, and turbidity levels in adjacent waters decline, which in 
turn increases the production of environmental services that people and 
industry value. These environmental services valued by industry and the 
public include: Recreation, public and private property ownership, 
navigation, water supply and use, and existence services. Table XVI-1 
provides a summary of various water related activities and their 
associated environmental services potentially impacted by discharges of 
sediment from C&D sites.

             Table XVI-1--Summary of Benefits From Reducing Sediment Runoff From Construction Sites
----------------------------------------------------------------------------------------------------------------
                                          Environmental service
                                         potentially affected by
              Activity                  runoff from construction                  Benefits category
                                                  sites
----------------------------------------------------------------------------------------------------------------
Recreation:                           Aesthetics, water clarity,    Non-market direct use.
--Outings                              water safety, degree of
--Boating                              sedimentation, weed growth,
--Swimming                             fish and shellfish
--Fishing                              populations.
Commercial Fishing and Shellfishing.  Fish and shellfish            Markets.
                                       populations.
Property Ownership..................  Aesthetics, safety of         Markets.
                                       property from flooding,
                                       property value.
Water Conveyance and Supply:          Turbidity, degree of          Avoided Costs.
--Water conveyance                     sedimentation.
--Water storage
--Water treatment
Transportation......................  Degree of sedimentation.....  Avoided Costs.
Water Use:                            Turbidity...................  Avoided Costs.
--Industrial
--Municipal
--Agricultural
Knowledge (No Direct Uses)..........  Environmental health and      Non-market non-use value.
                                       ecosystem function.
----------------------------------------------------------------------------------------------------------------

    However, not all of the changes in these services can be readily 
quantified as it requires a thorough understanding of the relationship 
between changes in water pollutant loads and production of 
environmental services. This problem is exacerbated by the fact that 
both the pollutant source and load reductions are relatively small, 
sporadic, numerous,

[[Page 63046]]

and dispersed over a wide area when compared to more traditional 
sources of pollutants, such as a wastewater treatment plant. As a 
result of the difficulty in assessing changes in each environmental 
service associated with an activity listed in Table XVI-1, EPA chose to 
focus on two main categories of benefits: Avoided costs and non-market 
benefits. The specific categories of avoided costs considered were: 
reservoir dredging, navigable waterway dredging, and drinking water 
treatment and sludge disposal. Non-market benefits considered were 
improvements in recreational activities and existence value from 
improvements in the health of aquatic environments.

B. Quantification of Benefits

    Reduced costs for water treatment, water storage, and navigational 
dredging are three benefit categories that EPA is using to estimate the 
benefits of the final rule. EPA used estimates of changes in sediment 
deposition and in-stream TSS concentrations from the SPARROW model runs 
to quantify the reduction in the amount of sediment that would need to 
be dredged from reservoirs and the reduction in the amount of TSS that 
must be removed from the source water used for the production of 
potable water. The SPARROW results provided these changes for each 
waterbody in the RF1 network (approximately 60,000 stream segments). 
This allowed EPA to associate these changes with data from the US Army 
Corps of Engineers on navigable waterways that are routinely dredged; 
EPA data on source water for drinking water treatment plants; and USGS 
data on the location of reservoirs used for hydroelectric power, flood 
control, a source for drinking water, and recreation.
    SPARROW results also allowed for the estimated change in TSS and 
nutrient concentrations in the RF1 network to be mapped to a Water 
Quality Index (WQI). The index is used to map changes in pollutant 
parameters, such as TSS and nutrients, to effects on human uses and 
support for aquatic and terrestrial species habitat. Implementation of 
the WQI involves the transformation of parameter measurements into 
subindex values that express water quality conditions on a common scale 
of 0 to 100. For the pollutant TSS, a unique subindex curve was 
developed for each of the 85 Level III ecoregions using baseline TSS 
concentrations calculated in SPARROW at the RF1 reach-level. The 
SPARROW generated concentration change estimates for sediment and 
sediment-bound nutrients were used to measure improvement along the WQI 
for each RF1 watershed. Section 10.1.1 of the Environmental Assessment 
Document provides detail on the WQI index and its application to the 
benefits analysis for the C&D regulation. The WQI presents water 
quality by linking to suitability for various human uses, but does not 
in itself identify associated changes in human behavior. Behavioral 
changes and associated welfare effects are implied in the benefit 
transfer approach for measuring economic values. The use of benefit 
transfer allows the results from economic valuation studies in the 
published literature to be used to generate WTP estimates associated 
with changes in the WQI. For more on the benefit transfer approach see 
Appendix G Meta-Analysis Results from the Environmental Impact and 
Benefits Assessment.
    The benefits analysis results are shown in Table XVI-2. The 
NMBi terms are included to demonstrate that the monetized 
benefits represent an unknown portion of total benefits of the rule, 
and are likely to vary with the options.

                            Table XVI-2--Annual Benefits (Million 2008 $) For Options
----------------------------------------------------------------------------------------------------------------
                                                                        Regulatory Options
                                                 ---------------------------------------------------------------
                                                     Option 1        Option 2        Option 3        Option 4
----------------------------------------------------------------------------------------------------------------
Avoided Costs:
    Reservoir Dredging..........................            $1.4            $2.9            $3.6            $3.2
    Navigable Waterway Dredging.................             1.3             2.6             3.3             2.9
    Drinking Water Treatment....................             1.2             1.8             2.1             1.8
Total Avoided Costs \a\.........................             3.8             7.2             8.9             7.9
Welfare Improvements............................           210.3           352.9           413.4           361.0
Total Annual Benefits \a\ \b\...................      214.1+NMB1      360.1+NMB2      422.3+NMB3      368.9+NMB4
----------------------------------------------------------------------------------------------------------------
\a\ Totals may not add due to rounding.
\b\ NMBi are the non-monetized benefits of the ith Option.
Source: Economic Analysis; Environmental Assessment.

XVII. Benefit-Cost Comparison

    EPA has conducted a comparison of monetized benefits to costs of 
the C&D effluent guidelines detailed in today's notice. The benefit-
cost analysis may be found in the complete set of support documents. 
Sections XII, XV, and XVI of this notice provide additional details of 
the benefit-cost analysis. Table XVII-1 provides the results of the 
benefit-cost analysis. A discount rate of 3% was used to annualize 
costs and benefits.

 Table XVII-1--Total Annualized Benefits and Costs of Options (Year 2008
                                   $)
------------------------------------------------------------------------
                                  Social costs
                                    (2008  $      Benefits \a\ (2008  $
             Option               millions  per    millions  per year)
                                      year)
------------------------------------------------------------------------
Option 1.......................          $175.8  $214.1 + NMB1
Option 2.......................         4,863.1  $360.1 + NMB2
Option 3.......................         9,081.1  $422.3 + NMB3
Option 4.......................           958.7  $368.9 + NMB4
------------------------------------------------------------------------
\a\ NMBi are the non-monetized benefits of the ith Option.
Source: Economic Analysis; Environmental Assessment.

XVIII. Approach To Determining Effluent Limitations and Standards

    The same basic procedures apply to the calculation of all effluent 
limitations guidelines and standards for this industry, regardless of 
whether the technology basis is BAT or NSPS. For simplicity, the 
following discussion refers only to effluent limitations guidelines; 
however, the discussion also applies to new source performance 
standards. The numeric limitation is 280 NTU, expressed as a maximum 
daily discharge limitation. Chapter 6 of the TDD provides a detailed 
description of the data and methodology used to develop the long-term 
average,

[[Page 63047]]

variability factor, and limitation and standard for today's final rule.

A. Definitions

    The limitation for turbidity, as presented in today's notice, is 
expressed as a maximum daily discharge limitation. Definitions provided 
in 40 CFR 122.2 state that the ``maximum daily discharge limitation'' 
is the ``highest allowable `daily discharge.' '' Daily discharge is 
defined as the `` `discharge of a pollutant' measured during a calendar 
day or any 24-hour period that reasonably represents the calendar day 
for purposes of sampling.''

B. Percentile Basis for Limitations, Not Compliance

    EPA promulgates limitations that sites are capable of complying 
with at all times by properly operating and maintaining their processes 
and treatment technologies. EPA established these limitations on the 
basis of percentiles estimated using data from sites with well-operated 
and controlled processes and treatment systems. However, because EPA 
uses a percentile basis, the issue of exceedances (i.e., values that 
exceed the limitations) or excursions is often raised in public 
comments on limitations. For example, comments often suggest that EPA 
include a provision that allows a facility to be considered in 
compliance with permit limitations if its discharge exceeds the 
specified daily average limitation one day out of 100. As explained in 
Section 6 of the TDD, the limitation was never intended to have the 
rigid probabilistic interpretation implied by such comments. The 
following discussion provides a brief overview of EPA's position on 
this issue.
    EPA expects that all sites subject to the limitation will design 
and operate their treatment systems to achieve the long-term average 
performance level on a consistent basis because sites using well-
designed and operated treatment systems have demonstrated that this can 
be done. Sites that are designed and operated to achieve the long-term 
average effluent levels used in developing the limitation should be 
capable of compliance with the limitation at all times, because the 
limitation incorporates an allowance for variability in effluent levels 
about the long-term average. The allowance for variability is based on 
control of treatment variability demonstrated in normal operations.
    EPA recognizes that, as a result of the requirements in 40 CFR part 
450, some dischargers may need to improve treatment systems, process 
controls, and/or treatment system operations in order to consistently 
meet the new effluent limitation and/or standard. As noted previously, 
however, given the fact that the promulgated limitation reflects an 
allowance for variability and the demonstrated ability of sites to 
achieve the LTA, the limitation is achievable.

