SECTION: CAPITOL HILL HEARING TESTIMONY

LENGTH: 8520 words

COMMITTEE: HOUSE TRANSPORTATION AND INFRASTRUCTURE

SUBCOMMITTEE: WATER RESOURCES AND ENVIRONMENT

HEADLINE: TESTIMONY IMPROVING WATER QUALITY

TESTIMONY-BY: JONH CRAIG , WATER QUALITY DIVISION DIRECTOR,

AFFILIATION: OKLAHOMA DEPARTMENT OF ENVIRONMENTAL QUALITY

BODY:
February 28, 2001 Jon Craig, Water Quality Division Director, Oklahoma Department of Environmental Quality Testimony: Improving Water Quality: State Perspectives on the Federal Water Pollution Control Act Before the House Subcommittee on Water Resources and the Environment Mr. Chairman, Members of the Committee and Subcommittee: My name is Jon Craig, President of the Association of State and Interstate Water Pollution Control Administrators (ASIWPCA) and the Director of the Water Quality Division, Oklahoma Department of Environmental Quality. I am accompanied today by our organization's Executive Director, Robbi Savage, who is based here in Washington and is available to work with you and the members of your excellent staff on a day-to-day basis. As you know, Mr. Chairman, AS1WPCA is the national, professional organization of State officials who are responsible for the implementation of the Clean Water Act and other water-related programs. As those on the front line, the Association's membership has a unique perspective on the issues before this Committee. The 1972 Clean Water Act gave the States the lead role in the development and implementation of the water quality program. ASIWPCA and its State members support the Clean Water Act and its goals to restore and maintain the nation's water quality. And, while significant progress has been made over these past 3 decades, States still face many challenges. In the last decade alone, State Water program administrators have been the recipients of a multitude of new Federal mandates and growing public expectations. Regrettably, fiscal support has not kept pace with these increasing demands. Mr. Chairman, we thank you for conducting these hearings, the subject of which is most timely. States and the Federal agencies involved in the planning, development, and implementation of our national water quality programs need to come together as partners to craft the Clean Water program of the future. In order to successfully implement these programs and to maximize our limited fiscal and personnel resources, the Association recommends the following as guiding principles: I . The States must maintain the lead role in the nation's clean water programs. 2.USEPA requirements need to be more flexible, and the Agency must work more cooperatively with the States to address the varied and complex program needs. To this end, ASIWPCA recommends that there be a more intense focus on: -Desired environmental outcomes, in lieu of process and procedure; -Implementation of and consistency with existing statutory authority, available resources, and State water quality agency jurisdiction; and -Recognition of and compatibility with the multi-statute, interactive nature of the Clean Water Act's programs. 3.The Federal government needs to concentrate on its primary responsibilities - that is, to develop and share sound scientific protocols, set national goals, provide technical support to the States, and serve as the conduit for taxpayer-funded support to the States and their environmental programs. 4.States need increased funding to match the level of governmental requirements placed on their programs. Over the past several years, the GAP associated with Federal mandates has widened the GAP between what is expected and what is funded. To the States, this is known as "Unfunded Mandates," and it is strictly prohibited in Federal law. In addition, the various funding vehicles need to be more flexible and supportive of watershed problem solving. 5.Diversion of resources from the core environmental programs to the "Initiative Du Jour" must end. Existing programs should, wherever possible, be utilized to achieve our mutual environmental objectives. 6. Well-designed programs, enhanced by phased and iterative management approaches is crucial to success. DISCUSSION Takin2 a Watershed Approach to Decision Makin2: The next generation of water quality problems are significantly different from those faced by the States in the past. These complex problems need to be resolved at the watershed level taking a holistic, rather than a piecemeal approach. States need to be able to focus limited resources on priorities that can achieve tangible water quality improvements. In addition, the patchwork of water quality programs must be considered in the decision- making process. Furthermore, in their efforts to comply with the requirements of the Clean Water Act, USEPA, States, and local governments should work together to identify opportunities to promote the watershed approach. USEPA should not prescribe, limit, or second-guess the States in such problem solving. It has been proven time and again that a top-down approach cannot produce and sustain the desired environmental result. Functionally Equivalent, Performance-Based Programs: Successful resolution of water quality problems will require collaboration and creative problem solving that may well expand beyond the Clean Water Act to encompass aspects of other statutes, including the Farm Bill, the Transportation Act, the Endangered Species Act, etc. Because of this expanding statutory framework, States will be called upon to design programs, in active partnership with their stakeholders, that fit their circumstances. It