This article originally appeared in Water & Wastes Digest January 2020 issue as "Association Forecast."
2019 was witness to large moves in the water industry. From revisions to the Lead and Copper Rule and the release of the U.S. EPA National Water Reuse action plan, the industry has developed plans with purpose and achievable goals. But there are a multitude of other issues facing the industry, some revolve around funding and financing, while others are changes to regulations and legislation—both federally and at the state level. To better understand the largest talking points of 2020, Water & Wastes Digest (WWD) asked four associations—American Water Works Association (AWWA), Water & Wastewater Equipment Manufacturer’s Association (WWEMA), National Association of Clean Water Agencies (NACWA) and Water Environment Federation (WEF)—to submit briefs on the issues most important to them and their memberships in the coming year. Below are summaries from leadership at those associations.
Regulatory Forecast for Drinking Water
By Tracy Mehan & Chris Moody
Last year saw a flurry of drinking water regulatory and legislative activities. Despite this, we would wager that there will be more to come for 2020. The upcoming election will likely lead the current administration to push out as much as possible prior to this time next year in case of unfavorable election results. Much of the anticipated activity for this year is expected to be related to tying off loose ends.
In 2019, several drinking water regulations were proposed by the U.S. Environmental Protection Agency (EPA). The first major piece of regulation for 2019 was for perchlorate, which proposed either setting a maximum contaminant level (MCL) or reversing the prior positive regulatory determination, which AWWA has supported due to the lack of evidence for meaningful opportunity to protect public health. In November the EPA proposed revisions to the Lead and Copper Rule (LCR), which included broad changes to the rule such as new precautionary requirements for systems based on exceeding a new lead trigger level. The rule also includes requirements for systems to develop lead service line (LSL) inventories and to implement a LSL replacement program upon exceedance of the lead trigger or action level. The revisions to LCR also include extensive public outreach and risk communication practices as well as mandated lead testing in schools. AWWA expects the EPA to propose final rules for perchlorate and the revisions to the LCR later this year.
Additionally, 2019 marked a year of frustration for environmental advocates and the regulated community alike concerning per- and polyfluoroalkyl substances (PFAS). While the EPA has been working to better understand PFAS through research, Congress worked tirelessly during 2019 to mandate further action by the EPA to address PFAS as a class. This is likely to continue through 2020. AWWA is also anticipating the EPA will include a suite of PFAS in its proposed Fifth Unregulated Contaminant Monitoring Rule this summer.
To Regulate or Not to Regulate – That is the Question
By Vanessa M. Leiby
The Trump Administration has made it clear in its words, Executive Orders and actions that a key priority of this administration is the reduction in size of the federal government and the reduction/elimination of various regulations that it perceives hinder business, commerce, and/or job creation in the U.S. With regard to the EPA, the administration announced Nov. 21 that it had taken 48 deregulatory actions, which the agency projects has saved U.S. citizens more than $5 billion in regulatory costs.
Against this backdrop of rollback and deregulation are extent and substantial environmental and public health threats that have risen to the national stage over the last three years. These include lead, perchlorate, and PFAS to name a few. The public, as well as communities, utilities, and states are demanding action and setting their own standards in the face of inaction at the federal level. Congress also has actively weighed in on many of these contaminants, trying to compel EPA to take action outside of the regulatory structures created by statutes such as the Safe Drinking Water Act (SDWA).
For those of us who were actively involved in helping develop and pass the 1996 Amendments to the SDWA, we recognize and appreciate this difficult challenge. Prior to 1996, EPA often regulated contaminants based on pressure from Congress and the public but without clear scientific rationale. In fact, one of the primary purposes of the 1996 Amendments to the SDWA emphasized sound science and risk-based standard setting to require that EPA create a rational and scientific processes for identifying, researching, and ultimately regulating contaminants of greatest health and environmental concern. This process is being tested today as EPA faces mounting pressure to take action. The Fall 2019 Unified Agenda of Regulatory and Deregulatory Actions, published Nov. 20, offers a glimpse into these answers about regulating contaminants.
Let’s start with PFAS, which saw significant public and Congressional outcry in 2019. PFAS are a group of ubiquitous and persistent man-made chemicals manufactured and used in a variety of industries around the globe, including in the U. S., since the 1940s. PFAS can be found in food packaging, non-stick Teflon products, fire retardants, and stain- and water-repellent fabrics to name a few.
Perfluorooctanic acid (PFOA) and perfluorooctanesulfate (PFOS) are two of the PFAS contaminants on the fourth Contaminant Candidate List for which EPA must make a regulatory determination by the end of 2019. This determination, which begins the rulemaking process to develop a National Primary Drinking Water Regulation (NPDWR), is based on three criteria: 1) health risk; 2) high occurrence; and 3) potential for risk reduction. EPA can determine if a contaminant should drop off the list, be further studied, or move down the path for regulation. This determination is published in the Federal Register for public comments.
EPA also consults with states and other Federal Agencies. Once this process is completed, it reviews and considers all the comments and recommendations and publishes a final notice in the Federal Register. According to the agenda, the publication of the final determination (not a rule) will be made by January 2021. Of note, EPA has already announced a delay in the assessment of draft toxicity values for PFAS until Q1 2020.