XIX. Regulatory Implementation

A. Monitoring Requirements

    EPA is requiring the monitoring of turbidity in stormwater 
discharges from C&D sites subject to the numeric limitation in order to 
determine whether the numeric limitation is being met. The NRC report 
highlighted that one of the weakest areas of the stormwater program is 
the lack of monitoring. NRC at 329. Until today, EPA has not required 
any monitoring requirements beyond visual inspections for discharges 
associated with construction activity, although some NPDES-authorized 
states (e.g., California, Georgia, Oregon, Vermont, and Washington) 
have imposed monitoring requirements on construction operators in their 
permits. See relevant state permit requirements in the rulemaking 
record (DCNs 42104, 42108-42111). Now that EPA is adopting a numeric 
effluent limitation for turbidity for certain construction sites, 
permits authorizing discharges associated with construction activity 
from those sites are required to include monitoring requirements in 
NPDES permits for discharges associated with construction activity. 
Pursuant to the NPDES regulations, the permit must specify the type, 
interval, and frequency of sampling ``sufficient to yield data which 
are representative of the monitored activity'' and must require 
monitoring for specific pollutants that are limited in the permit. 40 
CFR 122.48(b); see also 122.44(j)(1)(i). While the final rule does not 
enumerate the specific requirements (i.e., frequency, location, etc.) 
regarding the monitoring of turbidity in discharges from construction 
sites EPA emphasizes that compliance monitoring is required of 
permittees and that pursuant to EPA's NPDES regulations permitting 
authorities must specify requirements and procedures in their NPDES 
permits for representative sampling to ensure effective monitoring.
    While monitoring is routine in industrial discharge permits, EPA 
acknowledges that for most permitting authorities, including EPA, the 
inclusion of monitoring requirements in individual or general 
construction permits is new. EPA also recognizes that while it is 
appropriate to provide sufficient flexibility for permitting 
authorities to design monitoring protocols that are appropriate for 
their specific permits, given the particular circumstances in their 
jurisdiction, it will be important for EPA to provide additional 
guidance on monitoring of stormwater discharges from construction sites 
so that permitting authorities have a general sense of how to structure 
requirements that are consistent with today's rule. For that reason, 
EPA intends to provide monitoring guidance prior to the issuance of the 
next EPA CGP to provide a technical resource guide to permit writers in 
establishing monitoring requirements in their construction permits.
    The following is a discussion of a number of significant issues 
implicated by the numeric turbidity limitation and the requirement to 
monitor discharges from certain construction activities:
    Applicability of Numeric Turbidity Limitation and Monitoring 
Requirements: The turbidity limitation and monitoring requirements 
apply to construction activities that disturb 10 or more acres of total 
land area at one time. The 10-acre disturbance threshold includes non-
contiguous land disturbances that take place at the same time and are 
part of a larger common plan of development or sale. Smaller 
construction activities occurring at the same time, but in separate and 
distinct areas of a project site, which together disturb 10 or more 
acres of land, are also required to meet the sampling requirements. 
This clarification is consistent with EPA's NPDES stormwater 
regulations, which require permits for smaller scale disturbances that 
are part of a common plan of development or sale. See definition of 
large and small construction activities at 40 CFR 122.26(b)(14)(x) and 
(15), respectively.
    The numeric limitation and monitoring requirements only apply when 
the total disturbed area is 10 or more acres. Therefore, when 
stabilization of disturbed areas reduces the amount of total 
disturbances to less than 10 acres, the numeric limitation no longer 
applies and monitoring of discharges is no longer required. This 
provision creates an incentive for large sites to stabilize disturbed 
areas as quickly as possible, thereby reducing the turbidity in 
stormwater discharges from the site. This is also an incentive to phase 
construction activities so that less than 10 acres are disturbed at any 
one time. EPA recognizes that as construction activity progresses, less 
area of the construction site will consist of disturbed land. At 
present under the

[[Page 63048]]

EPA CGP, the Agency regulates stormwater discharges associated with 
construction activity until the owners or operators file a Notice of 
Termination to cease permit coverage. Often owners or operators must 
stabilize the construction site before a Notice of Termination is 
submitted to terminate permit coverage. Therefore, EPA is applying the 
numeric limitation to sites that disturb 10 or more acres at one time 
until such time as the site has stabilized disturbed areas bringing the 
total disturbance below 10 acres, recognizing that discharges may 
continue after this time. The non-numeric effluent limitations, at 40 
CFR 450.21, of this rule would still apply to any continuing 
discharges. With this threshold, EPA expects that the turbidity 
limitation may not apply at some sites during some periods of 
construction activity when less than 10 acres are disturbed at one 
time. EPA has made this determination for various reasons (see section 
X.G) while still controlling the discharge of pollutants from C&D sites 
during the majority of land disturbing activities.
    EPA emphasizes that the applicability of the turbidity limitation 
is tied to acres disturbed at one time, not to the ultimate amount of 
land disturbance on a site. Thus, the applicability of the numeric 
effluent limitation and monitoring based on a size threshold of 
disturbed land differs from the applicability provisions of the NPDES 
regulations at 40 CFR 122.26(b)(14) and (15) that determine whether 
discharges associated with construction activity need NPDES permit 
coverage. Under the 40 CFR 122.26 permit coverage is required for any 
site that will result in land disturbance of equal to or greater than 
one acre or will result in disturbance of less than one acre of total 
land area that is part of a larger common plan of development or sale 
if the larger common plan will ultimately disturb equal to or greater 
than one acre. For example, a construction site that ultimately 
disturbs over 1 acre at any point during the construction activity must 
obtain NPDES permit coverage, even if at all points during construction 
activity the total disturbed land area at one time is less than 1 acre. 
However, for purposes of the applicability of the numeric effluent 
limitation and monitoring requirement in the final rule a construction 
site could ultimately disturb 10 or more acres, but as long as that 
site does not disturb 10 or more acres at one time, monitoring and 
compliance with the turbidity limitation would not be required.
    An example may help to illustrate how EPA will implement the 10-
acre threshold trigger for requiring sampling.
    Examples of when individual disturbances of less than 10 acres are 
required to sample:
     If construction activities as part of a large residential 
subdivision that disturb 5 acres of land in one lot, and, at the same 
time, 5 acres of land in another lot, and the two lots are not adjacent 
to one another, samples of the discharges from these sites would be 
required pursuant to 40 CFR 450.22(a). Sampling is required under this 
scenario because together the two land disturbances measure 10 or more 
acres, and they are considered part of the same common plan of 
development or sale. However, no discharge sampling would be required 
if the two construction projects under this same scenario disturb less 
than 10 acres of land total at the same time.
     Alternatively, if one of the 5-acre projects occurs at a 
different time than the other, such that at no time are 10 or more 
acres being disturbed at the same time, then sampling is not required 
for these activities. In the same way, if one of the 5-acre projects 
has achieved final stabilization in accordance with 40 CFR 450.21(b) by 
the time the other 5-acre project commences, then no sampling is 
required because the combined acreage of ground disturbance at one time 
is less than 10 acres.
    Daily Maximum Limitation: EPA's numeric effluent limitation is a 
daily maximum limitation; meaning that permittees may sample the 
turbidity in their discharges multiple times over the course of a day 
and the average of all measurements may not exceed the limitation. 
During any given day, samples may be averaged to determine the average 
turbidity for the day. It is this average daily value that must be 
below the limitation specified in the rule. If one or more individual 
samples are above the limitation, but the average turbidity for the day 
is below the limitation, then discharges for that day are deemed to be 
in compliance with the limitation. This takes into consideration the 
variability of the discharge and allows higher levels of turbidity to 
be discharged temporarily, such as may occur during an intense period 
of rainfall. As explained previously, if a site has difficulty 
complying with the limitation on an ongoing basis, then the site should 
improve its controls, operations, and/or maintenance.
    If the permitting authority samples the discharge, those samples 
may be averaged with the measurements taken by the permittee for the 
same discharge event. For example, if the permittee takes three samples 
and the permitting authority takes one sample, then these four samples 
may be averaged to determine the daily value. As another example, if 
the permitting authority takes a sample or samples, but the discharger 
did not sample, then the permitting authority can use its sample or 
samples for determining compliance.
    Sampling Frequency: EPA is leaving the specific monitoring 
requirements to the discretion of each permitting authority, including 
such issues as the sampling frequency during any one discharge event 
and the number of discharge events that must be sampled. EPA would, 
however, discourage the practice of allowing the number of monitoring 
samples to vary arbitrarily merely to allow a site to achieve a desired 
average concentration, i.e., a value below the limitation that day. 
Additionally, as discussed above, EPA's NPDES regulations state that 
the permit must specify the type, interval, and frequency of sampling 
sufficient to yield data which are representative of the monitored 
activity. EPA expects that enforcement authorities would prefer, or 
even require, monitoring samples at some regular, pre-determined 
frequency. In general, EPA expects that, at a minimum, three samples 
per day will need to be collected at each discharge point while a 
discharge is occurring. In reviewing its data used as a basis for the 
limitation, EPA notes that 95 percent of daily values are based upon 
three or more samples per day which demonstrates the need for multiple 
samples. The recently-issued California Construction General Permit 
offers one method of ensuring that at least three samples are collected 
from the discharge event by requiring that turbidity samples be 
collected three times per day for the duration of the discharge event. 
See State Water Resources Control Board NPDES General Permit for Storm 
Water Discharges Associated with Construction Activities, Attachment E, 
p. 12. Permitting authorities may require more frequent monitoring than 
three samples per day in order to obtain representative sampling, and 
permittees may elect to perform more frequent monitoring. For example, 
the permit could specify that sampling must begin within one hour of 
the start of the discharge, and must continue until the discharge ends 
or until the end of the working day. The permit could also include 
exceptions to the minimum sampling frequency for circumstances such as 
adverse weather conditions (such as high winds or lightning) or intense 
rainfall, which would cause a reasonable person to believe that the 
safety of the sample collection personnel would be in jeopardy. In such

