oEPA
United States
Environmental Protection
Agency
Office of Water 430/9-81 -020
Program Operations (WH-547) July 1982
Washington DC 20460
c.1
Construction
Grants
1982 (CG-82)
Interim
Final
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CONSTRUCTION GRANTS - 1982
MUNICIPAL WASTEWATER TREATMENT
United States Environmental Protection Agency
Office of Water Program Operations
Washington, D.C. 20460
July, 1982
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PREPARED BY:
Municipal Construction Division and
Facilities Requirements Division
Office of Water Program Operations
Environmental Protection Agency
Washington, DC 20460
Task Officers: Lam Lim and H. William Kramer
Technical Assistance in the production of this publication was provided by:
Brown and Caldwell, Walnut Creek, California; and A. T. Bowyer, Inc., Towaco,
New Jersey.
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CONTENTS
TABLE OF CONTENTS iii
FOREWORD xi
INTRODUCTION
USER GUIDE xiii
Reference to Federal Regulations xiii
1981 Amendments to the Clean Water Act xiii
Terminology xiv
Other Guidance xiv
Appendixes xiv
MANAGING YOUR PROJECT xv
Introduction xv
Clean Water Act xv
Grants Program xv
Project Management and State Delegation xvii
State Contact xviii
Organizing the Project Team xviii
Funding Local Share xx
Intermunicipal Service Agreements xx
Avoiding Project Delay xx
Chapter
PART I. FACILITIES PLANNING
1 .... FACILITIES PLANNING—PURPOSE AND CONTENT 1
1.0 Amendments of 1981 1
1.1 Facilities Planning—Purpose and Definition 2
1.2 Contents of Facilities Plan 2
2 .... PREPLANNING 5
2.0 Preplanning Conference 5
2.1 Eligible Applicant 6
2.2 Plan of Study 6
2.3 Clearinghouse Comments 7
2.4 Procurement of Services 7
3 .... FACILITIES PLANNING CONSIDERATIONS 8
3.0 General Preparation Procedures 8
3.1 Public Participation 8
3.2 Environmental Description and Analysis 10
3.2.1 Historical and Archaeological Sites 12
3.2.2 Floodplains, Wetlands, and Flood Insurance 13
iii
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CONTENTS (continued)
Chapter
3 (continued)
3.2.3 Agricultural Lands 13
3.2.4 Coastal Zone Management 14
3.2.5 Wild and Scenic Rivers 14
3.2.6 Fish and Wildlife Protection 14
3.2.7 Endangered Species Protection 15
3.2.8 Air Quality 15
3.2.9 Water Quality and Quantity 15
3.2.10 Direct and Indirect Impacts 16
3.2.11 Mitigating Adverse Impacts 17
3.2.12 Determining Need for an EIS 17
WATER QUALITY MANAGEMENT PLANNING RELATED TO
FACILITIES PLANNING 19
4.0 Water Quality Management Plans 20
4.1 State Priority System and Priority List 20
4.2 Wasteload Allocations 20
4.3 305(b) Reports 20
EXISTING AND FUTURE CONDITIONS 21
5.0 Project Need and Planning Area Identification 21
5.1 Existing Environment of the Planning Area 21
5.2 Existing Wastewater Flows and Treatment Systems 22
5.3 Effluent Limitations 22
5.4 Infiltration and Inflow (I/I) 23
5.4.1 Sewer Use Ordinance and Sewer
Maintenance Program 24
5.5 Future Conditions 25
5.5.1 Population and Land Use Projections 25
5.5.2 Forecasts of Flows and Wasteloads 26
5.5.3 Flow Reduction 27
5.6 Future Environment Without the Project 28
DEVELOPMENT AND SCREENING OF ALTERNATIVES 28
6.0 Optimum Operation of Existing Facilities 28
6.1 Regionalization 29
6.2 Unsewered Areas 30
6.3 Conventional Collection System 31
6.4 Waste Treatment Management Techniques 32
6.4.1 Innovative and Alternative
Technology 32
6.4.2 Land Application 34
6.4.3 Small Alternative Wastewater
Systems (SAWS) 35
6.4.4 Individual Systems 37
iv
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CONTENTS (continued)
Page
Chapter
6 (continued)
6.5 Evaluation of Sewer Alignments 37
6.6 Use and Disposal of Sludge 37
6.7 Combined Sewer Overflows (CSO's) 39
6.8 Municipal Treatment of Industrial Flows 40
6.9 Staged Construction 40
6.10 Multiple Purpose Projects 41
7 .... EVALUATION OF PRINCIPAL ALTERNATIVES
AND PLAN ADOPTION 42
7.0 Evaluation of Monetary Costs 42
7.0.1 Sunk Costs 44
7.0.2 Cost Escalation Factors for Energy
Use and Land 44
7.0.3 Alternative Technology Cost Preference 44
7.0.4 Allocation of Costs for Multiple Purpose
Projects 45
7.1 Additional Capacity 45
7.2 Demonstration of Financial Capability 45
7.2.1 Assuring Low Cost Projects for Small
Communitites 48
7.3 Capital Financing Plan 49
7.4 Environmental Evaluation 50
7.5 Evaluation of Reliability 50
7.6 Evaluation of Energy Requirements 50
7.7 Evaluation of Implementability 50
7.8 Evaluation of Recreational Opportunities 50
7.9 Comparison of Alternatives 51
7.10 Views of the Public and Concerned Interests 51
8 .... SELECTED PLAN, DESCRIPTION AND IMPLEMENTATION
ARRANGEMENTS 53
8.0 Justification and Description of Selected Plan 53
8.1 Design of Selected Plan 53
8.2 Cost Estimates for Selected Plan 54
8.3 Energy Requirements of Selected Plan 54
8.4 Environmental Impacts of Selected Plan 54
8.5 Arrangements for Implementation 54
8.5.1 Institutional Responsibilities 54
8.5.2 Civil Rights Compliance 56
8.5.3 Operation and Maintenance
Requirements (O&M) 55
8.5.4 Pretreatment Program 55
8.6 Land Acquisition 57
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CONTENTS (continued)
Page
Chapter
8 (continued)
8.6.1 Gerieral Acquisition Considerations 57
8.6.2 "No Cost Arrangements" 58
8.6.3 Acquisition Method and Approval 58
8.6.4 Allowable Land Costs 59
9 .... REVIEW OF FACILITIES PLANS 60
9.0 Review and Evaluation 60
9.1 Summary Checklist 60
9.2 Agency Review 62
9.2.1 State Review and Certification to EPA 62
9.2.2 Advanced Treatment Review 62
9.2.2 EPA Actions Under NEPA 62
PART II. DESIGN
10 ... PREDESIGN 63
10.0 Predesign Conference 63
10.1 Field Testing of Innovative and Alternative
Technology ' 64
11 ... DESIGN AND ADMINISTRATIVE CONSIDERATIONS 66
11.0 Design Considerations 66
11.0.1 Pretreatment and NPDES Permit 66
11.0.2 Wet and Dry Well Classifications 66
11.0.3 Use of Mercury 67
11.0.4 Shellfish Waters 68
11.0.5 Chlorination Systems Using Gaseous
Chlorine 68
11.0.6 Chemical Storage and Hazardous Materials 69
ir.0.7 Safety 70
11.0.8 Bypassing of Sewage 70
11.0.9 Public Water Supply 70
11.0.10 Ventilation 70
11.0.11 Laboratory Facilities 71
11.0.12 Emergency Alarms 71
11.0.13 Equipment and Materials 71
11.0.14 Land Based Systems 77
11.0.15 Erosion and Sediment Control 77
11.0.16 Mitigation of Adverse Environmental
Impacts 77
11.0.17 Sewers 77
11.0.18 Sewer Rehabilitation 78
11.0.19 Operation and Maintenance 78
vi
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CONTENTS (continued)
Page
Chapter
11 (continued)
11.1 Administrative Considerations 78
11.1.1 Bonding and Insurance 78
11.1.2 (Reserve) 79
11.1.3 Buy American 79
11.1.4 Royalties 80
11.1.5 Project Sign 80
11.1.6 Small, Minority, Women's, and Labor
Surplus Area Businesses 80
11.2 Design Review 80
12 ... CONCURRENT ACTIVITIES DURING DESIGN 81
12.0 Concurrent Activities * ' si
12.1 Value Engineering 81
12.1.1 VE Team and Qualifications 81
12.1.2 Scope of Work 82
12.1.3 Proposal Cost and Timing 82
12.2 User Charge System 83
12.2.1 Actual Use 83
12.2.2 Ad Valorem Taxes 84
12.2.3 Other User Charge Considerations 84
12.2.4 Adoption of System 84
12.3 Sewer Use Ordinance 85
12.4 Plan of Operation 86
12.4.1 Staffing and Training 86
12.4.2 Administrative Functions 86
12.4.3 Budget 86
12.4.4 Operation and Maintenance Manual 86
12.5 Onsite and Cluster Systems 87
12.6 Innovative and Alternative (I&A) Technology
Reconfirmation 87
12.7 Planning for Local Funds 88
PART III. CONSTRUCTION
13 ... GRANT APPLICATION 89
13.0 Narrative Statement 89
13.1 Contents of Application 89
13.1.1 Clearinghouse Comments 89
13.1.2 Application Form 90
13.2 Limitations on Award 90
13.3 Other Step 3 Considerations 93
13.4 Procurement 94
13.5 Federal Grant Share 94
13.6 Grant Award 95
vii
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CONTENTS (continued)
Chapter
14 ... PROJECT CONSTRUCTION 96
14.0 Project Construction 96
14.1 Grant Increases/Decreases 96
14.1.1 .Grant Increase 96
14.1.2 Grant Decrease 96
14.2 Preconstruction Conference 96
14.3 Monitoring Construction 97
14.3.1 Change Orders 97
14.3.2 Onsite Observation 104
14.4 Payment Requests and Limitations 106
14.5 Plan of Operation 106
14.6 Project Performance 106
PART IV. FINANCIAL AND PROCUREMENT CONSIDERATIONS
15 ... FINANCIAL CONSIDERATIONS 108
15.0 Allowable and Unallowable Costs 108
15.1 Replacement Costs 108
15.2 Innovative and Alternative Technology Replacement
Grant 110
15.3 Force Account 111
15.3.1 Prior Approval 111
15.3.2 Other Force Account Considerations 111
15.4 Payments 112
15.4.1 Preaward Costs 112
15.4.2 Interim Payments 113
15.4.3 Final Payment 113
15.5 Grant Increases/Decreases 113
15.6 Audits 113
15.6.1 Financial Records 114
15.6.2 Audit Procedures and Reports 114
16 ... PROCUREMENT 115
16.0 Introduction 115
16.1 Procurement Certification 116
16.2 Procurement Management 116
16.3 Methods of Procurement 117
16.4 Formal Advertising 118
16.4.1 Solicitation for Bids 118
16.4.2 Bid Receipt and Opening 118
16.4.3 Bid Evaluation 118
16.5 Competitive Negotiation 119
16.5.1 Public Notice 120
16.5.2 Evaluation of Proposals 120
16.5.3 Negotiation and Award of Subagreement 120
viii
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CONTENTS (continued)
Page
Chapter
16 (continued)
16.5.4 Optional A/E Negotiation Procedure
16.5.5 Optional A/E Continuation
16.5.6 Cost and Price Considerations
16.6 Noncompetitive Negotiation
16.7 Small Purchases
16.8 Subagreements
16.9 Minority, Women's, Small and Labor Surplus Area
Businesses
16.10 Subagreement Clauses
16.11 Protests
120
122
122
123
124
124
125
126
126
FIGURES AND TABLES
Figure 1. Construction Grants Process xvi
Figure A. Major Activities In the Construction Grants Program xxii
Figure 2. Procedural Flow Chart for Facilities Planning 3
Figure 3. General Facilities Plan Preparation Procedures 9
Figure 4. Comparison of Principal Alternatives 52
Table 1. Wastewater Treatment System Reliability 74
Table 2. Sludge Handling and Disposal System Reliability 75
Table 3. Electric Power System Reliability 76
Table 4. Grantee and Contractor Responsibilities 109
IX
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APPENDICES
Appendix
A - PRMs and PQMs Discontinued or Cancelled Upon Publication
of CG-82
B - List of EPA Publications
C - Reserved
D - Energy Cost Escalation Factors - Example Calculation
E - Example Calculation - Present Worth and Equivalent
Uniform Annual Costs; Application of Alternative
Technology Cost Preference
F - Cost Adjustment for Financial Capability
G - Supplemental Information for Land Acquisition
H - Wet and Dry Well Classification
I - Reserve
J - Project Sign
K - Wastewater Facilities Financial Information Sheet
L - Highlights of 1981 Amendments to the Clean Water Act
*M - 40 CFR Part 35, Subpart I, Grants for Construction of
Treatment Works
*N - 40 CFR Part 33, Procurement Under Assistance Agreements
0 - Alternative Justifiable Expenditure Method of Cost Allocation
* Note: Complete document not included in draft package.
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FOREWORD
This book (CG-82) is part of our ongoing effort to simplify and delegate the
municipal construction grants program. It includes provisions of the
Municipal Wastewater Treatment Construction Grants Amendments of 1981, enacted
on December 29, 1981, and its implementing regulations published as an interim
final rule in the Federal Register on May 12, 1982. The 1981 amendments
significantly altered the procedural and administrative aspects of
implementing the Clean Water Act of 1977 but did not alter the National goal
of clean water.
The regulations implementing the 1981 amendments contain the requirements
for grant assistance under the construction grants program. To distinguish
restated regulatory requirements from discretionary guidance or suggestions of
good practice in CG-82, the following conventions are used. Requirements use
the words "must" or "will", or are written as imperative statements, and are
identified by a bar in the margin. If there appears to be a difference
between the regulations and the restatement in CG-82, the regulations govern.
Recommended methods or formats to meet the regulatory requirements use the
word "should". Suggestions of good practice, which may not relate to a
particular requirement, use the words "can" or "may". A municipality is not
required to follow the guidance in CG-82 in order to qualify for Federal grant
assistance.
The reason for this significant departure from previous policy is our
desire to focus on the statutory and program requirements that are necessary
to ensure effective project management. Our concern is results, not
procedures, and we want those results achieved in the most effective and
reasonable manner possible. The guidance in CG-82 is being provided to
facilitate achieving those results at reasonable costs. Where a municipality
or State develops alternative procedures to meet the stated results, then
those procedures are satisfactory. The cost of following the Step 3 guidance
described in this book is allowable for grant participation if approved by the
reviewing agency. An allowance for planning and design costs will be part of
any grant for building the project if no previous Step 1 or Step 2 grant has
been awarded. Costs for individual activities are not segregated and cannot
be negotiated in addition to the allowance.
As we continue our deregulation efforts, we will reevaluate and revise
CG-82 and other guidance materials as appropriate. We remain committed to
reducing the procedural requirements for planning, design, and building of
wastewater treatment works, to publishing new requirements (with the exception
of those specified by law or executive order), and to facilitate delegation of
the review and approval of projects to the States.
EPA intends that requirements be in the regulations only and therefore,
CG-82 replaces the former system of PRMs and ROMs. Upon publication of CG-82,
all PRMs and POMs are cancelled (Appendix A). This book and the revised
regulations (Subpart I of Part 40) apply to grants made on or after
May 12, 1982. For grants made before that date, the regulations and guidance
in effect at the time the grant was made still apply to those grants.
We plan to update the document to account for any changes in the
construction grant regulations when they are promulgated in final form. For
this reason, we are encouraging additional public comments on CG-82 and will
use these to make final revisions in the document (which will appear as
CG-83). Send any comments or suggestions to the Director, Municipal
Construction Division, Office of Water Program Operations (WH-547),
Environmental Protection Agency, Washington, D.C. 20460.
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INTRODUCTION
USER GUIDE
This book contains guidance to
participants in EPA's construction
grants program. It provides
information and suggested procedures
to help communities successfully plan
and design municipal sewage treatment
works, and to construct them with
Federal financial support. Because
this book is in fact guidance, the
recommendations it presents are
discretionary with each program
participant.
Of course, a major purpose of
this volume is to help communities
seeking or managing a construction
grant to comply with all program
requirements contained in Federal
regulation. Therefore, for
continuity and clarity, we have
summarized those regulatory
requirements at appropriate points
within the text. To identify them
as mandatory, we have employed
such wording as "must" and "will,"
and highlighted them by means of a
bar in the left margin. Because
these statements are merely
summaries, however, the reader
should not rely upon them as a
substitute for the regulations
themselves, as contained in the
Code of Federal Regulation.
This book contains guidance from
the preplanning stage to
completion of construction and
initial operation of the treatment
works. It is divided into four
major parts (planning, design,
construction, and financial/
procurement). You may need to
review only those parts which
correspond to the present stage of
development of your project.
Over two-thirds of the
municipalities which have received
Federal grant assistance from EPA
for the construction of treatment
works have a population under 10,000.
In most of these municipalities, the
governing body is not full-time nor in
many cases is there a full-time
municipal administrator. We recognize
that water pollution abatement is not
your only municipal concern.
Reference to Federal Regulations
References to regulations in this book
are made by citing specific portions
of the Code of Federal Regulations
(CFR). Virtually all regulations
applicable to the construction grants
program are contained in Title 40 —
Protection of Environment. Title 40,
in turn, is broken into parts,
sections, and subsections. For
example, 35.2108 means (Title 40)
Part 35, section 2108.
When other titles of the CFR are
cited, they will include the title
numbers before the letters CFR
followed by the part, section, and
subsection. Therefore, 10 CFR 2.7-3
means Title 10 — Energy, Part 2,
section 7, subsection 3.
At times it is necessary to cite
material published in the Federal
Register. This reference will be
shown as 45 FR 2186 which means
Volume 45, Federal Register, page
2186. When reference is made to a
law, the camion name is generally
used followed by letters and
numbers. For example, the Clean
Water Act of 1977 is the common
name and PL 95-217 means Public
Law, 95th Congress, 217th law
enacted by that Congress.
1981 Amendments to the Clean Water
Act
The Municipal Wastewater Treatment
Construction Grants Amendments of
1981, and changed significantly the
procedural and administrative aspects
of the municipal construction grants
program as they apply to
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grants made after that date. Detailed
implications of these changes are
contained in the regulations and are
incorporated throughout this book.
For easy reference, the changes are
highlighted in Appendix L.
Terminology
The terminology used in this book
is defined in the regulations in
40 CFR Parts 30, 33, or 35. Although
separate Federal grants are no longer
provided for facilities planning and
design of projects, the previous
designation of these activities as
Step 1, facilities planning, and
Step 2, design, will be retained
because of their common usage and
understanding. The term Step 3 grant
refers to building of the project
for which grant assistance will be
awarded. The term Step 2+3 grant
is to be understood to include a
Step 3 grant award which includes
an allowance (percentage of the
cost of building the project) for
design activities. Normally, Step 3
grant assistance will include an
allowance for the planning and design
activities.
The term "advance" refers to the
Federal funds provided to small
communities that, in the opinion of
the State, would not be able to
complete the application requirements
(facilities planning and design)
without such an advance. If Step 3
grant assistance is eventually
awarded, the advance will be
subtracted from the allowance.
Projects that received a Step 1
and/or Step 2 grant prior to the
enactment of the 1981 amendments
to the Clean Water Act should be
completed in accordance with the
terms and conditions of their grant
agreement. Step 3 grant assistance
will include an allowance for design
for those projects that received a
Step 1 grant prior to December 29,
1981. However, no allowance for
facilities planning and design will
be included in a Step 3 grant for
projects that received a Step 2 grant
prior to December 29, 1981.
As used in this book, the term
"project reviewer" means a State
employee reviewing your project
in a State that has been delegated
responsibility for administration of
the construction grants program
or an EPA employee reviewing the
project in a nondelegated State.
The term "reviewing agency" means the
State water pollution control agency
or, in a few instances, EPA.
Other Guidance
The text incorporates Federal
regulatory requirements and, at
times, refers to other EPA guidance
publications. The referenced guidance
publications are generally technical
(e.g., design criteria for land
application systems) and provide much
greater detail than required for this
book. Additional State requirements,
if any, will be provided by your
project reviewer.
Appendixes
Appendixes in this book contain
helpful information such as a listing
of applicable EPA technical publica-
tions, construction grants and
procurement regulations, technical
design or evaluation criteria, etc.
Copies of the publications listed
in Appendix B may be obtained
from your reviewing agency or from
the address listed in the appendix.
xiv
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Multiple quantities may be obtained
from the National Technical
Information Service, 5285 Port Royal
Road, Springfield, Virginia 22161.
MANAGING YOUR PROJECT
Introduction
This section is intended to assist you
in managing your project. It provides
a description of the basic objective
of the Clean Water Act, provides a
summary of the construction grants
program including an expanded dis-
cussion of the 1981 amendments,
discusses State delegation, your
project team, and other topics that
will be of assistance in managing
your project from inception through
construction and operation. Figure 1
represents the organization of CG-82
and the flow of activities during the
grants process. A listing of major
activities in the construction grants
program is provided at the end of this
introduction.
Clean Hater Act
The objective of the Clean Water Act
(CWA) as amended in 1981 is "...to
restore and maintain the chemical,
physical, and biological integrity of
the Nation's waters." This objective
is to be achieved in part by:
o Development of water quality
standards and the regulations
necessary to enforce them;
o Formulation of State and areawide
water quality management plans
including comprehensive analysis of
the actions necessary to meet the
water quality standards;
o Issuance of permits for the
discharge of all pollutants to
all point sources--industrial ,
municipal, and other facilities--that
release pollutants from pipes, sewers,
or other confined outfalls; and
o Provision for Federal funds
to assist in the construction of
municipal wastewater treatment works.
The reviewing agency will work with
you so that your project satisfies
the requirements of the CWA, its
implementing regulations, and other
applicable Federal and State laws and
executive orders (EO).
Grants Program
EPA is authorized under the CWA, as
amended, to provide grant assistance
to municipalities for the building
of wastewater treatment projects.
EPA grant assistance may be up to
75 percent of the allowable costs of
building the project and include an
allowance for facilities planning and
design. After October 1, 1984,
the Federal share will be 55 percent
of these costs. Innovative and
alternative (I&A) technology projects
may receive an additional 20 percent
Federal share, up to a maximum of
85 percent.
Eligible projects include collection
systems, intercepting sewers, waste-
water treatment facilities, outfall
sewers, infiltration/inflow (I/I)
rehabilitation and correction of
combined sewer overflows. After
October 1, 1984, eligible projects
include only intercepting sewers,
wastewater treatment facilities,
outfall sewers and I/I rehabilita-
tion, except that the Governor
of a State may elect to use up
to 20 percent of a State's allotment
for previously eligible projects.
xv
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(PART I)
(PART III)
/FACILITIES /
PLANNING* / /
APPLICATION FOR/
/ GRANT "/
(STATE \
CERTIFICATION \
EPA AWARD OF I
GRANT /
CONSTRUCTION
INITIAL
OPERATION
-PREPLANNING
CONFERENCE
-NEED
-EFFLUENT LIMITATIONS
-FLOWS. I/I. SSES
-EVALUATION OF
ALTERNATIVES. I/A
-ENVIRONMENTAL
EVALUATION
-FINANCIAL EVALUATION
-PUBLIC PARTICIPATION
-IMPLEMENTATION PLAN
-STATE REVIEW
-PREDESIGN
CONFERENCE
-DESIGN
CONSIDERATIONS
-VALUE ENGINEERING
-USER CHARGE SYSTEM
-SEWER USE ORDINANCE
-PLAN OF OPERATION
-STATE REVIEW
-PREAPPLICATION
CONFERENCE
-CLEARINGHOUSE
COMMENTS
-PROCUREMENT
(SEE PART IV)
-STATE CERTIFICATION
-EPA'S ACTIONS
UNDER NEPA
-AWARD
-PRECONSTRUCTION
CONFERENCE
-GRANT CHANGES
-CHANGE ORDERS
-MONITORING
CONSTRUCTION
-ONSITE INSPECTION
-PLAN OF OPERATION
"PERFORMANCE
LEGEND
APPLICANT
ACTIVITY
STATE/EPA
ACTIVITY
GRANTEE
ACTIVITY
(PART I) - PORTION1 OF CONSTRUCTION GRANTS 1982
THE STATE MAY ADVANCE FUNDS FOR PLANNING AND DESIGN
FOR SMALL COMMUNITIES THAT WOULD OTHERWISE BE UNABLE
TO PREPARE A REQUEST FOR A GRANT.
FIGURE 1. CONSTRUCTION GRANTS PROCESS
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Project development may best be
considered as a three-step process.
o Step l--facilities planning to
determine the type and extent of
project you should build.
o Step 2--project design including
the preparation of construction
drawings, specifications, and other
contract documents.
o Step 3--project construction for
which EPA grant assistance is awarded.
The construction grants regula-
tions also allow other types of
financial assistance under certain
circumstances. For example:
o Step 2 + 3 - - avai1 ab1e to
municipalities with a population of
25,000 or less and with projects
costing $8 million or less; the grant
agreement will include an allowance
for design; 30 percent of the allow-
ance will be paid upon grant award,
half the remaining when design is
50 percent complete, and the balance
with the first payment after award of
a subagreement for building the
project;
o Advance funding--financial
assistance provided to a small
community that in the judgement
of the State would otherwise be
unable to prepare a request for a
construction grant; advance funds so
provided are based on an allowance of
costs to prepare a facilities plan and
construction drawings, specifications,
and other contract documents; the
advance will be subtracted from any
subsequent grant or may be recovered
by the State agency if no grant is
made.
After the Federal government
appropriates funds for the grants
program, based on a formula set by
law, EPA allots the money among
the States. Each State, in turn,
prepares a list of all projects
to be funded and ranks the projects in
order of their importance. The
resulting list is called the State
project priority list. Your project
must be sufficiently high on the list
and be within the fundable range for
any given fiscal year in order for you
to obtain a grant.
Your application for grant assistance,
including supporting documents, is
submitted to your State agency.
It reviews the application, and if
the State has sufficient funds, it
certifies your project and sends the
application to EPA. EPA makes a grant
offer (within 45 days of your project
certification in delegated States)
and, after your acceptance, you may
begin the procurement procedures
necessary to build the project.
The grant award sets aside (obligates)
funds for your project. You request
payments from EPA during construction
as costs are incurred. Payment of
your facilities planning and design
allowance will be included with
your first construction payment.
Advance payment of building costs is
generally not allowed.
Your Step 3 project costs are subject
to audit by the Federal government;
therefore, you should keep adequate
records (Section 15.5.1).
Project Management and
State Delegation
The single most important task of a
municipal official with regard to a
wastewater project is to manage the
project to ensure its timely and
economical completion. This entails
bringing people together to select the
most appropriate technology, to work
xvi i
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on the project, making financial
arrangements to pay the local share,
obtaining a Federal and possibly a
State grant or loan to help pay the
costs, managing the cash flow of all
funds, and moving the project through
development and the grants process
with a minimum of delay.
State Contact
In order to eliminate duplicate
reviews of project documents, EPA
is well along in the process of
delegating the management and
administration of the construction
grants program to the States.
The extent of delegation varies from
State to State; you should check with
your project reviewer to determine how
this may affect you.
You should first contact your State
reviewing agency to obtain information
and an application package. Also, if
you have not already done so, request
information as to how to become listed
on the State project priority list.
Organizing the Project Team
To make a project run as smoothly as
possible, you will need a project
team. The team should consist of:
Municipal project manager
Architect/Engineer
Accountant/Financial Advisor
Attorney
Construction contractor
Treatment plant operator
o Municipal Project Manager
The municipal project manager oversees
whatever is necessary to keep
the project moving. His primary
responsibility is to maintain control
over the progress of the project and
ensure that everyone is doing his
job on time. Ideally, the municipal
project manager is a full-time
municipal employee with experience in
dealing with regulatory agencies and
Federal grants.
The municipal project manager will
need to keep excellent records
including a telephone log and a
followup system to ensure that
nothing is overlooked. He will
locate and identify the project
reviewer for your project in the
State agency and possibly EPA as
well. Keep the project reviewers
informed of your progress and forewarn
them of decisions they will have to
make in the near future. If the
project reviewer changes, it may be
beneficial to arrange a meeting to
bring the new project reviewer up to
date on the current status of the
project.
o Architect/Engineer
The selection of a competent,
experienced architect/engineer (A/E)
is perhaps the most important decision
you will make to ensure that your
project is done correctly, on time,
and satisfies all applicable State and
Federal laws. In most cases, an A/E
will do most of the work in the
planning and design phases of your
project and may provide other services
during construction. The A/E's
primary responsibilities prior to
grant application are to complete
the technical portions of the
facilities plan, prepare and
coordinate the design, prepare the
construction drawings, specifications
and contract documents, estimate
project costs, prepare other reports
which may be necessary, and provide
you with professional engineering
advice.
xvm
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Other A/E services may include value
engineering (VE) or construction
management. A VE review is required
for projects with estimated building
costs exceeding $10 million. Con-
struction management services, while
optional, may provide specialized
skills t-j ensure efficient and timely
construction. Firms specializing
in construction management are best
hired as early as possible, preferably
during the planning phase, so that you
can realize the maximum benefit from
their services. A construction
management firm can help you control
project costs, completion time, and
quality construction. Typical
construction management services
include developing, monitoring,
and updating the project budget
and schedule; reviewing A/E and
construction contractor staffing plans
to insure that adequate manpower will
be used to enable the project to stay
on schedule; providing inputs to the
A/E on construction phasing, trade
practices, and the suitability and
availability of various construction
materials; making recommendations
concerning bid packaging to increase
competition; expediting delivery of
equipment which you are purchasing
directly; and inspecting construction
to insure conformance with the
specifications. Despite the A/E's
role, it is your municipality's
project and you are responsible for
proper management of the project.
o Accountant/Financial Advisor
Since you will be using Federal
funds to build your project and are
therefore subject to Federal audit of
your Step 3 project costs, it is
essential to maintain accurate and
detailed accounts. Incomplete
or inaccurate accounts can lead to the
loss of part of your grant, placing
an undue financial burden on your
community. To maintain financial
records, you may use your municipal
treasurer or a private accounting
firm. The accountant should keep
separate ledgers for the EPA project,
identify allowable and unallowable
costs, maintain vouchers for all
costs incurred, and employ generally
accepted accounting practices.