Shifting gears, the Regulatory Revisions for the Lead and Copper Rule, which have been years in the making, continue to move forward. The Notice of Proposed Rulemaking (NPRM) was published in the Federal Register on Nov. 13. Comments must be received by Jan. 13. The proposed changes focus on six key areas: identifying areas most impacted; strengthening treatment requirements; replacing lead service lines; increasing sampling reliability; improving risk communication; and protecting children in schools. One key question will be the cost of implementing the rule since the Trump Administration requires that for every rule an Agency promulgates, additional rules of equal or greater cost must be taken off the books. This may be particularly challenging in light of the cost for lead service line replacement.
Perchlorate is another contaminant EPA has been wrestling with for a number of years. A recent Consent Decree filed against EPA mandated the agency finalize a NPDWR with a maximum contaminant level goal (MCLG) by Dec. 19. That, however has now been delayed until June 2020 due to an overwhelming number of comments. The agency’s proposed options range from three levels of MCLs and MCLGs to deciding not to regulate perchlorate at all – quite a range of options.
Finally, a rulemaking that is of interest to a number of WWEMA members is the Peak Flows Management Rule to address sanitary sewer overflows due to wet weather events. Although listed as deregulatory in nature, this rule will seek to ensure a consistent national approach for permitting Publicly Owned Treatment Works that allow for efficient plant operation while protecting the public from adverse health effects related to inadequately treated wastewater. A NPRM is expected in December 2019, although that timetable may be optimistic.
Modernizing the Outdated Affordability Framework
By Kristina Surfus & Emily Remmel
As the clean water sector looks ahead to the 50th anniversary of the Clean Water Act (CWA) in 2022, there are significant achievements to be celebrated, and yet more work to do. One significant regulatory and legislative priority that remains outstanding is modernizing the outdated affordability framework to reflect the real affordability challenges facing local utilities.
Aging infrastructure, regulatory drivers, and the diminution of federal dollars have left local governments holding the bag to fund capital improvements and ongoing operation and maintenance to meet today’s needs at rates that are not beyond the reach of the households they serve. As these challenges grow, it is imperative the EPA revise its outdated affordability guidance.
EPA’s existing 1997 guidance—Combined Sewer Overflows: Guidance for Financial Capability Assessment and Schedule Development—has serious, known flaws, including reliance on the 2% Median Household Income (MHI) threshold, which is a poor indicator of economic distress and fails to capture impacts across diverse populations within a community. The existing methodology does not look holistically at drinking water, wastewater, and storm water, nor does it account for other non-discretionary household costs which can exacerbate affordability challenges for individuals.
Echoing many of the water sectors concerns over affordability, the National Academy of Public Administration (NAPA) recommended major changes to EPA’s procedure for evaluating ratepayer affordability and utility financial capability. However, the recommendations did not provide a new methodology or path forward for EPA.
NACWA, AWWA, and WEF released a report in April 2019 titled Developing a New Framework for Household Affordability and Financial Capability Assessment in the Water Sector. This report builds upon the recommendations in the NAPA report and provides EPA with an adoption-ready, updated framework and methodology for household affordability and financial capability assessment. Working with EPA to update its affordability guidance in line with these recommendations will be a central regulatory priority for NACWA in 2020.
An updated water affordability methodology is only one element of ensuring access to clean and safe water services. The other legislative element NACWA will pursue is advancing legislation to establish a federal financial assistance program for water and wastewater services. Unlike other similar life-critical programs—such as supplemental food and heating assistance—no federal low-income assistance program for water and wastewater exists. This missing piece, combined with rising water and wastewater bills is further exasperated by growing income inequality, meaning too many households are at risk of loss of service. It also means public utilities, working to avoid shutoffs at all costs, must deal with growing numbers of delinquent accounts and lost revenue. Neither situation is sustainable.
As we look to the next 50 years of the CWA, ensuring access to water service and that utilities are resilient and sustainable is paramount. NACWA looks forward to continuing to work on these critical issues.
Congress Taking Hard Look at PFAS
By Steve Dye
Over the last year, Congress has taken a hard look at what the federal government can or should do to help address PFAS in our environment. EPA has also started a process to take some regulatory actions in the coming months. WEF has been closely monitoring these activities and directly involved with some of the policy proposals under consideration. WEF’s members also recently provided a groundswell of grassroots outreach by sending more than 1,000 letters to Congress when it was considering, including provision in the 2020 National Defense Authorization Act (NDAA).
PFAS is a huge concern for the sector, and we want to find technical and regulatory solutions to remediate it in treatment works and biosolids management. The Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), also known as Superfund, has been proposed as a possible regulatory avenue, but the wastewater sector has concerns about using that path without assurances that wastewater utilities and biosolids management programs will not be held liable. According to legal reviews of the statute, utilities could be held liable as a potential responsible party (PRP) although they are not the producers of the PFAS. Wastewater utilities are “receivers”, not “producers” or “users” of PFAS, and therefore should not be considered a PRP under CERCLA.
The final NDAA dropped a provision that would have included PFAS in CERCLA, but it is expected that Congress will consider including CERCLA and other regulatory statues in legislation in 2020.
Additionally, on Dec. 3, the EPA transmitted to the White House Office of Management and Budget a proposed regulatory determination for PFOS and PFOA in drinking water under the SDWA. This step sets in motion the process of adding PFAS to fourt4h Contaminant Candidate List (CCL4) of SDWA.
As any legislative or regulatory actions moves forward, WEF will be communicating with the public and policy makers how the clean water sector may be impacted. PFAS is a serious concern to communities nationwide and the clean water sector wants to be a partner in remediating this challenge.