[[Page 63049]]

instances, the permit might specify that sampling be conducted as soon 
as it is deemed safe by the sampling personnel. If, at the start of the 
next working day, there continues to be a discharge, then sampling 
should resume until the discharge ends or until the end of the working 
day.
    NPDES permitting authorities will also need to determine the 
minimum number of discharge events during which monitoring is required. 
It is EPA's general view that any storm event or snowmelt that 
generates a discharge from the construction site should be monitored 
since this is the surest way to determine the effectiveness of the 
site's passive controls during all phases of active construction.
    Testing Methodology: The permitting authority must specify in NPDES 
permits the requirements concerning the proper use, maintenance, and 
installation, when appropriate, of monitoring equipment or methods 
used. 40 CFR 122.48(a). Thus, permittees may elect to use automated 
samplers and/or turbidity meters with data loggers, if approved by the 
permitting authority. Each sample must be analyzed for turbidity using 
methods approved by the permitting authority, but EPA expects that the 
use of a properly calibrated field turbidimeter is sufficient. EPA is 
also leaving up to the permitting authority the applicable reporting 
requirements on the permitees sampling of their discharges from C&D 
sites.
    Monitoring from Linear Construction Activities: EPA believes that 
the permitting authority should exercise discretion when determining 
the monitoring locations and monitoring frequency for linear 
construction projects. For instance, the permitting authority might 
choose, for example, to utilize representative sampling at certain 
discharge locations that are representative of the discharge 
characteristics of other locations. EPA views the use of representative 
sampling points as being acceptable for linear projects due to the 
potential unique nature of these projects. Because of the size of 
linear projects, there may be dozens or more discharge points spaced 
over a large geographic area. In addition, accessing certain areas of 
the project during a storm event (such as areas that have recently been 
stabilized) may not be possible without significant disruption of the 
stabilization measures in place (such as might occur if it would be 
necessary to drive a vehicle over an area that has been recently 
stabilized in order to access the discharge point). EPA would generally 
recommend that permitting authorities concentrate on those areas of 
linear projects that are actively being constructed and not concentrate 
on areas that have been completed and stabilized. An example, for a 
project such as a pipeline or underground utilities, would be those 
areas where trenching activities are occurring.
    Exception for Larger Storm Events: The numeric limitation applies 
to all discharges from the site except on days when total precipitation 
during that day exceeds the local 2-year, 24-hour storm event. Even 
when total precipitation during the day exceeds the local 2-year, 24-
hour storm permittees must comply with the non-numeric effluent 
limitations Sec.  450.22(c) through Sec.  450.22(h). If the total 
precipitation on a day exceeds this amount, then the turbidity 
limitation would not apply to discharges for that day. However, the 
numeric effluent limitation is applicable to all discharges from the 
site on subsequent days if there is no local 2-year, 24-hour storm 
event during those days. Although the limitation would not apply on 
days with precipitation greater than the 2-year, 24-hour event, 
permittees would still be expected to monitor discharges during that 
day. Permitting authorities may extend the standard to larger or less 
frequent storm events if it is determined that the 2-year, 24-hour 
storm is not adequate for a particular project or larger geographic 
area. Controls would then need to be designed to handle these less 
frequent storm events and the corresponding larger volumes of 
stormwater.
    Although the numeric limitation would not apply on days where 
precipitation exceeds the 2-year, 24-hour event, permittees must still 
complywith the non-numeric effluent limitations Sec.  450.22(c) through 
Sec.  450.22(h). Also, permittees would still be required to manage the 
discharges from the site, and if passive treatment techniques are being 
utilized, permittees would still be expected to utilize those 
techniques. So for example, if a polymer dosing system is being 
utilized, permittees would be expected to continue dosing polymer and 
to continue managing the stormwater after the point at which the 2-
year, 24-hour storm precipitation amount was exceeded. The limited 
short-term exemption from the numeric effluent limitation is not an 
exemption from the requirement to manage discharges. In addition, it 
would be inappropriate for permittees to intentionally discharge large 
volumes of stormwater on these days, or to bypass treatment in addition 
to likely not being in compliance with the non-numeric effluent 
limitations in 40 CFR 450.21 and thus their NPDES permit. If a basin is 
being utilized, it is expected that the primary outlet would be 
utilized for the discharge (unless overflow occurs). Intentionally 
bypassing the primary outlet would be inconsistent with the non-numeric 
effluent limitations of the rule.
    EPA selected the 2-year, 24-hour storm event as the limiting event 
for determining compliance in recognition of the fact that passive 
controls can only be expected to consistently meet a numeric limitation 
to the level that they are designed to function. Typically, 
construction site controls are designed to manage stormwater up to a 
certain design storm event. For larger storm events, basins will likely 
overflow. Likewise, channels and conveyances will overtop and may begin 
to erode unless they are armored with materials such as flexible 
channel liners. EPA considered basing compliance on a 1-year storm, a 
2-year storm and a 5-year storm. A 1-year storm has a 100% chance of 
occurring in any given 12 month period, a 2-year storm has a 50% chance 
of occurring in any 12 month period and a 5-year storm has a 20% chance 
of occurring in any 12 month period. To EPA's knowledge, designing for 
a 5-year storm is not common practice on construction sites, with the 
exception of emergency spillways on basins. However, many states 
require that basins and other controls be designed to manage a 2-year 
storm. Given that designing controls to manage runoff from a 2-year 24-
hour storm provides a reasonable compromise between designing for a 
larger storm (at more expense) and allowing multiple discharges per 
year to potentially exceed the limitation (as would be the case with a 
smaller storm) EPA selected the 2-year storm as the maximum compliance 
storm event.
    Monitoring Locations: The numeric limitation applies to all 
discharges from C&D sites. However, diffuse stormwater, such as non-
channelized flow through a silt fence or other perimeter control that 
infiltrates into a vegetated area, and does not then discharge to 
surface waters, would not generally require sampling. EPA is 
encouraging (although not requiring) permittees to utilize dispersion 
of stormwater to vegetated areas and infiltration of stormwater instead 
of discharging it from the site. EPA encourages increased usage of such 
techniques, where appropriate. This is consistent with the concept of 
Low Impact Development (LID) techniques as well as the zero discharge 
goal of the Clean Water Act. Some projects present unique monitoring 
challenges, such as projects that are adjacent to or actually within 
waterbodies. Examples include

[[Page 63050]]

locks, dams, piers, and stream stabilization activities. For these 
types of projects, permitting authorities may need to exercise 
discretion when considering appropriate monitoring locations for 
discharges.
    Sampling Times: Although EPA has left the issue of when sampling is 
required during any given discharge event to the discretion of the 
permitting authority, it is EPA's general view that sampling should be 
conducted, at a minimum, during normal business hours at a project. 
This can generally be considered to be between the hours of 6 a.m. and 
6 p.m., or when workers are normally present on the construction site. 
The exception would be if unsafe conditions, such as heavy rain or 
lightning, would cause a reasonable person to determine that sampling 
would be dangerous.
    Notification to Permitting Authorities: Although not a requirement 
in today's rule, permitting authorities may want to consider 
requirements in their permits and consider mechanisms by which 
permittees would notify the permitting authority when they have 
exceeded the 10 acre disturbed land threshold and monitoring would be 
required at a particular project.