In addition to maintaining financial
records, your community's financial
advisor can help you assess the
financial capability of your residents
and community to afford the project
and help decide how to proceed.
The accountant should make an appoint-
ment with the project reviewer
to discuss the type and detail of
records to be maintained. An EPA
publication entitled "Accounting
Guide for Construction Grants" and
Appendix A to the EPA regulations
40 CFR Part 35 will be helpful to your
accountant.
o Attorney
You will need the assistance of an
attorney in procuring goods and
services (e.g., construction
contractors), completing the applica-
tion, and acquiring property,
easements or rights-of-way. Your
municipal attorney should be able to
provide these services.
o Construction Contractor
The construction contractor's
responsibilities will be defined in
the contract documents accompanying
the construction drawings and
specifications prepared by your
A/E firm. Construction contractors
will be selected through competitive
bidding and will play an important
role as part of your project team.
xix
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o Treatment Plant Operator
Your treatment plant operator should
be included in your project team at
the earliest possible time. He
may offer suggestions during design
to ensure efficient operation and
maintenance or make other operational
recommendations such as staffing or
training. During construction your
operator will have an opportunity
to observe and note location of
underground structures or piping which
may be of assistance later should
operational problems occur.
Funding Local Share
EPA will provide a grant to eligible
municipalities of up to 75 percent
until October 1, 1984, and 55 percent
thereafter of the allowable project
costs. The Federal grant share may be
increased by an additional 20 percent
for innovative or alternative
technology projects but in no case
exceed 85 percent. Your State may
also provide a State grant; however,
you must raise the remaining local
share of the project costs.
It may be possible to obtain grants,
loans, or loan guarantees from other
Federal agencies provided that the
laws administered by these agencies
allow their grant funds to be used for
this specific purpose. In the case of
qualified areas, the Farmers Home
Administration may be able to help you
fund the costs unallowed by EPA.
Another possible source of funds could
be the Department of Housing and Urban
Development. For further information
contact your project reviewer. After
you have exhausted all possible
sources of funds, arrange to raise the
remaining local share by, for example,
selling bonds, using general revenue
funds or revenue anticipation notes,
or using special funds earmarked for
your wastewater project.
jjitermunicipal Service Agreements
Many projects involve more than one
municipality, and it is sometimes
difficult to come to agreement with
all of the jurisdictions involved.
During your facilities planning
activities you should have reached
agreement with the other jurisdictions
with regard to cost sharing, operation
and maintenance responsibilities of
each party, enactment of ordinances
concerning sewer use and user charges,
and any other legally binding
procedures necessary for implementing
the project. While you are not
required to execute intermunicipal
service agreements at the completion
of facilities planning, it may
be prudent to do so or at least have a
meeting of the minds as reflected in a
written agreement.
Your reviewing agency may exercise
discretion with regard to the stage of
development or the execution of
intermunicipal service agreements for
Step 2+3 projects or projects which
receive advance funding. The decision
will be made on a case-by-case basis
depending on the complexity of the
project.
Executed intermunicipal service
agreements generally are required with
the Step 3 application for grant
assistance or before initiation of
procurement action for building the
project on a Step 2+3 project.
Therefore, you should consider
starting early to negotiate agreements
and, if at all possible, have a
written agreement before beginning
work on the design of your project.
Avoiding Project Delay
In addition to the items discussed
above, several other issues require
special attention in order to preclude
xx
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project delays. The list below
briefly describes common issues
which cause project delays and
often result in avoidable hardships to
municipalities. These issues are each
addressed in later sections of this
book but are highlighted here as an
early warning to project managers.
o Project Responsibility - Although
the EPA grant may represent up to
85 percent of the allowable project
costs and substantial work may
be performed by your contractors
(e.g., A/E or construction contrac-
tors), you are responsible for the
successful management and completion
of your project including operation
and maintenance (O&M) during the life
of the project necessary to meet
your National Pollutant Discharge
Elimination System (NPDES) permit
requirements. Section V of the grant
application entitled "Assurances" sets
forth your responsibilities once the
grant is accepted and should be
reviewed carefully.
o Project Cost - Due to the time
interval between completion of
your facilities plan, the design of
your project, and the application
for grant assistance, the estimated
costs of your project and your
local share may have increased. This
is especially true recognizing
the reduced Federal grant share
after October 1, 1984. You should
periodically revise and review the
local cost share of your project
and compare these cost estimates with
your community's current financial
status to ensure that the project is
realistic in terms of the financial
capability of your community.
o Documentation of Costs - The
Step~3phaseof yourproject is
subject to Federal audit which, in
turn, requires documentation of
project costs in order for these
costs to remain allowable for
grant participation. For example,
administrative costs for municipal
employees must be substantiated by
time sheets. Other costs should be
substantiated by invoices, and in the
case of construction change orders, be
supported by written minutes of
negotiation. While only Step 3 grant
costs are subject to Federal audit
(i.e., costs incurred prior to grant
award are excluded from Federal
audit), it is good practice to
develop and maintain an accounting and
filing system which provides an audit
trail from project initiation through
completion.
o O&M Costs - As project costs are
periodically revised and as a plan of
operation is developed, you should
carefully review the operation,
maintenance and replacement cost
estimates. Historically, too many
projects have underestimated these
costs only to find later that they
are higher than anticipated. Your
reviewing agency may be able to
provide you with experiences from
other municipalities that will help
guide you as to the reasonableness of
your costs.
o Environmental Review - The
environmental review is to be
completed before submission of your
application. You should work with the
State and EPA as early as possible in
the facilities planning process to
determine the appropriateness of the
Categorical Exclusion, a Finding
of No Significant Impact, or an
Environmental Impact Statement. You
may request in writing that EPA make a
formal determination.
xxi
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Action
FIGURE A
MAJOR ACTIVITIES IN THE
CONSTRUCTION GRANTS PROGRAM
Regulation
A. File notice of intent 30.305-8
B. Request advance (optional) 35.2025(b)
C. Request Environmental Scoping (optional) 35.2113 35.2030(c)
D. Facilities Plan
Submit to
State EPA
X
X
X X
- Existing environment (no action alt)
- Effluent requirements
- I/I analysis (if applicable)
- Alternative evaluation
- Open space and recreation evaluation
- Environmental evaluation
- Public participation
- Meet requirements of all other laws
- CSO need & benefits (if applicable)
- Selected alternative
- Complete waste treatment system
- Applicant's financial (etc.) capability
- Consistency with W3M plan
E. Project Design
- Value Engineering
- User Charge System
- Sewer Use Ordinance
- Plan of Operation
- O&M Manual
- Intermunicipal Services Agreements
F. Clearinghouse Comments
- Compliance with Limitations on Award
G. Final Design and Specifications
and the project schedule
H. Grant Application (D thru G)
I. State Certification
J. State Preliminary Env. Assess
K. State submit Grant Application Package
(D thru K)
- Procurement
- Project changes
- Project Performance
- Notice of Building Completion
and Final Inspection
6.507
35.2030(b)(2)
35.2030(b)(4)
35.2030 (b) (3)
35.2030(b)(5)
35.2030(b)(6)
6.504 35.2040
30.405
35.2024
35.2030(b)(1)&(7)
35.2030(b)(1)
35.2104(b)
35.2102
35.2114
35.2140
35.2130
35.2106
35.2206
35.2107
35.2040
35.2100
35.2040
35.2040
35.2042
6.507
35.2042
40 CFR 33
35.2204
35.2214
35.2216
X
X
X
X
X
X
X
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PART I. FACILITIES PLANNING
CHAPTER 1
FACILITIES PLANNING—
PURPOSE AND CONTENT
1.0
AMENDMENTS OF The Municipal
1981 Wastewater Treat-
ment Construction
Grants Amendments of 1981 (PL 97-117)
changed the CWA with regard to
facilities planning and design.
While separate grants for facilities
planning and design will no longer be
made, at the time of Step 3 grant
award, an allowance will be included
in the grant for these activities.
Your municipality may be eligible,
however, to receive an advance of
the allowance for planning and/or
design of your project if your State
reviewing agency determines that
you would otherwise be unable to
prepare a request, i.e., facilities
plan and design to qualify for grant
assistance. State reviewing agencies
will provide up to 10 percent of their
annual construction grant funding
allotment for advances and will
determine the terms and conditions for
seeking repayment if a construction
grant is not made at some point in the
future.
Those communities that received a
facilities planning grant or design
grant prior to December 29, 1981,
will complete their project according
to the grant agreement and any special
conditions attached to it. At
the completion of these projects,
municipalities will then follow the
current grant application process.
During facilities planning you should
anticipate the provisions of the 1981
amendments that become effective on
October 1, 1984. These provisions are
discussed throughout this book and
include Federal grant share, reserve
capacity and eligible project
categories.
The impact of these provisions will
be reflected in the local share of
project costs to be borne by your
municipality. It requires that
you carefully prepare your project
schedule, periodically revise it as
necessary, and remain in close contact
with your reviewing agency in order to
anticipate the timing of your grant.
Eliminating separate Step 1 and Step 2
grants will allow your community to
move more rapidly in the preparation
of your grant application. This may
result in reduced project costs
due to the impacts of inflation
on construction. In addition, you no
longer have to prepare three separate
applications. These changes are
intended to enable you to build your
project sooner, resulting in earlier
water pollution abatement.
You should note that the technical
requirements for facilities planning
and project design have not changed
under the 1981 amendments (the
exception is allowable costs for
reserve capacity after December 29,
1981). You will need to complete a
facilities plan and meet other
Federal requirements. Therefore, you
are encouraged to follow the guidance
in this book and seek the review
by your reviewing agency of your
facilities plan both during and
after its completion. It is also
recommended that you request the
review of your project design at
intermediate points and at completion
to ensure compliance with both
State and Federal requirements.
By maintaining contact with your
-------
project reviewer and ensuring
that your project meets all of the
applicable requirements, you will
avoid potential delays at the time of
grant application.
1.1
FACILITIES
PLANNING—
PURPOSE AND
DEFINITION
The facilities
planning process is
the first major step
leading to award
of grant assistance.
Facilities planning consists of those
necessary plans and studies that
directly relate to the construction of
treatment works needed to comply with
the enforceable requirements of the
Act. Facilities planning is a process
of evaluating alternative solutions,
and through systematic screening and
evaluation, selecting the alternative
which is the most cost effective,
i.e., is the most economical means of
meeting water quality or public health
requirements over the useful life of
the facilities while recognizing
environmental and other nonmonetary
considerations. The facilities plan
also demonstrates that the selected
plan can be carried out from legal,
institutional, financial, and manage-
ment standpoints. A flow chart
(Figure 2) illustrates the principal
stages of the facilities planning
process. Each major stage corresponds
to a chapter in Part I of this book.
The facilities plan is your record of
why the selected treatment system best
meets your needs. The selection of
the best wastewater management
alternative is the most important
outcome of the facilities planning
process. The plan, therefore, should
present a clear picture of how this
decision was reached.
It also will enable your project
reviewer to assure compliance with
applicable regulations.
1.2
CONTENTS OF Include the
FACILITIES PLAN following in your
facilities plan.
o A description of both the
proposed treatment works and the
complete waste treatment system of
which it is a part (Section 5.2).
o A description of the Best
Practicable Wastewater Treatment
Technology (BPWTT) (Section 6.4).
o A cost-effectiveness analysis of
the feasible conventional, innovative
and alternative wastewater treatment
works, processes and techniques
capable of meeting the applicable
Federal, State and local effluent and
water quality requirements. The
monetary costs to be considered
include the present worth or
equivalent annual value of all capital
costs and operation, maintenance and
replacement costs. The population
forecasting in the analysis is the
disaggregation of the State developed
population projection. A cost-
effectiveness analysis includes:
- An evaluation of alternative flow
reduction methods (Section
5.5.3);
- A description of the relationship
between the capacity of alterna-
tives and the needs to be served,
including capacity for future
growth expected after the treat-
ment works becomes operational
(Section 5.5.2);
- An evaluation of improved
effluent quality attainable by
upgrading the operation and
maintenance and efficiency of
existing facilities as an
alternative or supplement to
building of new facilities
(Section 6.0);
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1.
FACILITIES PLAN
PURPOSE AND
CONTENT
2.
PREPLANNING
A
3-8.
Z
PREPARATION OF
FACILITIES PLAN
(SEE FIGURE 3J
9.
REVIEW OF
FACILITIES PLAN
LEGEND
-PREPLANNING
CONFERENCE
-SPECIAL TOPICS
-GENERIC PLANS
-PLAN OF STUDY
STATE/EPA ACTIVITY
APPLICANT/GRANTEE ACTIVITY
COORDINATED ACTIVITY
3. GENERAL CONSIDERATIONS
-PUBLIC PARTICIPATION
PROCEDURES
-ENVIRONMENTAL
DESCRIPTION AND
ANALYSIS
4. WATER QUALITY
MANAGEMENT
6. EXISTING AND FUTURE
CONDITIONS
-FLOWS
6. DEVELOPMENT AND
SCREENING OF
ALTERNATIVES
7. EVALUATION OF
ALTERNATIVES
-COST-EFFECTIVENESS
ANALYSIS
8. DESCRIPTION OF
SELECTED ALTERNATIVE
-CLEARINGHOUSE
COMMENTS
-STATE REVIEW AND
CERTIFICATION
-EPA ACTIONS UNDER
NEPA
6.
CHAPTER NUMBER
FIGURE 2. PROCEDURAL FLOW CHART FOR FACILITIES PLANNING
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- An evaluation of the alternative
methods for the reuse or ultimate
disposal of treated wastewater
and sludge material resulting
from the treatment process
(Section 6.6);
- Consideration of systems with
revenue generating applications
(Section 6.4);
- An evaluation of opportunities to
reduce use of or recover energy
(Section 6.4.1); and
- Cost information on total capital
costs, and annual operation,
maintenance and replacement
costs, as well as estimated
annual or monthly costs to
residential and industrial
users (Section 7.2).
o A demonstration of the non-
existence or possible existence of
excessive I/I in an existing sewer
system (Section 5.4).
o An analysis of the potential open
space and recreation opportunities
associated with the project
(Section 7.8).
o An adequate evaluation of the
environmental impacts of alternatives
(Section 7.4).
o For the selected alternative, a
concise description at an appropriate
level of detail of at least the
fol1owi ng:
- Estimated capital construction
and O&M costs (identifying the
Federal, State, and local shares)
and a description of the manner
in which the local costs will be
financed (Section 8.2);
- Estimated cost of future
expansion and long-term needs for
reconstruction of facilities
following their useful life
(Section 7.3);
- Cost impacts on wastewater system
users (Section 7.2); and
- Institutional and management
arrangements necessary for
successful implementation
(Section 8.5.1).
o A description of a municipal
pretreatment program if applicable
(Section 8.5.4).
o A demonstration that the selected
alternative is consistent with
any applicable approved water
quality management (WQM) plan
(Section 4.0).
o A demonstration that the
municipality has the legal, institu-
tional, managerial and financial
capability to ensure adequate
construction and operation and
maintenance of the treatment works
throughout the project's service
area including the ability to comply
with 40 CFR 35.405 and 30.340-2; this
later section of the regulations
not only addresses financial and
management capabilities but includes
compliance with the Civil Rights Act
of 1964, equal employment opportunity
and labor laws (Section 8.5).
o Comments of relevant State,
interstate, regional and local
agencies (Section 13.1.1).
o A summary of public participation
in the development of the facilities
plan (Section 3.1.1).
If any of the above information has
been developed separately from
the facilities plan, it may be
-------
incorporated by reference rather
than duplicated, although documenta-
tion of each item is necessary
in your completed plan.
Normally, facilities planning for the
entire project area is completed
before design or before Step 3 grant
'assistance is awarded; however, the
reviewing agency may provide grant
assistance for a segment or phase of
the project if:
o The project segment or phase
satisfies the provisions of the
National Environmental Policy Act
(NEPA) (Section 9.2.2);
o Facilities planning related to
the project has been substantially
completed and the project for which
grant assistance is awarded will not
be significantly affected by the
completion of the facilities plan;
o The project segment will be a
component part of the complete system
meeting the enforceable requirements
of the CWA;
o You agree to complete the
facilities plan and treatment works
on a schedule specified in the grant
agreement whether grant funding is
available for the remaining segments;
and
o The cost of building the
treatment works would consume a
major portion of the State's annual
allotment; or
o The period to complete the
building of the treatment works will
cover three years or more; or
o A Federal or State court order
requires that the treatment works be
segmented.
CHAPTER 2
PREPLANNING
2.0
PREPLANNING Chapter 1 discusses
CONFERENCE the purpose and
content of
facilities plans as well as the 1981
amendments to the CWA. It is evident
that preplanning should precede the
preparation of a facilities plan in
order to assure that costs, schedules
and scope of work performed during
facilities planning are adequate to
satisfy regulatory requirements and
are commensurate with complexity of
the water pollution problems.
Preplanning assistance, including a
preplanning conference with your
reviewing agency, is strongly
encouraged. In some cases, the
recommended conference will be
held after facilities planning has
begun but before it has progressed
substantially.
Generally, the project reviewer will
contact you when your project has been
placed on the State's project priority
list and provide appropriate guidance
materials. At the State's or your
request, you may wish to schedule a
preplanning conference at which you,
other municipal officials and possibly
your A/E will meet with the project
reviewer to discuss various elements
of the construction grants program.
While a conference may not be possible
for every project, you are entitled to
assistance and explanations by the
project reviewer before or soon after
you initiate activities leading up to
grant assistance.
At the conference, requirements for
grant assistance and issues relevant
-------
or unique to your project will be
reviewed and addressed. For example:
o For small communities, an advance
of funds for planning and design and
the use of a simplified generic
facilities plan;
o For sewered communities with
a population of 10,000 or less,
consideration for use of at least
facultative ponds, trickling filters
or overland flow land treatment; for
unsewered communities of 10,000 or
less, consideration of onsite systems;
and
o Estimated charges to customers
and the impact of those charges
in terms of median household income
(Section 7.2) as well as your
community's financial capability
and arrangements for financing
the local share of project costs
(Section 12.7).
In addition, you may request an early
determination of the scope of the
environmental review including
eligibility for Categorical Exclusion,
preparation of an Environmental
Information Document (EID),a Finding
of No Significant Impact (FNSI) or
concurrent development of an Environ-
mental Impact Statement (EIS),
i.e., piggybacking (Section 9.2.2).
2.1
ELIGIBLE
APPLICANT
A municipality will
be eligible for
grant assistance if
it meets the following requirements at
the time of application:
o Is a public body created under
State law having as one of its
principal responsibilities the
treatment, transport or disposal of
liquid wastes of the general public in
a particular geographic area;
o Is a designated and approved
management agency authorized in a
WQM plan; and
o Demonstrates the legal authority
and financial capability to build
and manage the resulting treatment
works.
If two or more political jurisdictions
are included in the facilities
planning area, the eventual grant
applicant may be a joint authority
that represents all the jurisdictions
or a designated lead agency. In these
cases, carrying out the approved
facilities plan will be based on
written intermunicipal service
agreement between the public bodies.
Projects involving more than one
municipality should meet to discuss
their interrelationships and resolve
differences before the application
process begins.
2.2
PLAN OF STUDY While not required,
it may be v ery
helpful for you to prepare a plan
of study for your project. A plan
of study can help ensure that you,
your A/E firm and the reviewing
agency have a common understanding
of the scope, schedule and costs of
preparing the facilities plan.
Ideally, the plan of study should be
prepared prior to the preplanning
conference and serve as the basis
for discussion. Suggested items
to be included in the plan of study
include a description of the work
tasks to be performed resulting
in the completion of an approvable
facilities plan, a schedule for
completion of work tasks and
outputs, and an estimate of
manhours and costs to complete work
tasks.
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2.3
CLEARINGHOUSE Most States have one
COMMENTS or more agencies
that act as an
areawide clearinghouse for all
projects within a specific geo-
graphical area. At an early stage of
development of your project, you are
encouraged to establish contact with
the clearinghouse to obtain comments
that will indicate the degree of
interest or concern other agencies
have in your project. You should
review any comments received to
identify sensitive issues for
evaluation in your facilities plan.
Office of Management and Budget (OMB)
Circular A-95 requires the inclusion
or approvals of relevant State, local
or Federal agencies as part of your
application for grant assistance.
2.4
PROCUREMENT
SERVICES
OF
sional services
assist them in
facilities plan
Step 3 grant
an allowance
and project
things, the
account the
services
Most municipalities
find it necessary
to procure profes-
(e.g., A/E firm) to
the preparation of a
and project design.
assistance will include
for facilities planning
design. Among other
allowance takes into
cost of professional
required for these
activities. Because EPA will not
reimburse you for your actual costs,
but rather provides an allowance,
you need not comply with the provi-
sions of EPA's procurement regulations
(40 CFR Part 33) for procuring these
services; however, you will need to
comply with the provisions during the
building of the project or certify
that your own procurement system at a
minimum satisfies the provisions.
The procurement of services during the
early stages of your project is solely
your responsibility. EPA suggests
that you give careful consideration to
the procurement procedures you will
use and, lacking your own system,
consider using 40 CFR Part 33. A
discussion of procurement is included
in Chapter 16.
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CHAPTER 3
FACILITIES PLANNING CONSIDERATIONS
3.0
GENERAL
PREPARATION
PROCEDURES
Figure 3 is a
flow chart that
i11ustrate s the
preparation of a
facilities plan. The chart relates
Chapters 4 through 8 of this book to
the overall facilities planning
process illustrated by Figure 2 in
Chapter 1.
Figure 3 graphically indicates how
public participation and environmental
evaluation are integrated throughout
the development of the facilities
plan. To reduce duplication in
this book, public participation and
environmental evaluation are described
in this chapter. Subsequent chapters
refer to these descriptions as
appropriate.
Maintaining the interrelationship
among evaluation of alternatives,
environmental evaluation and public
participation will ensure that
issues critical to the identification
of the most cost-effective alternative
such as financial and environmental
impacts, treatment processes, siting
of facilities, etc., will be addressed
thoroughly during facilities planning.
Your schedule of work should include a
periodic review of these inter-
relationships with your project
reviewer to ensure that they are
maintained throughout the facilities
planning process.
3.1
PUBLIC
PARTICIPATION
Open discussion and
citizen involvement
can help you develop
plans that reflect the needs and
values of your community. Informing
the public early about the scope and
nature of the facilities planning and
involving them during development and
evaluation of alternatives can surface
important facts and identify issues
early, so they can be resolved without
unnecessary delay or additional cost.
Even more important, a better,
less costly project may result. The
understanding gained for the project
and its costs during meetings and by
reading fact sheets can help develop
citizen support for the bonds and user
charge system needed to fund the
project and help assure the revenues
needed later for operation of the
facility.
Public participation required in
connection with state and local
statutes and with the environmental
review process under Part 6 should be
coordinated with your facilities
planning public participation program
wherever possible.
You are not required to use EPA's Part
25 public participation regulations in
facilities planning; however, you may
wish to review Part 25 for suggestions
for your program, such as, you should:
o Inform your community's residents
near the start of the facilities
planning process when assessing
problems and of developments through-
out the facilities planning process;
o Provide your project reviewer
and the public with a brief public
participation work plan. The work
plan describes how public participa-
tion will be conducted, encouraged and
assisted during facilities planning.
It includes staffing plans, a budget,
schedule of activities, points of
consultation and preparation of
responsiveness summaries, consulta-
tion and information distribution
mechanisms, and an identification of
-------
PUBLIC PARTICIPATION:
CONSIDER
PRIOR PUBLIC
' NOTICE AND ~
CONSULTATION
SUBMIT
WORK
PLAN
PUBLIC CONSULTATION
OR MEETING AND
RESPONSIVENESS
SUMMARY (R.S.)
PUBLIC
- MEETING
AND R.S.
PUBLIC
- MEETING
AND R.S.
DESCRIPTION AND EVALUATION
OF ALTERNATIVES:
4. WQM PLANS
RELATED TO
FACILITIES
PLANNING
6. DESCRIPTION AND
ANALYSIS OF
EXISTING —
AND FUTURE
CONDITIONS
6. DEVELOPMENT
AND SCREENING
OF FEASIBLE ™
ALTERNATIVES
MID-
-COURSE
MEETING
7. EVALUATION
OF PRINCIPAL ^
^" ALTERNATIVES *
(COST-EFFECTIVENESS)
. PLAN SELECTION,
PRELIMINARY
DESIGN AND
IMPLEMENTATION
SCHEDULE
ENVIRONMENTAL EVALUATION:
8. REVIEW AND
ADOPTION OF
FACILITIES
PLAN
10. DESIGN
PRIOR
ENVIRONMENTAL
' IMPACT
SCOPING
3.
ENVIRONMENTAL
DESCRIPTION
AND
ANALYSIS
ALTERNATIVES
TO AVOID.
. MINIMIZE OR —
MITIGATE
IMPACTS
PREPARATION
OF EID AND EIS -
AS APPROPRIATE
COMPLETION
OF EID AND
DRAFT EIS
AS APPROPRIATE
REVISIONS TO
EID AND DRAFT EIS
AS NECESSARY
LEGEND
3. CHAPTER
FIGURE 3. GENERAL FACILITIES PLAN PREPARATION PROCEDURES (Detail of FIGURE 2.).
-------
segments of the public to be reached
for participation. The work plan
and other information can be made
available through the use of existing
local information channels if widely
read, such as town bulletin boards, or
notices in the library. Further
savings for small communities can be
realized by using local officials
or volunteers to coordinate public
participation efforts and prepare
records of meetings;
o Consult with the public when
identifying wastewater problems and
screening alternative solutions,
but before selection of principal
alternatives for detailed evaluation;
o Provide the public with at
least 30 days advance notice of
meetings, such as town council or
other regularly scheduled meetings;
o Hold a public meeting after
alternatives are largely developed but
before the preferred alternative is
selected, and present preliminary cost
information,
o Consider a midcourse review of
your public participation program with
your project reviewer;
o Hold at least one public meeting
before adopting the facilities plan.
You should indicate in a public notice
that the recommendations of the
facilities plan, including financial
information, will be discussed.
Specify where the facilities plan
and other pertinent information is
available for public review 30 days
prior to the meeting;
o Allow the public to make written
and oral statements; a question and
answer session should be provided if
possible. Prepare a complete record
of the meeting and prepare a final
responsiveness summary for inclusion
in the facilities plan;
o Prepare and distribute a
responsiveness summary after each
public meeting. A responsiveness
summary should summarize significant
public comments, both adverse and
beneficial, and the justification for
rejection or incorporation of the
comments into the plan; and
o Present at the meeting a brief
summary of the facilities plan
including the cost
developed in Chapter 7.
i nformati on
3.2
ENVIRONMENTAL
DESCRIPTION AND
ANALYSIS
The facilities plan
will provide
sufficient informa-
tion to evaluate the
environmental impacts of the principal
alternatives on the natural and human
environment. Evaluate the adverse and
beneficial , direct and indirect,
long-term and short-term monetary
and nonmonetary impacts, and any
irreversible or irretrievable commit-
ments of resources. Any of the
negative impacts could be the basis
for eliminating an alternative from
further consideration. Describe the
reasons for rejecting an alternative
in the facilities plan.
Because actions under the construction
grants program are subject to the
National Environmental Policy Act
(NEPA) and EPA regulations (40 CFR
Part 6), EPA cannot accept an
application or award grant assistance
for building of the proposed
facilities until the environmental
review of your project is complete.
You may formally request an early
determination of the scope of your
10
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environmental review. If, based
on a determination by the State
and EPA, a Categorical Exclusion
cannot be issued, the environmental
information you provide in the
facilities plan will enable EPA
to decide whether an Environmental
Impact Statement (EIS) or A Finding of
No Significant Impact (FNSI) is
appropriate for the proposed project
(Section 3.2.12) and will enable
the reviewing agency to prepare an
environmental assessment. If a
Categorical Exclusion is appropriate,
you will not be required to prepare a
formal Environmental Information
Document (EID) during facilities
planning under 40 CFR Part 6 unless
subsequent issues are raised. State
requirements, however, may still
apply.
To facilitate preparation of an
environmental assessment, you
should integrate the environmental
analyses conducted throughout the
facilities planning process into
the facilities plan. A complete
summary of the environmental analyses
should be presented in a separate
chapter. Revise the environmental
analyses to include information
developed during design and
construction. The environmental
information you provide in the
facilities plan is termed an EID.
Environmental information in the
facilities plan describes:
o The proposed action, including
purpose and need;
o The existing environment in
the planning area as related to
the evaluation of the alternatives
and selection of a proposed
project. The existing environmental
conditions to be described in
the facilities plan are listed in
Section 5.1;
o The future environment without
the project, i.e., the "no action"
alternative and its effects on
future environmental conditions in
the planning area as discussed in
Section 5.6;
o The development and evaluation of
alternatives as described further in
Chapters 6 and 7. Evaluate impacts
on the environment as beneficial or
adverse, direct or indirect, and
long-term or short-term; and
o The environmental impacts of the
selected alternative as described in
Section 8.4 with special attention to
unavoidable impacts, tradeoffs,
commitments of resources, and measures
to mitigate adverse effects;
o Sources of information used
to describe existing and future
conditions. Consult with regional,
State and Federal agencies as
appropriate early in the planning
process for assistance in locating
the sources of information.
Environmental resources in your
planning area may be identified
relatively inexpensively by:
o Conducting literature searches,
interviews and limited field visits
for familiarization with the area
and identification of areas likely
to contain sensitive resources
(floodplains, wetlands, significant
agricultural lands, endangered
or threatened species habitat,
cultural properties, parks, etc.);
o Using field surveys for positive
identification and verification in
areas directly impacted by the
principal alternatives;
11
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o Conducting intensive original
field research only in areas directly
impacted and when necessary to
determine the significance of the
resource, the nature and extent of the
impacts and to develop mitigative
measures.
