National Drinking Water Clearinghouse
West Virginia University
PO Box 6893
Morgantown, WV
26506-6893



Regulations:

How in the world does EPA make them?


by Jamie Knotts
On Tap Assistant Editor

Ask any drinking water operator or utility manager what’s the hardest part of their job and it’s likely that one of their top answers would be “understanding and complying with ever-changing federal regulations.” But ask them how the U.S. Environmental Protection Agency (EPA) sets new requirements they have to put into place at their treatment plant and you’ll probably be met with a blank stare.

Understanding some of the regulations is hard enough, let alone knowing the complicated procedure EPA uses to develop new rules. The regulation process involves Congress, the President, scientists, lobbyists working for special interest groups, agency bureaucrats and technical experts (specializing in engineering, science, public health, economics, and statistics), and the general public. As part of the technical evaluation and analysis that goes into developing drinking water rules, EPA must consider data and research on contaminant occurrence, chronic and acute health effects, sensitive sub-populations, available control technologies as well as readily available analytical methods. And even though the process allows for input from many different groups, EPA has been severely criticized at times for how it does set its regulations.

Giving EPA Authority
The landmark piece of legislation that gives EPA power in developing and overseeing drinking water regulations is the Safe Drinking Water Act (SDWA). Originally passed by Congress in 1974 to protect public health by regulating the nation’s public water supply, the law was amended in 1986 and 1996, and requires many actions to protect drinking water and its sources—rivers, lakes, reservoirs, springs, and groundwater wells. (See the Winter 1996 and Winter 1999 issues of On Tap for more information about the SDWA.) The SDWA authorizes EPA to set national health-based standards for drinking water to protect against both naturally-occurring and manmade contaminants that may be found in drinking water. EPA, states, and water systems then work together to make sure that these standards are met.

EPA also gets directives from Congress, Presidential initiatives, and priorities set by the agency’s administrator. In addition to introducing a bill in Congress, another way a representative or senator can influence the rule-making process is by attaching riders—an amendment added to a piece of legislation—to a related or non-related bill making its way through Congress.
For instance, an influential senator may have a local or state water concern that he or she wants EPA to address through a new or updated regulation. By adding a directive to EPA onto an appropriation bill, it’s less likely that the President will veto the legislation outright due to one of many riders that’s been attached to the larger piece of legislation that he wants to sign.
The recently contested arsenic standard is an example of a congressional rider that is making its way through the legislative process. In this example, the House of Representatives added a rider stipulating that the EPA immediately adopt the Clinton Administration’s standard of 10 parts per billion (later rescinded by the Bush Administration). The U.S. Senate’s rider to a piece of its legislation simply said that EPA was to immediately set a new standard for arsenic that provides for appropriate health protection.

Because the two riders differ, a conference committee made up of members of both the House and Senate will negotiate the final wording before it is sent to the President for either a signature or a veto, assuming the rider makes it out of the conference committee. Some riders are removed through negotiations before bills ever reach the President.

Presidential Powers Enter the Mix
But Congress isn’t the only player in the process. The President wields considerable power in how EPA carries out its oversight and regulatory functions. From an administrative and political point of view, the President’s selection of EPA Administrator is often seen as a barometer of how the agency will operate. Administrators set priorities within the agency, which often dictate how the agency will approach a regulation’s development.

As occurred with the change from the Clinton Administration to the Bush Administration in January, the President can also exert his influence over regulations passed by a previous administration. President Bush directed that all federal agencies had 60 days to review any standards passed in the waning days of the Clinton Administra-tion. President Bush disagreed with the Arsenic Standard as developed by EPA and put it on hold through the 60-day review. Once EPA promulgates a regulation (publishes a final rule in the Federal Register), 180 days must pass before the regulation goes into effect. The President’s hold on regulations fell within this 180-day wait period. The House and Senate’s riders arose as a direct response. Once the conference committee completes final negotiations, we’ll know what shape the final Arsenic Standard will take.