B. Implementation

    While pursuant to the CRA this entire rule is effective February 1, 
2010 the numeric effluent limitation and the associated monitoring 
requirements for sites with 20 or more acres of land disturbed at one 
time will become applicable to discharges associated with construction 
activity 18 months following the effective date of this final rule on 
August 2, 2010. The numeric effluent limitation and the associated 
monitoring requirements for sites with 10 or more acres of land 
disturbed at one time will become applicable to discharges associated 
with construction activity four years following the effective date of 
this final rule on February 2, 2014. The non-numeric effluent 
limitations in Option 4 will become applicable when the rule is 
effective or 60 days after the final rule is published in the Federal 
Register on February 1, 2010.
    Once EPA has promulgated effluent limitations and standards under 
CWA sections 301 and 306, and those limitations and standards become 
effective, the permitting authority must incorporate those limitations 
into NPDES permits as effluent limitations. 40 CFR 122.43-44. For 
discharges associated with construction activity, once the ELGs and 
NSPSs become effective the permitting authority must include permit 
limitations at least as stringent as those promulgated in this 
regulation in any individual NPDES permits or in the next construction 
general permit issued after the effective date of this regulation. EPA 
anticipates that the permitting authorities, particularly those whose 
construction general permits will expire within the next 18 months, 
would like time to develop guidance on the new requirements given the 
change in focus from past construction permits of non-numeric effluent 
limitations and BMPs to numeric limitations and monitoring 
requirements. EPA is aware of at least 10 states whose construction 
general permits are scheduled to expire within the first 18 months 
after the effective date of this final rule, in addition to the 4 
states and other jurisdictions who are permitted by the EPA CGP, 
proposed to expire on June 30, 2011. In order to provide permitting 
authorities time to develop guidance on the requirements of this rule, 
including monitoring requirements, EPA is providing a 18 month lead 
time for the permitting authorities between the effective date of this 
final rule and when the numeric limitation and monitoring requirements 
are applicable to stormwater discharges associated with construction 
activity. The C&D ELG, including the numeric limitations and monitoring 
requirements, will be effective February 1, 2010, even though the 
numeric limit will not be applicable to discharges for 18 months from 
the effective date of this rule for sites with 20 or more acres of land 
disturbed at one time and four years after the effective date for sites 
with 10 or more acres of land disturbed at one time. Thus, the 
permitting authorities whose construction general permits will expire 
after the effective date of the C&D ELG must still incorporate the 
numeric limitation and monitoring requirements into their newly issued 
CGPs even though it will not be applicable until 18 months from the 
effective date for sites with 20 or more acres of land disturbed at one 
time and four years after the effective date for sites with 10 or more 
acres of land disturbed at one time. After the effective date of this 
rule, permitting authorities must incorporate the requirements into 
newly issued permits. Without an 18 month lead time in the 
applicability of the numeric limitation and monitoring requirements 
permitting authorities and the permittees in those states would have, 
what EPA believes, an unreasonably short time period to digest these 
new requirements and plan accordingly. While it is impossible to 
determine exactly how much time is necessary for permitting authorities 
and permittees, EPA weighed the need to provide enough time, for the 
reasons stated below, against the desire to apply these important 
numeric limitations and monitoring requirements in a timely manner in 
order to achieve important reductions in pollutant discharges from C&D 
sites and determined that 18 months for sites with 20 or more acres of 
land disturbed at one time and four years for sites with 10 or more 
acres of land disturbed at one time are reasonable periods of time.
    In this rule EPA has determined that passive treatment technologies 
and a numeric effluent limitation with monitoring requirements is BAT 
and NSPS. As discussed above, it is clear that passive technologies are 
technologically available, as they are used widely throughout the U.S., 
however before this rule there were no nationwide numeric limitations 
or monitoring requirements connected with the construction industry, 
and particularly with the use of passive treatment technology at C&D 
sites. Monitoring requirements are a critical part of any numeric 
limitation. Given the sea change to the regulated industry there may be 
implementation issues associated with incorporation of monitoring 
requirements into permits, for example, permitting authorities may 
specify the frequency of monitoring; the location of monitoring; The 
duration of monitoring in relation to storm events; the samples that 
will be representative of the flow and characteristics of the 
discharges from the C&D site; whether it will approve the use of 
automated samplers and/or turbidity meters with data loggers; and 
establish procedures for analyzing the sample for turbidity and 
appropriate quality assurance/quality control procedures. The 18 month 
period will also allow permitting authorities to develop any necessary 
training or certification programs. An important factor in the 
effective implementation and compliance with this rule will be the 
permitting authority being able to digest the numeric limitation and 
monitoring requirements and developing guidance and outreach to the 
regulated community to provide assistance so the requirements are 
understood and can be effectively met by owners and operators of C&D 
sites. This will provide the regulated industry with the guidance, 
knowledge and tools necessary in order to effectively monitor their 
discharges in order to ensure they are meeting the numeric limitation.
    In addition to the reasons stated above regarding the permitting 
authority having the time to develop guidance to assist C&D site 
operators, for this industry, it is necessary to allow it a

[[Page 63051]]

period of time to become accustomed to monitoring discharges and 
understand how different passive approaches impact the level of 
turbidity in their stormwater discharges. Allowing a phase-in of the 
monitoring requirements and turbidity limitation will allow the 
industry time to adjust their controls to determine what the most 
effective passive technology or combination of technologies are to 
reduce levels of turbidity, and to train personnel on any new 
techniques or technologies implemented at the site, how to sample and 
analyze stormwater discharges, and how to correctly apply polymers or 
treatment chemicals, if necessary, without causing environmental harm. 
As noted previously, the monitoring requirements are a critical part of 
the numeric limitation developed as BAT and NSPS and the establishment 
of a numeric limitation and monitoring requirements for discharges 
associated with the construction industry represents a sea change for 
the industry and permitting authorities. This change is in line with 
the technology forcing nature of the CWA; however, it may require 
significant time and resources for many construction firms to adapt 
their operations in light of the new stormwater control measures.
    Learning how to use what for many firms will be new control 
techniques will likely require some initial period of adjustment, 
modification, and revision to ensure that the selected control measures 
achieve the required discharge limitation. EPA would expect that most 
of the firms affected in the first phase will be relatively large firms 
with in-house expertise or access to the necessary resources to 
implement passive treatment technologies. Because, as noted, the final 
rule requires a significant change in the controls necessary for the 
discharges associated with construction activity from current practices 
for many firms, there may be, at least in the near term, a limited 
universe of available expertise in passive treatment in the form of 
available guidance information and trained engineering personnel 
specialized in these treatment measures. EPA also expects that 
expertise and understanding will grow over time and that technologies 
may well both improve and decrease in cost. In these circumstances, 
phasing in the application of the numeric limitations provides time to 
facilitate the efficient development and transfer of this expertise, 
and allows the industry to explore opportunities for cost savings.
    EPA estimates that sites which disturb 20 or more acres at any one 
time represent 48 percent of all sites subject to the numeric limits. 
The pollutant reduction associated with these sites is estimated to 
represent 69 percent of the pollutants discharged by construction 
sites. Expanding the application of the numeric limit after two and a 
half years to sites that disturb 10 or more acres at any one time will 
achieve a 77 percent sediment reduction over baseline discharges. EPA 
has determined that phasing the application of the limitation ensures 
that effective progress is made towards achieving the pollutant 
reductions and benefits associated with BAT and BADT while providing 
the construction industry with additional time to implement the 
regulation in recognition of the current economic downturn.
    EPA plans to work closely with states and industry to ensure 
effective implementation of this rule. EPA will also monitor progress 
with respect to a range of variables, including appropriate 
technologies and their performance, costs, and overall industry 
conditions, with the ability to make adjustments if warranted.

C. Upset and Bypass Provisions

    A ``bypass'' is an intentional diversion of the streams from any 
portion of a treatment facility. An ``upset'' is an exceptional 
incident in which there is unintentional and temporary noncompliance 
with technology-based permit effluent limitations because of factors 
beyond the reasonable control of the permittee. EPA's regulations 
concerning bypasses and upsets for direct dischargers are set forth at 
40 CFR 122.41(m) and (n).
    Because much of today's rule includes requirements for the design, 
installation, and maintenance of erosion and sediment controls, EPA 
considered the need for an additional bypass-type provision in regard 
to large storm events. However, EPA did not specifically include such a 
provision in the text of the regulation because the rule only requires 
dischargers to meet a numeric turbidity limitation for discharges on 
days with storm events smaller than the 2-year, 24-hour storm. Because 
EPA is not establishing requirements for control of larger storm 
events, specific bypass provisions were not necessary. Standard upset 
and bypass provisions are generally included in all NPDES permits, and 
EPA expects this will be the case for construction stormwater permits 
issued after this rule becomes effective.