EPA's decision either to issue a
FNSI or prepare an EIS will be
based on an environmental review of
the information you provide in the
facilities plan (Chapter 7). In
addition, EPA must comply with
procedures of other environmental
laws and executive orders. Following
are special topics which either
require consultation with other
agencies or describe procedures
designed to avoid delays during
the preparation and review of your
facilities plan. Adverse impacts
in any of these environmentally
sensitive areas may result in the need
for an EIS and the imposition of
special conditions in your grant
agreement.
An evaluation of your responses
to issues raised during public
participation and your integration
of environmental evaluation into the
facilities plan, by your project
reviewer, is strongly recommended
before initiating project design. For
further assistance in evaluating
environmental impacts, consult the EPA
publication "Environmental Assessment
of Construction Grants Projects"
(FRD-5).
3.2.1
HISTORICAL AND
ARCHAEOLOGICAL
SITES
The National
Historic Preserva-
tion Act and
Executive Order
11593 establish procedures for
consultation and commentary by the
Advisory Council on Historic
Preservation on EPA grant actions that
will affect a property listed or
eligible for listing on the National
Register of Historic Places. Contact
the State Historic Preservation
Officer (SHPO) for information about
properties listed or eligible for
listing on the National Register. As
early as possible in the planning, you
should provide the SHPO with a base
map showing the boundaries of the
planning area. From this map the
SHPO will be able to locate known
properties which, where possible,
should be avoided. Later, when
alternatives are developed, provide
the SHPO additional information or
another map showing all potential
alignments and sites where construc-
tion may occur. This will allow the
SHPO to recommend whether a cultural
resource survey is needed. Your
project reviewer can advise you
of specific procedures for consulting
with the SHPO.
In general, your plan should avoid
direct and indirect impact by the
proposed facilities on identified
properties or potentially sensitive
areas. Any unavoidable direct impact
(will require an evaluation of the
identified historic or cultural
property, additional detailed
information about the property, an
evaluation of the potential effect the
project may have on the property
(36 CFR 800.3) and any proposed
mitigative measures. At a minimum,
adequate data on the property's
boundary, integrity and its signifi-
cance will be necessary to evaluate
its eligibility for listing on the
National Register (36 CFR 60.6).
Cultural resource surveys should be
initiated early in the planning
process and completed as soon as
practical , but before award of
grant assistance.
12
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3.2.2
FLOODPLAINS, EPA's Policy
WETLANDS, AND Statement of
FLOOD INSURANCE Procedures for
Floodplain Manage-
ment and Wetlands Protection requires
EPA to prepare an assessment for any
action under its programs that will
affect a floodplain or wetland. In
addition, States may also have
special requirements for assessing
impacts upon these sensitive areas.
Information is generally readily
available to identify 100-year
floodplains and wetlands greater than
5 acres. Floodplains and flood hazard
areas are shown on maps prepared by
the Federal Emergency Management
Agency (FEMA). Wetlands may be
identified by maps available from
the U.S. Fish and Wildlife Service
(USFWS), the U.S. Army Corps of
Engineers (COE) or the Soil
Conservation Service (SCS).
You should develop or modify
alternatives to avoid direct or
indirect impacts on wetlands and
floodplains wherever possible. EPA
will not fund costs for treatment
works capacity for new developments on
environmentally sensitive land, such
as floodplains or wetlands.
If your project will affect wetlands,
floodplains, impact navigable waters
or cause the discharge of dredge or
fill materials, consult with FEMA,
USFWS, and EPA, and with the COE to
determine whether a "404/Section 10"
permit for discharge of dredge or fill
material will be needed. If a permit
is necessary, the COE should identify
alternative locations to be evaluated
and which environmental factors should
be addressed.
If the selected alternative proposes
construction or would serve new
development in a flood hazard area,
all affected communities will have to
participate in the National Flood
Insurance Program of the Federal
Emergency Management Agency in order
for you to receive Step 3 grant
assistance. Early coordination among
affected communities will help avoid
delays in grant award.
3.2.3
AGRICULTURAL
LANDS
In your facilities
plan, evaluate the
direct and indirect
impacts of your project on significant
agricultural lands. The policy
aims to protect these lands from
irreversible loss as an environmental
or essential food production resource
by locating facilities on agricultural
land only when necessary to serve
existing residential users (Section
6.5). Identify in your facilities
plan significant agricultural lands in
the planning area by consulting
with the local office of the Soil
Conservation Service, U.S. Department
of Agriculture (USDA). Environ-
mentally significant agricultural
lands as defined by EPA and USDA
include the following categories:
o Prime farmland - land that has
the best combination of physical and
chemical characteristics for producing
food, feed, forage, fiber, and oilseed
crops, and is also available for these
uses (the land could be cropland,
pastureland, rangeland, forest
land, or other land, but not developed
land or under water). It has the soil
quality, growing season, and moisture
supply needed to economically produce
sustained high yields of crops when
treated and managed according to
acceptable farming methods;
o Unique farmland - land other than
prime farmland that is used for the
13
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production of specific high value
food and fiber crops. It has the
special combination of soil quality,
location, growing season, and
moisture supply needed to economically
produce sustained high quality
and/or high yields of a specific
crop when treated and managed
according to acceptable farming
methods.
Discuss additional farmlands of
State, local and environmental
importance with your project reviewer.
Evaluate alternatives that will
avoid or minimize adverse impacts on
significant agricultural lands.
Examples of mitigation measures
are described in Section 3.2.11.
Interceptors and collection
systems should be located on
significant agricultural land only
if necessary to eliminate existing
discharges or serve existing
habitation.
3.2.4
COASTAL ZONE
MANAGEMENT
The Coastal Zone
Management Act
requires that all
Federal activities be consistent with
approved State coastal zone management
programs to the maximum extent
practicable. If your project is
located in the coastal zone of a State
with an approved coastal management
plan, a consistency certification
will need to be submitted to the
appropriate agency. Consult with the
Office of Coastal Zone Management,
U.S. Department of Commerce or
the appropriate State agency for
details. In developing and evaluating
alternatives insure to the maximum
extent practicable that they are
consistent with any approved State
coastal management programs applicable
to the planning area.
3.2.5
WILD AND To comply with the
SCENIC RIVERS Wild and Scenic
Rivers Act, EPA will
determine from the Secretary of the
Interior or Agriculture that the
project will not directly and
adversely impact any wild, scenic, or
recreational river area. During
facilities planning identify any
inventoried or designated rivers in
the planning area through consultation
with the appropriate State agency and
the National Park Service, Department
of the Interior. Develop and evaluate
project alternatives to avoid or
mitigate adverse impacts on these
rivers.
3.2.6
FISH AND
WILDLIFE
PROTECTION
The Fish and
Wildlife Coordina-
tion Act requires
that actions that
will control or modify any natural
streams or other body of water
be undertaken so as to protect
any fish and wildlife resources
and their habitats that may be
affected. During facilities planning
consult the U.S. Fish and Wildlife
Service and any appropriate State
agency to find ways to prevent or
lessen adverse impacts your project
could have on fish, wildlife or their
habitats.
Wastewater treatment facilities can
attract birds that pose potential
birdstrike hazards at nearby airports.
If locating a wastewater treatment
facility within 10,000 feet of an
airport, you can coordinate the
location with the regional Fish and
Wildlife Service representative, and
either regional Federal Aviation
Administration officials for civilian
airports or nearby military air base
commanders.
14
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3.2.7
ENDANGERED Under the Endangered
SPECIES Species Act if a
PROTECTION project affects a
species of plant,
wildlife or its critical habitat that
the Federal, State or local government
lists as endangered or threatened, EPA
will consult the U.S. Fish and
Wildlife Service, National Marine
Fisheries Service, or State agency
to identify mitigative measures.
Projects should avoid disrupting
threatened or endangered species and
their habitats, but if disruption is
unavoidable, the facilities plan will
suggest mitigative measures. Consult
these agencies during facilities
planning to determine whether the
proposed planning area includes the
habitats of listed species.
328
AIR QUALITY The Clean Air Act
requires all
Federally funded projects to conform
to approved State Air Quality
Implementation Plans (SIP). During
facilities planning evaluate the
direct and indirect impacts of the
alternatives on air quality. Consult
with the State and regional agencies
that monitor SIP compliance. Evaluate
alternatives for compliance with the
SIP and include measures to mitigate
adverse impacts, if applicable.
3.2.9
WATER QUALITY
AND QUANTITY
In your facilities
plan, evaluate the
capability of each
alternative to meet applicable
Federal, State and local water quality
criteria. For existing facilities,
discharges to surface water must meet
the conditions in your National
Pollutant Discharge Elimination System
(NPDES) permits (5.3 and 4.1).
Include a copy of the permit or a list
of the NPDES effluent limitations in
the facilities plan. The impacts of
your discharge on estuaries should be
carefully evaluated, for example,
potential impacts on shellfish
waters should be discussed with the
appropriate State fish and health
agencies.
Wherever effluent from proposed
facilities will percolate or discharge
into ground water, include in your
facilities plan information and an
analysis showing the impacts on the
ground water. Demonstrate in your
plan that the effluent, when mixed
with ground water used as a public
water supply> will comply with
Federal, State and local environmental
laws including the standards
established under the Safe Drinking
Water Act (40 CFR Part 141). Show
that the facility to be built over the
recharge zone of a designated sole or
principal source aquifer and its
effluent will not create an immediate
or potential public health hazard.
In your facilities plan provide
for the development of a program to
periodically test water from existing
potable wells in areas employing
onsite treatment in the project area.
If there are a substantial number of
onsite systems in the project area,
additional monitoring of aquifers may
also be necessary.
A facilities plan should identify and
evaluate special problems and the
potential for erosion and sedimenta-
tion resulting from construction.
Special problems include long grades,
steep slopes and highly erodible
soils. Special construction
techniques that deal with these
problems should be addressed.
For project sites where dewatering
operations are expected during
construction, consideration should be
15
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given to minimizing adverse effects
from the discharge of silt-laden
waters by means of filtration,
sedimentation basins or similar
construction methods.
For projects that involve land
treatment or disposal, methods
of waste application should be
carefully studied and selected to
ensure soil erosion and sediment
runoff is minimized.
You should include provisions in the
facilities plan for supporting local
and State shoreline stabilization
efforts where appropriate.
The facilities plan should also
address the indirect impacts on
water quality caused by stormwater
runoff resulting from substantial
increased development. Other problems
which may need to be addressed in your
facilities plan include depletion of
ground water, saltwater intrusion, or
land subsidence.
3.2.10
DIRECT AND
INDIRECT
IMPACTS
Assess in your
facilities plan
both direct
(primary) and
indirect (secondary) environmental
impacts of the principal and selected
alternative. Direct impacts are
caused by construction, operation or
maintenance of the treatment works and
may include for example:
o Disruption of traffic, business
or other daily activities during
construction;
o Damage to historical, archaeolog-
ical, cultural or recreational
areas during construction;
o Disturbance of sensitive
ecosystems such as wetlands and
habitats of endangered or threatened
species during construction;
o Damage and pollution of surface
waters due to erosion during
construction;
o Impacts on water quality from
effluent discharge during operation;
o Displacement of households,
businesses, or services; and
o Discharge of pollutants, noise or
visual impacts.
Indirect impacts are caused by
development made possible by the
project and may include for example:
o Changes in the rate, density,
location or type of development,
including residential, commercial or
industrial; changes in the use
of open space or other land;
o Increased air, water, noise
pollution, or solid waste from
the induced changes in population and
land use;
o Damage to sensitive ecosystems
(wetlands, habitats of endangered
species) and environmentally protected
areas (parks, historic sites) that
result from changes in population and
land uses; and
o Socioeconomic pressures for
expansion of existing facilities
(housing, schools, highways) and
services (police, fire, medical
emergency) resulting from induced
changes in land use and population.
The environmental analysis should
give special attention to indirect
16
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impacts to determine whether they
will violate Federal, State or local
laws.
3.2.11
MITIGATING
ADVERSE
IMPACTS
Earlier sections
have discussed
real or potential
adverse environ-
mental impacts. Wherever possible,
avoid or minimize adverse impacts.
Where adverse environmental impacts
are unavoidable, discuss methods, both
structural and nonstructural , to
mitigate them. Such actions may
i nclude:
Structural:
o Changes in design, size or
location of facilities;
o Rerouting of interceptors to
avoid sensitive areas;
o Staging or orderly extension of
sewer service;
o Screening for noise or aesthetic
purposes;
o Systems for odor or aerosol
control;
o Cultural resource recovery
including artifacts or important
historical data.
Nonstructural:
o Development and enforcement of
sewer use regulations;
o Protection of environmentally
sensitive areas by local ordinance;
o Modification of zoning
ordinances, land use or development
plans;
o Stormwater runoff control
ordinances; and
o Water conservation programs to
reduce wastewater flows.
Costs to mitigate the direct, adverse
physical impacts of the building or
operation of the treatment works
are allowable for grant funding.
Mitigative measures should be reason-
able in cost and duration and should
relate to the resource affected.
Mitigation of indirect effects is
best accomplished by nonstructural
measures. Although you may select
structural or nonstructural measures
to mitigate indirect impacts, they are
not grant eligible.
Grant assistance will not be
awarded until your facilities plan
provides for mitigation of adverse
effects.
3.2.12
DETERMINING NEED
FOR AN EIS
Whether a decision
to prepare an EIS
i s made before,
during or after completion of the
facilities plan, it can be made only
by EPA based on an environmental
review (Section 9.2.2). EPA must
prepare an EIS when any of the
following conditions exist.
o The treatment works will induce
significant changes in industrial,
commercial, agricultural or resi-
dential land use concentrations
or distributions. Factors to be
considered in determining if these
changes are significant include:
(1) vacant land subject to increased
development pressure as a result of
the treatment works; (2) population
increases; (3) accelerated rate of
change in population or population
density; (4) potential for overloading
17
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sewage treatment works; (5) extent
to which landowners may benefit
from the areas subject to increased
development; (6) nature of land use
regulations in the affected area
and their potential effects on
development; and (7) deleterious
changes in the availability or demand
for energy.
o The treatment works, including
the collection system will have
significant adverse direct or indirect
effects on wetlands or be located on
wetlands.
o The treatment works, including
the collection system, will have
significant adverse direct or indirect
effects on a habitat identified on the
Department of Interior's or a State's
threatened and endangered species list
or their critical habitats.
o The treatment works, will cause
direct or induced changes that:
(1) displace population; (2) alter the
character of an existing residential
area; (3) adversely affect a flood-
plain or wetland; or (4) adversely
affect significant amounts of prime
or unique agricultural land or
agricultural operations on this
land as defined in EPA's policy to
protect environmentally significant
agricultural land.
o The treatment works will have
significant adverse direct or indirect
effects on parklands, public lands,
or areas of recognized scenic,
recreational, archaeological or
historic value.
o The treatment works may have
significant adverse direct or indirect
effects through induced development on
local ambient air quality or noise
levels, surface or ground-water
quantity or quality, or fish or
wildlife and their natural habitats.
o The treated effluent will
continue being discharged into a
body of water for which the present
classification is too low to protect
present or recent uses and for which
the effluent will not be of sufficient
quality or quantity to meet the
standards of these uses.
o The treated effluent will have
an adverse impact on existing or
potential sources of ground-water
supply.
If an EIS appears to be necessary,
based in part on review of your
facilities plan, the applicable WQM
plan, and clearinghouse comments, you
should discuss the possible use of the
joint EIS/EID approach (piggybacking)
with your project reviewer.
A piggyback EIS/EID saves considerable
time because the EIS is prepared
concurrent with, rather than
subsequent to, the facilities plan.
To ensure independent review, the EIS
and the facilities plan are prepared
by different consultants.
If EPA determines that an EIS
is needed, an expanded public
participation program may be
desirable.
Segments of a complete wastewater
treatment system (Section 1.2)
may receive subsequent grants if all
of the following conditions are met:
o There are overriding cost or
program considerations;
o The segment is noncontroversial;
o The segment is necessary to
correct water quality or other
immediate environmental problems;
18
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o The segment by its completion
will not foreclose any reasonable
options; and
o A FNSI has been
least 30 days prior
award for that segment.
issued for at
to the grant
CHAPTER 4
WATER QUALITY MANAGEMENT PLANS
RELATED TO FACILITIES PLANNING
4.0
WATER QUALITY Several sections of
MANAGEMENT PLANS the Clean Water
Act have been
consolidated into an integrated WQM
planning process. Through this
process State and areawide agencies
conduct WQM planning activities
designed to achieve the water quality
goals of the Act. WQM activities are
described in the State's WQM plan and
the State's annual work program.
A water quality based approach will
allow States to focus on their
priority water quality bodies, and
when necessary, to provide adequate
water quality protection beyond what
will be achieved through technology-
based control. In implementing a
water quality approach for municipal
treatment works and other pollution
sources, 205(j) funds may be used to
address the following basic questions:
o What is the use to be protected?
o To what extent does pollution
contribute to the impairment of the
use?
o What is the level of point source
pollution control necessary to restore
or enhance the use?
o What is the level of nonpoint
source pollution control necessary to
restore or enhance the use?
Key outputs of the WQM process
for facilities planning include:
(1) the State priority system,
and (2) the problem assessment and
trend analysis contained in the
19
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, idn
con
P I a n
other
i I i e s ,
.ing functions
i i t i e s p 1 d n
;stency with
After a
mal 305 (b) report. Once
and approved, the State
becomes the foundation
water pollution control
The State, or the agency
iie State has delegated WQM
will review each
in its area for
the approved WQM
waste treatment
jement agency has been designated
a WQM plan has been approved,
.truction grants funds may be
ai arded only to those agencies
for construction of treatment
works that conform to the approved
WQM plan.
Facilities planning is based on
the wasteload allocations, delineation
of planning areas, and population
projections in the approved WQM
plan. If this information is not
available in an approved WQM plan,
the reviewing agency may not approve
grant assistance unless either the
information was not. within the scope
of the WQM work program, or the
grant is necessary to achieve the
water quality goals of the Act.
Facilities plans which are being
prepared at the time of WQM plan
approval should continue unless the
WQM plan clearly justifies a change in
the required treatment levels or
alternative approach based on lower
costs or significant environmental
impacts.
4.1
SFAlb" PRIORITY
SYSTEM AND
PRIORITY LI SI
The State's priority
system will result
State ' s
in the
project priority
list, from which projects are selected
and certified by the State for EPA
grant funding. States will identify
priority water quality areas (PWQA)
for use in setting priorities for
, <">• u-ots. PWQAs will generally be
water quality limited segments. The
regulations require that the priority
system include criteria for ranking
projects based on the impairment of
designated uses resulting from
existing municipal discharges and the
extent of surface or ground-water
use restoration or public health
improvement resulting from the
reduction in municipal pollution. The
State may also include other criteria
in its priority system for ranking
projects.
4.2
WASTELOAD
ALLOCATIONS
(WLAs)
The State agency
establishes total
maximum daily loads
(TMDLs) for all
municipal and industrial discharges to
surface waters throughout the State.
The TMDLs developed through WLAs are
generally incorporated into the
effluent limitations and compliance
schedule in the NPDES permit and
State discharge permit, if any. The
WLA performed by your State is a
critical factor in determining the
level of your facilities planning
effort. Projects which require
greater than secondary treatment
are subject to special reviews
(Section 5.3).
4.3
305(b) REPORTS Your State's
biennial 305(b)
report to Congress, describing the
quality of its waters and the status
of its water quality program, may
contain useful information for the
waters in your planning area. In
preparing this report your State has
been encouraged to describe the water
quality benefits provided by the
construction grants program, such as
pollution reduction and preservation
or enhancement of uses. Documentation
of these benefits may be based in part
20
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on "before and after" water quality
studies conducted using funds under
106, 205(g) and 205(J). The preopera-
tion "before" study may be conducted
as part of the WLA study, while the
"after" study may be conducted
after your facility is operating.
Analysis of the water quality and
biological data from these studies can
be used to verify previous model
predictions, detail the water quality
improvements from your facility, and
assist in planning and design of
future facilities. Appendix C
contains technical guidance on
how to perform "before and after
analyses."
CHAPTER 5
EXISTING AND FUTURE CONDITIONS
5.0
PROJECT NEED AND
PLANNING AREA
IDENTIFICATION
The wastewater
treatment needs and
facilities planning
area for your
community were identified during the
UQM planning process based in part on
effluent limitations in your NPDES
permit, applicable ground-water
criteria and State requirements. You
should review this information to
ensure that the planning area is large
enough to take advantage of economies
of scale and efficiencies possible in
regional planning, or decentralized or
individual systems. Tht planning area
will also be sufficient to er 're
that the most cost-rh"active mea of
achieving the established - >r
quality goals can be ifse-ii !,
and that an adequate e^aludt f
environmental °ffects c '; : ; rv<
5.1
EXISTING The tacilitKt. ..•,.-•
ENVIRONMENT describes e
OF THE PLANNING e n v i ro nn • -
AREA c o - -H i t i o , f
pro 'e - ,•- -
for analysis of al tenidti vss ,-iri c
determination of direct anH iv^ir<-."<
impacts of the proposed project, Int
description should in:'1"df
o Surface arid r> <'f- •' m1 • :.•.. ' r
hydrology (quarit'iiv ;!).•''•' .:d
uses);
o Physiography, topography, geology
and soils;
o Precipitation, temperature, and
prevail ing winds;
21
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o Terrestrial and aquatic plants,
animals and natural communities;
o Air quality and noise;
o Energy production and
consumption;
o Population, socioeconomic, and
public health conditions;
o Land use and development;
o Public facilities and services;
and
o Related Federal, State, and other
projects in the planning area.
Clearly identify envi
sensitive features and
avoided or protected.
consult with Federal ,
regional agencies and the
in the planning process.
sources of information
description.
ronmentally
areas to be
You should
State, and
public early
Reference
used in the
5.2
EXISTING The facilities
WASTEWATER FLOWS plan provides an
AND TREATMENT inventory of
SYSTEMS existing wastewater
characteristics and
treatment facilities including
areas served by onsite systems
and their interrelationships. The
inventory indicates conditions that
limit the number of alternatives and
the severity of the pollution problems
and includes:
o Major influent characteristics
(particularly toxic pollutants)
and their variability as a basis for
design criteria and pretreatment
needs;
o The location of industrial and
municipal treatment plants, sludge
management areas and facilities,
pretreatment plants, pumping stations,
and sewer service areas;
o A description of these
facilities, including design
capacities, existing flows,
characteristics of wastes, NPDES
permits, and overload conditions;
o Locations of significantly
developed areas served by onsite or
unconventional systems;
o A discussion and analysis of
average, peak, dry and wet weather
f1ows;
o Locations of bypasses and
overflows;
o The extent of any combined (storm
and sanitary) sewer system; and
o A description of flow-reduction
programs in effect.
5.3
EFFLUENT
LIMITATIONS
Identify the
applicable effluent
limitations for all
discharges and all NPDES permits
(include identifying numbers) issued
to existing facilities in the planning
area. Effluent limitations are based
on wasteload allocations developed by
the State and will indicate the
level of treatment required for each
facility. At a minimum, secondary
treatment or its equivalent is
required for all municipal point
source discharges to surface waters.
Secondary treatment is defined
generally as 30-day average not to
exceed 30 mg/1 each of bio-chemical
oxygen demand and suspended solids.
An amendment to the Clean Water
Act allows the use of biological
treatment processes such as oxidation
ponds, lagoons, and ditches and
22
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trickling filters, provided the
State certifies that water quality
will not be adversely affected
in effluent limited waters. The
secondary treatment regulations will
be revised also. Higher levels of
treatment (referred to as advanced
treatment or AT) may be required to
meet State standards for water quality
limited waters.
All projects with incremental costs
for the advanced treatment over
$3 million will be reviewed by the EPA
Administrator. In such cases,
the AT project can be approved only if
the costs attributable to the more
stringent levels of treatment are
supported by a demonstration of
significant improvement in water
quality resulting in restoration
of an impaired designated use or
mitigation of existing public health
problems. If AT is likely, it should
be discussed at your preplanning
conference or thereafter with your
project reviewer. Note: Considera-
tion of land treatment systems and
reuse/recycling technologies is a
normal part of facilities planning.
These systems are especially
applicable as alternatives to AT.
For existing treatment plants your
NPDES permits will contain appropriate
effluent limitations. If new
discharge locations are proposed
during facilities planning, the
State will determine the effluent
limitations for each new discharge.
5.4
INFILTRATION AND
INFLOW (I/I)
Before EPA can award
grant assistance,
the facilities plan
will demonstrate that each sewer
system discharging into the treatment
works is not, and will not be,
subject to excessive infiltration or
inflow.
* The policy pertaining to I/I is being
reviewed and will likely be revised
in the final regulation because of
numerous comments on the subject.
"Infiltration" is water, other than
wastewater, that enters a sewerage
system (including sewer service
connections) from the ground, i.e.,
through defective pipes, joints or
manholes. "Inflow" is water, other
than wastewater, that enters the
sewerage system from roof drains,
cellar drains, cross connections with
storm drains, catch basins, cooling
towers, or drainage from springs or
swamps. Excessive I/I is that portion
of the infiltration or inflow which
can be removed from the sewerage
system through rehabilitation at less
cost than continuing to transport and
treat it.
You may determine the I/I conditions
in the sewer system by analyzing the
preceding year's flow records from
existing treatment plants and pump
stations. For smaller systems where
flow records may not be available, you
should obtain flow data by conducting
flow monitoring at a single point at
the treatment plant during high ground
water and rainstorms.
You may use the following criteria to
rapidly determine whether your system
contains excessive I/I. When the flow
rate measured during high ground-water
conditions exceeds 120 gallons per
capita per day (gpcd), or when the
peak flow rate during a rainstorm
exceeds 2.5 times the average treat-
ment plant design flow, the system
may have excessive I/I and further
analysis may be necessary.
The nonexcessive infiltration rate of
120 gpcd contains two flow components:
70 gpcd of domestic wastewater base
flow and 50 gpcd of infiltration.
This is a national average based on
the results of a needs survey of some
270 Standard Metropolitan Statistical
Area (SMSA) cities.
23
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For systems where the flow exceeds the
120 gpcd or 2.5 criteria, you may
select either to:
o Request the approval of the
Regional Administrator to proceed with
treatment works design without further
analysis. In this case show that the
proposed project or treatment system
is cost effective and that the
capital, operation, and maintenance
costs for the additional capacity of
the treatment works will be available.
The federal funding of the treatment
plant will be limited to that portion
of the plant size of up to 120 gpcd.
o Or you may perform further study
of the sewer system to determine the
quantity of excessive I/I through a
cost-effectiveness analysis. Under
this option, you will propose a sewer
rehabilitation program to eliminate
the portion of I/I that is excessive
and size your treatment plant
accordingly. The Federal funding of
the sewer rehabilitation program will
be limited to the amount of I/I
eliminated upon completion of sewer
rehabilitation. In addition, you will
certify the I/I conditions in the
sewer system at the end of the
first year of operations of a new
treatment facility (Section 14.6).
If the analysis under the second
option is conducted, results should be
incorporated into the facilities plan
to substantiate the I/I conclusions.
The results of your analysis should
include:
o Total treatment plant flow,
infiltration and inflow;
o Estimated I/I from service
laterals;
o Estimated cost for transport and
treatment of I/I;
o Estimated rehabilitation costs to
eliminate cost-effective I/I;
o Excessive I/I;
o Nonexcessive I/I to be included
in the design capacity of the
treatment works;
o A proposed sewer system
rehabilitation program; and
o A commitment to develop an
effective sewer system operation and
maintenance program (Section 5.4.1).
You may perform minor sewer
rehabilitation prior to grant award
(considered a preaward cost) when
approved in advance by your reviewing
agency provided the work is not a
part of your municipality's normal
0 & M responsibilities. Where
structural repairs are required for a
large portion of the sewer system,
make those repairs after grant award.
Although the regulatory requirements
reflected in existing guidance on I/I
analysis are no longer applicable, the
technical information contained in
MCD-19 may be useful in your analysis
(see Appendix B of this book).
5.4.1
SEWER USE
ORDINANCE AND
SEWER
MAINTENANCE
PROGRAM
If a sewer
r e h a b i 1 i t a t i o n
program is prepared,
it should address
corrective actions
to be included as
part of a sewer use ordinance (Section
12.3). The portion of the ordinance
addressing I/I should contain a
realistic program for: removal of
excessive infiltration from sewers
located on private property (e.g.,
service laterals); removal of illegal
connections from the sewer system
(e.g., downspouts, storm or area
drains); specify acceptable levels of
infiltration for new sewers; and
provide design details for new
connections. The enactment and
24
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enforcement of the sewer use ordinance
will help prevent overloading of the
completed treatment works.
The sewer rehabilitation program
should also contain a commitment to
develop a comprehensive and effective
sewer maintenance program. The
maintenance program may be developed
as part of your Step 3 grant
activities (Section 8.5.3).
5.5
FUTURE
CONDITIONS
The facilities
planning peri od
for wa stewater
projects should be 20 years beyond
the date the facilities are scheduled
to begin operation (up to 40 years
for interceptor sewers). The 1981
amendments to the CWA, however, limit
grant assistance for reserve capacity
as follows:
(a) An interceptor that received a
Step 3 grant on a segment before
December 29, 1981 may receive grants
for the remaining interceptor segments
included in the facilities plan for
reserve capacity as planned, up to
40 years;
(b) A primary, secondary or advanced
treatment facility, or its inter-
ceptors included in the facilities
plan may receive a Step 3 grant with
20 years reserve capacity if the grant
is received after December 28, 1981,
but before October 1, 1984;
(c) Except as provided in (a) above,
a primary, secondary or advanced
treatment facility, or its inter-
ceptors included in the facilities
plan that received a Step 3 grant on a
segment before October 1, 1984, may
receive grants with 20 years reserve
capacity for the remaining segments;
(d) Except as provided in (c) above,
after September 30, 1984, no grant
will be made to provide reserve
capacity for a project for secondary
treatment, or more stringent treat-
ment, or new interceptors and
appurtenances. Grants for such
projects will be based on capacity
necessary to serve existing needs
(including existing needs of residen-
tial, commercial, industrial, and
other users) as determined on the date
of the approval of the Step 3 grant,
but in no case greater than existing
needs on October 1, 1990.