is for these reasons that the USEPA must assure that the Clean Water Act requirements are performance based. States' equivalent programs ought to be deemed acceptable if they achieve the same or better environmental results in the watershed. Adaptive Management: States and local governments have worked diligently to improve water quality, and the public and private sector have invested over $1 trillion dollars since the passage of the 1972 Clean Water Act. Yet, even with this tremendous investment, many waters have not attained the desired environmental goal, due in large measure to the pressures of increasing population growth and changing land hydrologic uses combined with increasing uses for recreation and commerce. Therefore, it is unrealistic to expect all program components to be the highest priority. The national program, therefore, needs to continue to support adaptive management. States need to be able to apply management practices, evaluate progress, adjust programs and secure necessary funding over time. The Clean Water Act does not envision the creation of a perfect plan, but rather sets forth a cyclical 3- 5 year process to move toward the Act's goals. USEPA POLICY DEVELOPMENT The USEPA has the responsibility for setting the national course for our environmental programs. However, the recent pace of USEPA policy development is unprecedented. The plethora of rules and policies issued over the past several months will significantly affect already-overburdened State and Local programs. And, while States have been successful in their efforts to increase State program funding, the additional mandates imposed by the former Administration were not accompanied by commensurate funding or technical assistance, and the States' abilities to expand programs to carry them out are limited. Among the topics that the new requirements address are: - Revision of the total maximum daily load (TMDL) rule; -Proposed permit requirements for concentrated animal feeding operations (CAFO's); -USEPA 304(a) criteria for nutrients, fish advisories, and methyl mercury; -Regulation and permitting of Sanitary Sewer Overflows (SSO's); and -Expanded pen-nit coverage for stormwater. It is of concern that the USEPA has taken to prescribing approaches that neither maximize existing resources nor build on effective programs. The test of time has shown that States deliver more cost- effective management and that they can, with greater flexibility, provide equal or better environmental results. Some of the requirements in these new policies need to be revisited. Many of the issues are discussed in further detail below. 1. Total Maximum Daily Loads (TMDL's) The passage of the Clean Water Act provided the States with the authority to establish water quality standards, build and manage permitting and enforcement programs, finance municipal wastewater treatment facilities, and develop nonpoint source (NPS) and watershed management programs. The establishment of TMDL's was authorized in the 1972 statute, yet the professionals at the Federal and State environmental agencies knew that TMDL development would be expensive, time consuming, and speculative given limited data and abatement technologies. It must be recognized that USEPA's priorities varied and did not, until fairly recently, include TMDL's. It must also be recognized that the current slew of litigation is focused at the Federal level, with the impact of the consent orders directly affecting the resources and workload at the State and local levels. States agree that TMDL's should be a meaningful component of State water quality management programs. And, as the Congress looks at the Clean Water Act, the Association calls to your attention four fundamental challenges that we believe should be addressed: I . The significant lack of funding to implement the programs, 2.Inadequate resources and data to successfully address nonpoint source and other water quality problems in the current program, 3.Major gaps in available science, data, research, and monitoring, and 4.Insufficient attention given to multi-media and multi- jurisdictional water problems. The scope of Section 303 (d)(1)(A), which authorized the TMDL program, is fairly limited - specially the States must: -Identify waters that do not meet water quality standards (WQS) after application of existing basic point source control requirements, -Prioritize those waters, and -Determine the total waste load the water body is able to receive and still meet WQS (with a margin of safety). USEPA has gone beyond those boundaries in the new rule, promulgated over the specific objectives and direction from Congress. This poses significant problems for State water pollution control managers. The new rule envisions TMDL's with a high level of quantification and certainty, but in terms of fully addressing and resolving the nation's remaining water quality problems, that expectation is, at times, unreasonable. States will have difficulty implementing portions of the rule that appear to go beyond the plain reading of Section 303(d). TMDL's should not be used as surrogates to impose requirements that USEPA would have no authority to apply. Unless stakeholders are willing to support TMDL's, the partnerships that the States have worked so diligently to construct (particularly in the nonpoint source arena) will begin to unravel. The workload is staggering. For example, if one assumes an even distribution of TMDL development nationwide, with no additional TMDL's called for under the new rule: -1.5 TMDL's would need to be approved each workday for the next I 0 years by each of the I USEPA Regional Offices. -Assuming (optimistically) that an "80% savings" could be achieved (taking advantage of lessons learned, economies of scale, and delisting inappropriate waters), States would have to produce (and USEPA approve) 1. 