D. Variances and Waivers

    The CWA requires application of effluent limitation guidelines 
established pursuant to section 301 to all direct dischargers. However, 
the statute provides for the modification of these national 
requirements in a limited number of circumstances. Moreover, the Agency 
has established administrative mechanisms to provide an opportunity for 
relief from the application of ELGs for categories of existing sources 
for toxic, conventional, and nonconventional pollutants. ``Ability to 
Pay'' and ``water quality'' waivers do not apply to conventional or 
toxic pollutants (e.g., TSS, PCBs) and, therefore, do not apply to 
today's rule. However, the variance for Fundamentally Different Factors 
(FDFs) may apply in some circumstances.
    EPA will develop effluent limitations or standards different from 
the otherwise applicable requirements if an individual discharging 
facility is fundamentally different with respect to factors considered 
in establishing the limitation of standards applicable to the 
individual facility. Such a modification is known as a ``fundamentally 
different factors'' (FDF) variance.
    Early on, EPA, by regulation provided for the FDF modifications 
from the BPT and BAT limitations for toxic and nonconventional 
pollutants and BPT limitations for conventional pollutants for direct 
dischargers. For indirect dischargers, EPA provided for modifications 
for PSES. FDF variances for toxic pollutants were challenged judicially 
and ultimately sustained by the Supreme Court. Chemical Manufacturers 
Assn v. NRDC, 479 U.S. 116 (1985).
    Subsequently, in the Water Quality Act of 1987, Congress added new 
section 301(n) of the Act explicitly to authorize modifications of the 
otherwise applicable BAT effluent limitations or categorical 
pretreatment standards for existing sources if a facility is 
fundamentally different with respect to the factors specified in 
section 304 (other than costs) from those considered by EPA in 
establishing the effluent limitations or pretreatment standard. Section 
301(n) also defined the conditions under which EPA may establish 
alternative requirements. Under section 301(n), an application for 
approval of a FDF variance must be based solely on (1) information 
submitted during rulemaking raising the factors that are fundamentally 
different or (2) information the applicant did not have an opportunity 
to submit. The alternate limitation or standard must be no less 
stringent than justified by the difference and must not result in 
markedly more adverse non-water quality environmental impacts than the 
national limitation or standard.

[[Page 63052]]

    EPA regulations at 40 CFR part 125, subpart D, authorizing the 
Regional Administrators to establish alternative limitations and 
standards, further detail the substantive criteria used to evaluate FDF 
variance requests for direct dischargers. Thus, 40 CFR 125.31(d) 
identifies six factors (e.g., volume of process wastewater, age and 
size of a discharger's facility) that may be considered in determining 
if a facility is fundamentally different. The Agency must determine 
whether, on the basis of one or more of these factors, the facility in 
question is fundamentally different from the facilities and factors 
considered by EPA in developing the nationally applicable effluent 
guidelines. The regulation also lists four other factors (e.g., 
infeasibility of installation within the time allowed or a discharger's 
ability to pay) that may not provide a basis for an FDF variance. In 
addition, under 40 CFR 125.31(b)(3), a request for limitations less 
stringent than the national limitation may be approved only if 
compliance with the national limitations would result in either (a) a 
removal cost wholly out of proportion to the removal cost considered 
during development of the national limitations, or (b) a non-water 
quality environmental impact (including energy requirements) 
fundamentally more adverse than the impact considered during 
development of the national limitations. EPA regulations provide for an 
FDF variance for indirect dischargers at 40 CFR 403.13. The conditions 
for approval of a request to modify applicable pretreatment standards 
and factors considered are the same as those for direct dischargers.
    The legislative history of section 301(n) underscores the necessity 
for the FDF variance applicant to establish eligibility for the 
variance. EPA's regulations at 40 CFR 125.32(b)(1) are explicit in 
imposing this burden upon the applicant. The applicant must show that 
the factors relating to the discharge controlled by the applicant's 
permit which are claimed to be fundamentally different are, in fact, 
fundamentally different from those factors considered by the EPA in 
establishing the applicable guidelines. An FDF variance is not 
available to a new source subject to NSPS. See E.I. du Pont de Nemours 
v. Train, 430 U.S. 112, 138-39 (1977).

E. Safe Drinking Water Act Requirements

    EPA is encouraging the use of stormwater dispersion and 
infiltration to manage stormwater discharges from construction 
activity. By using dispersion and infiltration techniques, permittees 
may be able to significantly reduce or even eliminate discharges in 
certain situations. While permittees may choose to utilize infiltration 
practices such as infiltration trenches and wells to manage 
postconstruction stormwater discharges, EPA does not expect that 
permittees will utilize these practices to any great degree during the 
construction phase because sediment may cause clogging of these 
practices and therefore reduce their useful life. However, it is 
important to note that certain types of infiltration practices used to 
manage stormwater from construction activity may be subject to 
regulation under the Safe Drinking Water Act's (SDWA) Underground 
Injection Control (UIC) program and EPA's implementing regulations at 
40 CFR parts 144-147. SDWA established the UIC program to provide 
safeguards so that injection wells do not endanger current and future 
underground sources of drinking water (USDWs) (42 U.S.C. 300h). The UIC 
program is implemented by Federal and state government agencies that 
oversee underground injection activities in order to prevent 
contamination of USDWs.
    Some infiltration practices may involve injection into a well, 
which is defined as a bored, drilled, driven shaft, or dug hole that is 
deeper than its widest surface dimension, or an improved sinkhole, or a 
subsurface fluid distribution system (40 CFR 144.3). In those cases, 
the infiltration practices would be regulated under the UIC program as 
a Class V well. For example, an infiltration trench that includes an 
assemblage of perforated pipes, drain tiles, or similar mechanism 
intended to distribute fluids below the surface would probably be 
considered a Class V injection well. Also, commercially manufactured 
stormwater infiltration devices such as pre-cast or pre-built 
proprietary subsurface detention vaults, chambers or other devices 
designed to capture and infiltrate stormwater runoff are generally 
considered Class V wells. Drywells, seepage pits, and improved 
sinkholes are also generally considered to be Class V wells if water is 
directed to them and their depth is greater than their widest surface 
dimension or they are connected to a subsurface fluid distribution 
system.
    Typically, Class V wells are authorized by rule and do not require 
a permit if the owner or operator submits inventory information to the 
State, if it has primary enforcement responsibility for the UIC Class V 
program, or EPA, and complies with the other requirements for Class V 
wells. The state or EPA regional UIC program director with primacy for 
the UIC Class V program should be contacted when these types of 
infiltration practices are planned to assist in determining whether 
they are Class V wells.
    There are some geologic settings that are so sensitive that 
contaminated stormwater may move too rapidly through the soil profile 
for sufficient pollution removal. As a result, USDWs may be threatened. 
The source water assessments required under the 1996 Amendments to the 
Safe Drinking Water Act are good sources of information on sensitive 
geologic settings for public water supplies, as is EPA's Source Water 
Practices Bulletin: Managing Stormwater Runoff to Prevent Contamination 
of Drinking Water (Office of Water, EPA 816-F-007, July 2009).

F. Other Clean Water Act Requirements

    Compliance with the provisions of this rule would not exempt a 
discharger from any other requirements of the CWA.

XX. Related Acts of Congress, Executive Orders, and Agency Initiatives

A. Executive Order 12866: Regulatory Planning and Review

    Under section 3(f)(1) of Executive Order 12866 (58 FR 51735, 
October 4, 1993), this action is an ``economically significant 
regulatory action'' because it is likely to have an annual effect on 
the economy of $100 million or more. Accordingly, EPA submitted this 
action to the Office of Management and Budget (OMB) for review under 
Executive Order 12866 and any changes made in response to OMB 
recommendations have been documented in the docket for this action.
    In addition, EPA prepared an analysis of the potential costs and 
benefits associated with this action. This analysis is contained in 
Section 8.3, Comparison of Social Cost and Monetized Benefits in 
Chapter 8 of the Economic Analysis. A copy of the analysis is available 
in the docket for this action and the analysis is briefly summarized 
here. Table XX-1 provides the results of the benefit-cost analysis.

    Table XX-1--Total Annualized Benefits and Costs of the Regulatory
                                 Options
------------------------------------------------------------------------
                                  Social costs
                                    (2008  $      Benefits \a\ (2008  $
             Option               millions  per    millions  per year)
                                      year)
------------------------------------------------------------------------
Option 1.......................          $175.8  $214.1 + (NMB)1
Option 2.......................         4,863.1  360.1 + (NMB)2
Option 3.......................         9,081.1  422.3 + (NMB)3

[[Page 63053]]

 
Option 4.......................           958.7  368.9 + (NMB)4
------------------------------------------------------------------------
\a\ NMBi are the non-monetized benefits of the i\th\ Option.
Source: Economic Analysis; Environmental Assessment.