All incremental costs for additional
capacity will be paid solely by your
municipality.
The most cost-effective plan may
provide for staging construction of
operable parts of the facilities to
meet changing conditions during the
planning period. Your plan should
consider not only constructing a
facility now which satisfies your
needs for the next 20 years recog-
nizing the reserve capacity grant
limitations, but also consider
if it is more cost effective to
construct a facility to satisfy your
needs in 10 or 15 years and later
construct additional facilities if
and when they are required. The
objective of evaluating staging of
construction is to ensure that
oversized facilities are not
constructed thereby precluding
a potential financial burden or
possible adverse environmental
effects resulting from the project,
particularly if the expected growth
fails to occur (Section 6.9).
5.5.1
POPULATION AND
LAND USE
PROJECTIONS
Wastewater treatment
needs and design
capacities for your
facilities planning
area will be determined by land
use patterns, economic growth, and
25
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the resulting population growth. The
estimates of population in your
planning area during the next 20 years
are to be constant with current state
projections and those used in the most
recently completed Needs Survey. This
projection is based on 1977 or later
population projections prepared by the
Bureau of Economic Analysis of the
Department of Commerce or your State's
projections as approved by EPA. The
State may decrease existing projec-
tions if used consistently statewide.
In any case, the projected State
population figures are to be
consistent for air and water planning.
Most States have completed population
projections. If projections are not
available you may: prepare your
projection by calculating your average
yearly growth rate from 1970 to
present and assuming that growth rate
will continue, multiply that rate by
20 years (planning period); or compute
the growth rate of a larger area
(township, county for example) where
future population projections are
available and assume your community
will grow at the same rate. If in
doubt as to what population projection
to use for your community, consult
your project reviewer.
The facilities plan should be
carefully coordinated with land use
plans. Projected land use patterns
and densities are one basis for
determining the optimum capacity and
location of facilities. Where
land use plans have not been prepared
for all or part of the planning
area, you can estimate future land use
patterns and densities in consultation
with existing planning agencies and
zoning commissions.
Lands where development should be
avoided, such as highway rights-
of-way, powerline easements and
environmentally sensitive areas
(e.g., significant agricultural lands,
parks and historic or archaeological
sites), are not to be included when
estimating future development patterns
and densities.
5.5.2
FORECASTS OF
FLOWS AND
WASTELOADS
The facilities plan
relates the size
and capacity for the
facilities to the
needs in the planning area. In
determining design flow for the
treatment works, consider: existing
base flows; estimated future flows
from residential, commercial, institu-
tional and industrial sources; and
nonexcessive I/I. Existing base flows
equal actual metered flows minus the
excessive I/I.
You should estimate future
residential, commercial, and institu-
tional flows based on one of the
methods described below. Each method
combines the sources of wastewater
flows and expresses their total
contribution in terms of "residential
population equivalent" or gpcd.
Capacity to accommodate future
increases of per capita flow over time
should not be proposed or approved for
grant funding.
o Method 1 - Base your estimate of
existing average daily flow on
reliable water supply records adjusted
for consumption and other losses, or
on records of wastewater flows for
extended dry periods minus estimated
dry weather infiltration. This
figure should be further reduced by
industrial users and limited users
(e.g., seasonal population). The
resulting figure (gpcd based on
existing sewered residential popula-
tion equivalent) is then multiplied by
26
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the future projected population. This
method is preferred and should be used
whenever possible.
o Method 2 - When water supply
or wastewater flow records are
inadequate, you should calculate
future average daily base flows
(ADBF) by multiplying one of the
following gpcd figures by the
future population projection. For
nonstandard metropolitan statistical
areas where the total population
10 years in the future is projected
to be 5,000 or less a figure of 60 to
70 gpcd should be used. In all other
instances 65-80 gpcd is acceptable.
The reviewing agency may approve a
larger value if existing commercial
and institutional sources contribute a
substantial share of the total ADBF.
The treatment works may include
capacity for both existing and future
industrial flows (Section 6.8).
You should contact existing industries
during the planning process to
determine whether existing flows
will increase or decrease and the
characteristics of their discharges.
This evaluation could include:
industrial recycling, estimated
user charges, potential increased
efficiency, and the general economic
situation. You should consider
requiring letters of intent from all
industries intending to increase
their flows, locate in the area, or
contribute significant industrial
discharges.
Flow allowances for unknown future
industrial growth should not exceed
5 percent (or 10 percent for a town
with less than 10,000 population) of
the total design flow of the treatment
works before the unknown future
industrial flow was considered or
25 percent of the total industrial
flow (existing plus documented
future). In all cases, unknown future
industrial growth provisions should
conform with WQM plans, land use plans
and zoning ordinances.
5.5.3
FLOW REDUCTION The facilities plan
will include an
evaluation of alternative flow and
reduction measures unless: the
existing ADBF is less than 70 gpcd
or the reviewing agency determines the
area has an effective existing flow
reduction program.
When these'conditions are not met, the
facilities plan should consider:
o A public information program to
encourage wastewater reduction;
o Changes in water pricing policies
to promote conservation;
o Installation of water meters and
retrofitting existing homes with
water saving devices;
o Changes in local ordinances or
codes that require installation
of water saving devices in new homes
or other buildings.
Your plan should include recommenda-
tions on which flow reduction
techniques can be cost-effectively
implemented when the project becomes
operational. It should also include
projections of expected flow reduc-
tions in 10 and 20 years. The
analysis should consider potential
increased costs of: administration, a
public information program, public and
private sector costs for retrofitting
existing buildings, and the additional
costs for installing water saving
devices in lieu of conventional
devices. The analysis should also
27
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consider reduced or deferred
construction and operating cost
(including energy) for your water
supply system, water and wastewater
treatment works.
The plan should discuss steps to
implement flow reduction. A public
information program should highlight
recommended flow reduction measures,
their costs, potential savings and
costs for a typical household. A
recent EPA publication, "Flow
Reduction Handbook," FDR-15, contains
analysis procedures and examples which
may assist you (see Appendix B).
5.6
FUTURE
ENVIRONMENT
WITHOUT THE
PROJECT
The description
of the future
conditions developed
in the preceding
sections will help
document the need for the project
and will provide a benchmark for
comparison with other alternatives
(Chapter 6). This description of the
future environment without any project
is termed the "no action" alternative
and is to be evaluated as an alterna-
tive to your project. The "no action"
alternative will frequently be
appropriate for a portion of the
planning area.
CHAPTER 6
DEVELOPMENT AND SCREENING
OF ALTERNATIVES
The primary objective of facilities
planning is to develop and evaluate
alternatives (not to be confused
with "alternative technology,"
Section 6.4.1) and select the most
cost-effective project for wastewater
management in the planning area.
Note, however, that cost effectiveness
includes consideration of a variety of
factors (economic, environmental,
social, institutional). The evalua-
tion and selection process seeks to
identify the alternative which is the
most economical means of meeting
applicable effluent and water quality
and public health requirements over
the useful life of the facility while
recognizing environmental and other
nonmonetary considerations, and is
implementable from legal, institu-
tional, financial, and management
standpoints.
Small communities should consider
the possible use of simplified
(generic) plans to help select the
most cost-effective alternative.
This should be discussed with your
project reviewer. For larger
communities, all feasible alternative
waste management systems are
identified and screened to determine
those principal alternatives that are
capable of meeting Federal, State,
and local criteria. Evaluation of
principal alternatives is discussed in
Chapter 7.
6.0,
OPTIMUM Include in your
OPERATION OF facilities plan an
EXISTING evaluation of
FACILITIES improved effluent
quality attainable
either by upgrading the operation and
28
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maintenance of existing facilities as
an alternative or supplement to
construction of new facilities.
Include an explanation of why improved
effluent quality cannot be obtained
cost effectively if your facilities
plan recommends complete or partial
abandonment of existing facilities.
An evaluation of existing facilities,
including onsite disposal systems such
as septic systems, may reveal that
they can function more efficiently
with the addition of new equipment,
operational changes, or the addition
and training of operating personnel.
Problems with plant and onsite system
operation are usually due to one or
more of the following:
o Adequacy of the treatment plant
design for the character and amount of
waste treated (including I/I and
industrial flows;
o Adequacy of O&M program including
process control method, laboratory
procedures, maintenance management
systems, staffing, salaries, and
replacement funds and schedules;
o Site-related problems.
o Outdated or failing equipment.
You should describe the cause,
extent, nature and location of
malfunctions.
EPA publication MO-16 "Performance
Evaluation and Troubleshooting at
Municipal Wastewater Treatment
Facilities" and report form 7500-5,
and the Design Manual: "Onsite
Wastewater Treatment and Disposal
Systems" provide detailed system
evaluation guidance.
Whatever the results of the
evaluation, identifying the possible
optimum operation of existing
facilities will help determine if
additions, expansions or replacements
must be made, and the extent to which
existing facilities can be converted
or used in lieu of a new system.
Consider any improvements expected as
a result of future pretreatment by
industrial contributors, removal of
excessive I/I, or staging of new
capacity.
6.1
REGIONALIZATION If the facilities
planning area
includes several communities, each
served by separate facilities or
systems for wastewater disposal, a
planning approach that considers
regional management as well as
physical consolidation of systems
should be considered. These
approaches may have been evaluated
or recommended in an approved
water quality management (WQM)
plan for the area and should be
followed as appropriate.
Alternatives for a large planning area
may involve various arrangements for
construction, operation, maintenance
and management. For example, several
jurisdictions may form a regional
authority to construct, operate and
maintain a centralized treatment
system for the entire planning area.
As another approach, one jurisdiction
may serve as a lead agency for
construction, operation and mainte-
nance of separate facilities that
serve each of the jurisdictions.
Regionalization need not involve
construction of physically inter-
connected facilities. Rather,
individual jurisdictions may be
responsible for construction of
29
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municipal facilities and onsite
systems while a regional authority may
be formed to administer one or more
operation and management functions,
such as sludge management.
Regional facilities have various
advantages and disadvantages.
Advantages may include: savings
in personnel, materials and supplies,
more treatment capability per
dollar, higher operator skill levels,
better performance of treatment plant,
opportunities for offsetting
treatment, and fewer sites and
effluent discharge points. Fewer
sites and discharge points could
reduce direct environmental impacts.
Disadvantages may include: higher
costs due to heavy reliance on
technology, longer design and
construction time, potential for
induced growth and resultant adverse
environmental impacts, depletion of
streamflow, concentrated discharge,
and need for intermunicipal service
agreements.
When considering regional alternatives
involving construction of new
interceptors or collector sewers to
connect communities in the planning
area, evaluate the environmental
factors discussed in Section 3.2.
Additional guidance for evaluating
interceptor and collection systems is
provided in Section 6.5. The cost for
the collection system portion of a
project in a small community generally
represents at least 50 percent of the
total household cost and can represent
six times the cost of the treatment
plant alone. For this reason,
the financial impact of extending
sewers should be carefully evaluated
(Section 7.2).
The reviewing agency will exercise
discretion with regard to the stage of
development of intermunicipal service
agreements for Step 2+3 projects or
projects which receive advance
funding. Executed agreements or
equivalent documented commitments
are to be submitted with a Step 3
application or before initiation of
procurement action for building the
project for Step 2+3 grant assistance
(see Introduction - Managing Your
Project).
Regionalization with an unincorporated
area is usually accomplished in the
following ways:
o An intermunicipal agreement where
a "municipality" (i.e., county) signs
on behalf of the unincorporated
area;
o Voluntary annexation (you may not
require annexation as a prerequisite
to sewer service);
o Service contracts with individual
users.
6.2
UNSEWERED AREAS Identify in the
fac i1ities plan
existing systems used for wastewater
disposal that are causing or are
likely to cause public health
problems, are contaminating ground
water, or are violating NPDES permits.
If the proposed project will include a
new conventional or small alternative
wastewater system (Section 6.4.3) for
a portion of the planning area,
you should provide the following
information to justify the need for
the project:
o Specific documentation of the
nature and extent of health, ground
water or discharge problems associated
with existing wastewater disposal
systems;
30
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o Pertinent information (soil
classification maps, previous soil
borings or excavation data, percola-
tion test results, historical data)
documenting physical restrictions to
the use of onsite systems; and
o Documentation of the nature,
number, frequency and location of
malfunctioning onsite systems. A
community survey which describes and
analyzes the system failures is
recommended. Use of maps, aerial
photography or 1eachate-sensing
equipment for representative samples
will generally avoid the need for
gathering detailed engineering
data house to house except where
geologic conditions are unusual or
inconsistent.
Where the need to replace onsite
systems has been determined, the
facilities plan should compare
conventional collection and treatment
systems to small alternative waste-
water systems. Discussions for
evaluation of alternatives for
unsewered communities are further
described in Section 6.2.
6.3
CONVENTIONAL
COLLECTION
SYSTEM
A conventional
collection system is
a collection system
carrying essentially
raw wastewater, consisting of 6-inch
diameter or larger gravity collector
sewers normally with manholes, force
mains, pumping and lift stations and
interceptors leading to a central
treatment plant. Because the Clean
Water Act is intended primarily to
correct existing water quality
problems, new conventional sewage
collection systems are grant eligible
only where the bulk (generally two-
thirds of the expected flow (existing
plus future residential users)) will
be from the resident population on
October 18, 1972 (the date the Federal
Water Pollution Control Act amendments
were enacted) and where new develop-
ment will not occur on environmentally
sensitive areas. Where new collectors
are funded provide assurances that the
existing populations will connect
within a reasonable time after project
completion.
The 1981 amendments modified the
earlier legislation and discontinues
grants for conventional collection
systems after October 1, 1984,
except when a Governor exercises
his discretionary authority to
approve such projects for grant
assistance.
Where the population density within a
proposed collection system area
is greater than 6 persons per acre
(two households per acre), conven-
tional gravity collector sewer
construction and centralized treatment
may be cost effective.
Where the population density is less
than 6 persons but 1.5 or more
persons per acre (one household per
2 acres), both conventional and small
alternative wastewater systems should
be evaluated.
Where the population density in an
area is less than 1.5 persons per
acre (one household per 2 acres),
conventional collector sewers will
generally be considered noncost
effective unless a severe pollution or
public health problem exists and
conventional collector sewers are
shown to be clearly more cost
effective than any alternatives
for sparsely populated areas
(Sections 6.4.3 and 6.4.4).
31
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6.4
WASTE TREATMENT Earlier sections
MANAGEMENT have discussed
TECHNIQUES upgrading existing
facilities, the "no
action alternative, and regional
management alternatives that are to
be evaluated in your facilities
plan. To insure that your analysis
identifies the BTWTT also evaluate at
least the following:
o Biological or physical-chemical
treatment and discharge to surface
waters (conventional concepts of
treatment);
o Innovative and alternative
technologies (Section 6.4.1);
o Land application or other systems
for the reuse of wastewater and
recycling of pollutants (Section
6.4.2);
o Small alternative wastewater
systems (including onsite systems
and alternative conveyance systems,
Sections 6.4.3 and 6.4.4); and
o For sewered communities with a
population of 10,000 or less, consider
at least one of the following:
facultative ponds, trickling filters,
or overland flow land treatment;
o For unsewered communities of
10,000 or less, consider onsite
systems.
Your facilities plan should evaluate
each of these management techniques
and include provisions for applying
the best BPWTT. BPWTT is defined
as the cost-effective technology
that can treat wastewater, combined
sewer overflows, nonexcessive
I/I, and residuals in publicly owned
or individual wastewater treatment
works and meet the applicable
provisions of:
o Part 133 for secondary treatment
and discharge to surface waters;
o Part 125, Subpart G for marine
discharge waivers (less than
secondary);
o Part 122.62(d) for higher levels
of treatment beyond secondary if
required to meet more stringent water
quality or State standards; and
o "Alternative Waste Management
Techniques for Best Practicable
Waste Treatment" (41 FR 6190) for
percolation to ground water after
land application, land treatment
or reuse.
As each management technique is
evaluated, consider opportunities to
generate revenues and reduce the use
of, or recover energy (e.g., sale of
methane gas after anaerobic digestion
or sale of processed sludge) thereby
offsetting some of the O&M costs.
6.4.1
INNOVATIVE AND I&A technology
ALTERNATIVE is a concept
TECHNOLOGY (I&A) introduced by the
CWA which provides
for reclaiming and reuse of water,
productive recycling of wastewater
constituents or otherwise eliminating
the discharge of pollutants, reducing
consumption of or recovering energy,
or reducing costs. Innovative
technology differs from alternative
technology and conventional concepts
of treatment because it involves a
higher degree of risk to gain specific
benefits. Both alternative technology
32
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and conventional concepts of treat-
ment are candidates for innovative
classification if they meet a specific
criterion.
Alternative technology employs proven
techniques which reclaim wastewater,
recycle nutrients, save energy or
conserve resources. Examples of
alternative technologies include:
o Processes and techniques for the
treatment and use of effluents such as
land treatment, aquifer recharge,
aquaculture, silviculture; and direct
reuse for industrial and other
nonpotable purposes, horticulture and
revegetation of disturbed land; total
containment ponds and ponds for the
treatment and storage of wastewater
prior to land application;
o Land application of sludge for
horticultural, si 1vicultural or
agricultural purposes (including
supplemental processing by means
of composting or drying), and
revegetation of disturbed lands;
o Energy recovery facilities such
as codisposal measures for sludge and
refuse which produce energy, anaerobic
digestion facilities with 90 percent
or greater methane recovery and use,
and self-sustaining incineration;
o Individual and other onsite
treatment systems with subsurface or
other means of effluent disposal and
facilities constructed for the
specific purpose of septage treatment.
Innovative projects, on the other
hand, employ techniques that are not
fully proven under the circumstances
of their contemplated use and that
provide advancement over the state-
of-the-art. This definition
recognizes a reasonable level of risk
*The definition of innovative technology
is being reviewed and will likely be 33
revised in the final regulation because
of numerous comments on the subject...
and corresponding benefits for
innovative projects. Conventional
concepts of treatment or alternative
technologies may be classified as
innovative if through an unproven
improvement or modification of
the process the project results
in a significant cost reduction
when compared to an appropriate
conventional technology. Significant
cost reduction may be considered
in the range of 15 percent reduction
in life cycle costs, i.e., present
worth of the costs over the planning
period of the project. Energy
reduction may be translated to dollars
using the appropriate regional cost
conversion factors.
In order to encourage evaluation and
use of I&A technology projects, the
regulations provide incentives
including:
o Federal grant assistance of up to
85 percent (up to 75 percent after
October 1, 1984);
o Special set-asides of grant
funds for use only on innovative or
alternative (I or A) projects;
o Higher priority on State's
project priority list;
o Eligibility for grant assistance
of field testing (Section 10.1);
o 100 percent replacement or
modifications for projects which
fail under certain circumstances
(Section 15.2);
o 15 percent cost preference
for alternative technology over
conventional projects.
In order to assist you and your
Architect/Engineer A/E in evaluating
-------
I&A projects, EPA has established an
I&A program which provides technical
and administrative assistance. In
addition, EPA has established a small
alternative wastewater technology
(SAWS) clearinghouse at West Virginia
University (address in Appendix B).
6.4.2
LAND APPLICATION Land application
for treatment and
disposal of effluents is encouraged
by both the CWA and the EPA because of
its many advantages. These advantages
include potential cost and energy
savings, recycling or reclaiming of
resources, and higher levels of
treatment when compared with conven-
tional concepts of treatment. To
encourage the use of land application
techniques, grants may be increased up
to 85 percent funding and costs of
land used as an integral part of the
treatment process are allowable for
grant funding (Section 8.4.6). The
15 percent cost preference is also
applicable for publicly owned land
treatment systems.
During facilities planning, a two-
phase approach to the evaluation
of land treatment alternatives is
recommended. The first phase should
include enough detail to determine
if sites are available, soils are
suitable, and whether the cost of land
treatment is competitive with other
alternatives. If these conditions are
met, phase 2 would include an in-depth
investigation of sites and refinement
of design factors. An analysis of
land treatment should include:
o Site selection—A map of the
planning area showing the tracts
of land evaluated as potential land
treatment sites. The plan should
describe reasons for rejecting sites
as well as the availability of
suitable sites. Categorical elimina-
tion of land treatment for lack
of suitable sites is generally
unacceptable unless well documented
and supported by adequate data;
o Loading rates and land area--
Values used for these design
parameters should agree with estab-
lished ranges in EPA design manuals
(Section 11.0.14). Values outside the
established ranges should be justified
and supported by a discussion of
extenuating circumstances;
o Estimated costs—Costs for land
treatment should be compared with
those in the EPA design manuals as
updated using current and local
cost indexes. Elimination of land
treatment due to land and transport
costs should be documented;
o Preappl ication treatment—The
level of pretreatment prior to
land application should conform with
EPA design manuals for the type
of process used. Treatment more
stringent than recommended in the
design manual should be justified. If
.documentation is not acceptable,
the costs of the additional processes
beyond those recommended in the
design manual may be unallowable for
grant funding;
o Environmental effects — The
environmental evaluation of land
treatment systems should emphasize
quality and quantity of surface
and ground-water resources, energy
conservation, pollutant recycling,
and compatibility of land use. BPWTT
criteria are to be met for protection
of ground water based on current
quality and uses of the water
(Section 3.2.9).
Three techniques of land treatment
have been identified as potentially
34
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cost effective. These include slow
rate irrigation, rapid infiltration
and overland flow and are discussed
separately in EPA design manuals.
Other possible application techniques
include ground-water recharge to
prevent saltwater intrusion along
coastlines, recreation purposes or
municipal water supplies. Each
technique, however, should be care-
fully evaluated to ensure protection
of the public health and to avoid
significant adverse environmental
impacts.
Where land application techniques
require the use of large tracts of
land, EPA encourages leasing or
contractual arrangements rather than
land purchase. This is especially
true for small alternative waste-
water systems (1 mgd or less) and
where marketable irrigation water
could result in a nominal or no fee
lease.
6.4.3
SMALL
ALTERNATIVE
WASTEWATER
SYSTEMS (SAWS)
SAWS are character-
ized by onsite
treatment systems
(e.g., septic tanks
and drain fields)
and nonconventional collection systems
(e.g., small diameter sewers) serving
one or a cluster of users. Small
communities with a population of
3,500 or less or sparsely populated
areas of larger communities may
receive up to 85 percent grants
for SAWS because they qualify
as alternative technology (Section
6.4.1).
Twenty-one SAWS are briefly described
in an EPA publication (FRD-10)
available from your project reviewer.
Detailed technical descriptions
of many of these systems are found in
EPA's "Design Manual for Onsite
Systems Wastewater Treatment and
Disposal" (EPA-625/1-80-012). These
systems include:
o Land treatment;
o Subsurface disposal or mound
systems;
o Cluster systems that serve
several users;
o Small diameter gravity sewers
(6 inches or less);
o Pressure or vacuum sewers;
o Dual systems (blackwater/
graywater).
You are encouraged to review EPA
publications, several of which
describe SAWS in lay terms while
others provide technical design
data for use by your A/E firm (see
Appendix A for titles).
Renovation of existing or construction
of new SAWS should be given thought-
ful consideration in your facilities
plan, especially if your municipality
is not presently served by a con-
ventional collection and centralized
treatment system. Combinations of
SAWS and conventional systems may also
offer considerable savings compared
with a single conventional collection
and centralized treatment system. For
example, septic systems work quite
well in many small towns except in one
isolated area such as a business
district or "downtown" area where open
space for septic systems is not
available. In this case, the business
district may be served by a conven-
tional collection and treatment system
while the outlying areas may use
septic systems.
35
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SAWS may only be allowable for grant
assistance if they serve principal
residences and small commercial
establishments that were inhabited or
in use on or before December 27, 1977,
the date the Clean Water Act Amend-
ments were signed. This should not,
however, preclude connection of
residences and small commercial
establishments along the line that
were inhabited or in use after this
date where their flows are incidental.
| Municipal access to SAWS is required.
While this requirement may be met by
an easement or a covenant, it may be
easily satisfied by a simple agreement
that is recorded with the deed.
Another option is State enabling
legislation which ensures access to
municipal wastewater land disposal
zones.
For publicly owned systems, the
agreement referred to above should
state that:
o The municipality will retain
ownership of the system which will
be "publicly owned;"
o The municipality will be able to
enter the property for construction or
O&M purposes at reasonable times for
the life of the project; and
o The municipality will have
complete control over the system.
For privately owned systems (Section
6.4.4) a simple agreement will
suffice if it is recorded with the
deed for each individual system and
provides access to the system at all
reasonable times for inspection,
monitoring, construction, maintenance,
operation, rehabilitation and
replacement.
Title abstracts or insurance, detailed
property and septic tank location
descriptions, or land surveys are not
required for either publicly or
privately owned systems.
Describe in the facilities plan a
management program for SAWS to
be implemented after award of grant
assistance. The program should
include:
o Physical inspection of all onsite
systems in the planning area at least
every 3 years;
o Pumpouts, renovation and replace-
ment as needed;
o Routine maintenance and servicing
of mechanical and electrical
components;
o Testing of selected existing,
local potable water wells once a
year;
o Additional monitoring of water
supply aquifers, if appropriate,
where substantial numbers of onsite
systems exist; and
o User charge system and financing
plan.
Your program could also provide for
review and approval of new sites
and installations, and a public
education program for homeowners on
the operation and maintenance of their
individual systems.
For a more complete discussion of
management programs, see "Facilities
Planning for Management of Small
Alternative Wastewater Treatment
Systems" (see Appendix B).
You may use the 15 percent cost
preference (see Section 7.0.3) to
36
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determine if the SAWS is the most
cost-effective alternative, unless
they are privately owned individual
systems. Also, see Section 7.2.1 on
financial impact analysis for small
communities.
6.4.4
INDIVIDUAL
SYSTEMS
Individual systems
are small alterna-
tive wastewater
treatment systems that are privately
owned. Normally, these are onsite
systems with localized treatment and
disposal.
As a financial incentive to small or
rural communities, an eligible
municipality may apply for a grant for
construction of individual, privately
owned treatment works when they are
shown to be cost effective and public
ownership is not feasible.
Private systems may serve "principal
residences" (residence for 51 percent
or more of the year, i.e., not second
homes or recreation residences),
and compatible wastes from "small
commercial establishments" with dry
weather wastewater flows of less than
25,000 gallons per day. Private
nonprofit entities such as churches,
schools, hospitals or charitable
organizations are considered small
conmercial establi shments.
Privately owned systems do not qualify
for use of the 15 percent cost
preference to determine the most cost
effective alternative. However,
they are eligible for up to 85 percent
grant assistance since they are
alternative technology. Also see
Section 7.2.1 on financial impact
analysis for small communities.
6.5
EVALUATION OF
SEWER ALIGNMENTS
collectors will influence growth in
the planning area, they should be
planned carefully and considered for
staging of construction. You should:
o Not extend interceptors into
environmentally sensitive areas
unless necessary and then only if they
eliminate existing discharges or serve
existing communities that violate an
enforceable requirement of the CWA;
o Evaluate direct and indirect
impacts of interceptors on environ-
mentally sensitive areas such as
floodplains, wetlands, and significant
agricultural lands, and undeveloped
lands (less than one household per
2 acres);
o Identify measures to minimize
adverse impacts on environmentally
sensitive areas where no practical
alternative exists.
EPA will not fund portions of
treatment works providing capacity
for new development in environmentally
sensitive areas and may impose
conditions on subsequent grants,
including restrictions on sewer
hookups, or condition NPDES permits to
ensure implementation of mitigating
measures. Limits on the eligibility
of collectors are discussed in
Section 13.2.
Assess the need for interceptors,
areas to be served and the existence
of environmentally sensitive areas in
your facilities plan. Consider
alternative routes for interceptors in
light of the above factors.
6.6
Since the location,
length and size of
interceptors and
USE AND DISPOSAL
OF SLUDGE
A significant
byproduct of
wastewater treatment
is the production of sludge. Use or
37
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dispose of your sludge with as much
care as you give to the disposal of
treated wastewater effluents. Take
three important factors into account:
o Safe use and disposal that will
not result in adverse impacts on human
health and the environment;
o Economical and cost-effective
sludge disposal (including operation
and maintenance costs); and
o Public acceptance of sludge
disposal risks, costs, alternatives,
and environmental consequences;
pay particular attention to siting
problems.
Many different treatment and disposal
methods are available for evaluation.
In general , these methods can be
considered in two major categories:
o Treatment and volume reduction--
incineration (thermal reduction),
composting and surface impoundments;
and
o Ultimate utilization and
disposal — landfills, ocean dumping
and discharge, landspreading and
distribution/marketing.
Some methods of sludge utilization are
considered alternative technology
(landspreading, for example) and are
eligible for up to 85 percent grant
funding. Other methods are candidates
for innovative classification if they
meet the criterion. Land used as
part of the sludge treatment or
disposal method is eligible for grant
funding provided the sludge is used
productively.
Because of the nutrient value of
sludge, EPA encourages close examina-
tion of landspreading techniques.
While certain restrictions are
necessary (heavy metals loadings, for
example), landspreading of municipal
sludge can be effectively employed as
a means of recycling a valuable
resource.
Note that municipal sludge is
addressed in the regulations
implementing the "Resource Conserva-
tion and Recovery Act" (RCRA) which
provides regulation of solid wastes
including toxic and hazardous
materials. Regulations implementing
the RCRA provide that:
o Sewage sludge in all cases is
considered a solid waste;
o Sewage sludges can be subject to
control as hazardous wastes;
o Municipalities are to determine
if their sludge is hazardous; and
o If a municipal sludge is
hazardous, the municipality will
obtain a hazardous waste identifica-
tion number and may need a permit to
treat, store or dispose of sludge for
volumes greater than 1,000 kg per
month.
In general, municipal sludge is
not hazardous unless stormwater or
industrial dischargers are major
contributors to the wastewater
treatment system.