5 TMDL's per week per USEPA region for the next IO years. ASIWPCA Recommendations for TMDL's Given the magnitude of the task before us, a practical and flexible approach is needed. The Association believes that some provisions of the new rule need to be reconsidered and refined. Specifically, the Association recommends that the: -States develop TMDL's for waters impaired by pollutant(s) where TMDL's are the appropriate solution. Their scope should be limited to a reading of the statutes -- i.e. a credible technical analysis that identifies the maximum allowable pollutant load or other conditions necessary to attain water quality standards (WQS) for pollutant(s) of concern. -States are authorized todelist waterbodies using the same procedures and methodologies that apply to listings, i.e. a high burden of proof should not be required. If WQS are attained or a TMDL is approved, a waterbody should be delisted. -Artificial and unreasonable deadlines should not be imposed -- States should be able to set priorities and schedules, in consultation with the public. Implementation plans should not be required as part of TMI)Ls. This is not to say that TMDL's should be developed but not implemented - in fact, implementation is essential and fully supported by the States. However, Section 303(d) does not authorize implementation as a component of this provision. It is critical that the: States be allowed to take adaptive management approaches, particularly where nonpoint sources are of significant concern. States be able to implement a variety of controls as expeditiously as possible, as described in the upgraded nonpoint source management programs and other mechanisms recognized under State and Federal law. - In the interim period before TMDL development and approval, States should have wide latitude to operate programs and issue/reissue permits. There should be no expansion of USEPA pen- nit authority in States that have been delegated authority under the National Pollutant Discharge Elimination System (NPDES). 2. Section 106 State Management Assistance Section 106 of the statute authorizes funds for the day-to-day management of the State programs. The continued resolution of clean water problems is placing enormous resource demands on States. Section 106 funding was static for decades. The Congress last year heard the call of the States for additional resources and appropriated a $50 million funding increase. Even with this significant increase to $172 million, the estimated shortfall is in the range of $480 - $700 million annually. However, this estimate significantly understates the ever-increasing monitoring and TMDL- development/implementation needs. ASIWPCA Recommendations on 106: -The Association urges Congress to reauthorize Section 106 at a more adequate level and to work with States and the USEPA to increase annual appropriations. To successfully implement the State water programs, a funding level of $350 million is needed annually. -Tribal water quality programs are important to the overall success of national efforts and should be funded independently, not as a set-aside or at the expense of State programs. 3. Infrastructure Financin2 and the Clean Water State Revolvin2 Loan Fund (CWSR-F) Congress created the CWSRF in 1987 to finance municipal, nonpoint source, and estuary pollution control needs. This innovative program was immediately established in all 50 States, which accounts for its initial and continuing success. There have been more than 6,800 loans executed with a total value of $23 billion. SRT Projects have been built at less expense, 50% faster, and with four times the buying power of construction grants. It is surprising and regrettable that over the last 8 years, Federal funding for the CWSRF has declined - despite significant infrastructure needs exceeding $200 - 300 billion. As the water programs continue to evolve, CWSRF should be evaluated and refinements incorporated to assure that the program continues to be capitalized. Specifically, the Association believes strongly in the following principles: - The CWSRF program should continue to be the infrastructure- financing mechanism. The limited Federal funds available need to be used efficiently to resolve priority problems. -Significant additional capitalization is needed. -The SRF should be refined to take a more comprehensive and balanced approach to watershed clean up and protection. -More flexibility is needed to make water pollution control affordable in hardship situations. Over time, there have been a host of studies and reviews of the total funding needed to construct and maintain wastewater treatment facilities. The USEPA, for example, issued its GAP study, which documented infrastructure needs in the hundreds of billions. Most recently, a coalition of water industry interests has issued the Water Infrastructure Now Report. Though this report provides a useful perspective on infrastructure financing, it raises significant State concerns. For example, the recommendations are limited in scope. The vast array of water program demands are not fully considered in the report, and the specific needs of the States are not adequately addressed. Specifically, the report does not adequately consider the broad array of nonpoint and other