SDWA Steers EPA
Under the SDWA, Congress requires EPA to review existing regulation to see if any regulations need to be updated, which is often referred to as the six-year review process. Congress also requires EPA to develop regulations for a specific list of contaminants, including microbial disinfection products, radon, arsenic, and the ground water rule. And finally congress requires EPA to address new contaminants through a risk-based analysis of contaminants listed on EPA’s contaminant candidate list.
When EPA considers a contaminant as identified through legal requirement, court order, Presidential initiative, or administrator priority, the SDWA requires EPA to establish a primary drinking water standard. At its simplest, EPA does this through a three-step process.

First, EPA identifies contaminants for regulatory consideration. To do this, it must determine whether the contaminant may adversely affect public health, evaluate where the contaminant occurs in drinking water with the frequency levels of public health concern, and decide whether regulating a contaminant poses a meaningful opportunity to reduce risk. EPA identifies these contaminants for further study, and determines contaminants to potentially regulate. Second, EPA determines a maximum contaminant level goal (MCLG) for contaminants it decides to regulate. This goal is the level of a contaminant in drinking water below which there is no known or expected risk to health. These goals allow for a margin of safety.

Third, EPA specifies a maximum contaminant level (MCL), the highest permissible level of a contaminant in drinking water delivered to any public water system user. These levels are enforceable standards, and are set as close to the MCLG as feasible. SDWA defines feasible as the level that may be achieved using the best technology, treatment techniques, and other means that EPA finds (after examining for efficiency under field conditions) are available, taking cost into consideration. When it is not economically or technically feasible to set an MCL, or when there is no reliable or economic method to detect contaminants in the water, EPA instead sets a required Treatment Technique, which specifies a way to treat the water to remove contaminants.

How EPA Develops Regulations
The process EPA uses to develop regulations becomes a little more complicated when you look at the specifics. The steps the agency uses include tiering, analytic blueprint, options development, options selection, and final agency review. Under tiering, the EPA lead office responsible for the rule—the Office of Ground Water and Drinking Water for drinking water regulations—assigns the rule to one of three tiers. Tier 1 includes the rules that are the most visible and controversial, and of most interest to the agency’s administrator. Tier 2 includes rules with extensive cross-media issues or which require extensive cross-agency involvement.

Tier 1 and 2 regulations require a cross-agency workgroup and early senior management direction. Tier 3 includes all rules not considered Tier 1 or 2. The Regulatory Steering Committee, which consists of representatives of EPA’s
assistant administrators and is approved by the Administrator’s Office, receives the tier designation.

From there, the cross-agency workgroup coordinates the regulation’s development and, as a first step, prepares an analytic blueprint—the plan for the analyses, consultation, and other activities that support the regulation. The blueprint details how EPA will gather the economic, scientific, technical, and intergovernmental information needed to make sound decisions, as well as the analyses required by law or Executive Order. It also addresses significant policy issues, including implementation issues, such as the need for real-time compliance assistance tools, as well as international factors like treaties, transboundary or global pollution, and other countries’ relevant experiences. Senior management in the program offices, and in some cases, the Administrator’s Office guides the blueprint development. It is then circulated for approval by workgroup program managers and, in the case of Tier 1 and 2 rules, senior management. A blueprint is required for Tier 1 and 2 regulations, and strongly recommended for Tier 3.

The next step is to develop options. To develop regulatory options, the lead program office consults with a broad range of stakeholders, which may include state, local, and tribal governments, industry, small businesses, public interest groups, and others. The workgroup conducts the analyses in the analytic blueprint and considers other issues such as disproportionate impacts on minority groups, children’s health issues, and innovative alternatives to the regulation. Once the options are developed, EPA management considers the scientific findings, the relative benefits and costs, and the policy issues identified through the various analyses and consultations. If management selects a rulemaking option, the workgroup drafts the preamble to the rule, the proposed regulatory text, and supporting documents.