Because of the complex nature of
sludge disposal EPA has prepared
"A Guide to Regulations and Guidance
for the Utilization and Disposal
of Municipal Sludge" (MCD-72).
You should obtain a copy of this
publication and also discuss sludge
disposal options with your project
reviewer.
38
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6.7
COMBINED SEWER The costs and
OVERFLOWS benefits from
(CSO's) control of combined
sewer overf1ows
(CSO's) vary with numerous environ-
mental and system-related factors.
Decisions relating to CSO's are made
on a case-by-case basis.
Control of pollution from CSO's should
be considered if application of BPWTT
for dry weather flows would not meet
water quality standards. Treatment or
control of CSO's should be considered
only after secondary treatment of all
dry weather flows in the area is
assured. (Exception: where EPA has
received an application for a marine
discharge waiver under Section 301(h)
of the Clean Water Act).
Where measures may be proposed for the
control of CSO's, the facilities plan
should evaluate the following for the
20-year planning period:
o Alternative control techniques
and management practices that could
attain various levels of pollution
control;
o Cost of achieving various levels
of pollution control by each of
the control techniques that appear to
be most feasible and cost effective;
o Benefits to receiving waters of a
range of pollution control alterna-
tives during wet weather conditions.
Consult WQM plan as appropriate;
o Costs and benefits from addition
of advanced treatment (AT) processes
for dry weather flows in the area as
an alternative to CSO control.
The alternatives selected for control
of CSO's should meet the following
criteria:
o The analysis demonstrates that
the proposed level of pollution
control is necessary to protect an
attainable beneficial use of the
receiving waters even after the
standards required by the Clean Water
Act for industrial discharges are met
and a minimum of secondary treatment
is achieved for all dry weather
municipal discharges in the area;
o Provision has been made for
funding of secondary treatment of
all dry weather flows in the area or
an application for a marine discharge
waiver has been received by EPA;
o The technique proposed for CSO
control is more cost effective
for protecting beneficial uses than
other CSO control techniques plus
higher levels of treatment for dry
weather municipal flows in the
area (CSO Guidebook and CSO Manual -
Appendix B);
o The marginal costs of control are
not substantial compared to marginal
benefits.
If portions of the planning area are
served by combined sewers and an
evaluation of CSO abatement is to be
included in the facilities plan, you
should request additional guidance
from your project reviewer. To
determine what portion of CSO control
costs for a multiple purpose project
are allowable for grant funding, refer
to the multipurpose discussion in
Section 7.0.4.
Beginning October 1, 1984, grant
assistance, at a Federal share of
55 percent, for correction of CSO
problems will be considered only upon
the request of a Governor where CSO
correction is on the State priority
list and upon demonstration that
significant usage of the water for
fishing and swimming will not be
39
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possible without the proposed project,
and that the project will result in
restoration of an existing impaired
use. Beginning October 1, 1982,
additional funding, if appropriated,
will become available to address water
quality problems of marine bays and
estuaries due to CSO's.
The Clean Water Act prohibits grant
assistance for control of pollutant
discharges from a separate storm
sewer system.
6.8
MUNICIPAL Consider the issues
TREATMENT OF mentioned below
INDUSTRIAL FLOWS when planning
municipal treatment
facilities that will accommodate
industrial flows. The treatment works
design capacity may include allowances
for industrial flows if the principal
purpose of your project and system is
the transport or treatment of domestic
discharges of the entire community,
area, region or district concerned
(Section 5.5.2). However, grant
assistance will not be provided.
o To convert noneompatible
industrial wastewater to compatible,
or to transport or treat noncompatible
industrial wastewater;
o For costs to transport or treat
wastewater from a Federal facility
contributing-more than 250,000 gpd, or
5 percent of the design flow of the
complete wastewater treatment system,
whichever is less.
Where industries will be served by the
planned facilities, a pretreatment
program is required when:
0 The municipal treatment works has
a flow greater than 5 mgd and serves
or is expected to serve industries
subject to pretreatment standards
under the CWA;
o The WQM plan has not provided
for development of an approvable
pretreatment program.
Other situations when a pretreatment
program may be required should
be discussed with your project
reviewer. Section 8.5.4 identifies
specific elements to be included in a
pretreatment program.
6.9
STAGED
CONSTRUCTION
Adding plant
capacity or
extending inter-
ceptors in stages during the 20-year
planning period may be more cost
effective than full development
immediately.
Factors you should consider are:
o Relative cost of providing full
capacity initially compared with
the present worth of deferred costs
for providing capacity when needed:
and
o Uncertainties of projecting
long-term wastewater flows and
possible technological advances or
flow and waste reduction measures
which may limit need for full
capacity.
Modular development of operable
components of a treatment plant is
advisable in areas where high growth
rates are projected, where treatment
must become more stringent later in
the planning period, or where existing
facilities are to be used initially
but phased out later.
To evaluate the cost effectiveness of
staged construction in your facilities
plan, you should select an appropriate
staging period as shown in the chart
below unless your State has developed
other guidelines.
40
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If the ratio of:
QD/QI 1s
Less than 1.3
1.3 to 1.8
Greater than 1.8
Max. Staging
Period (Years)
20
15
10
Where QQ is flow at end of
20-year planning period and QI is
flow at beginning of plant operation.
The staging period for interceptors
is normally 20 years. However, within
the limitations on reserve capacity
discussed in Sectin 5.5, a larger
interceptor may be appropriate. You
should consider:
o The larger pipe
the adverse direct
environmental impacts;
would reduce
and indirect
o It is consistent with projected
land use patterns; and
o It
Federal,
laws.
is not in conflict with
State or local environmental
When determining the
interceptor you should
the following:
size of the
also consider
o Daily or seasonal variations of
flow, timing of flows from various
parts of the tributary area, and pipe
storage effects;
o Feasibility of off pipe storage
to reduce peak flows;
o Use of an appropriate peak flow
factor that decreases as average
daily flow to be conveyed increases.
requirements of the CWA (i.e., NPDES
permit or ground-water criteria),
but that also has components
not associated with enforceable
requirements of the Act.
Projects designed only to meet an
enforceable requirement are considered
single purpose. Thus, a project
that includes land application as
an integral part of a wastewater
treatment system to meet effluent
limitations is considered single
purpose. An agricultural reuse
project that uses effluent that
could be discharged to a stream,
i.e., discharge meets NPDES
limitations, is considered multiple
purpose.
To reduce costs and conserve energy,
the facilities plan may contain a
broad examination of structural and
nonstructural alternatives that
include multiple purpose options.
Section 7.0.4 discusses the identifi-
cation of allowable costs for multiple
purpose projects.
6.10
MULTIPLE
PURPOSE PROJECTS
that is designed
A multiple purpose
project should be
considered as one
to meet enforceable
41
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CHAPTER 7
EVALUATION OF PRINCIPAL
ALTERNATIVES AND PLAN ADOPTION
After developing feasible alternatives
as described in Chapter 6, system-
atically screen them to identify those
capable of meeting Federal, State and
local criteria (Section 6.4).
Analyze the resulting principal
alternatives to identify those which
have cost-effective potential.
A computer assisted procedure for the
design and evaluation of wastewater
treatment systems (CAPDET) can be used
to quickly evaluate costs of a large
number of alternatives. CAPDET can
also evaluate upgrading and expansion
of wastewater treatment facilities,
estimate user charges, and rank
alternative treatment systems by
present worth, capital, total project,
energy, and O&M costs. These costs
can be used in a preliminary evalua-
tion of the financial impact on the
users and community. User assistance
is available from the CAPDET Clearing-
house at Mississippi State University.
You should also apply the financial
impact criteria to identify expensive
projects (Section 7.2).
Principal alternatives selected
through this screening process will
undergo a thorough cost-effectiveness
analysis. The level of detail in your
analysis depends upon the size and
complexity of your project. In the
facilities plan discuss the reasons
for the selection of a preferred
alternative and the reasons for the
elimination of other alternatives.
The following sections describe in
greater detail the screening criteria
for plan selection.
7.0
EVALUATION OF Calculate present
MONETARY COSTS worth or equivalent
uniform annual costs
for each principal alternative in
order to make a valid comparison of
future capital and O&M. "Present
worth" is the sum which, if invested
now at a given rate, would provide
exactly the funds required to make all
future payments. "Equivalent uniform
annual cost" is the expression of a
nonuniform series of expenditures
as a uniform annual amount. Either
of these methods may be used.
Detailed procedures for making these
calculations are explained in most
engineering economics textbooks.
The discount rate to be used for
facilities planning begun in fiscal
year 1982 (October 1, 1981 to
September 30, 1982) is 7 5/8 percent.
Three examples are shown in Appendix E
and include: a project assuming
varying O&M, staged construction
and salvage value; a project using an
onsite alternative; and a project
using land application.
You should calculate costs on the
basis of market prices prevailing
at the time of your cost-effectiveness
analysis. The analysis should
not allow for inflation of wages and
prices, except those for land and
energy (Section 7.0.2). This is based
on the assumption that prices, other
than the exceptions, for resources
involved in treatment works construc-
tion and operation, will tend to
change over time by approximately the
same percentage. Changes in the
general level of prices will not
affect the comparison of alternatives
in the cost-effectiveness analysis;
they may, however, affect your
community's ability to fund the
project.
42
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Your analysis should include all costs
(capital, annual and other direct
costs such as disruption of business
due to street work or the market value
of publicly owned land that could
be used for purposes other than
wastewater treatment) that are
attributable to the construction and
operation of your treatment works.
Capital costs include building the
wastewater treatment facility,
interceptor sewers, pump stations,
collection sewers; lease, easement or
fee acquisition of rights-of-way
and sites; relocation; and other
costs.
Interest during construction should be
computed in one of two ways. If
expenditures are uniform and the
construction period is less than
4 years, interest is computed by
taking one-half of the product of
the construction period (years), the
total capital expenditures ($) and
the discount rate. Otherwise, the
interest should be calculated on a
year-by-year basis.
Costs for O&M including labor,
utilities, materials, outside
services, expenses, and replacement
of equipment and parts to ensure
effective and dependable operation
during the planning period, should be
included in the cost-effective-
ness analysis as annual costs. These
costs usually include both fixed
and variable costs depending on the
quantity of wastewater that is
collected and treated. Another type
of annual "cost" is the revenue
which you may receive from your
treatment works through energy
recovery, crop production or other
byproducts. You should subtract this
amount from the annual O&M cost in
your cost-effectiveness analysis.
Your cost-effectiveness analysis
should also consider the treatment
works salvage value which is its worth
at the end of the planning period.
This value is based on a straight-line
depreciation from the market price at
the time of analysis to the end of the
planning period (except for land as
noted in Section 7.0.2). You should
use the following periods for the
useful life of the treatment works
components:
o Land—permanent;
o Wastewater conveyance structures
(collection systems, outfall pipes,
interceptors, force mains, tunnels,
etc.)--50 years;
o Other structures (plant
buildings, concrete tankage, basins,
lift station structures, etc.)--30 to
50 years;
o Process equipment--15 to 20
years;
o Auxiliary equipment—lO to 15
years.
For interim facilities with an
anticipated useful life of less than
20 years, salvage value should be
based on demonstrated resale or
reuse opportunities at the end of the
period of interim use.
Once the present worth or equivalent
uniform annual cost is determined
for each principal alternative, the
cost-effective alternative can be
identified.
There is also a cost preference
for projects involving alternative
technology. Section 7.0.3 gives
additional guidance and summarizes the
procedures for application of the cost
preference in the analysis.
43
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7.0.1
SUNK COSTS Any investments or
commitments made
before or during facilities planning
are regarded as sunk costs. As sunk
costs they should not be included in
the cost-effectiveness analysis
because they have already been
committed regardless of the alter-
native selected. Such investments and
commitments include:
o Investments in existing
wastewater treatment facilities
and associated lands even though
incorporated in the plan;
o Outstanding bond indebtedness;
o Cost of preparing the facilities
plan.
7.0.2
COST ESCALATION
FACTORS FOR
ENERGY USE AND
LAND
Energy prices should
be escalated for
the appropriate
fuel , region and
time period as shown
in Appendix D of this book. Factors
for vehicle fuels may be considered
proportionate to the factor for
distillate oil plus State vehicle fuel
taxes. You should consider the
applicable provisions of existing
State energy plans during facilities
planning but should not delay if a
plan is not available.
Land prices should be escalated at a
uniform rate of 3 percent per year
except for right-of-way easements
which do not appreciate.
You may use different escalation
figures if justified and based on
historical data for your area.
7.0.3
ALTERNATIVE If a proposed
TECHNOLOGY COST publicly owned
PREFERENCE system includes
alternative tech-
nology components, use the following
procedure to apply the 15 percent
cost preference.
a.
b.
c.
Calculate the present
worth of the conventional
components of the proposed
alternative system.
Using the total present
worth of the proposed
alternative system,
calculate the percentage
that the conventional
components represent.
If the present worth of the
conventional components is
more than 50 percent of the
total present worth of the
proposed alternative system:
(1) Calculate the present
worth of the least
costly conventional
system components or
equivalent portion of
the treatment process
being replaced;
(2) Multiply the present
worth cost of (1) by
1.15;
(3) Add the result of (2)
to the present worth
of the remaining
components of the least
costly conventional
system.
d. If the present worth of the
conventional components
represents 50 percent or
44
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less of the total present
worth of the proposed
alternative system, multiply
the total present worth
of the least costly
conventional system by 1.15.
Result: The total present worth of
.the proposed alternative system should
be less than the result of c.(3) or d.
above to be considered cost effective.
Example 4 in Appendix F shows the
application of the alternative
technology cost preference.
7.0.4
ALLOCATION OF Multiple purpose
COSTS FOR projects combine
MULTIPLE water pollution
PURPOSE PROJECTS control practices
meeting the enforce-
able requirements of the CWA with
other purposes (e.g., agricultural,
energy generation or recreation).
Generally, when projects involve
multiple purposes (Section 6.10), the
allocation of costs to each purpose
will be based on the Alternative
Justifiable Expenditure (AJE) method
as described in Appendix 0.
However, if a multiple purpose project
is the most cost-effective way of
satisfying enforceable requirements
(e.g., for CSO's), it should be
treated as a single purpose project to
determine grant eligibility. If the
project is cost effective, it is the
preferred alternative regardless of
what other purposes it serves. When
determining cost effectiveness, apply
the alternative technology 15 percent
cost preference.
Also, multiple purpose projects that
[combine wastewater treatment with
recreation do not need to use the AJE
method but can be funded at the level
of the most cost-effective, single
purpose alternative. Incremental
costs of the recreation component that
exceed the most cost-effective, single
purpose alternative cannot be grant
funded.
To determine what percentage of a
project with recreation purposes
is allowable, you should calculate the
grant eligibility percentage by
dividing the present worth of the
cost-effective pollution control
alternative by the present worth of
the multiple purpose project, and
multiplying the result by 100.
Another simpler means of determining
allowable costs can be used for
proposed projects that involve clearly
separate recreational components
that are part of an otherwise
single purpose project. Here the
allowable cost simply equals the total
capital cost of the single purpose
components.
To determine the grant assistance for
each component of a multiple purpose
project, multiply the cost of the
component by the allowable percentage
determined by the appropriate cost
allocation method. The resulting
amount is then multiplied by up to
75 percent for a non I&A component
and up to 85 percent for an I&A
component. Funding of up to 85
percent for I&A technology is limited
to project portions specifically
identified as I&A unit processes, I&A
unit operations, or other components
uniquely necessary for proper
functioning of the I&A components.
Revenues generated by multiple purpose
projects ordinarily should not
be deducted from costs in either cost-
effectiveness comparisons with
single purpose projects or in cost
45
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allocations. However, some projects
involving revenues from cogeneration
of energy in the form of steam or
methane may qualify for a limited
exception. If an energy cogeneration
project involves the sale of energy
rather than its reuse within the
plant, then anticipated revenues may
be used in cost calculations up to a
maximum of the net value of energy
(revenue less cost of plant reuse)
that reasonably could have been
reused within the wastewater pollution
control components of the proposed
project.
7.1
ADDITIONAL
CAPACITY
Although you may
propose additional
capacity beyond the
allowable reserve (Section 5.5),
it is not grant fundable. After
October 1, 1984, grant assistance will
only include costs for the capacity
required at the time of grant award,
not in excess of needs as of October
1, 1990. After identifying the cost-
effective alternative, you should
address the proposed "additional
capacity" alternative in the same
detail. Special emphasis should
be placed on the environmental
impacts, including indirect impacts,
of the proposed project.
The allowable cost is equivalent
to the estimated construction costs of
the most cost-effective treatment
works (conveyance and treatment
plant). Estimate the costs of
construction of the additional
capacity alternative and the cost-
effective alternative on a consistent
basis. You should use recent cost
curves published by EPA, Office of
Water Program Operations (i.e.,
MCD-10, MCD-53, FRD-11, FRD-21,
FRD-22) to determine the cost ratios
between cost-effective project
components and those of the additional
capacity project. Multiply your cost
ratios by the construction contract
costs for the additional capacity
alternative to determine the
incremental eligible costs of the
additional capacity.
Although grant assistance only funds a
portion of the project, the review and
approval process will be the same as
for a fully allowable project.
If the environmental impacts of
any portion of the project are
unacceptable, grant assistance will
not be awarded for any project costs.
When you receive the grant offer, it
may include special grant conditions
to protect the Federal government from
any further claim due to additional
capacity. Note that the user charge
system applies to the entire project
including the part providing the
additional capacity.
7.2
DEMONSTRATION OF To ensure proper
FINANCIAL construction,
CAPABILITY operation, and
maintenance of
treatment facilities, it is essential
that the community be able to raise
sufficient capital and operating
revenue.
The facilities plan includes a
monetary analysis of the total
resource cost of the principal
alternatives. In addition, an
explicit analysis of the financial
constraints that limit a community's
ability to finance, operate and
maintain the facilities performed
early in the planning process can be
an effective screening tool in the
cost-effectiveness analysis, and can
meet the requirement to demonstrate
your financial capability for the
useful life of the project as a part
of your grant application. During
46
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facilities planning this estimate of
financial capability will ensure that
the local government agencies and
residents are aware of their total
financial obligation. These financial
costs are identified for the selected
plan and should be presented at a
public meeting.
A financial capability analysis will
help answer six key questions:
o What is proposed in the
facilities plan?
o What roles and responsibilities
will local government have?
o How much will the facilities cost
at today's prices?
o How will the facility be funded?
o What is the average annual cost
per household?
o What is the community's financial
capability?
The identification of the costs to the
community, reflected in the charges to
customers, includes user charges and
other costs such as debt service on
any existing system, debt service
on the local share of new capital
costs (you should use actual or
expected interest rates when
calculating debt service), annual O&M
(including replacement) costs, and
connection charges (Section 7.0).
Analysis of the financial character-
istics of a community can include
existing debt, revenues, assessed
value of property, median household
income, income distribution, rate of
population growth, bond ratings,
existing sewer system charges,
planned capital expenditures, and
other factors and trends. The
analysis is applicable to community
systems and communities that are party
to an intergovernmental agreement
(Section 8.5.1).
Information on these costs should be
developed as part of the draft plan of
operation (Section 12.4) and user
charge system (Section 12.2) required
before a Step 3 grant will be awarded.
To assist you in this analysis an
example summary information sheet is
included in Appendix E of this book.
Your State may have modified this
sheet to better reflect local condi-
tions. In any case, the information
on the sheet you use will accompany
your eventual application for a Step
2+3 or Step grant to demonstrate your
community's financial capability. You
should revise the information to
reflect improved cost estimates
and current community financial
characteristics after design.
The financial capability analysis is
especially important to determine a
small rural or semi rural community's
ability to pay project costs (Section
7.2.1). The recently published Finan-
cial Capability Guidebook is available
from EPA to further assist you.
Projects that appear to be expensive
should receive careful review. We
suggest that the criteria below be
used to help identify expensive
projects regardless of when the
project was initiated. Calculate
total annual charges to customers
(after Federal and other funding is
determined) for wastewater facilities.
Include debt service, connection
costs, and O&M. EPA considers the
project expensive when the total
annual costs exceed the following
percentages of annual household median
income (1980 dollars):
1.0% When median income is under
$10,000.
47
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1.5% When median income is between
$10,000 and $17,000.
1.75% When median income exceeds
$17,000.
(Use the consumer price index to
adjust income data from other years
and the dollar ranges in the table to
the year of your most recent cost
estimates, or adjust project cost and
household income to 1980 values. See
Appendix F).
Where identifiable, you should also
consider the effects of projected
charges to customers in areas with
household incomes below the poverty
level. If your project appears likely
to be expensive, you should also:
o Review the cost-effectiveness
analysis to ensure that lower cost
alternatives have not been overlooked
and that estimates are adequate and
accurate;
o Determine whether high costs are
due to water quality limitations and
requirements of advanced treatment
processes. If so, reconsider
alternatives;
o Review soundness of local share
financing of project;
o Pursue other funding sources.
It may be possible to reduce the local
share of capital costs by using funds
available from State and Federal
agencies, such as Farmers Home
Administration and Housing and Urban
Development. Requirements for funding
from other agencies' programs will
vary and some communities may not
qualify. A thorough investigation
during facilities planning of all
possible sources of funding will
ensure that the local share is
available. Be sure you have a firm
commitment from any funding source.
7.2.1
ASSURING LOW Per capita costs
COST PROJECTS for conventional
FOR SMALL sewerage projects
COMMUNITIES are frequently
higher in small
communities (flows less than 1 mgd)
partly because of the size and
distribution of their population.
Small communities have fewer financial
and management resources from which to
draw. These circumstances make it
critical that low cost, especially low
O&M cost, technologies be selected.
You can use the following two-phase
screening to help select the tech-
nology for your project. The first
phase determines the technology
selected and exempts from further
review those that involve one or more
of the following:
o Onsite and cluster systems;
o Facultative ponds;
o Overland flow land application;
o Trickling filters;
o Rehabilitation, expansion or
upgrading of any of the above;
o Upgrading the operation,
maintenance, and management of
existing facilities as an alternative
or supplement to construction of new
facilities.
The second phase of screening involves
an operability assessment and the
application of problem project indica-
tors. (Projects in the construction
stage as well as operating projects
should also undergo a financial
capability analysis if not performed
previously.) The operability
assessment evaluates the operational
and maintenance requirements of
48
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alternative treatment systems in
the context of the community's
institutional structure and its
financial and management capabilities.
Such an evaluation can point to the
need for a simplification of the
proposed technology, for improve-
ments in the community's management
capability, or both. Useful informa-
tion for conducting such an evaluation
can be found in the Wastewater Utility
Management Manual which will be
available in the fall of 1982.
The following indicators should also
be used to determine if there is a
potential problem with the project.
o Selection of an energy-intensive
or sophisticated mechanical treatment
facility for a small community (O&M
costs that exceed $50 per household
per year);
o Abandonment of existing low O&M
cost facilities (including onsite
systems);
o Sewering of rural, sparsely
developed areas (collector system
lengths greater than 80 feet per
household);
o Unrealistic or incomplete cost
estimates in the facility plan;
o Increases in capital or O&M cost
estimates that exceed those derived
using appropriate cost indexes;
o Questionable need for all or part
of the project;
o Permit requirements not justified
by sound standards and waste!oad
allocation;
o Short payback period for bonds or
loans (less than 20 years);
o Higher bond or loan interest
rates than those originally used in
estimating household costs;
o High up-front, one-time fees
(greater than $1,000);
o Total annual user costs exceed a
certain percentage of median household
income (see Section 7.2);
o High percentage of households
with income in the poverty range;
o Lack of investigation of
alternative or additional funding
sources;
o Projected population growth rate
that exceeds 1.5 times the previous
population growth rate or projected
population growth over the planning
period that exceeds 30 percent of the
existing population;
o Widespread homeowner opposition
after project costs are discussed
during public participation.
If a potential problem is detected
using these indicators, the grantee
should perform a detailed review as
outlined in Section 7.2, as well as a
review of the need for and scope of
the project.
7.3
CAPITAL
FINANCING PLAN
The project for
which you request
grant assistance may
not be the only project addressed in
your facilities plan (e.g., staged
construction of a larger project that
will satisfy future needs). Other
projects in your jurisdiction, other
facilities plans, or other non-
Federal ly funded wastewater treatment
projects may represent future
financial obligations to be borne by
49
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you or the system users. For this
reason, you are encouraged to prepare
a capital financing plan as a part of
your facilities plan which recognizes
the cost relationship between your
proposed project and future wastewater
projects. The capital financing plan
should contain:
o A projection of the future
requirements for waste treatment
services within your jurisdiction for
a period at least 10 years;
o A projection of the nature,
extent, timing and costs of future
expansion and reconstruction of
treatment works which will be
necessary to satisfy your future
requirements for waste treatment
serivces; and
o The specific manner you intend to
use to finance the future expansion
and reconstruction.
7.4
ENVIRONMENTAL
EVALUATION
Carefully evaluate
the environmental
impacts of principal
alternatives as described in
Section 3.2. Evaluate the adverse and
beneficial, direct and indirect,
short-term and long-term, monetary and
nonmonetary impacts on the natural and
human environment. Identify measures
to mitigate adverse impacts, identify
any unavoidable impacts and consider
the irreversible and irretrievable
commitments of resources associated
with each principal alternative.
7.5
EVALUATION OF
RELIABILITY
Evaluate each
alternative for its
reliability, i.e.,
ability to meet and maintain effluent
limitations. The selected plan will
be able to consistently meet these
requirements throughout the planning
period.
7.6
EVALUATION OF Include an analysis
ENERGY of energy require-
REQUIREMENTS ments for each
alternative system
considered in your facilities plan.
The selected plan should propose
to reduce consumption or increase
recovery of energy where cost
effective. Energy reduction or
recovery is one of the important
aspects of I&A technology and your
energy analysis should be integrated
into your consideration of I&A
technology. Where State energy plans
exist, the analysis should also
consider the recommendations of these
plans.
7.7
EVALUATION OF Evaluate alterna-
IMPLEMENTABILITY tives for their
implementability
taking into account legal, institu-
tional and financial constraints.
Ensure that all jurisdictions find the
selected plan acceptable and equitable
(Section 8.2). Pay particular
attention to financial management
provisions of intermunicipal
service agreements.
7.8
EVALUATION OF
RECREATIONAL
OPPORTUNITIES
Include in your
facilities plan
an analysis and
description of
potential opportunities for recrea-
tion, open space and access to bodies
of water. Evaluate the recreational
potential of the selected treatment
plant site and collection system. You
should base the analysis on existing
data or evaluation of the sites. The
analysis need not require extensive
new data collection or surveys to
determine suitability. The level of
detail needed to produce a good
recreational use analysis in a
50
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facilities plan depends upon the size
of the community, the facility, and
the suitability of the chosen site for
recreation.
You should provide sufficient detail
to determine the site's potential
recreational uses. Show you
considered the recreation elements of
approved WQM plans. You should also
coordinate with State and local
recreation programs. Additional
information may be found in the State
Comprehensive Outdoor Recreation Plan
or from the National Park Service of
the U.S. Department of the Interior.
Potential recreation benefits
associated with wastewater projects
include:
o Use of interceptor rights-of-way
for running or hiking paths, bicycling
or equestrian trails;
o Use of roadway to facilities for
access to waterways for canoeing,
boating, fishing or swimming;
o Provision for access to natural
areas for camping, photography
or nature appreciation;
o Use of project sites for sports
such as target shooting or field
sports;
o Use of facilities or sites for
educational or information purposes;
o Recreational opportunities at
offsite locations such as application
of effluent or sludge to improve other
recreational areas.
Multipurpose projects that include
recreation may also be considered
by coupling facilities planning
activities with recreation planning.
The allowable costs of multipurpose
projects are limited to the costs
of the least costly, single purpose
pollution control project; but
inclusion of recreation opportunities
in the plan can effectively enhance
public support while not significantly
increasing the local share of project
costs.
7.9
COMPARISON OF
ALTERNATIVES
Review, summarize,
and compare the
costs, primary
energy requirements, environmental
impacts, implementability and other
significant factors of the principal
alternatives. Figure 4 is a sample
of a tabular comparison that may
be used effectively for public
presentations. Where quantification
is not possible, brief descriptions
will serve. The visual display
should allow comparison of alter-
natives at a glance so it can be
used at public meetings. One
alternative should be the "no action"
alternative.
You should conduct a midcourse review
with your reviewing agency to ensure
that all alternatives have been
adequately considered, that the
results of the environmental analyses
are available, and that the applicable
State, local, and Part 6-related
public information requirements have
been met.
7.10
VIEMS OF THE
PUBLIC AND
CONCERNED
INTERESTS
A public participa-
tion program should
be an integral part
of the facilities
pianni ng process
(Section 3.1). A section or chapter
of the facilities plan should describe
51
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FIGURE 4. COMPARISON OF PRINCIPAL ALTERNATIVES
Type of Impact
Monetary Cost
Capital Cost ($)
Annual O&M Cost ($)
Total Present Worth ($)
Cost/Household Unit ($)
Environmental Impact
Cultural Resources
Floodplains & Wetlands
Agricultural Lands
Coastal Zones
Wild & Scenic Rivers
Fish & Wildlife
Endangered Species
Air Quality
Water Quality & Uses
Noise, Odor, Aesthetics
Land Use
Energy Requirements
Recreational Opportunity
Reliability
Implementability
Alternatives
#1
#2
#3
#4
SAMPLE FORMAT
Legend:
++ Significant beneficial impact
+ Minimal beneficial impact
o No impact
- Minimal adverse impact
-- Significant adverse impact
52
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and summarize the public participation
program including public meeting
rogram including public meeting
comments and your responses. Letters
submitted by individuals, groups or
agencies should be appended to the
plan. Where significant issues
surface at meetings or in correspon-
dence, the plan should indicate the
appropriate response or action taken,
justify controversial findings, or be
revised.
EPA recommends holding a public
meeting before the facilities plan is
formally adopted and submitted to your
reviewing agency. The preferred
plan and alternatives should be
presented at the meeting for public
review and comment. Also, submit the
draft facilities plan for review and
comment by the areawide clearinghouse.