B. Paperwork Reduction Act

    The information collection requirements in this rule will be 
submitted for approval to the Office of Management and Budget (OMB) 
under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. The 
information collection requirements are not enforceable until OMB 
approves them.
    EPA is establishing mandatory monitoring requirements for 
construction sites under authority of Clean Water Act (CWA) Section 308 
to demonstrate compliance with effluent limitations and standards for 
turbidity promulgated under today's rule. Sediment, created as a result 
of construction activity and measured by turbidity, is the primary 
pollutant that causes water quality impairment for streams and rivers. 
It is also one of the leading causes of lake and reservoir water 
quality impairment and wetland degradation. The sediment entrained in 
stormwater discharges from construction activity can harm aquatic 
ecosystems, increase drinking water treatment costs, and degrade 
recreational uses of impacted waters. Sediment can also accumulate in 
rivers, lakes, and reservoirs, leading to the need for dredging or 
other mitigation. Additionally, Section 402(a)(2) of the CWA directs 
EPA to prescribe permit conditions to assure compliance with 
requirements ``including conditions on data and information collection, 
reporting and such other requirements as [the Administrator] deems 
appropriate.''
    EPA estimates a total annual burden to regulated construction sites 
larger than 10 acres and regulatory authorities, as a result of the 
monitoring requirements of this final rule, of 3,018,750 hours and 
average annual costs of $91,978,103. These are based on the following 
assumptions:
     Total number of projects ongoing at some point in a year, 
but not necessarily active for the entire year: 39,361.
     Average reporting frequency: monthly.
     Average number of monitoring reports submitted per year: 
7.07.
     Total number of DMR reports submitted per year: 278,251.
     Average burden hours per response: 10.85 (10.30 hours per 
permittee, 0.55 hour per permitting authority).
    These estimates account for full implementation of the monitoring 
requirements which will not occur for 4 years after the effective date 
of this rule. EPA will submit an Information Collection Request (ICR) 
to the Office of Management and Budget for approval which requests 
approval for only a portion of this burden reflecting the 
implementation of the rule over the next three years. Upon expiration 
of that ICR, EPA will update the clearance request to reflect full 
implementation of the numeric limitations in the subsequent request.
    In addition, EPA estimates annual capital costs to the industry of 
$7,085,890. The capital cost to the industry is based on the use of one 
turbidimeter per active site per year (28,922) and the annual purchase 
of a turbidimeter calibration kit, for a total annual cost of $245 per 
project. For the states, EPA estimates start-up costs of $1,564,000, 
based on an average expected cost of $31,280 per state for equipment 
purchases and program set-up. Annualized over 10 years, this cost is 
$3,667 per state. Burden means the total time, effort, or financial 
resources expended by persons to generate, maintain, retain, or 
disclose or provide information to or for a Federal agency. This 
includes the time needed to review instructions; develop, acquire, 
install, and utilize technology and systems for the purposes of 
collecting, validating, and verifying information, processing and 
maintaining information, and disclosing and providing information; 
adjust the existing ways to comply with any previously applicable 
instructions and requirements; train personnel to be able to respond to 
a collection of information; search data sources; complete and review 
the collection of information; and transmit or otherwise disclose the 
information.
    An agency may not conduct or sponsor, and a person is not required 
to respond to a collection of information unless it displays a 
currently valid OMB control number. The OMB control numbers for EPA's 
regulations in 40 CFR are listed in 40 CFR part 9. When this ICR is 
approved by OMB, the Agency will publish a technical amendment to 40 
CFR part 9 in the Federal Register to display the OMB control number 
for the approved information collection requirements contained in this 
final rule.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency 
to prepare a regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements under the Administrative 
Procedure Act or any other statute unless the agency certifies that the 
rule will not have a significant economic impact on a substantial 
number of small entities. Small entities include small businesses, 
small organizations, and small governmental jurisdictions.
    For the purposes of assessing the impacts of today's rule on small 
entities, small entity is defined as either a: (1) A small business as 
defined by the Small Business Administration's (SBA) regulations at 13 
CFR 121.201; (2) a small governmental jurisdiction that is a government 
of a city, county, town, school district or special district with a 
population of less than 50,000; or (3) a small organization that is any 
not-for-profit enterprise which is independently owned and operated and 
is not dominant in its field. EPA does not anticipate any impacts on 
small organizations and impacts on small governments are discussed 
under the UMRA analysis section. The RFA provides that EPA generally 
define small businesses according to the size standards established by 
the Small Business Administration (SBA). The SBA established criteria 
for identifying small businesses is based on either the number of 
employees or annual revenues (13 CFR 121). These size standards vary by 
NAICS (North American Industrial Classification System) code. For the 
C&D industry NAICS categories (236 and 237) the small business annual 
revenue threshold is set at $33.5 million. The SBA sets the small 
business threshold for NAICS 2372 (Land Subdivision of NAICS 237) at $7 
million. However, for the purpose of the economic analysis, EPA 
allocated this sector amongst the four primary building construction 
sectors: Single-family housing, multifamily housing, industrial 
building, and commercial and institutional building construction. By 
merging the land subdivision sector with sectors that have a higher 
small business revenue threshold, there is likely to be an overestimate 
of the number of these firms considered small businesses. However, 
according to the 2002 Economic Census, 93 percent of firms in the land 
subdivision sector made less than $5 million annually, and 98 percent 
made less than $10 million. So nearly all the firms in this sector 
would already be considered a small

[[Page 63054]]

business under $7 million threshold, and merging this sector with the 
four primary building construction sectors, will not have a meaningful 
affect on the estimate of small businesses for this industry.
    In order to gather more information on the potential impacts of 
today's rule on small businesses, EPA used the discretion afforded to 
it under the Regulatory Flexibility Act (RFA), as amended by the Small 
Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), to 
convene a Small Business Advocacy Review (SBAR) Panel for this 
rulemaking on September 10, 2008. EPA held an outreach meeting with 
Small Entity Representative (SERs) on September 17, 2008. A list of 
SERs and the outreach materials sent to SERs are included in the docket 
(see DCN 41115-41133). EPA prepared a report that summarizes 
information obtained from the Panel, which is also included in the 
docket. (see DCN 41136).
    After considering the economic impacts of today's final rule on 
small entities, I certify that this action will not have a significant 
economic impact on a substantial number of small entities. Overall, EPA 
estimates that in a typical year there will be 82,000 in-scope firms, 
and of this total, approximately 78,000, or about 96 percent, are 
defined as small businesses. Under Option 4, EPA estimates that only 
230 small businesses would experience costs exceeding 1 percent of 
revenue and no small businesses would incur costs exceeding 3 percent 
of revenue. Both numbers represent very small percentages of the in-
scope small firms. The 230 firms estimated to incur costs exceeding 1 
percent of revenue represent about 0.3 percent of all estimated 
potentially in-scope small businesses. Therefore, EPA does not consider 
the selected option to have the potential to cause a significant 
economic impact on a substantial number of small entities.
    All of the options considered for the final rule require the use of 
BMPs. As the rule applies to construction projects and not directly to 
firms, the most effective way for EPA to minimize impacts to small 
firms was by crafting options that did not impose significant costs on 
small projects. EPA's final rule does this by establishing an acreage 
threshold for the numeric turbidity limitation.

D. Unfunded Mandates Reform Act (UMRA)

    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. EPA has determined that this rule contains 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. Accordingly, EPA has prepared under section 202 of the 
UMRA a written statement which is summarized below.
    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 to adopt 
the least costly, most cost-effective or least burdensome alternative 
that achieves the objectives of the rule. 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. Of the four options considered for the final rule option, 
one was the least costly. However, EPA concluded that option one was 
not technology forcing and did not reflect ; therefore, it did not meet 
CWA objectives. Of the remaining three options, EPA selected the least 
costly, most cost-effective or least burdensome option, satisfying 
section 205 requirements.
    As part of the financial impact analysis, EPA looked specifically 
at the impact on government entities resulting from both compliance 
with construction site requirements and from administering the 
additional monitoring reports submitted by in-scope firms. Table XX-2 
shows the results of this analysis. The estimated administrative costs 
are conservative, as they do not take into account that part of the 
NPDES permit program is administered by the federal government. For 
more information on how this analysis was performed, see Section 14-1 
Assessing Costs to Government Entities in Chapter 14 of the Economic 
Analysis.

             Table XX-2--Impacts of Regulatory Options on State & Local Governments (million 2008 $)
----------------------------------------------------------------------------------------------------------------
                                                                Option 1     Option 2     Option 3     Option 4
----------------------------------------------------------------------------------------------------------------
Compliance Costs:
    Federal.................................................         $3.8        $87.1       $166.9        $17.7
    State...................................................          8.1        178.1        323.0         35.3
    Local...................................................         46.2      1,022.3      1,854.0        202.4
Administrative Costs:
    Federal.................................................          0.0          0.0          0.0          0.0
    State...................................................          0.0          2.2          6.2          6.2
    Local...................................................          0.0          0.0          0.0          0.0
Total Costs:
    Federal.................................................          3.8         87.1        166.9         17.7
    State...................................................          8.1        180.3        329.2         41.5
    Local...................................................         46.2      1,022.3      1,854.0        202.4
                                                             ---------------------------------------------------
        Total...............................................         58.1      1,289.7      2,350.1        261.6
----------------------------------------------------------------------------------------------------------------
Source: Economic Analysis.

    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

[[Page 63055]]

Federal intergovernmental mandates, and informing, educating, and 
advising small governments on compliance with the regulatory 
requirements.
    After performing an assessment of the economic impacts on small 
government entities, EPA determined that the rule would not 
significantly or uniquely affect small governments, and therefore did 
not develop a small government agency plan as specified in UMRA. This 
rule does not impose any requirements uniquely on small governments. 
The assessment of impacts on small governmental entities involved three 
steps: (1) Identifying small government entities (i.e., those serving 
populations of less than 50,000, (5 U.S.C. 601[5])), (2) estimating the 
share of total government costs for the regulatory options incurred by 
small governments, and (3) estimating the potential impact from these 
costs based on comparison of small government compliance costs with 
small government revenue and outlays. For details of this analysis see 
Section 14.2 Assessing Costs and Impacts on Small Government Entities 
in Chapter 14 of the Economic Analysis. Table XX-3 has the results of 
the small government entity impact analysis. The table shows that under 
Option 4, total small government costs are estimated to be only 0.08% 
of total small government revenue, and under no option considered did 
total small government costs exceed 1% of total small government 
revenues.