At the end of the process, the lead office prepares a final draft and circulates it to the workgroup for final review and approval. If the rule is in Tier 1 or 2, the Office of Policy, Economics and Innovation chairs a final agency review meeting to assure that all issues are resolved, that all requirements have been met, and that the rule is ready for Office of Management and Budget review (where required) or Federal Register publication.

Stakeholders Get Involved
The 1996 amendments to the SDWA greatly enhanced the general public and drinking water stakeholders’—operators, utilities, water association members, environmental groups, and other drinking water professionals—input into the rule-making process. EPA takes comments through public meetings, presentations at conferences, and workgroup meetings.

Jerry Biberstine, a senior environmental engineer with the National Rural Water Association (NRWA), says EPA’s openness to others’ input has been helpful for small and rural drinking water utilities. “Small and rural systems have special problems that are difficult to determine when you’re just looking at large systems when writing rules,” says Biberstine. “Such things as the cost of treatment and the scope of the rule are important to small systems, so we offer EPA that insight.

“We feel the impact on small systems—75 percent of all systems—is difficult for EPA to determine because they are most familiar with larger systems and the cost impacts to them,” he says. “NRWA has been providing EPA with a sense of scope, cost, and other factors that represent a small or rural water utility’s perspective. We give them input that hopefully helps them make regulations that are both affordable and implementable for small water systems.

“We’ve been lucky to have someone sit in on almost every workgroup on rule-writing,” Biberstine says. “We’ve had members involved in committee meetings and public meetings, and Rural Water has also offered written comments to the agency. In addition we’re in contact with EPA personnel directly.” The American Water Works Association (AWWA) also takes an active role in EPA’s rule making. Under the direction of the AWWA Water Utility Council (WUC) and AWWA Executive Committee, association volunteers serve on Technical Advisory Workgroups (TAW) to participate in developing new regulations, preparing comments on proposed regulations, and implementing projects under the Water Industry Technical Action Fund. AWWA’s Government Affairs Division supports the activities of the WUC and TAWs and periodically prepares status reports on upcoming regulations. In addition, AWWA members often offer testimony to Congress and EPA about proposed legislation and regulations.

Improving the Regulatory Process
It’s no secret that most groups that are regulated dislike being so. And they often disagree with the scope and impact that requirements place on them. The federal government recognized this, and in 1996, President Clinton issued an Executive Order instructing agencies to adhere to 12 “principles of regulation.” These principles, which provide a series of guideposts for agencies to follow in developing more focused, effective, efficient, and less burdensome rules, were grouped into six broad themes that call on agencies to:
1. properly identify problems and risks to be addressed, and tailor the regulatory approach narrowly to address them;
2. develop alternative approaches to traditional command-and-control regulation, such as using performance standards (telling people what goals to meet, not how to meet them), relying on market incentives, or issuing non-binding guidance in lieu of rules;.
3. develop rules that, according to sound analysis, are cost-effective and have benefits that justify their costs;
4. consult with those affected by the regulation, especially state, local, and tribal governments;
5. ensure that agency rules are well coordinated with rules or policies of other agencies; and
6. streamline, simplify, and reduce the burden of federal regulation.

EPA Is Criticized
But just because a federal agency says it is being more accountable and less burdensome to the community it regulates doesn’t always sit well with those facing compliance issues with new or more stringent regulations. Aside from those stakeholders being regulated, EPA officials have also criticized the agency. In 1996, David Lewis a researcher with the EPA National Exposure Research Laboratory in Athens, Georgia, wrote a commentary in the Athens Banner-Herald, that the EPA’s environmental policies were misguided.

Lewis’ guest column read, in part, that “federal regulators assume that everything humans do will ultimately harm the environment. Therefore, they promulgate regulations aimed at making it extraordinarily difficult and expensive to do anything that changes the environment in any way.” EPA investigated Lewis for alleged ethics violations as a result of the commentary. Investigators looked into whether an editor’s note in Lewis’ column violated a rule because it over-emphasized his position with the agency.