After the meeting has been held and
comments received, local officials may
adopt the facilities plan for the
proposed project. You should include
a final responsiveness summary and
responses to significant comments in
the final facilities plan.
CHAPTER 8
SELECTED PLAN, DESCRIPTION AND
IMPLEMENTATION ARRANGEMENTS
8.0
JUSTIFICATION
AND DESCRIPTION
OF SELECTED PLAN
strate that the
effective and
sound. Describe
and the complete
system in detail.
In a brief narrative
you should summarize
why the pi an was
selected. Demon-
plan is the most cost
is environmentally
the treatment works
wastewater treatment
Cover all elements,
including service areas, collection
sewers, onsite systems, interceptors,
treatment works and ultimate disposal
of effluent, sludge and septage. You
should use maps to show locations
of major components, existing and
proposed, including locations of any
individual systems proposed for grant
assistance. The plan should clearly
name project segments, implementing
authority and approximate construction
schedule.
8.1
DESIGN OF
SELECTED PLAN
You should present
preliminary design
data in the plan to
demonstrate that all major components
of the system have been included,
the cost estimate is adequate and
reasonable, and the facilities can
meet effluent limitations. The level
of detail of the preliminary design
varies from project to project
depending on the project's complexity.
For example, standard package plants
will not require the same degree of
detail as a pure oxygen system
with phosphate removal and sludge
incineration. Discuss the appropriate
level with your project reviewer.
Preliminary design data for treatment
facilities should include a simple
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tabulation (one or two pages) of
information such as:
o A description of the major
features;
o Unit processes and sizes;
o A schematic flow diagram for
treatment plants and plant and pumping
station siting;
o Sewer lengths and sizes;
o Proposed design criteria,
including detention times, overflow
rates, process loadings, removal
efficiencies, initial design flow,
and reserve capacity;
o Schedule for completion of design
and construction.
8.2
COST ESTIMATES
FOR SELECTED
PLAN
The facilities plan
provides cost
estimates for
design, building,
and operation and maintenance of the
selected plan. Include an estimate of
total project costs and average annual
charges to customers, as described in
Section 7.2. You should also include
a statement on the availability and
estimated costs of sites for the
proposed facilities and their
availability (Section 8.6).
8.3
ENERGY
REQUIREMENTS OF
SELECTED PLAN
Describe features of
the selected
plan that conserve,
recover or reduce
energy consumption. For systems that
claim innovation on the basis of
energy reduction (translated into cost
savings), the plan should contain a
detailed energy analysis.
8.4
ENVIRONMENTAL The facilities plan
IMPACTS OF discusses how the
SELECTED PLAN treatment works will
com pi y with all
pertinent requirements of applicable
Federal, State and local environmental
laws and regulations.
Unless your project has been granted a
Categorical Exclusion, the facilities
plan will describe the existing
environment and relevant direct and
indirect impacts of the selected plan.
Emphasize:
o The selected plan's unavoidable
adverse impacts, especially on
environmentally sensitive areas;
o The relationship between local
short-term uses of the environment
and the maintenance and enhancement of
long-term environmental productivity,
such as temporary disruption of
farming by land application of sludge;
o Irreversible and irretrievable
commitments of resources; and
o Mitigation of unavoidable adverse
impacts.
The description emphasizes indirect
impacts on environmentally sensitive
areas, present and future actions to
protect these areas, and assures that
interceptors conform with approved
WQM plans and EPA's objectives for
minimizing indirect impacts on
environmentally sensitive areas.
8.5
ARRANGEMENTS FOR
IMPLEMENTATION
8.5.1
INSTITUTIONAL
RESPONSIBILITIES
The facilities plan
demonstrates that
the implementing
authority has the necessary legal
54
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financial, institutional and
managerial resources to ensure the
building, operation and maintenance of
the project. Where responsibility for
implementation rests with more than
one agency, agreement between agencies
will be required as part of the
application for grant assistance.
To describe the arrangements for
implementation adequately, the plan
should:
o Identify each agency and its
responsibility;
o Demonstrate that each agency has
the ability and authority under State
law (or reasonable expectation of
obtaining such authority) to finance,
design, construct, acquire access,
operate and maintain those facilities
within its jurisdiction;
o Identify any referendums or
public elections necessary to
implement the plan;
o Include adopted resolutions of
plan acceptance and agreements
among jurisdictions; and
o Identiiy jurisdictions that
oppose or have failed to approve the
plan and describe steps necessary to
reach agreement.
The intermunicipal agreement should:
o Include proposed formula for
allocating the local share of capital
costs (based on flow, or flow and
strength, etc.);
o Identify the cost basis for
regional allocation, such as value of
existing facilities; value of land;
periodic capital requirements for
expansion; and costs for operation,
maintenance, replacement, and
administration;
o Identify the procedures for
administration and management of the
agreement including cost accounting
and records management systems; and
o Include financial arrangements
that obligate each jurisdiction
to enforce the requirements for user
charges, sewer system rehabilitation
and sewer use ordinance.
The requirements for an intermunicipal
agreement may be waived if you can
demonstrate:
o That an agreement is already in
place; or
o Evidence of historic service
relationships for water supply,
wastewater, or other services in the
absence of the existence of formal
agreements; or
o That the financial strength of
the supplier agency is adequate to
continue the project, even if one of
the proposed customer agencies fails
to participate.
The facilities plan should include a
schedule of specific actions to
implement the plan and to meet its
objectives on schedule. The dates
in this schedule should correspond to
compliance dates specified in your
NPDES permits (if applicable).
Resolve differences that would result
in failure to meet the compliance
schedule, including, if necessary, a
formal request through the reviewing
agency for extension of compliance
dates.
Some capital expenditures could be
met through creative financing
techniques using special improvement
districts, industry assistance to
local governments, or intergovern-
55
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mental agreements.
arrangements will
influence on the
alternatives. You
those arrangements
community will conti
financial eligibil
described above.
The institutional
have a strong
feasibility of
should structure
to ensure your
nue to meet these
ity requirements
The financial and institutional
arrangements provide the project
reviewer with a starting point in an
overall financial assessment. A
schedule for marketing bonds and
developing a user charge system
can be developed during facilities
planning. These dates should
be adjusted as necessary during
subsequent design and building of the
project.
8.5.2
CIVIL RIGHTS
COMPLIANCE
Comply with the
requirements of the
Civil Rights Act of
1964 and EPA regulations (40 CFR
Part 7). Include in your facilities
plan a statement that these require-
ments have been met. Where minority
areas are included in the facilities
planning area, show in the plan
that such areas will be served or
excluded from service only for
cost-effectiveness reasons.
8.5.3
OPERATION AND
MAINTENANCE
REQUIREMENTS
(O&M)
The facilities plan
should contain a
brief but accurate
summary of the
personnel , proce-
dures and budget that are necessary to
operate, maintain and manage the
proposed treatment works (including
sewers and pump stations). If an
existing plant is to be upgraded
or expanded, existing staffing,
O&M policies and budget should be
reviewed and updated as necessary to
assure a sound O&M program. Note
that the O&M funds include funds for
the replacement of equipment required
during the useful life of the project.
Your program should also include
a sewer maintenance program
(Section 5.4.1).
Where a completely new treatment
system will be constructed, a more
detailed O&M discussion should be
included in the facilities plan.
A list of items to include in an O&M
discussion is as follows:
o Required annual O&M budget
(fixed and variable costs);
o Staffing (number and certifica-
tions);
o Training (based on available
personnel);
o Laboratory requirements (for
sampling and process control);
o Special maintenance requirements;
o Special operating requirements
(cold climate restrictions, etc.);
o Residuals disposal (sludge,
incinerator ash, etc.).
Although O&M costs (except for
startup costs) are not allowable,
your cost estimates are needed in your
cost-effectiveness analysis and to
determine charges to customers. O&M
considerations are discussed further
in an EPA publication "Operation/
Maintenance/Management Program
Guidance, Fiscal Year 1982."
8.5.4
PRETREATMENT
PROGRAM
Where your treatment
f aci1ities serve
or will serve
nonresidential customers, you may
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decide it is necessary to develop a
pretreatment program in accordance
with the NPDES permit program
requirements.
A pretreatment program is intended to
control pollutants from nonresidential
sources in order to allow for the
.reclamation and reuse of wastes
wherever practicable. The objectives
are:
o To prevent the introduction into
the treatment plant of pollutants
that will interfere with plant
operation or disposal or use of
municipal sludge;
o To prevent the introduction into
the treatment plant of pollutants that
will pass through the plant into
receiving waters or that will be
otherwi se harmful; and
o To recycle and reclaim wastewater
and sludge produced by wastewater
treatment where possible.
When a pretreatment program is
necessary, the facilities plan should
include a schedule of actions to
implement the program. A document
"Municipal Pretreatment Program
Guidance Package" is available from
Municipal Technology Branch (WH-547),
USEPA, Washington, D.C. 20460,
(202) 426-8976.
A complete and approvable pretreatment
program should include the following:
o A survey that identifies system
user by type and location and the
character and volume of pollutants
dicharged;
o An evaluation of the legal
authority for control and enforcement
including adequacy of enabling
legislation and selection of mecha-
nisms to be used (e.g., ordinances,
codes);
o A determination of technical
information needed to support
development of an enforcement
mechanism to ensure compliance with
NPDES permit conditions;
o An evaluation of revenue sources
and financial programs to ensure
adequate funding to carry out the
pretreatment programs;
o The design of a monitoring
enforcement program;
o A determination of pollutant
removals in existing treatment
facilities;
o A preliminary determination of
monitoring equipment required at
the treatment facilities;
o A determination of tolerance of
the treatment facilities to toxic
pollutants; and
o A preliminary determination of
the municipal facilities' need
for monitoring or analysis of
nonresidential wastes.
8.6
LAND ACQUISITION
8.6.1
GENERAL
ACQUISITION
CONSIDERATIONS
identify:
As an integral part
of your cost-
effecti veness
analysis, you should
o The most suitable land for the
project (e.g., size, soil conditions,
slope, location); and
57
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o The most appropriate way to
secure the rights in the land (fee
simple, total ownership, easement,
ownership of some rights, lease,
certain rights for a period of time)
or "no cost."
Acquisition of any interests in
real property will comply with
EPA regulations (40 CFR Part 4)
implementing the Uniform Relocation
and Real Property Acquisition Policies
Act (PL 91-646).
Your project will be evaluated to
determine if you have sufficient
rights to the project land and to
ensure undisturbed construction and
operation of the project for its
useful life.
Acquisition of land including
easements should be initiated as soon
as possible. For land to be grant
eligible you need written approval of
the price or grant award prior to
making an offer to acquire. All land
should be acquired, option taken or
formal condemnation proceedings begun
before initiating building of the
project.
You should use professional staff to
appraise, negotiate or condemn
land. Consider contracting with State
or Federal land acquisition agencies
if you do not have these capabilities.
Use "The Uniform Appraisal Standards
for Federal Land Acquisition" (GPO
052-059-000-20). See Appendix G for
supplemental information.
Obtain reviewing agency approval that
the appraised value represents the
fair market value of the property.
The reviewing agency should contract
appraisal review if it does not have
qualified in-house staff. You should
not negotiate with the land owner
prior to the Regional Administrator's
approval of the price to be offered.
Some modest increase above the
appraised value may be paid to avoid
the cost, time, and public relations
problems involved with condemnation if
approved by the Reginal Administrator.
8.6.2
"NO COST
ARRANGEMENTS"
Acquisition of land
required for sludge
application may not
be necessary; only the right to use
the land for this purpose needs to
be secured. Communities can manage
sludge and effluent by making arrange-
ments with a group of farmers willing
to accept sludge and effluent on an
intermittent basis. Carefully
conceived sludge and effluent applica-
tion arrangements of this nature can
provide for disposal, but the cost of
land is not allowable for grant
participation because the community
does not actually acquire any interest
in the property itself.
8.6.3
ACQUISITION
METHOD AND
APPROVAL
Certain land costs
such as lease,
easement or fee
simple purchase
are allowable for grant participation.
The method of acquisition depends
on cost effectiveness, public
acceptability, feasibility and
local circumstances.
A combination of public and private
land ownership may be the best
solution, i.e., the land required for
preapplication treatment and seasonal
storage might be publicly owned, while
the irrigated land could be leased
from a farmer.
Before you make an offer to acquire
any rights in land for which you
intend to request grant participation,
you need to have your reviewing
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agency's prior written approval of the
price. Early land acquisition with
prior approval is considered a
"preaward cost" and is eligible for
grant participation in a future grant
(Sections 13.2 and 15.3.1).
You may use your own property
management standards and procedures
for land that has been acquired in
part or wholly with grant funds
as long as they meet the minimum
provisions of 40 CFR 30.810 et. seq.
Record the government's interest in
the title to the property.
Your lease or easement should contain
conditions such as:
o Limiting the purpose to land
application or sludge (residuals)
management and complementary purposes
and describing that use;
o Waiving the landowner's right to
restoration at the termination of the
lease/easement. (The government
cannot be responsible for removing
irrigation systems, draining and
filling ponds, etc.);
o Landowner agreeing to apply a
specified quantity of the community's
wastewater or sludge to his land for a
specified time span;
o Providing these conditions for
the life of the project;
o Providing for your full recovery
of damages in the event of premature
lease termination.
A copy of the proposed leasing
agreement (contract) and other
supporting materials should be
presented in your facilities plan.
8.6.4
ALLOWABLE LAND
COSTS
Allowable land costs
include:
o A reasonable amount of land
including irregularities in applica-
tion patterns, buffer areas, berms,
dikes and similar uses where land is
an integral part of the treatment
process;
o Land for sludge disposal with
application at the maximum rate
possible (generally 5 dry tons per
acre per year is considered minimum
acceptable rate);
o Land required for the composting
of sludge including its curing and
temporary storage (if a program for
use of the compost has been approved);
o A soil absorption system for a
group of two or more homes provided
that the municipality has complete
ownership and beneficial use of the
land;
o Ponds constructed specifically
for temporary storage of treated
wastewater prior to land application
to meet seasonal imbalances between
wastewater supply and application
schedules. The total land area of
the pond or cell constructed for
combination treatment and storage
purposes is allowable for grant
funding if the storage volume is
greater than the treatment volume.
Otherwise, the grant fundable area
will be determined by the ratio of the
storage volume to the total volume of
the pond.
-"Storage volume" is that portion
of a pond or cell which retains
water prior to the water's
application to the land.
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-"Treatment volume" is that
portion of a pond or cell
specifically designed for
biological stabilization of the
wastewater.
Ineligible land costs including
existing treatment works are discussed
in Appendix A to 40 CFR Part 35
Subpart I of the regulations.
CHAPTER 9
REVIEW OF FACILITIES PLANS
9.0
REVIEW AND
EVALUATION
The timing of
review, approval,
and certification of
facilities plans will vary from
State to State. Although State
certification that a facilities plan
satisfies all regulatory requirements
is not required until the submission
by the State to EPA of a Step 3
grant application, you are strongly
encouraged to have your project
reviewer evaluate your facilities plan
before beginning project design. This
evaluation will help ensure that
all Federal and State statutory
requirements are satisfied and that
the project to be designed will
meet the prerequisites for grant
assistance.
In addition to your reviewing agency's
evaluation, you should also solicit
comments on your completed facilities
plan from the appropriate clearing-
house and WQM agency, if any. Agency
review procedures and corresponding
determinations of facilities plans
are discussed in Section 9.2.
9.1
SUMMARY
CHECKLIST
Summarized below are
the major items
you should consider
during facilities planning.
Project Management
o Prepare plan of study.
o Conduct preplanning meeting with
reviewing agency.
o Arrange
advance of
appropriate.
for local funds or
grant allowance as
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o Organize project team and
designate municipal project manager.
o Prepare public participation
program.
o Coordinate with WQM agency if
applicable.
Facilities Plan
o Population and flow forecasts.
o Sewer System Evaluation, if
applicable. Watch timing and obtain
State agreement of results.
o Possible use of generic plan for
small communities (consult project
reviewer).
o Alternatives development:
- Land application;
- Small wastewater systems;
- Centralized treatment;
- Upgrading and optimal
operation of the existing
system;
- Innovative and alternative
technology;
- No action.
o Financial Capability Analysis.
o Environmental assessment of
alternatives as integral part of
facilities plan.
o Alternatives evaluation based on:
- Costs;
- Engineering feasibility;
- Environmental impacts;
- Public acceptance;
- Implementability.
o Public participation program.
Facilities Plan review by
o WQM agency;
o Clearinghouse (A-95);
o State agency;
Critical Topics: Be sure the
following areas receive close
attention:
o Detail of facilities plan;
o Coordination with WQM agencies;
o Population and flow forecasts;
o Public participation;
o Alternatives development and
analysis, particularly low cost
alternatives for small communities;
o Effluent limitations;
o Disposal of residuals;
o Intermunicipal service
agreements;
o Pretreatment program;
o Preliminary cost estimates;
o O&M;
o Financing and economic impact;
o Financial capability.
Project Administration: Check on:
o Filing system;
o Accounting records;
o Force account.
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9.2
AGENCY REVIEW While a review of
your completed
facilities plan is not required until
submission of your application, you
are encouraged to request such a
review prior to undertaking project
design. In order for you to under-
stand the actions required on the part
of the State and the decisions to be
made by EPA concerning the review and
approval of your facilities plan, a
brief description of these actions is
provided below.
9.2.1
STATE REVIEW AND The completed
CERTIFICATION TO facilities plan
EPA along with comments
from the State
and areawide clearinghouses and
appropriate WQM agency is submitted to
your State reviewing agency. The
State will conduct its review and
contact you for additional informa-
tion, clarification or suggestions
for change if appropriate. Upon
resolution of any problems the State
reviewing agency will certify to
EPA (at the time of application
submission) that the facilities
plan:
o Conforms with the require-
ments of the construction grants
regulations and applicable laws;
o Has been made available to the
appropriate WQM agency for comment;
and
o Conforms with approved WQM
plans.
9.2.2
ADVANCED
TREATMENT (AT)
REVIEW
headquarters will conduct the review
based in part on information
submitted by the State or EPA regional
office.
For AT projects with incremental
capital costs of $3 million or less,
the State or EPA regional office will
conduct the review. Grant assistance
may be awarded only after these
reviews.
9.2.3
EPA ACTIONS
UNDER NEPA
For AT projects with
incremental capital
costs greater than
$3 million, EPA
An application for
grant assistance
may only be
considered after the regional adminis-
trator has completed the appropriate
environmental document (40 CFR Part 6).
If your project was not issued a
Categorical Exclusion based on earlier
coordination with EPA (Section 2.0),
EPA will apply the criteria (Section
3.2.12) under the National Environ-
mental Policy Act (NEPA) to determine
whether an Environmental Impact
Statement (EIS), or more commonly, a
Finding of No Significant Impact
(FNSI) should be prepared. The
decision by EPA is based on:
o Your completed facilities plan
where review of the facilities
plan has not been delegated to the
State; or
o The State's environmental
assessment where the State has been
delegated authority for facilities
plan review; and
o Other documentation considered
necessary by EPA to allow a determina-
tion.
If an EIS is not warranted, EPA
will prepare and publish a FNSI (with
a 30-day comment period). The
decision not to prepare an EIS will
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be supported by an environmental
assessment incorporated into or
attached to the FNSI.
If EPA determines that significant
adverse impacts which cannot be
satisfactorily mitigated will result
from your project, you will be
notified prior to the publication in
.the Federal Register of a notice of
intent to prepare an EIS.
EPA will prepare the EIS either by
direct use of agency staff, or by
contract with a consultant. When the
need for an EIS is determined before
completion of facilities planning, the
joint EIS/EID approach can be used
(Section 3.2.12).
The EPA regulations (40 CFR Part 6)
outline detailed procedures and
criteria to be followed in the
process of EIS preparation. Grant
assistance may not be awarded until a
a final EIS has been prepared and all
regulatory requirements have been
imet. However, action may continue on
;discrete segments of the project
before the environmental review is
complete, under certain conditions
(Section 3.2.12).
PART II. DESIGN
CHAPTER 10
PREDESIGN
10.0
PREDESIGN A predesign
CONFERENCE conference with your
reviewing agency
after facility plan approval, while
not required, is strongly recommended.
The predesign conference will provide
an opportunity to review Federal and
supplementary State requirements
for design as well as other grant
application requirements. Examples of
other requirements which might be
discussed include:
o Field testing of innovative or
alternative technology designs
(Section 10.1);
o Value engineering
(Section 12.1);
review
o User charge system and sewer use
ordinance (Sections 12.2 and 12.3);
o Timing and dollar amount of grant
assistance (Section 13.5);
o Plan of operation (Section 12.4);
o Land acquisition (Section 8.6);
o Intermunicipal service agreements
(Introduction-Managing Your Project);
o Pretreatment (Section 8.5.4);
o Reviewing agency's environmental
review of project (Section 9.2.2);
o Sewer system evaluation (Section
5.4.1);
o Combination Step 2+3 grant
(Introduction-Managing Your Project).
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Prior to the conference you may wish
to prepare a brief description of the
activities you will perform during the
design phase of your project. The
description could be similar to the
plan of study (Section 2.2) and
address milestones, schedule and
other aspects of your project.
One aspect of project design which
should be clarified concerns the level
of detail of the design work to be
submitted to your reviewing agency.
For example, some A/E's prepare design
engineering reports which show the
assumptions and calculations used to
size various components of the treat-
ment works. Items such as surface
settling rates, weir overflow rates,
detention times, pump system head
curves, volume of various tanks, etc.,
are very often included in these
reports. The reviewing agency
may or may not wish to review the
assumptions, design criteria and
calculations prior to the preparation
of the drawings. In any case, prudent
project management suggests that a
predesign conference take place and
that all significant project design
criteria be reviewed.
10.1
FIELD TESTING OF The field testing
INNOVATIVE OR of a proposed
ALTERNATIVE (I&A) technology
TECHNOLOGY project is intended
to provide an
additional increment of verification
of its performance capability under
the circumstances of use. Alternative
technology processes or techniques
(Section 6.4.1) are generally fully
proven but may require verification
for the particular application or
unique circumstances associated with
your project. Innovative processes or
techniques, on the other hand, are
developed but not fully proven under
the circumstances of contemplated use,
and field testing may be desirable to
verify performance and/or refine
design parameters.
The costs associated with field
testing of proposed innovative or
alternative (I or A) projects are
allowable for grant participation (as
a preaward cost) and in some cases may
require the construction, lease or use
of relatively large structures.
Discuss this aspect with your project
reviewer and ensure that there is
agreement before proceeding.
Applications for proposed field
testing should explain why the
technology is not fully proven
and demonstrate that full testing is
needed to:
o Reduce the element of risk to an
acceptable level;
o Increase confidence in the
widespread use of the technology;
o Permit refinement and
verification of design or performance
criteria; and
o Achieve significant cost or
energy (translated to cost) savings
over conventional technology.
The size or scale of field testing
necessary to demonstrate full develop-
ment may range from pilot to full
scale and should be determined by
considering the following items.
o The size of the principal
components are such that physical,
chemical or biological processes are
accurately simulated.
o Process variables normally
expected in full-scale application
are simulated.
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o Al 1 recycle
considered.
st reams a re
o Variations in influent
characteristics substantially
affecting performance in full-scale
application are anticipated and
simulated.
o The time of testing is adequate
to ensure process equilibrium.
o Full control of all major process
variables is demonstrated.
o The service life of high
maintenance or replacement items is
accurately estimated.
o Basic process safety, environ-
mental , and health risks are
considered and found to be within
reasonable limits.
o Type and amount of all required
process additives are determined.
The program of field testing should be
the most cost-effective approach
reflecting practical and efficient use
of existing facilities or newly
constructed facilities. The field
testing program should be of the
smallest size and duration necessary
to accomplish technical and economic
feasibility objectives. Elements of
project design that may be field
tested include portions of projects
that qualify as I or A technology
based on the evaluation in your
facilities plan and include complete
systems, unit processes, proprietary
equipment and devices or modifica-
tions and improvements of existing
technology.
The results of field testing can be
used to confirm final qualification
of a system or selected components as
I or A technology. A final design
report for projects incorporating a
field testing program should be
prepared and submitted to the
reviewing agency. The report should
summarize the findings and include
items such as scope and objectives,
location of field test, duration,
costs, variables, and the impact on
design. Field testing should not be
considered where its use would delay
construction of needed facilities
beyond dates necessary for compliance
with NPDES permit schedules.
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CHAPTER 11
DESIGN AND ADMINISTRATIVE
CONSIDERATIONS
11.0
DESIGN
CONSIDERATIONS
Treatment works are
designed by an A/E
registered in the
State in which the project is to be
constructed. In designing the
treatment works the A/E will employ
sound design principles and place his
seal on the construction drawings and
specifications. In addition, the A/E
will employ State design criteria
where applicable; however, based on
past experiences, EPA has established
several basic policies concerning the
design of treatment works. These
policies are not complete design
standards and should be used only
to supplement the State's design
criteria.
11.0.1
PRETREATMENT AND Pretreatment in the
NPDES PERMIT context used
in this book is
directed only to nonresidential
sources of wastes discharged into your
treatment system. The objectives of
pretreatment are to prevent the
introduction of pollutants which may
pass through or interfere with your
treatment process or contaminate your
effluent and/or sludge thereby
limiting your options for disposal or
reuse. Failure to attain any of the
objectives may lead to a violation of
your National Pollution Discharge
Elimination System (NPDES) permit.
During the facilities planning
phase you will have had preliminary
discussions with your reviewing agency
concerning your NPDES permit. The
permit for existing or proposed
facilities will contain requirements
for effluent or water quality limita-
tions (i.e., the level of treatment
you must achieve), a schedule for
compliance with the permit conditions,
and specific requirements for pre-
treatment necessary for your project.
To satisfy these requirements it will
probably be necessary to conduct
investigations of the characteristics
of the nonresidential wastes, prepare
an evaluation of your legal authority
for enforcement, establish adminis-
trative procedures, and identify
financial sources to develop and
implement your pretreatment program
(Section 8.5.4). Pretreatment
requirements will impact nonresiden-
tial contributors discharging into
your system and possibly modify
your project design and sewer use
ordinance. If your project will treat
wastes from nonresidential sources, it
is recommended that you determine from
your project reviewer the necessary
actions to satisfy pretreatment
requirements, if you have not already
done so, during the design phase of
your project.
11.0.2
WET AND DRY WELL Wastewater may
CLASSIFICATIONS generate explosive
gases. In addition,
volatile products, such as gasoline
or industrial solvents, may be
inadvertently or illegally introduced
into the sewerage system. Where
pumping is necessary, wastewater is
generally stored, for a relatively
short time, in a holding tank called a
wet well where sewage gas or other
volatiles may accumulate. The waste-
water remains in the wet well until a
control signal turns the pumps on
and lowers the liquid level to a
predetermined elevation. Pumps,
motors, and electric equipment are
sometimes located in the wet well
and may represent an ignition
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source if explosive gases are present.
Your design should take this hazard
into account and include features
to preclude the possibility of an
explosion or possible injury of
workers due to the inhalation of
potentially toxic gases. Equipment
located in wet and dry wells should be
designed to minimize explosion
and areas subject to buildup of
gases should be ventilated. Classi-
fication of wet and dry wells as Class
I and either Division 1 or 2 (National
Electrical Code) should be made on a
case-by-case basis and depends on the
type of sewer system, the probability
of hazardous gases being present,
the intended use and the type of
ventilation used.
Strict enforcement of the sewer use
ordinance and the development of
specific contingency plans (included
in the O&M manual) to combat
accidental or illegal discharge of
compounds is encouraged. Guidance
containing good engineering practice
for design of wet and dry wells is
contained in Appendix H of this
book.
11.0.3
USE OF MERCURY Mercury is a toxic
and hazardous
substance. It should be used with
extreme care in trickling filter
flow distributors and comminutor
seals. Problems with conversion
of older trickling filter rotary
distributors from mercury seals to
mechanical seals may require special
consideration. If it is anticipated
that significant additional cost,
operating or maintenance problems
associated with such conversions will
arise, you should consult with
your project reviewer. It may be
determined after consultation and
evaluation of other alternatives that
continued use of mercury seals is the
best solution. To prevent violation
of Section 307(a) of the CWA you
should submit a written request for
use of mercury seals to your reviewing
agency for approval. This request
should address the following issues:
o Acknowledgement that all costs
associated with the repair, replace-
ment or modification of existing
mercury seals when not replaced
with mechanical seals are not grant
eligible;
o Agreement to comply with all
applicable provisions of the Toxic
Substances Control Act and the Solid
Haste Disposal Act;
o Acknowledgement that you can J)e
held liable for any damages related to
the discharge of mercury contaminated
effluent or sludge;
o Establishment of a mercury spill
monitoring program including an annual
mercury inventory;
o Establishment of an emergency
response program which provides
for the safe disposal of effluent
and/or sludge contaminated with
mercury and a program for immediately
notifying all downstream water users
of possible mercury contamination;
o Modification of your NPDES permit
to identify a potential mercury
contamination hazard.
Mercury float switches have been used
for several years with no reported
failure where mercury was discharged
to the wastewater. For that reason
and since mercury float switches
contain small amounts of mercury
(usually less than 15 grams)
those switches and other equipment
67
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containing similarly small quantities
of mercury may be used in treatment
works. It is anticipated that care
will be exercised when specifying
equipment using small amounts of
mercury and consider items such as
sel f-contamintnent, leakproof, and
corrosion resistance.
Reviewing agencies may specify
additional considerations for assuring
that applicable considerations
have been addressed before
approving construction drawings and
specifications.
11.0.4
SHELLFISH WATERS If your project
proposes to dis-
charge effluent into shellfish growing
waters, the environmental impacts will
have been assessed in your facilities
plan or by your reviewing agency. The
environmental assessment in all
likelihood will have recommended
measures to minimize the adverse
impacts of the discharge upon shell-
fish. These recommendations should be
carefully considered during project
design. However, in addition to
these recommendations the following
considerations should be taken into
account during the design phase of
your project.