watershed needs, focusing instead on funding municipal treatment works. The coalition calls for an annual funding level (up to over $15 Billion), a funding level that is unlikely to be appropriated. ASIW?CA is not supportive of the Federal creation of new State finance authorities that duplicate or supplant the highly effective CWSRF and other existing State financing programs. hi addition, ASIWPCA is not supportive of a federally mandated grant program. Rather, States need wide latitude to make the best use of limited funding to address impaired watersheds. AS1WPCA Recommendations on the CWSRF: -Increase CWSRF funding. Significant additional funding above $2.4 billion is needed annually to capitalize the SRF. -Expand eligible uses of the CWSRF. The cumulative impact of USEPA regulatory and policy requirements impose significant burdens that should be recognized. CWSRF eligibilities should be expanded beyond current provisions (that cover traditional municipal wastewater treatment, combined sewer overflows (CSO's), sanitary sewer overflows (SSO's), nonpoint source control, and implementation of Section 320 estuary plans) to include: Acquisition of land, easements, and rights of way related to wastewater treatment. Loan repayment periods extended up to 40 years or a facility's useful life. Funding privately owned point sources such as CAFO's. Other possibilities that some States suggested are: - Pollution prevention. - Outreach and technical assistance. - Private as well as public clean water utilities. - Address affordability. For some communities and individuals, loans or increased wastewater utility rates are not affordable. Hardship/low income assistance should be allocated in the SRF. In the CWSRF States should be able to blend a variety of financing mechanisms (loans, principal subsidies, and grants) to achieve affordability. Each State should be able to define "small and hardship" as well as the target level of affordability. States should have the option to exempt small/hardship communities from Title 11 and Federal crosscutting requirements (see below). -Eliminate earmarks or set-asides. States should have maximum flexibility in allocating funds. Special set-asides for innovation, low-income assistance, etc. are restrictive and limit States' ability to meet local needs. -Limit Federal involvement and minimize requirements. Congress intended that States have the primary role in the establishment and long-ten-n management of the CWSRF. Federal requirements should be limited and attached only to initial uses of the capitalization grant amount. Loan recipients should be exempt from the detailed project requirements of the 1970's Title 11 construction grants program and Federal crosscutting laws. State, not Federal, laws should apply (e.g. related to Davis Bacon wages). -Relationship to the Drinking Water SR-F. States should be able to transfer funds between the Clean Water and the Drinking Water SRF's as their circumstances and priorities merit. -Increase coverage of State administrative costs. State CWSRF administrative expenses have become more costly over time as the fund has grown and the allowable level is tied to the amount of annual Federal capitalization (4%). States should be authorized to use: 4% of Title VI capitalization (Federal and State), 0.5% of the SRF's current value, or Up to $400,000 annually. - Federal tax law restrictions. The private activity volume caps limit the use of tax-exempt bond proceeds for private sector water pollution abatement. The investment rate (arbitrage) restrictions unduly limit the State ability to invest bond issue and other CWSRF. These barriers should be removed. 4. Nonpoint Source (NPS) Management The majority of the remaining water quality problems in the United States are due in large measure to NPS pollution. These sources include rural and urban runoff, development and urbanization, air deposition, abandoned mines, and natural sources (e.g. from leaching, erosion, and wildlife). Reductions affect large segments of society, involve millions of sources and many levels of government, and therefore require careful attention to land use management. This requires the investment. of at least as much time and resources as States have devoted to point sources. Under Section 319, States are putting into place strategic frameworks to guide and leverage a broad array of Federal, State, and local activities. They have made significant progress, but they still face critical issues. ASIWPCA Recommendation for NPS's: For the first several years of authorization as least: For later years: -States should continue their lead role and have wide latitude to create the NPS programs needed to achieve and maintain beneficial uses. State program adequacy should be judged based on the results that can be achieved. Acceptable strategies should include cooperative and regulatory approaches, financial incentives, interagency agreements, technical assistance, educational programs, land use authorities, etc. -The TMDL requirements need to be more compatible with NPS realities, i.e. take an adaptive management approach. -USDA programs should be greatly enhanced, including technical assistance and environmental/conservation funding for impaired waters in the 2001 Farm Bill. -319 authorization levels should support the program's growth, i.e.: $500 Million Annually $1 Billion Annually The definition of what qualifies as matching funds should be more flexible. A 40% State match of general funds is sometimes difficult to achieve when there are large Federal land holdings. States should be encouraged to (and get credit for) leveraging a broad range of funding. -Eligible uses of the funds should be very broad (planning, technical assistance, assessment, program administration/implementation, enforcement, education, demonstrations, and training) and include local program institution and stormwater management. 