In June 2000, David Paris testified before Congress where he offered a number of criticisms of EPA’s work in implementing the 1996 SDWA amendments. Paris, a water supply administrator with the Manchester Water Treatment Plant in Manchester, New Hampshire, spoke on behalf of the AWWA. While complimenting EPA’s Office of Groundwater and Drinking Water for involving the public in developing regulations, he noted that, “AWWA does have a major concern that EPA is not conducting essential research and developing new data to support drinking water regulations as expected in the 1996 SDWA Amendments.
“There is also a long-term concern that the authorizations for the new drinking water state revolving fund will not be adequate to address the needs identified to comply with SDWA regulations and upgrade drinking water infrastructure to ensure that high quality safe drinking water is provided to the American people.”

NRWA’s Jerry Biberstine says one of the biggest problems EPA has with rulemaking is the amount of time it has to consider sound science that shows the benefits and the cost of the rules. “It’s the time frame that is the problem,” he says. “Congress forces EPA to address all the concerns of a proposed regulation in a short amount of time. I fault the process rather than EPA. They are under considerable pressure.”

EPA Recognizes Problems
EPA itself recognized problems and that its regulatory process needed to be improved. In a June 2001 EPA Task Force Report titled Improving Regulations, the agency acknowledged problems and ways to improve the process, primarily the quality of supporting scientific, economic, and policy analysis. The report said that EPA needed, “better science and economic analysis, broader consideration of policy options, and greater accountability.”

EPA acknowledged that, “It is absolutely essential that EPA leaders have the best possible scientific and economic information to consider when making decisions. But it’s important to note that science and economics are only two of the many factors that must be considered. Other factors might include implementation by states or local governments, disproportionate impacts on low income communities, the limitations of available technology, or whether a certain approach can actually be enforced. The role of science and economics is, therefore, to inform the decision making, not to dictate the final decision.”

Regulations Affect Small Systems
Mike Keegan, an analyst with the NRWA, says that small and rural water systems often face the brunt of regulations and may not have the resources to cope with them. “We try to advocate for the small town’s best interest and help EPA look at the big picture,” he says. “A lot of their rules don’t apply to small communities. Small communities’ problem is a resource problem rather than a regulatory problem. EPA comes at it with a regulatory solution saying a system needs to meet a standard and then they fine you if you don’t comply with that standard. We’re saying small utilities need the resources to correct the problems, not a regulation—and usually we are not talking about water quality problems, but rather administriatve problems.”

Keegan says that the current EPA rulemaking process also doesn’t allow for much leeway for locals to make decisions. “The people who run the town’s water system and the local community should have some choice in the matter,” he says. “The SDWA is blind to nuances at the local level.

“Let’s say that when the new arsenic regulation is finalized it allows only 10 parts per billion and a certain town’s water tests at 10.5 parts per billion. In the gray area like this, I want the local community to have more control on the issue rather the requirements be set in stone,” Keegan says. “They should have some say as to whether they want to install an expensive treatment process for 0.5 parts per billion. Scientists can’t claim that their water would be any safer having that small amount removed.

“If you went out and told them (small utilities) what they needed to do to improve their water and make it sensible, then they could take care of their problems much easier,” Keegan says. “Regulations just don’t fit. We try to get in there (the rule-making process) to hopefully make sure the rules don’t do any harm. “I think one of the biggest problems has been the environmental groups constantly misleading the public on who is in control of their local water quality,” continues Keegan. “A local community has complete control over quality issues, however, big environmental groups promote the image of a sinister force attempting to harm your family. They should be educating the public on civics and how to empower locals to better make local decisions instead of always removing local authority and replacing it with federal authority.

“We have an open challenge to the green groups: If they can get the local votes to implement any of their policies we would back them 100 percent. However, the reality is that locals don’t back their agenda so they need to override the local will with EPA authority.”

For more information about EPA’s regulatory process, visit the Office of Ground Water and Drinking Water’s Web site at www.epa.gov-/OGWDW/ or call the Safe Drinking Water Hotline at (800) 426-4791.

For more information about NRWA, visit their site at www.nrwa.org or call them at (580) 252-0629.