Reliability
Equipment, unit processes and the
overall treatment process should be
designed to provide a Reliability
Class I (Section 11.0.13). In
general, this reliability class
defines the redundancy of system
components or provision for adequate
capacity when one component or unit
process is out of service.
State Requirements
Discharge in close proximity to
shellfish harvesting areas should be
avoided wherever possible. State
environmental protection authorities
and shellfish regulatory agencies
should be contacted for further design
requirements if this is unavoidable.
11.0.5
CHLORINATION C h 1 o r i n a t i o n
SYSTEMS USING continues to be the
GASEOUS CHLORINE most common practice
for disinfection of
treated wastewaters prior to dis-
charge. While chlorination is an
effective disinfectant, it also
presents potentially dangerous
conditions when used improperly or
accidentally leaked. In the worst
case chlorine can cause death by
suffocation or severe burns when
brought in contact with skin and eyes.
When combined with small quantities of
water, chlorine can become highly
corrosive. Therefore, chlorination
systems should be designed to prevent
chlorine leaks, to ensure the quick
and safe handling of any chlorine
leaks, and to minimize operator and
local resident exposure.
The discussion below represents EPA's
technical guidance and the basis
for minimum adequacy in safety
considerations and should be used to
supplement (not replace) other safety
requirements and regulations such as
those published by the Occupational
Safety and Health Administration
(OSHA). This section deals with
design considerations and represents
good engineering practice.
Design Considerations
o Where chlorine or chlorination
equipment is stored or installed in a
building used for other purposes, a
gas tight partition should separate
the chlorination room from other parts
of the building, doors should be
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equipped with panic hardware and open
to the outside at ground level and
storage and feed areas should be
separated.
o A clear glass, gas tight window
should be installed in the exterior
door or interior wall of the chlorina-
tion room to permit viewing without
entering the room.
o Chlorination rooms should be
heated to 50 °F and the chlori nation
feed equipment room 5-10°F higher;
to avoid overheating above 140°F
containers should be shielded from
direct sunlight and stored with level
rails or cradles designed for this
purpose.
o Forced mechanical ventilation
should provide a complete air change
every 4 minutes with inlets and
outlets at opposite ends of the room;
exhaust outlets should be at floor
level since chlorine gas is heavier
than air.
o Exhaust equipment should be
activated by external light switches
or other automatic systems such as
door activated mechanisms.
o Emergency showers and eye
baths should be located external
to, but close by, the chlorination
room.
o An automatic chlorine detection
system should be provided for
facilities with capacity of 1 mgd or
more and activate sound alarms,
flashing lights, notification to
operator's area or police department,
or other measures to ensure emergency
response. Smaller capacity treatment
facilities should also consider use of
detention and alarm systems where the
benefits warrant the additional cost.
O&M Design Considerations
o Rail delivery of chlorine is to
comply with Department of Transporta-
tion regulations (49 CFR 174.560) and,
in general, provide dead-end sidings
used only for chlorine delivery.
o Chlorine cylinders should be
lifted with forklift trucks and other
hoisting equipment equipped with
special cradles or carriers designed
for such purposes; chains, rope
slings, or magnetic hoists should
never be used.
o Tank barge unloading should
comply with U.S. Army Corps of
Engineers and Coast Guard regulations.
o One-ton cylinders should be
stored on cradles or pairs of level
rails. One hundred and 150-pound
cylinders should be secured with
safety chains, never be piled on top
of one another nor stored with other
compressed gases; empty containers
should be tagged appropriately and
stored separately from full cylinders;
cylinder emergency repair kits should
be readily available.
o Self-contained positive pressure
headgear with self-contained
compressed air supply and full face
piece should be located away from
areas likely to be contaminated but
convenient and available for emergency
use; additional (spare) air supply
cylinders should be provided; and
routine training, inspection and
cleaning of emergency equipment should
also be provided.
o Piping and valves in chlorine
rooms should be color coded and
labeled.
11.0.6
CHEMICAL STORAGE
AND HAZARDOUS
MATERIALS
All chemicals should
be stored and
curbed to hold the
entire volume in
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the event of an accidental spill. In
addition, adequate safety protection
gear is to be provided for plant
disposal of chemicals and hazardous
materials may be subject to the
provisions of the Resource Conserva-
tion and Recovery Act and the Toxic
Substances Control Act.
Sewage Sludge
The storage, transport, and disposal
of sewage sludge may be subjected to
the hazardous waste regulations
implementing the Resource Conservation
and Recovery Act (Section 6.6).
Regulatory agencies have generally
not classified sewage sludge as a
hazardous waste. Rather, it is up to
each municipality to determine if its
sludge is hazardous based on the types
of industrial waste discharged into
the system or by laboratory testing if
deemed necessary. The characteristics
of a hazardous waste include:
ignitability, corrosivity, reactivity,
extraction procedure (EP) toxicity.
In general, the characteristic most
likely to cause a sludge to be
hazardous would be the toxicity level
as determined by the EP test.
The results of the pretreatment
studies conducted during or after
facilities planning or the require-
ments of the NPDES permit program may
require nonresidential dischargers to
pretreat their wastes, eliminating
those chemicals which could cause your
sludge to be classified as hazardous.
If it is possible that your sludge
may be classified as a hazardous
waste, you should contact your
reviewing agency during design to
initiate procedures for obtaining
a permit as a generator, storer,
transporter, and disposer of hazardous
wastes.
11.0.7
SAFETY The specifications
will require
contractor compliance with OSHA's
regulations and applicable State
requirements. In addition, the
specific design considerations
for chlorine systems, chemical
storage and handling, and wet well
classifications as described in
earlier sections should be taken into
consideration.
11.0.8
BYPASSING OF
SEWAGE
Avoid bypassing of
flows from sewers
or treatment
facilities during construction
except where absolutely essential
and with specific approval from
your reviewing agency. Eliminate
existing bypasses and include
provision in new facilities for
temporary storage and treatment
of all flows. Any bypassing to the
receiving stream is to be indued in
the NPDES permit.
11.0.9
PUBLIC WATER
SUPPLY
supplies from
contamination.
11.0.10
VENTILATION
Use backflow
preventers to
protect public water
the possibility of
Adequate ventilation
should be provided
to eliminate hazardous working
conditions. Specific requirements
for chlorine systems and wet/dry wells
are given in Sections 11.0.2 and
11.0.5 of this book. Adequate
ventilation should also be considered
for chemical storage areas, buildings,
laboratories, enclosed structures,
and sludge handling and digestion
areas.
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11.0.11
LABORATORY Laboratory facili-
FACILITIES ties should be
adequate to conduct
sampling and testing required to
properly control the treatment
process, and to provide the report
data required by the NPDES permit or
reviewing agency. Alternatively,
provision may be made for testing
by commercial laboratories,
universities or other treatment works
equipped to perform the necessary
tests.
11.0.12
EMERGENCY ALARMS Emergency alarms
should be provided
to alert operators or other officials
of malfunctions in system components.
Highest priority should be provided
to systems which endanger operator
or public safety or cause a complete
system failure resulting in
discharge of inadequately treated
sewage.
11.0.13
EQUIPMENT AND MATERIALS
Nonrestrictive Specifications
Specifications are to be written to
encourage maximum, free and open
competition. Specifications are
not to contain proprietary,
exclusionary or discriminatory
requirements for structures,
materials, equipment or processes
other than those based on performance
with two exceptions:
o Where it is necessary to provide
for interchangeabil ity of parts of
equipment;
o Where it is necessary to test or
demonstrate a specific thing (for
example, innovative technology or
techniques).
When in your judgment it is
impractical or uneconomical to make a
clear and accurate description of the
technical requirements, a brand name
or equal description may be used as a
means to define the performance or
other salient requirements. In so
doing, you need not establish the
existence of any source other than the
brand or source so named.
With regard to materials such as pipe
or chemical grout, it is not mandatory
that two or more types of material
be specified. In general, it is
preferable to use performance specifi-
cations for materials based upon
accepted nationally known standards.
In the case of pipe, for example,
these standards may be AWWA, USAS,
ASTM, or Federal specifications and
standards.
If it is necessary to use a
restrictive specification which
reflects minimum essential performance
needs, you should justify its use in
writing prior to the issuance of the
specifications and be prepared to
defend your justification in the event
of a protest (Section 16.11).
Sole Source Procurement
Noncompetitive negotiation is allowed
when it is necessary to test or
demonstrate something specific
(e.g., equipment or processes used in
innovative technology designs) and
with the prior approval of the
reviewing agency. Noncompetitive
negotiation may require the submission
of a price or cost analysis. The
analysis may include a review of
direct costs (materials, labor, etc.),
indirect costs (overhead, general, and
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administrative expenses), profit, and
comparisons with other similar
products or previous purchases of
the same product. These costs are
typically subject to audit.
Qualification of Major Items
of Equipment
The qualification of major items of
equipment before receipt of bids for
construction is optional. This
procedure may be used to ease the
administrative burden of determining
responsive, responsible suppliers on
equipment. In all cases, the equip-
ment furnished must comply with the
specifications and qualified suppliers
may be rejected as nonresponsive on
the basis of subsequently furnished
information.
The A/E prepares a qualification
information package which contains
enough specific detail regarding
performance and quality to assure that
equipment suppliers will thoroughly
understand what is required. Adequate
advertisement (30 days minimum) or
direct contact is made with new
and established manufacturers,
small, minority and women's business
enterprises to ensure each has an
opportunity to. compete. Date, time,
and place of qualification information
are given in advertisements and direct
contacts.
Evaluation of the qualification
submittals should be made by the A/E
and reported to you. All proposers
are notified of their status.
Protests, if any, should be handled in
accordance with the procurement
regulations (Section 16.11).
Equipment and Process Compatibility
Recognizing the requirements for free
and open competition, the resulting
uncertainty of equipment selection and
its incorporation into the treatment
system, construction drawings and
specifications should be reviewed
to ensure equipment and process
compatibility. In many cases shop
drawings from successful suppliers
will be insufficient to ensure
compatibility of operation and control
of an integrated total treatment
system. It is, therefore, essential
that the A/E thoroughly reviews unit
process interfaces with respect to
mainstream process performance charac-
teristics and control and the impact
of sidestream and overall system
controllability.
Material and Storage of Equipment
To minimize potential adverse climatic
effects, materials and equipment
should be properly stored at the
construction site. The specifications
should include a provision directing
contractors to obtain and implement
storage procedures as recommended by
the manufacturer.
Reliability
Treatment facilities should be
designed, constructed and operated
to ensure reliable total system
performance over the life of the
project as necessary to:
o Protect public health;
o Achieve water quality and
pollution control objectives for
both surface and groundwater;
o Prevent environmental damage.
Design practices necessary to ensure
reliable performance, however,
should be both cost effective and cost
beneficial.
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Reliability can be designed into a
project by one of two methods: (1) a
separate analysis of risks, costs and
benefits or (2) the use of generally
recognized criteria such as State
standards or the suggested design
features described in this chapter.
Your A/E generally will select the
most appropriate method.
In the first method, determination of
the level of reliability required to
satisfy these conditions should
consider:
o Total cost including capital
cost, O&M costs and the cost of
failure (if this can be costed) times
the probability of failure;
o Size and relative contribution
of excessive wastewater pollutant
loadings compared to uncontrolled
sources (e.g., nonpoint source
pollutant loadings);
o Magnitude, duration and frequency
of excessive pollutant loadings in
comparison to receiving water quality
and assimilative capacity;
o Conservative versus nonconserva-
tive nature of pollutant;
o Stability or persistence of
pollutant in the receiving waters.
These factors identify and quantify
the consequences of failure as the
basis for design levels of total
system reliability.
In the second method, techniques are
employed to designate surface or
groundwaters by their use and to
select a corresponding treatment level
and class of reliability for the
treatment facilities. Treatment
levels are defined in "Alternative
Waste Management Techniques for Best
Practicable Waste Treatment" with
the greatest level of treatment
given to surface waters used for
public drinking water supply, water
contact recreation, shellfish, and
fisheries.
The reliability class for treatment
facilities is designated based
on the use of the receiving waters and
the probable adverse impact of
inadequately treated discharge on
them. Reliability classes may be:
o Class I - treatment works which
discharge into navigable waters that
could be permanently or unacceptably
damaged by effluent which is degraded
in quality for only a few hours
(e.g., discharges near drinking water
sources into shallfish waters or
in close proximity to areas used for
contact sports);
o Class II - treatment works which
discharge into navigable waters
that would not be permanently or
unacceptably damaged by short-term
effluent quality degradation but could
be damaged by continued (several
days) effluent quality degradation
(e.g., discharges into recreational
waters);
o Class III - treatment works not
otherwise designated as Class I or II.
Each class is broadly defined for each
of the three major systems within a
treatment facility: (1) wastewater
treatment system, (2) sludge handling
and disposal system, and (3) electric
power system. Each of the three major
systems contains recommendations
common to each class and component
backup recommendations for each
separate class. Tables 1, 2, and 3
summarize the recommendations for each
reliability class.
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TABLE 1 - HASTEWATER TREATMENT SYSTEM RELIABILITY
WASTEMATER TREATMENT SYSTEM
Features Common to Class I, II( III:
Trash removal or comminution
Grit removal - not applicable to treatment work* which do not pump or dewater sludrje <«-9./ stabilisation ponds)
Provisions for removal of settled solids - applicable to channels, pump wells and piping prior to degritting or primary
sedimentation
Holding basin - applicable to Class I with adequate capacity for all flows
Unit operation bypass - not applicable where two or more units are provided and operating unit can handle peak flowi
applicable to comminution regardless of number of units
Component Backup Features
Backup bar screen for mechanically cleaned bar screen or comminutor
Backup puinp
Primary sedimentation basins
Trickling filters
Aeration basin
Aeration blowers or mechanical aerators
Air diffusers
Final sedimuntatlon basins
Chemical flash mixer
Chemical sedimentation basins
filters and activated carbon columns
Klocculation basins
Disinfectant contact basins
Class I
Yes
Yes*
Multiple basins2
Multiple filters3
Min. 2 of equal
volume
Multiple units4
Multiple sections5
Multiple basins3
Min. 2 or backup6
Multiple basins3
Multiple units3
Minimum 2
Multiple basins2
Clans II
Yes
Yes*
Multiple basins2
Multiple filters2
Min. 2 of equal
volume
Multiple units4
Multiple sections5
Multiple basins2
No backup
No backup
No backup
No backup
Multiple basins2
Class III
Yes
Yes*
Minimum 22
No backup
Single basin
permissible
Minimum 2
Multiple sections5
Minimum 22
No backup
No backup
No backup
No backup
Multiple baainb
1 - Sufficient capacity of remaining puup to handle peak flow with one pump out of service
2 - With largest unit out of service remaining units have capacity for at least 50% design flow
3 - With largest unit out of service remaining units have capacity for at least 75» design flow
4 - With largest unit out of service remaining units able to maintain design oxygen transferi backup unit may be
5 - With largest section out of service oxygen transfer capability not measurable Impaired
6 - If only one basin, backup system provided with at leaat 2 mixing devices (1 may be unlnstalled)
uninstalled
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TABLE 2 - SLUDGE HANDLING AND DISPOSAL SYSTEM RELIABILITY
SLUDGE HANDLING AND DISPOSAL SYSTEM
Features Common to Class I, II, III«
Alternate methods of sludge disposal and/or treatment - applicable to unit operations without backup
capability
Provisions for preventing contamination of treated wastewater
en
Component Backup Features Common to Class I, II, III;
Sludge holding tanks - permissible as alternative to backup capability with adequate capacity for
estimated time of repair
Backup pump - sufficient capacity of remaining pumps to handle peak flow with 1 pump out of servicej
backup pump may be uninstalled
Anaerobic sludge digester
Digestion tanks - at least 2 digestion tanks
Sludge mixing equipment - backup equipment or flexibility of system such that with 1 piece of
equipment out of service total mixing capability is not lost; backup
equipment may be uninstalled
Aerobic sludge digestion
Aeration basin - backup not required
Aeration blowers or mechanical aerators - at least 2 units* permissible for less than design oxygen
transfer with 1 unit out of servicej backup unit may be
uninstalled
Air diffusers - with largest section out of service oxygen transfer capability not measurably
impaired
Vacuum filter - multiple filters with capacity to dewater design sludge flow with largest capacity
filter out of servicei each filter serviced by 2 vacuum pumps and 2 filtrate pumps
Centrifuges - multiple centrifuges with capacity to dewater design sludge flow with largest capacity
centrifuge out of service
Incinerators - backup not required; backup required for critical auxiliary components (e.g., center
shaft cooling fan)
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TABLE 3 - ELECTRIC POWER SYSTEM RELIABILITY
ELECTRIC POWER SYSTEM
Features Common to Class If II f III:
Power sources - two separate and independent electric power sources from either two separate utility
substations or one substation and one standby generator
Capacity of Backup Power Source
Mechanical bar screen or comminutors
Main pumps
Degritting
Primary sedimentation
Secondary treatment
Final sedimentation
Advanced waste treatment
Disinfection
Sludge handling and treatment
Critical lighting and ventilation
Class I
Yes
Yes
Optional
Yes
Yes
Yes
Optional
Yes
Optional
Yes
Class II l
Yes
Yes
No
Yes
Optional
Optional
Optional
Yes
No
Yes
Class III 1
Yes
Yes
No •
Yes
No
No
No
Yes
No
Yes
At least treatment equivalent to sedimentation and disinfection
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11.0.14
LAND BASED
SYSTEMS
The design of land
based systems
should be based on:
o "Process Design Manual , Land
Treatment of Municipal Wastewater"
(EPA 625/1-81-013);
o "Design Manual, Onsite Wastewater
Treatment and Disposal Systems" (EPA
625/1-80-012);
o "Process Design Manual for Sludge
Treatment and Disposal" (EPA 625/1-
79-011).
The specifications should also address
protection of soil integrity during
construction. For example, onsite
system trench construction for the
soil absorption system should not take
place during wet weather where clays
are present, equipment travel should
avoid infiltrative surfaces and
special attention should be given to
grade, bedding and backfill materials.
For land treatment systems, the land
surface should be disturbed as little
as possible or restoration techniques
(plowing, discing) should be employed
wherever necessary. Limitations on
the size and weight of the construc-
tion equipment and climatic conditions
during which construction may not take
place should be included in the
specifications especially for land
based systems.
11.0.15
EROSION AND
SEDIMENT CONTROL
During the environ-
mental evaluation
of your project in
the facilities planning stage, the
potential for soil erosion and
sediment buildup in water bodies,
wetlands or floodplains was con-
sidered. In all likelihood, the
environmental information document
recommended the employment of certain
mitigating procedures during design
and construction of the project to
provide erosion and sediment control.
You should also ensure that erosion
and sediment control measures
addressed in your facilities plan
are incorporated in the design and
construction phases of your project.
Such measures should include:
o A schedule that provides for the
construction of structures as soon as
possible after clearing and grading;
o Specifications for temporary and
permanent measures to be used for
controlling erosion and sediment;
o A list containing completion
dates for each temporary and permanent
measure for controlling erosion and
sediment; location, type and purpose
for each measure; and dates when
temporary measures will be removed or
replaced;
o Soil or landscaping maintenance
procedures should be included in the
O&M manual.
11.0.16
MITIGATION OF
ADVERSE
ENVIRONMENTAL
IMPACTS
During project
design, review the
recommendations for
mitigation of
adverse environ-
mental impacts contained in your
facilities plan or in the reviewing
agency's environmental assessment and
incorporate appropriate mitigation
measures into the project design.
Failure to incorporate mitigation
measures could lead to a requirement
for EPA to prepare an EIS, thus
potentially delaying the project.
11.0.17
SEWERS Sewers should be
designed to maintain
minimum scouring velocities and have
adequate capacity to accommodate flows
based on appropriate peaking factors.
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An allowable rate of infiltration
for sewers should be specified and
confirmed by tests after installation
(Section 5.4).
11.0.18
SEWER
REHABILITATION
Where sewer system
rehabilitation is
required based on
the conclusions of the sewer system
evaluation, specifications and
bid proposals should include unit
prices for such items as: internal
closed-circuit television monitoring,
sewer line cleaning, pressure testing,
and chemical grouting of joints, slip
lining, or any other item of work that
lends itself to unit pricing. In
addition, the specifications should
define the sequence of operations
(cleaning, TV, pressure test,
grouting) and the approval authority
necessary to perform each operation.
11.0.19
OPERATION AND The proposed design
MAINTENANCE should provide
for f1exib i1ity
in operation (e.g., bypassing of
individual unit processes or
components) and easy access to
equipment requiring routine mainte-
nance (e.g., greasing of bearings or
changing of lubricants).
11.1
ADMINISTRATIVE Chapter 16 addresses
CONSIDERATIONS procurement. It
describes procedures
which allow you to use your own
procurement system or in the alter-
native the minimum requirements to be
followed when using EPA's procurement
system. The sections below discuss
administrative provisions of the
procurement regulations applicable to
construction and which are included in
the bidding documents as they are
developed. Bidding documents are
prepared by your A/E and include:
o A complete statement of work
to be performed, including where
appropriate, construction drawings and
specifications and the required
performance schedule;
o The terms and conditions of the
subagreement to be awarded, including
where appropriate, payment, delivery
schedules, point of delivery anH
;>i.iieuu i ei , pu i ii L
acceptance criteria;
and
o A clear explanation and the
method of bidding and the method
of evaluating bid prices, and the
basis and method for awarding the
subagreement;
o The responsibility requirements
or criteria which will be employed in
evaluating bidders;
o The prevailing wage determination
made under the Davis-Bacon Act, if
applicable; and
o The deadline and place to submit
bids and a copy of 40 CFR 33.295 and
subparts F and G to 40 CFR Part 33.
By including in the specifications
copies of the regulations cited
in the preceding item or their
equivalent (Section 16.10), many of
the administrative statutory require-
ments are initially satisfied. At a
later time these requirements may have
to be invoked in order to assure
compliance with their provisions. In
addition to the bidding documents and
regulatory provisions above, other
provisions of the procurement regula-
tions applicable to construction of
the project are briefly described
below.
11.1.1
BONDING AND
INSURANCE
Contracts under
$100,000 are subject
to State and local
requirements for bid guarantees,
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performance and payment bonds. For
contracts in excess of $100,000 you
may (a) use your own requirements for
these items provided the reviewing
agency determines that the Govern-
ment's interest is adequately
protected or (b) require a 5 percent
bid guarantee and 100 percent perfor-
mance and payment bonds. Bonds
shall be obtained from companies
holding certificates of authority as
acceptable sureties.
Contractors should be required
to obtain construction insurance
(e.g, fire and extended coverage,
workmen's compensation, public
liability and property damage,
and "all risk", builder's risk,
or installation floater coverage)
as required by State or local
law.
11.1.2
(. Reserve )
Flood Insurance
Flood hazard areas have been
delineated on Flood Hazard Boundary
Maps or Flood Insurance Rate Maps
issued by the Department of Urban
Development. If flood hazard areas in
your community are delineated in one
of these maps, your participation in
the Federal Emergency Management
Agency's flood insurance program is
a prerequisite for Step 3 grant
assistance. You will have to provide
adequate flood protection insurance
for structures located in flood hazard
areas both during construction
(specifications generally require the
contractor to provide this insurance
during construction) and for the
useful life of the project. Insurance
is necessary on new or reconstructed
surface structures which are walled or
roofed (e.g., control building or
pumping station) and have a value of
$10,000 or more.
11.1.3
BUY AMERICAN The CWA requires
that preference be
given to domestic construction
materials in EPA grant assisted
projects. The preference is limited
to 6 percent above the bid or offered
price on foreign materials (including
duties whether or not assessed). Some
construction materials manufactured
in the United States include both
domestic and foreign components. If
the construction material has foreign
components representing 50 percent or
more of the value of the product, the
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entire product is considered to be
foreign.
The Buy American clause in the
procurement regulations is to be
included in all EPA grant assisted
projects. The reviewing agency
may waive this requirement where
appropriate.
11.1.4
ROYALTIES Reasonable royalties
associated with
the procurement of the right to use or
the rights in a patented product,
apparatus, or process are allowable
costs for grant participation
provided that they are necessary,
cost effective and that prior written
approval is obtained from the
reviewing agency. Periodic payment of
royalties for the right to operate
under a patent are considered
operating costs and are not allowable
for grant participation. Prior to
specifying a product or process which
requires the payment of a royalty, you
should determine if other royalty-free
products or processes are available in
order to provide competitive bidding.
Royalties are based on a published fee
schedule or on reasonable fees
charged to other users under similar
conditions.
11.1.5
PROJECT SIGN A sign for the
project site should
be provided by the contractor in
accordance with established specifica-
tions (Appendix J).
11.1.6
SMALL, MINORITY,
WOMEN'S AND
LABOR SURPLUS
AREA BUSINESSES
Contractors should
take affirmative
steps to assure that
small, minority and
women's businesses
are used when possible as sources of
supplies, equipment, construction and
services in accordance with 40 CFR
Part 33. The affirmative steps are
described in Section 16.9 and are to
be included in the bidding documents.
11.2
DESIGN REVIEW A review of your
bidding documents
including the construction drawings
and specifications will be performed
prior to Step 3 grant assistance or
before initiating procurement action
on Step 2+3 projects. A technical
review of the construction drawings
and specifications will be made by
your reviewing agency. Also, a
biddability and constructability
review will be conducted by the
COE or delegated State to ascertain
that the proposed construction
drawings and specifications provide
adequate information so that a
contractor can bid and construct the
facility without additional details
or directions. The review does
not relieve you nor your A/E of
responsibility for the project design,
but it is a reasonable determination
that the effluent or water quality
limitations in the facilities plan are
likely to be achieved, that the
results of the sewer system evaluation
have been considered, that the
recommendations of the VE review
have been included and that the
procurement regulations are satisfied.
Structural, electrical and mechanical
details of design will typically not
be reviewed in detail. Obvious
irregularities will be noted and
reported to you. Compliance with
design and administrative considera-
tions of this section will be
confirmed by your reviewing agency.
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CHAPTER 12
CONCURRENT ACTIVITIES DURING DESIGN
12.0
CONCURRENT During project
ACTIVITIES design it will be
necessary to
undertake other activities which are
either directly or indirectly related
to the project design or are a part of
the grant application process. While
some of these activities could
be undertaken after design, it
is recommended that they be per-
formed concurrently with design
in order to save time and continue
moving the project toward grant
award.
12.1
VALUE VE is an intensive
ENGINEERING (VE) review utilizing
a specialized
cost control technique which
identifies unnecessary high cost
in a project. VE obtains the best
project at the least cost without
sacrificing quality or reliability by
incorporating:
o A multidisciplinary team of
design professionals guided by
a VE coordinator;
o An evaluation of cost and
function relationships;
o Concentration on high cost areas;
o Generation of creative alterna-
tives;
0 Cost savings without sacrifice to
quality or reliability;
o Recommendations to you and the,
original design team.
A VE review is required for
treatment works costing in excess of
$10 million. VE is recommended for
projects costing less than $10 million
because of the potential for substan-
tial savings. VE serves as a
mechanism to enhance the design of
wastewater treatment facilities by
providing the project designer with an
opportunity to utilize the knowledge
and experience of other individuals to
optimize the project design.
12.1.1
VE TEAM AND
QUALIFICATIONS
The VE team
coordinator is an
important VE
participant who should have demon-
strated technical and managerial
capability enhanced by a 40-hour VE
workshop. The team coordinator acts
as a liaison between the VE team,
the project's design team, the
review agencies and you. The team
coordinator should have participated
in at least two VE studies on
wastewater construction projects.
Other VE team members should be
experienced professionals with VE
training and, if possible had previous
VE experience in wastewater construc-
tion projects. For a treatment plant
project the team members may include a
sanitary engineer, an electrical
engineer, a mechanical engineer, a
civil/structural engineer, a plant
operator, and a cost estimator. The
team makeup and size should be in
proportion to the nature, size, and
complexity of the project.
Because it is essential that the VE
team be independent and objective, you
may want to consider using a separate
subagreement with a second A/E firm to
perform the VE review instead of a
subcontract or under the original A/E
subagreement.
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12.1.2
SCOPE OF WORK The VE review should
consider all
components and systems of the project.
Depending on the size and complexity
of the project, the VE effort may vary
from one team and one review session
to multiple teams and multiple
reviews. For example, on a large
treatment plant project with advanced
waste treatment, two separate reviews
may be appropriate: one review at the
20-30 percent design stage to evaluate
the treatment process, design life,
plant layout, structural design,
hydraulic capacity, etc.; and a second
review when electrical and mechanical
systems are being designed.
The VE review will generally result in
two reports. The preliminary report
should include such items as:
o Scope of the VE review;
o Basic VE methodology employed
including the results of each phase
such as:
Information Phase - collection of
all facts, background and
data that are pertinent to the
design, including a functional
analysis and a cost model;
Speculative or Creative Phase -
creation of an extensive list
of alternative ways to perform
the essential functions found
during information gathering,
concentrating on areas with
highest potential savings;
Evaluation and Analytical Phase -
evaluation of the feasibility of
alternatives generated during the
creative phase;
Investigation Phase - a more
complete evaluation of the most
feasible alternatives;
o Summary of VE recommendations;
o Estimated cost savings for each
recommended alternative.
The preliminary report is often
presented both orally and in writing
to you and the original design team.
Since the objective is to obtain the
best project at the least cost without
sacrificing quality or reliability, it
is important that all participants in
the VE process remain objective.
A final report should include items
such as:
o Accepted VE recommendations;
o Cost and schedule for imple-
menting the accepted recommendations;
o Rejected recommendations and
reasons for the rejection;
o Net savings (both capital and
O&M) over the planning period.
In reviewing the final report you and
your reviewing agency should ensure
that rejected recommendations are well
justified or request a reevaluation.
12.1.3
PROPOSAL COST
AND TIMING
Since VE is a
process that
involves numerous
senior professionals, the selection of
experienced and well qualified VE
team members and the team coordinator
is essential for best results.