5. Animal Feedin2 Operations (AF01s) ASIWPCA supports the development of a comprehensive AFO Strategy. Many States have extensive programs that are effective. They should not be required to dismantle them and issue Section 402 permits. ASIWPCA Recommendations for AFO's: -AFO's should be required to develop manure management plans that are consistent with sound agronomic practices and water quality protection needs. -Both cooperative and regulatory mechanisms should be acceptable. Their adequacy should be judged based on broad, national performance expectations and water quality results (not process). Components of an acceptable State program should be defined as: Performance standards Education and technical Assistance Comprehensive manure management plans Public participation Complaint response Enforcement provisions Proactive inspection Statewide water quality monitoring When States use a regulatory approach, small CAFOs should be allowed sufficient time to voluntarily comply, thereby avoiding regulatory permitting. -Due to resource and other limitations, arbitrary deadlines are not appropriate. States must have latitude to coordinate and prioritize in conjunction with other important State programs. AFO implementation should be targeted to impaired and other high priority waters. -Additional financial assistance should be provided for producers and State and USDA Natural Resources Conservation Service staff. -The eligibilities for Section 319 Nonpoint Source, CWSRF, and EQIP funding should be extended to cover all concentrated animal feeding operations (CAFO's). State Water Quality Standards States are concerned about the recent changes USEPA has made to Section 304(a) criteria that cover nutrients, impaired waters due to fish advisories, methyl mercury, and sediment. USEPA intends to require that State adopt water quality standards (WQS) criteria for those parameters in all waters within 3 years (or be subject to USEPA promulgation). States appreciate and need better science from USEPA, but they question whether that has been achieved, particularly with regard to nutrients. In addition, State resources are inadequate to develop appropriate and defensible WQS criteria for all waters within the expected timeframe. This could unnecessarily increase both the number of TMDL's required and the associated municipal, industrial, and nonpoint source compliance costs. Waters that exceed USEPA's 304(a) nutrient criteria may be healthy. The utility of adopting WQS criteria for impaired waters with fish advisories or methyl mercury is questionable when States has no authority to control the source of the problem (e.g. air deposition). ASIWPCA Recommendation for 304(a) Criteria States should continue to be responsible for determining whether and what WQS refinements are appropriate or necessary. They should not be required to adopt criteria unless: - The pollutants have been determined to interfere with a designated use and - Adoption would be useful in pollution control decision-making. The Arsenic Rule There is continuing concern about the USEPA-promulgated Arsenic Rule. ASIWPCA concurs with the issues raised by its sister organization the Association of State Drinking Water Administrators (ASDWA) concerning: - Lack of adequate health effects at lower levels - Estimates of costs that do not fully account for disposal Cumulative costs of regulations and problems assuming POU or POE treatment for small systems when the regulatory "acceptance" of such treatment has not been vetted. Many States continue to express concern with USEPA's final rule on regulating arsenic in drinking water. Questions about actual health effects at low levels and the potential large cost implications - particularly for small systems - should warrant an approach where the standard is eased from 20 ppb to 50 ppb as an initial step. Once the health effects research has been completed and better cost data gathered from those systems that will have to install treatment and deal with waste disposal issues, USEPA can re- evaluate the standard during the six-year contaminant review process. This phased approach would result in an immediate reduction of arsenic in systems that have higher levels, allow better cost data to be developed based on actual system experience, provide time for USEPA to complete its health research to determine whether there is a linear or non-linear threshold for arsenic exposure, and promote the development of cost-effective technologies that can be tested and available at such time as the standard may be further lowered and affect more systems. Mr. Chairman, members of the Subcommittee, on behalf of the State water quality regulators and their Association, ASIWPCA, I thank you for providing me with this opportunity to share our views and perspectives with you. We look forward to having the opportunity to work with you and members of your staff to craft legislative language to address the concerns highlighted in this statement. I am available to address any questions you may have at this time, and our Executive Director is also available to work with members of your staff. Again, thank you for allowing me to appear before you today.

LOAD-DATE: March 1, 2001, Thursday