              Table XX-3--Impacts of Regulatory Options on Small Government Units (Million 2008 $)
----------------------------------------------------------------------------------------------------------------
                                                                Option 1     Option 2     Option 3     Option 4
----------------------------------------------------------------------------------------------------------------
Compliance Costs:
    Small Government Entities...............................        $21.7       $480.5       $871.4        $95.1
Administrative Costs:
    Small Government Entities...............................          0.0          0.0          0.0          0.0
Total Costs:
    Small Government Entities...............................         21.7        480.5        871.4         95.1
Small Government Impact Analysis Concepts:
    Total Revenues..........................................      125,515      125,515      125,515      125,515
    Total Costs as % of Total Revenues......................        0.02%        0.38%        0.69%        0.08%
    Capital Outlay..........................................       13,455       13,455       13,455       13,455
    Total Costs as % of Total Capital Outlay................        0.16%        3.57%        6.48%        0.71%
    Construction Outlay Only................................        8,529        8,529        8,529        8,529
    Total Costs as % of Total Construction Outlay...........        0.25%        5.63%       10.22%        1.12%
----------------------------------------------------------------------------------------------------------------
Source: Economic Analysis.

    Consistent with the intergovernmental consultation provisions of 
section 204 of the UMRA, EPA initiated consultations with the 
governmental entities affected by this rule. EPA took and responded to 
comments from government entities on the earlier proposed C&D rule and 
on this rule. To help characterize the potential impacts to government 
entities, EPA has gathered state government data regarding NOI 
submissions, and from U.S. Census data and Reed Construction Data. EPA 
has compiled information on how much construction activity is 
undertaken by government entities. EPA has routinely consulted with EPA 
regional offices who maintain direct and regular contact with state 
entities. Finally, EPA met directly with and solicited data from all 
the state Stormwater Coordinators who attended EPA's Annual Stormwater 
Conference in 2007. During 2008 and 2009, EPA attended several 
conferences and workshops to present information on the Agency's C&D 
rule. These meetings were open to the public and widely attended.

E. Executive Order 13132: Federalism

    Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August 
10, 1999), directs agencies to develop an accountable process to ensure 
``meaningful and timely input by State and local officials in the 
development of regulatory policies that have federalism implications.''
    Although EPA expects the final rule would have little effect on the 
relationship between, or the distribution of power and responsibilities 
among, the federal and state governments, EPA has concluded that this 
final rule has federalism implications as defined by the Executive 
Order. As previously noted, it is estimated to impose substantial 
direct compliance costs on State and local governments combined. 
Accordingly, EPA provides the following federalism summary impact 
statement as required by section 6(b) of Executive Order 13132. As 
noted in the UMRA section above, EPA consulted with State and local 
governments early in the process of developing the proposed action to 
permit them to have meaningful and timely input into its development. 
While EPA did not consult with State and local elected officials, the 
Agency did consult with all of the state Stormwater Coordinators in 
attendance at EPA's Annual Stormwater Coordinator's conferences in 2008 
and 2009. EPA also attended several conferences where governmental 
officials were present, such as the International Erosion Control 
Association (IECA) conference in February 2009, the MAC-IECA conference 
in September 2009, and the Northwest Environmental Business Council 
meeting in March of 2009. In general, the concerns EPA heard included 
the costs of the regulation as related to publicly funded projects, 
increased burden and the lack of dedicated funding sources for 
permitting authorities to implement and enforce the new requirements 
given that permitting authorities are already over-burdened.
    EPA also tried to mitigate compliance costs on State and local 
governments by incorporating a disturbed acreage threshold of 10 acres 
for applicability of the turbidity limitation. Although EPA does not 
have comprehensive data on construction projects conducted by state and 
local governments, EPA believes that a large proportion of building 
projects undertaking by these entities are likely to fall below this 
threshold. Building projects constructed by local governments are 
typically projects such as schools, libraries, recreation centers, 
parks, office buildings, etc., which EPA believes would tend to have 
construction footprints smaller than 10 acres. And like private 
projects, those that are bigger may be able to use sequencing to 
prevent more than 10 acres from being disturbed at one time. Likewise, 
many local government non-building projects are likely to have smaller 
construction footprints as well. EPA expects that the majority of local 
government non-building projects

[[Page 63056]]

would be activities such as small-scale road improvements, sewer and 
water line repair projects, and other miscellaneous construction 
activities with smaller amounts of land disturbance. With respect to 
state government projects, highway construction projects are the one 
category of construction undertaken by state governments that are 
likely to be the most significantly impacted by the final rule 
requirements, since many of these projects may exceed 10 acres 
disturbed at one time. However, as highway projects constitute a 
significant portion of construction projects nationwide, EPA has no 
reasonable basis for exempting these projects from regulation. As 
discussed above, EPA has included a number of provisions to facilitate 
compliance with the numeric limitation, including phase-in of the 
limitation, an exemption from the limitation on days when precipitation 
exceeds the 2-year, 24-hour storm event, and averaging of monitoring 
samples over a full day for determining compliance with the limitation. 
EPA expects that many state government building projects would fall 
below the 10 acres disturbed threshold.

F. Executive Order 13175 (Consultation and Coordination With Indian 
Tribal Governments)

    Executive Order 13175, entitled ``Consultation and Coordination 
with Indian Tribal Governments'' (65 FR 67249, November 6, 2000), 
requires EPA to develop an accountable process to ensure ``meaningful 
and timely input by tribal officials in the development of regulatory 
policies that have tribal implications.''
    ``Policies that have Tribal implications'' is defined in the 
Executive Order to include regulations that have substantial direct 
effects on one or more Indian Tribes, on the relationship between the 
Federal government and the Indian Tribes, or on the distribution of 
power and responsibilities between the Federal government and Indian 
Tribes. This final rule does not have tribal implications. It will not 
have substantial direct effects on Tribal governments, on the 
relationship between the Federal government and Indian Tribes, or on 
the distribution of power and responsibilities between the Federal 
government and Indian tribes as specified in Executive Order 13175. 
Today's final rule contains no Federal mandates for Tribal governments 
and does not impose any enforceable duties on Tribal governments. Thus, 
Executive Order 13175 does not apply to this rule.

G. Executive Order 13045: Protection of Children From Environmental 
Health Risks and Safety Risks

    Executive Order 13045, ``Protection of Children from Environmental 
Health Risks and Safety Risks'' (62 FR 19885, April 23, 1997) applies 
to any rule that: (1) is determined to be ``economically significant'' 
as defined under Executive Order 12866, and (2) concerns an 
environmental health or safety risk that EPA has reason to believe may 
have a disproportionate effect on children. If the regulatory action 
meets both criteria, the Agency must evaluate the environmental health 
or safety effects of the planned rule on children, and explain why the 
planned regulation is preferable to other potentially effective and 
reasonably feasible alternatives considered by the Agency.
    This final rule is not subject to Executive Order 13045 because it 
does not concern an environmental health or safety risk that EPA has 
reason to believe may have a disproportionate effect on children. This 
rule is based on technology performance, not health or safety risks.

H. Executive Order 13211 (Energy Effects)

    This rule is not a ``significant energy action'' as defined in 
Executive Order 13211, ``Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use'' (66 FR 
28355, May 22, 2001) because it is not likely to have a significant 
adverse effect on the supply, distribution, or use of energy. 
Additional fuel may be required for construction equipment conducting 
excavation and soil moving activities. EPA determined that the 
additional fuel usage would be very small, relative to the total fuel 
consumption at construction sites and the total annual U.S. fuel 
consumption.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act (NTTAA) of 1995, (Pub. L. 104-113, section 12(d); 15 U.S.C. 272 
note) directs EPA to use voluntary consensus standards in its 
regulatory activities unless to do so would be inconsistent with 
applicable law or otherwise impractical. Voluntary consensus standards 
are technical standards (e.g., materials specifications, test methods, 
sampling procedures, and business practices) that are developed or 
adopted by voluntary consensus standard bodies. The NTTAA directs EPA 
to provide Congress, through OMB, explanations when the Agency decides 
not to use available and applicable voluntary consensus standards.
    The Agency is not aware of any consensus-based technical standards 
for the types of controls contained in final rule and did not receive 
any comments to this effect from the public.

J. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    Executive Order 12898 (59 FR 7629 (Feb. 16, 1994)) establishes 
Federal executive policy on environmental justice. Its main provision 
directs federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies, and activities on minority populations and low-income 
populations in the United States.
    EPA has determined that this final rule will not have 
disproportionately high and adverse human health or environmental 
effects on minority or low-income populations because it increases the 
level of environmental protection for all affected populations without 
having any disproportionately high and adverse human health or 
environmental effects on any population, including any minority or low-
income population. The final rule will reduce the negative effects of 
discharges from construction sites in the nation's waters to benefit 
all of society, including minority communities.

K. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. EPA will submit 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 United States prior 
to publication of the rule in the Federal Register. A Major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is a ``major rule'' as defined by 5 U.S.C. 
804(2). This rule will be effective February 1, 2010.

L. Judicial Review

    In accordance with 40 CFR 23.2, today's rule is considered 
promulgated

[[Page 63057]]

for the purposes of judicial review as of 1 p.m. Eastern Standard Time, 
December 15, 2009. Under Section 509(b)(1) of the Clean Water Act 
(CWA), judicial review of today's effluent limitations guidelines and 
new source performance standards may be obtained by filing a petition 
in the United States Circuit Court of Appeals for review within 120 
days from the date of promulgation of these guidelines and standards. 
Under Section 509(b)(2) of the CWA, the requirements of this regulation 
may not be challenged later in civil or criminal proceedings brought to 
enforce these requirements.

List of Subjects in 40 CFR Part 450

    Environmental protection, Construction industry, Land development, 
Erosion, Sediment, Stormwater, Water pollution control.

    Dated: November 23, 2009.
Lisa P. Jackson,
Administrator.

0
40 CFR part 450 is added as follows:

PART 450--CONSTRUCTION AND DEVELOPMENT POINT SOURCE CATEGORY

Subpart A--General Provisions
Sec.
450.10 Applicability.
450.11 General definitions.
Subpart B--Construction and Development Effluent Guidelines
450.21 Effluent limitations reflecting the best practicable 
technology currently available (BPT).
450.22 Effluent limitations reflecting the best available technology 
economically achievable (BAT).
450.23 Effluent limitations reflecting the best conventional 
pollutant control technology (BCT).
450.24 New source performance standards reflecting the best 
available demonstrated control technology (NSPS).

    Authority:  42 U.S.C 101, 301, 304, 306, 308, 401, 402, 501 and 
510.

Subpart A--General Provisions


Sec.  450.10  Applicability.

    (a) This part applies to discharges associated with construction 
activity required to obtain NPDES permit coverage pursuant to 40 CFR 
122.26(b)(14)(x) and (b)(15).
    (b) The provisions of Sec.  450.22(a) do not apply to discharges 
associated with interstate natural gas pipeline construction activity.
    (c) The New Source Performance Standards at Sec.  450.24 apply to 
all new sources and are effective February 1, 2010.
    (d) The BPT, BCT and BAT effluent limitations at Sec.  450.21 
through 450.23 apply to all sources not otherwise covered by paragraph 
(c) of this section and are effective February 1, 2010.


Sec.  450.11  General definitions.

    (a) New Source. New source means any source, whose discharges are 
defined in 40 CFR 122.26(b)(14)(x) and (b)(15), that commences 
construction activity after the effective date of this rule.
    (b) [Reserved]

Subpart B--Construction and Development Effluent Guidelines


Sec.  450.21  Effluent limitations reflecting the best practicable 
technology currently available (BPT).

    Except as provided in 40 CFR 125.30 through 125.32, any point 
source subject to this subpart must achieve, at a minimum, the 
following effluent limitations representing the degree of effluent 
reduction attainable by application of the best practicable control 
technology currently available (BPT).
    (a) Erosion and Sediment Controls. Design, install and maintain 
effective erosion controls and sediment controls to minimize the 
discharge of pollutants. At a minimum, such controls must be designed, 
installed and maintained to:
    (1) Control stormwater volume and velocity within the site to 
minimize soil erosion;
    (2) Control stormwater discharges, including both peak flowrates 
and total stormwater volume, to minimize erosion at outlets and to 
minimize downstream channel and streambank erosion;
    (3) Minimize the amount of soil exposed during construction 
activity;
    (4) Minimize the disturbance of steep slopes;
    (5) Minimize sediment discharges from the site. The design, 
installation and maintenance of erosion and sediment controls must 
address factors such as the amount, frequency, intensity and duration 
of precipitation, the nature of resulting stormwater runoff, and soil 
characteristics, including the range of soil particle sizes expected to 
be present on the site;
    (6) Provide and maintain natural buffers around surface waters, 
direct stormwater to vegetated areas to increase sediment removal and 
maximize stormwater infiltration, unless infeasible; and
    (7) Minimize soil compaction and, unless infeasible, preserve 
topsoil.
    (b) Soil Stabilization. Stabilization of disturbed areas must, at a 
minimum, be initiated immediately whenever any clearing, grading, 
excavating or other earth disturbing activities have permanently ceased 
on any portion of the site, or temporarily ceased on any portion of the 
site and will not resume for a period exceeding 14 calendar days. 
Stabilization must be completed within a period of time determined by 
the permitting authority. In arid, semiarid, and drought-stricken areas 
where initiating vegetative stabilization measures immediately is 
infeasible, alternative stabilization measures must be employed as 
specified by the permitting authority.
    (c) Dewatering. Discharges from dewatering activities, including 
discharges from dewatering of trenches and excavations, are prohibited 
unless managed by appropriate controls.
    (d) Pollution Prevention Measures. Design, install, implement, and 
maintain effective pollution prevention measures to minimize the 
discharge of pollutants. At a minimum, such measures must be designed, 
installed, implemented and maintained to:
    (1) Minimize the discharge of pollutants from equipment and vehicle 
washing, wheel wash water, and other wash waters. Wash waters must be 
treated in a sediment basin or alternative control that provides 
equivalent or better treatment prior to discharge;
    (2) Minimize the exposure of building materials, building products, 
construction wastes, trash, landscape materials, fertilizers, 
pesticides, herbicides, detergents, sanitary waste and other materials 
present on the site to precipitation and to stormwater; and
    (3) Minimize the discharge of pollutants from spills and leaks and 
implement chemical spill and leak prevention and response procedures.
    (e) Prohibited Discharges. The following discharges are prohibited:
    (1) Wastewater from washout of concrete, unless managed by an 
appropriate control;
    (2) Wastewater from washout and cleanout of stucco, paint, form 
release oils, curing compounds and other construction materials;
    (3) Fuels, oils, or other pollutants used in vehicle and equipment 
operation and maintenance; and
    (4) Soaps or solvents used in vehicle and equipment washing.
    (f) Surface Outlets. When discharging from basins and impoundments, 
utilize outlet structures that withdraw water from the surface, unless 
infeasible.


Sec.  450.22  Effluent limitations reflecting the best available 
technology economically achievable (BAT).

    Except as provided in 40 CFR 125.30 through 125.32, any point 
source subject to this subpart must achieve, at a

[[Page 63058]]

minimum, the following effluent limitations representing the degree of 
effluent reduction attainable by application of the best available 
technology economically achievable (BAT).
    (a) Beginning no later than August 2, 2010 during construction 
activity that disturbs 20 or more acres of land at one time, including 
non-contiguous land disturbances that take place at the same time and 
are part of a larger common plan of development or sale; and no later 
than February 2, 2014 during construction activity that disturbs ten or 
more acres of land area at one time, including non-contiguous land 
disturbances that take place at the same time and are part of a larger 
common plan of development or sale, the following requirements apply:
    (1) Except as provided by paragraph (b) of this section, the 
average turbidity of any discharge for any day must not exceed the 
value listed in the following table:

------------------------------------------------------------------------
                                                           Daily maximum
                        Pollutant                         value (NTU)\1\
------------------------------------------------------------------------
Turbidity...............................................            280
------------------------------------------------------------------------
\1\ Nephelometric turbidity units.

    (2) Conduct monitoring consistent with requirements established by 
the permitting authority. Each sample must be analyzed for turbidity in 
accordance with methods specified by the permitting authority.
    (b) If stormwater discharges in any day occur as a result of a 
storm event in that same day that is larger than the local 2-year, 24-
hour storm, the effluent limitation in paragraph (a)(1) of this section 
does not apply for that day.
    (c) Erosion and Sediment Controls. The limitations are described at 
Sec.  450.21(a).
    (d) Soil Stabilization. The limitations are described at Sec.  
450.21(b).
    (e) Dewatering. The limitations are described at Sec.  450.21(c).
    (f) Pollution Prevention Measures. The limitations are described at 
Sec.  450.21(d).
    (g) Prohibited Discharges. The limitations are described at Sec.  
450.21(e).
    (h) Surface Outlets. The limitations are described at Sec.  
450.21(f).


Sec.  450.23  Effluent limitations reflecting the best conventional 
pollutant control technology (BCT).

    Except as provided in 40 CFR 125.30 through 125.32, any point 
source subject to this subpart must achieve, at a minimum, the 
following effluent limitations representing the degree of effluent 
reduction attainable by application of the best conventional pollutant 
control technology (BCT). The effluent limitations are described at 
Sec.  450.21.


Sec.  450.24  New source performance standards reflecting the best 
available demonstrated control technology (NSPS).

    Any new source subject to this subpart must achieve, at a minimum, 
the following new source performance standards representing the degree 
of effluent reduction attainable by application of the best available 
demonstrated control technology (NSPS): The standards are described at 
Sec.  450.22.

[FR Doc. E9-28446 Filed 11-30-09; 8:45 am]
BILLING CODE 6560-50-P