Likewise, it is vital that you and
your design A/E, when soliciting or
advertising for VE proposals, clearly
specify VE coverage, constraints,
number of studies required and other
essential factors to assure that all
proposals will be submitted on the
same basis. Proposals should specify:
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the number of studies and teams, names
and experience backgrounds for
team leader and study team members
including disciplines represented,
description of tasks and procedures
with schedules and cost for the study
and report.
Experience shows that two VE studies
(one at about 25 percent, the other at
about 75 percent of design) will
generally achieve optimum VE benefits.
If project constraints rule out
the second study, one study should be
scheduled usually around 30 percent of
design for best results. If managed
properly, VE will not delay the
project. After the team selection, a
prestudy meeting with you, your design
A/E, VE team leader and reviewing
agency will help refine the scope,
schedules and procedures and improve
working relationships to maximize
study benefits.
12.2
USER CHARGE
SYSTEM
The user charge
represents the
amount of money you
will charge each customer each year in
order to pay for the operation,
maintenance, and replacement (OM&R)
of the wastewater collection and
treatment system. A sound user charge
system is an essential step in
ensuring your ability to pay for OM&R.
Generally, the charges are based
on the amount of water (measured by
water meters) used by homeowners
and small commercial establishments.
Industries and large commercial users,
in general, also pay by water use but
in addition a surcharge may be added
because the strength of their waste
or the rate of discharge causes
additional O&M costs to be incurred.
Nonresidential users which discharge
toxic pollutants into the system
will pay for any increased costs of
managing the effluent or sludge
that results from the toxics. The
objective of the user charge system is
to provide the money necessary to
operate and maintain the treatment
works plus a reserve to pay for
replacement. Replacement is the
expenditures for obtaining and
installing equipment, accessories or
appurtenances during the useful life
of the treatment works necessary to
maintain its design capacity and
performance (e.g., pumps, motors,
etc.). The O&M costs will include
items such as salaries, chemicals,
utilities, insurance, training,
supplies, etc.
The user charge system as used in this
context should not include charges
which are levied to customers to
retire bonds or amortize debt. The
EPA regulations do not contain
requirements for how you accomplish
this. You may include a separate
charge for capital expenses or debt
service on bills to users or in the
general tax base.
In public meetings during facilities
planning, you should have advised the
public of the estimated user charges.
If the user charges developed during
design are significantly different,
you should consider having another
public meeting to explain the
difference. An EPA publication
on user charge systems will be of
assistance to you in developing and
implementing your user charge system.
However, the next few sections briefly
describe some aspects of user charge
systems.
12.2.1
ACTUAL USE One basis for a user
charge system is the
contributor's actual use of the
wastewater treatment works. The
actual use is measured in terms of
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water meter readings, measurement of
sewage flow, strength or rate of
discharge from large nonresidential
users or other means of determining
the proportion of the system used by
contributors. The rate charges based
on actual use are then uniformly
applied in each class of users
(residential, small commerical, etc.)
in proportion to its contribution.
Note, however, that the rates may
vary between classes and in some
water-short areas rates have been
established to help conserve water
resources and encourage recycling or
reuse of process wastes.
If you do not have an existing user
charge system and are building a new
system, the user charge for the first
year should be based on your estimates
of O&M costs and then adjusted
annually thereafter to reflect actual
costs.
12.2.2
AD VALOREM TAXES Another approach
used for developing
a user charge system is based on ad
valorem taxes. Ad valorem taxes are
taxes based on the value of property.
This system has been approved for use
because some municipalities have based
their tax system on it. In order for
an ad valorem based user charge system
to be approved, certain conditions are
to be satisifed.
o As of December 27, 1977 you had
in existence a system of dedicated ad
valorem taxes which was used then and
continues to be used for collecting
revenues for the operation and
maintenance of your treatment works.
0 The ad valorem user charge system
distributes costs to the residential
and small nonresidential users class,
in proportion to the use of the
treatment works by this class.
o Industrial and commercial users
as a class each pay their share of the
O&M costs (including replacement)
based on actual use.
12.2.3
OTHER USER
CHARGE
CONSIDERATIONS
It is necessary
that each user be
notified at least
annually of the rate
and portion of the user charges or
ad valorem taxes attributable to
OM&R of the treatment works. For
example, assume 3 persons per house-
hold with each person using 70
gallons per day. This is equivalent
to 76,650 gallons per year for the
household. If we further assume that
the annual user charge is $100 per
year and of this amount $40 is for
operation and maintenance and $60 is
for debt retirement, the user charge
rate would be $.52 per 1,000 gallons
($40/76.65 x 1,000 gallons). The user
is specifically notified of this rate
($.52/1,000 gallons) although in some
cases the bill may include other
charges.
A problem sometimes arises for those
communities with existing sewer
systems which contain some infiltra-
tion and/or inflow which is not
economical to remove. The O&M
costs for treating this flow can be
distributed among all users based on
either:
o The same manner that is used for
actual use, or
o Any combination of flow volume,
land area of user, number of hookups
or discharges, or property valuation
(if an ad valorem system has been
approved).
12.2.4
ADOPTION OF
SYSTEM
The user charge
system is generally
developed during
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the design phase and approved as a
prerequisite to award of grant
assistance. Very often the user
charge system is enacted by a munici-
pal ordinance and includes details on
how rates will be established, how
often bills will be sent, and
requires annual review and updating as
necessary. The annual review should
be conducted to determine whether
sufficient revenue is being collected,
whether revenue is generated in
proportion to cost, and that the
equipment replacement reserve account
is adequate. If your project will
serve more than one municipality,
it will be necessary for each partici-
pating jurisdiction to enact similar
or identical user charge systems
before the treatment works is placed
in operation. Where there are prior
service agreements concerning user
charges, the new system developed and
approved under the EPA grant will
take precedence over any terms or
conditions of earlier, inconsistent
agreements. Enact the user charge
system before the treatment works are
placed in operation.
12.3
SEWER USE
ORDINANCE
Approval of a sewer
use ordinance is a
prerequisite to
award of grant assistance. A sewer
use ordinance restricts certain
connections and wastes, in order to
protect your investment and enhance
treatment process stability and
effluent quality. Many municipalities
with existing wastewater treatment
systems have already enacted a sewer
use ordinance. In this case you
should submit a copy with your grant
application to your project reviewer.
The sewer use ordinance:
o Prohibits new inflow sources,
i.e., extraneous water generally
associated with storm events such as
downspouts, area drains, sump pumps,
connections from storm sewers, etc.;
o Requires that new sewers and
connections be properly designed
and constructed;
o Prohibits introduction of wastes
into the sewers in an amount or
concentration that endangers the
public's safety or the physical
integrity of the system which may
cause violations of your NPDES permit
or preclude the selection of the
most cost-effective alternative for
treatment, reuse and sludge disposal.
The sewer use ordinance should be
directly related to your municipal
pretreatment program and may be
the legally binding instrument
which implements portions of your
pretreatment program.
While the three items above form the
basis for a sewer use ordinance, the
actual details contained in the
ordinance may be much more specific
and contain descriptions or procedures
such as: limitations on wastewater
strength from nonresidential users;
prohibition on dilution; notification
procedures concerning accidental
spills; discharge reporting require-
ments; rights of all parties including
right of municipality to enter all
properties for testing and measurement
and right of property owners including
protection of trade secrets,
insurance, and safety requirements.
As is true with the user charge
system, if your project serves
more than one municipality, it may be
necessary for each jurisdiction to
enact a sewer use ordinance in order
to ensure that the entire system is
protected.
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12.4
PLAN OF A draft pi an of
OPERATION operation prepared
during project
design can be an effective management
tool for planning and scheduling
those activities necessary during
construction, startup and continuing
operation. The submittal of a draft
plan of operation is a prerequisite
for Step 3 grant award. The draft
plan of operation schedule should
identify specific actions and comple-
tion dates to assure an orderly
transition from construction to
operation and forms the basis for a
final plan of operation. Grant
payments will not exceed 50 percent
until a satisfactory plan of operation
is submitted to your reviewing agency.
Some of the more important considera-
tions to be addressed in a plan of
operation are summarized in the next
sections.
12.4.1
STAFFING AND
TRAINING
o A staffing plan
should include
salaries, number of
staff, organizational structure and
licenses or certifications for
operators;
o Chief operator should be hired
before construction is 50 percent
complete;
o Preoperation training should be
begun 30 days after chief operator is
hired;
o Hiring problems, if any,
should be identified 60 days before
plant startup;
o All staffing problems should be
resolved and hiring accomplished
30 days before startup;
o Continuous training plan and
schedule should be developed 30 days
prior to plant startup.
12.4.2
ADMINISTRATIVE o Laboratory and
FUNCTIONS testing procedures
should be estab-
lished in order to monitor treatment
process including;
o Procedures for submission to
State of required reports;
o Procedures for startup and
continuing engineering services
for one year after completion of
construction;
o Provisions for employee safety
training prior to plant startup;
o Provisions for a maintenance
management system.
o Procedures for financial
management system to include
accounting, billing, collection, and
annual review.
12.4.3
BUDGET o An adequate
budget identifying
the basics for determining the annual
O&M costs and cost of personnel ,
material, administration, supplies,
utilities, chemicals, equipment
replacement, contractual services,
insurance, etc.;
o Salaries including benefits which
will attract qualified personnel;
o Training to orient and upgrade
employees.
12.4.4
OPERATION AND
MAINTENANCE
(O&M) MANUAL
An O&M manual is an
essential part
of the plan of
operation. It
provides essential information for the
treatment works operator and guidance
for day-to-day operations. Grant
payments will not exceed 90 percent
until a satisfactory O&M manual has
been furnished to the reviewing
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agency. Major topics which should
be included in the manual are:
o Information on items such
as design and peak flows, pump
capacities, sedimentation basin
detention times, surface and weir
loadings, food to microorganism
loadings, oxygen transfer require-
ments, and other process design
assumptions;
o Startup procedures for each unit
operation and equipment items;
o Unit process information and
control measures and monitoring
procedures for efficient operation;
o Maintenance management system
including procedures such as
lubrication, oil and filter changes,
and other preventive and routine
maintenance procedures as well as a
spare parts inventory;
o Laboratory tests necessary for
control of the treatment works
and the specific reports to be sent to
regulatory agencies;
o Safety procedures for operating
equipment with particular emphasis on
potentially hazardous areas such as
wet and dry wells, chlorination
facilities and anaerobic digesters;
o Organizational structure, job
descriptions and duties, purchase
order preparation and approvals,
budget preparation, etc;
o Troubleshooting, analyzing and
solving problems which frequently
occur in treatment plants and are
related either to unit processes or
the operation of specific pieces of
equipment;
o Emergency operating plan
including emergencies which may
occur (for example, power outage,
chlorine leak, excessive flows
during storms) and the procedures to
be followed until normal operation can
be resumed.
12.5
ONSITE AND
CLUSTER SYSTEMS
If your project
includes onsite or
cluster treatment
systems, you will be responsible to:
o Assume responsibility for the
systems including proper installation,
operation and maintenance;
o Assure that systems will be
constructed, operated and maintained
to protect underground potable
water sources;
o Develop a user charge system;
o Obtain reasonable access to all
systems;
o Establish a comprehensive
management and periodic
inspection program including water
well testing.
During the design phase you should
prepare a brief report addressing
these responsibilities and indicating
how and when they will be implemented.
12.6
INNOVATIVE
AND ALTERNATIVE
(I&A)
TECHNOLOGY
RECONFIRMATION
During the develop-
ment of your
facilities plan you
evaluated numerous
alternative waste-
water treatment
systems including those employing
innovative or alternative (I or A)
technologies. The project, or
its components, selected in your
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facilities plan may have been
initially classified as I or A
(Section 6.4.1). Based on the
criterion or definition used to
classify your project as I or A, it
may be necessary to reconfirm that
designation during design. For
example, a project classified as
alternative technology such as
self-sustaining incineration may need
to be reverified during design.
Proposed innovative technology
projects, in general, require a more
detailed evaluation than alternative
technology projects in order to
confirm the significant cost savings.
It may be necessary to recompute the
cost savings after a significant
portion of the design is completed and
compare it with the estimates in the
facilities plan. On the other hand,
the reviewing agency may determine
that a treatment system is innovative
because of local variations in
geographic or climatic conditions or
because it achieves significant
public benefits which would not
otherwise be possible. Based on the
results of reevaluation the project or
component parts may be confirmed as I
or A or lose that designation. In the
latter case, you should resolve with
your project reviewer whether to
continue with the project design
presently underway.
12.7
PLANNING FOR
LOCAL FUNDS
One criterion for
evaluating and
selecting your
project during the facilities planning
phase was a financial impact analysis
(Section 7.2). At the conclusion of
design you should reevaluate the
financial impact of the project upon
your municipality's financial status
to ensure that the project is not too
costly. For example, your A/E
will have prepared a revised cost
estimate of the project based upon the
detailed construction drawings and
specifications and current costs of
construction. These costs should be
compared with the estimates in
your facilities plan. You should
also reexamine your municipality's
indebtedness or ability to finance the
local cost share. During the time
from completion of your facilities
plan to completion of design, your
municipality may have incurred other
debts or undergone other changes which
affect your debt limitation. If you
determine that your project is not too
costly, you should undertake financial
arrangements to ensure that you can
obtain the non-Federal funds for
construction generally within 90 days
of grant award. If you determine that
your project is too expensive based on
the criteria in Section 7.2, you
should meet with your project reviewer
to determine means of reducing project
costs.
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PART III. CONSTRUCTION
CHAPTER 13
GRANT APPLICATION
13.0
NARRATIVE
STATEMENT
Your Step 3 grant
a ssi stance
applicati on wi11
include your completed facilities
plan, bidding documents including
construction drawings and specifi-
cations as well as other supporting or
supplementary information. After
grant award your Step 3 activities
will not only include building the
project but also may include other
activities such as preparation
of the final plan of operation,
implementation of your user charge
system, etc. Therefore, you may find
it helpful to prepare a narrative
statement which describes your
project's history (e.g., pertinent
correspondence with your reviewing
agency concerning your facilities
plan, environmental review or design)
and the activities you intend to
undertake after grant award. The
narrative statement serves to tie
together all the separate activities
(schedule, scope of work, costs),
places them in proper perspective and
helps attain complete understanding of
your project by the project reviewer.
If you choose to provide a narrative
statement, it could be part of
your letter forwarding the application
package or a separate attachment.
13.1
CONTENTS OF
APPLICATION
An application for
Step 3 grant
assistance includes:
o Certification that there has been
adequate public participation based on
State and local statutes.
o Comments of appropriate clean'ng-
house(s) (Section 131.1);
o Evidence of compliance with all
applicable limitations on award
(Section 13.2);
o Construction drawings and spec-
ifications suitable for bidding
purposes and the project schedule
(Part II of this book);
o Draft plan of operation;
o In the case of an application
for Step 3 assistance that includes
the acquisition of eligible land,
include a plat which shows the legal
description of the property to be
acquired, a preliminary layout of the
distribution and drainage systems, and
an explanation of the intended method
of acquiring the property;
o In the case of an application for
Step 2+3 grant assistance, include the
above items except drawings and
specifications and eligible land
description. Note that not all of the
limitations on award are applicable at
the time of Step 2+3 application.
The following sections discuss the
contents of an application (other than
facilities plans and project design)
and in the case of limitations on
award, list the items and provide
references to other sections of this
book.
13.1.1
CLEARINGHOUSE
COMMENTS
o A facilities plan prepared
in accordance with the regulations
(Part I of this book);
Before submitting an
application obtain
the comments of the
appropriate clearinghouse. If you
elected to obtain clearinghouse
comments after completion of your
facilities plan but before design and
if your project design conforms with
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the selected plan in your facilities
plan, generally you need not obtain
additional comments. If more than one
year has elapsed between the date of
clearinghouse comments and the date of
application submission, it may
be necessary (consult your project
reviewer) to resubmit project
information to the clearinghouse.
The clearinghouses have 30 days to
review your application documents and
return comments to you. Include the
comments with your application and, if
appropriate, address adverse comments.
13.1.2
APPLICATION FORM The application form
(EPA Form 5700-32)
contains specific instructions for its
completion. The form is signed by
your authorized representative
acting as the "applicant" for grant
assistance. Include a copy of the
resolution designating the official
authorized to sign the application.
Three items, however, require special
attention.
Site Information
For projects requesting grant
assistance for acquisition of
eligible land a plat which shows a
legal description is required
(Section 13.1). For projects
requesting grant assistance for
eligible land previously acquired or
for which an option for purchase has
been taken and for which approval as a
preaward cost (Section 13.2) has been
granted, submit a copy of the deed
or other interest in the property or a
copy of the option. In both cases,
the deed will include provisions
which note and protect the Federal
interests.
For projects involving land acquisi-
tion not eligible for grant
assistance, the land, easements or
other real property must be obtained,
bonafide options taken or formal
condemnation proceedings initiated
before grant assistance is awarded.
The municipal attorney will need to
describe the status of your real
property acquisitions in a separate
attachment to your application.
Funding Local Share
The application form requires
information concerning the amount of
grant assistance (Federal and/or
State) you expect to receive. You
should explain fully how you will
raise the non-Federal project funds in
order to initiate procurement actions
to build the project promptly. If
procurement action for building the
project is not initiated within nine
months from grant award, your grant
may be terminated.
Assurances
Review the assurances contained in
Part V of the grant application form
carefully. After grant award you will
have to anticipate and plan for the
work involved in meeting these
assurances.
13.2
LIMITATIONS ON
AWARD
Before grant award
the project reviewer
will determine that
all regulatory requirements are met
and that costs requested for grant
participation are reasonable and
allowable. Many of these limitations
will have been satisfied if your
facilities plan and design have been
completed in accordance with this
guidance. However, the limitations
are listed below as a convenient
check to you and referenced to other
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sections of this book or are briefly
described as appropriate.
Advanced Treatment
Projects for which the incremental
cost of advanced treatment exceeds
$3 million are to be reviewed and
approved by EPA headquarters
(Section 9.2.2).
Hater Quality Management (WQM)
Plans
Projects will be consistent with
applicable WQM plans and grant
applicants shall be as designated in
the plan (Section 4.1).
Priority Determination
Projects will be listed on the
State's project priority list and the
award of grant assistance shall not
jeopardize the funding of any projects
of higher priority.
Funding and Other Considerations
Grant applicants will agree to pay
the non-Federal project costs and
demonstrate the legal, institutional,
managerial and financial capability
to ensure adequate building and
OM&R of the treatment works
(Section 2.1). Certify that it has
not violated any Federal, State,
or local law in connection with
facilities planning or design work.
Debarment and Suspension
Grant applications will indicate
whether a subagreement was awarded to
an individual, organization or unit of
government for facilities planning or
design work whose name appears on
EPA's master list of debarments,
suspensions and voluntary exclusions.
If grant applicants affirmatively
certify that such an award was
made, EPA will closely examine the
facilities plan, construction drawings
and specifications to determine
whether to award a Step 3 grant.
Intermunicipal Service
Agreements
Executed intermunicipal service
agreements or other legally binding
instruments covering financing,
construction and operation will be
submitted for Step 3 projects or
before initiating procurement action
on Step 2+3 projects if the project
serves two or more municipalities
(Introduction-Managing Your Project).
This requirement may be waived if:
o An agreement is already in place;
o Historical evidence for services
between parties exists; or
o The grant applicant is
financially strong enough to continue
the project even if one of the
proposed communities fails to
participate.
Segmented Treatment Works
Grant assistance may be awarded for a
phase or segment of a treatment works,
although the phase or segment does
not result in compliance with the
enforceable requirements of the CWA,
provided:
o Grant applicants agree to
complete the treatment works of which
the phase or segment is a part in
accordance with a specified schedule
in the grant agreement, regardless of
whether or not grant funding is
available for the remaining phases or
segments; and
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o One or more of the following
conditions exist: (1) the federal
share of the cost of building the
treatment works would require a
disproportionate share of the State's
annual allotment relative to other
needs or would require a major portion
of the State's annual allotment;
(2) the period to complete the
building of the treatment works will
cover three years or more; (3) the
treatment works must be phased or
segmented to meet the requirements of
a Federal or State court order.
Step 2+3
Grant assistance for Step 2+3 projects
are limited to: municipalities
with population of 25,000 or less;
allowable Step 3 project cost of
$8 million or less; and complete
treatment systems (i.e., not for
treatment works phase or segment).
Access to Individual Systems
Grant applicants will provide
assurance of unlimited access to
privately owned individual systems
and provide assurance of complete
management capability for small
alternative wastewater treatment
systems (Section 6.4.3).
Revised Water Quality
Standards
Grants may not be awarded after
December 29, 1984 in States which
have failed to review and revise if
appropriate or adopt new water
quality standards.
Marine Waiver Discharge
Applicants
Grant applicants who have also applied
for a secondary treatment waiver
(Section 3pl(h) of the CWA) will
include with their applications
provisions for possible future
additions of treatment processes
to meet full secondary treatment
requirements.
Environmental Review
Grant applicants will have completed
an environmental information document
(EID) as part of their facilities plan
and worked with their reviewing agency
in order for the reviewing agency
to make a determination as to the
appropriateness for categorical
exclusion, a finding of no significant
impact (FNSI) or the preparation of an
environmental impact statement (EIS)
(Section 9.2.2). An application for
grant assistance will be submitted
only after EPA has completed the
appropriate environmental document in
accordance with 40 CFR Part 6.
Value Engineering Review
Projects with total estimated costs of
building the treatment works in excess
of $10 million will be subject to a
value engineering review prior to
grant award (Section 12.1).
Sewage Collection Systems
Projects involving sewage collection
systems will be for replacement or
major rehabilitation of existing
systems not built with Federal funds
awarded after October 18, 1972 or for
new systems where the bulk (generally
two-thirds) of the expected flows are
from residences in existence on
October 18, 1972 (Section 6.3).
Grant applicants will provide
assurance that existing residences
will connect to the sewer system
within a reasonable time after project
completion.
Preaward Costs
In general, project work performed
before grant award is not allowable
for grant participation except: an
allowance will be included in the
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grant award for facilities planning
and design (Section 1.0); in
emergencies where delay could
result in significant cost increase
(e.g., procurement of major equipment
requiring long lead times, field
testing of I&A technologies, minor
sewer rehabilitation, acquisition or
'option for purchase of eligible land,
advance building of minor portions of
the treatment works); and only after
completion of the environmental review
and approval by the reviewing agency.
Prior approval of preliminary Step 3
work by the reviewing agency does not
obligate it to grant assistance,
and potential grant applicants proceed
at their own risk.
Infiltration/Inflow (I/I)
(Grant applicants will demonstrate
that the proposed treatment works
project is not or will not be subject
to excessive I/I (Section 5.4).
User Charge System and
Sewer Use Ordinance
A user charge system (Section 12.2)
and sewer use ordinance (Section 12.3)
will be approved before grant award
for Step 3 projects or before
initiating procurement action for
Step 2+3 projects. Where an existing
system or ordinance is in effect,
it will be demonstrated that they are
adequate and being enforced.
Reserve Capacity
Grant assistance for reserve capacity
will be limited depending on the date
of Step 3 grant award and the date of
earlier segmented grant awards if any
(Section 7.1).
Transport and Treatment of Compatible
Industrial Wastewater
Grant assistance will be provided for
treatment works capacity to transport
and treat compatible industrial
wastewater only if the treatment works
would be eligible for grant assistance
in the absence of the industrial
capacity. Grant assistance will
not include (a) costs to convert
noncompatible to compatible wastewater
nor transport nor treat noncompatible
wastewater, and (b) costs allowable
to the transport and treatment of
wastewater from a Federal Government
facility with flows in excess of
250,000 gallons per day or 5 percent
of the design flow whichever is less.
In addition to the regulatory limita-
tions on award cited above, other
actions or documentation may be
required at the time of applica-
tion based on the results of your
facilities plan or project design.
For example, you may need to furnish
evidence of your participation in the
flood insurance program (Section
11.1.1), you may need to describe your
procedures to comply with your pre-
treatment program (Section 8.5.4), or
you may wish to continue with your
public participation program (Section
3.1). In any case, you should provide
sufficient information and documenta-
tion to describe the activities you
will undertake during Step 3.
Plan of Operation
Grant applicants will submit a draft
plan of operation (Section 12.4).
13.3
OTHER STEP 3
CONSIDERATIONS
Several other Step 3
actions should be
undertaken either
prior to or after Step 3 grant
assistance. These actions and their
timing are briefly described below.
Grant Payment Schedule
Your application should include a
preliminary or final schedule for
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disbursement of grant funds. The
payment schedule may be revised after
receipt of bids if necessary. For
smaller projects the schedule may show
quarterly payment requests but for
larger projects monthly estimates may
be advisable. In projecting a payment
schedule you should anticipate payment
of the allowance for planning and
design with the first payment request
after initiation of construction.
This information is used to forecast
your cash needs for Federal budgetary
purposes. Give careful considera-
tion to your cash flow needs and
assumptions as the schedule is
prepared.
13.4
PROCUREMENT You are encouraged
to use your own
procurement system if it meets the
Federal minimum requirements as
described in Chapter 16. At the time
of grant application complete the
"Procurement System Certification Form
for Applicants for EPA Assistance"
(EPA Form 5700-48) in accordance with
its instructions (Appendix N).
One aspect of procurement at the time
of grant application concerns A/E
services.
By signing the application form you
have certified that you will comply
with the assurances contained in
Part V of the form. One of the
assurances indicates that you will
provide A/E services needed to
complete the project, including
technical supervision of the building
of the project, to ensure conformance
with approved construction drawings
and specifications. In addition, a
condition of grant acceptance will
require that your prime engineer
supervise the operation of the
treatment works, train operating
personnel, revise the O&M manual,
prepare curriculum and training
material for operating personnel,
observe and periodically report on the
performance of the project, and advise
you whether the project is capable of
meeting the project performance
standards. These activities are to be
carried out during the first year of
operation of the project.
The procurement of the A/E firm to
provide these services will comply
with the applicable provisions of your
certified procurement system or EPA's
procurement regulations and the costs
should be anticipated prior to and
included in your application for
assistance. However, under certain
circumstances you may continue with
the same A/E firm which provided
engineering services during facilities
planning or design without having to
readvertise and reevaluate candidate
firms (see Section 16._).
13.5
FEDERAL GRANT
SHARE
After review and
approval of a
completed applica-
tion, grant assistance will be awarded
based on the sum of the total Step 3
allowable cost plus the allowance and
wi 11 be:
o 75 percent before October 1,
1984;
o 55 percent after October 1, 1984;
or
o 75 percent after September 30,
1984 for all segments of treatment
works (except collection systems and
CSO's) only if a related segment
received Step 3 grant award prior to
October 1, 1984;
o I&A technology projects or
their I&A components may receive
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up to 85 percent grant assistance or
20 percent additional grant assistance
whichever is less;
o A uniform lower Federal share may
be requested by the Governor of a
State and used on all projects and
subsequent grant increases if any;
o In States which provide State
grant assistance and for projects
which are designated as I or A, the
State grant will be in the same
proportion as provided to non I or A
projects. For example, assume a
conventional project with a total cost
of $100. The Federal share would be
$75 and the non-Federal share the
balance or $25. If a State is
awarding 15 percent grants, the State
grant would be $15 and the local
share $10. The State grant represents
60 percent ($15/$25) of the non-
Federal share. If an I or A project
costing $100 is awarded an 85 percent
Federal grant or $85, the non-Federal
share is $15. In this case, the State
grant is required to be 60 percent (as
before) of the non-Federal share or
$9 (60 percent x $15) and the local
share is $6 (40 percent x $15);
o All grants are subject to Federal
appropriations and the availability
of remaining funds in the State's
allotment or required reserves.
13.6
GRANT AWARD State reviewing
agencies will
receive and review all applications
and supporting documents to assure
they are complete. In States which
have been delegated authority to
review and certify all requirements
necessary for award of Step 2+3 and
Step 3 grant assistance, the State
will provide such certification to EPA
and EPA will have 45 days in which to
approve or disapprove the application.
If EPA does not approve or disapprove
the application within 45 days, the
application will be deemed approved
subject to available appropriations.
In States which have not entered into
delegation agreements with EPA or have
received partial delegation, the State
will provide EPA with certification
and other such documentation as has
been agreed to between the State and
EPA.
As a result of the review process,
the project reviewer may modify the
grant amount, scope of work or
other aspects of the project. In
addition, special conditions based on
recommendations from the State agency
may be included in the grant agreement
(EPA Form 5700-20).
The completed grant agreement will be
mailed to you. You should promptly
review and accept the grant agreement
and return it to EPA. The person
signing and accepting the grant is the
authorized representative (usually the
same person who signed the application
form). If there is a new authorized
representative, an authorizing
resolution will be included with the
agreement. Once signed, the agreement
forms a legally binding contract
between you and the federal govern-
ment. You should review the agreement
carefully and, if necessary, discuss
any changes from your application with
your project reviewer. Also, note
special grant conditions that require
attention during your project and
review the payment schedule included
in the agreement.
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CHAPTER 14
PROJECT CONSTRUCTION
14.0
PROJECT
CONSTRUCTION
After grant award
you are in a
positionto
initiate procurement of construction
contracts. Procurement is discussed
in Chapter 16 and you should comply
with guidance in that chapter
concerning the use of your or EPA's
procurement system.
14.1
GRANT INCREASES/ At the time you
DECREASES submitted your grant
application you
should have requested a grant based on
your estimate of allowable project
costs including building costs.
Your building costs may also have
included a "construction contingency"
(typically 10 percent or less) since
you cannot be sure of the costs until
the project is bid. After receipt of
bids your building costs are more
firmly established and the contingency
should be reduced (typically 2 to
5 percent). The post-bid contingency
covers minor changes such as
differences between estimated and
actual quantities of material on
unit price items or unknown field
conditions which may be encountered.
14.1.1
GRANT INCREASE If the bid prices of
the successful
contractors exceed your estimated
building costs including the
contingency and if the prices are
reasonable and you wish to award the
contract(s), you may apply for
a grant increase. You should submit
your request and supporting documents
to your State agency. If appropriate
and assuming sufficient funds remain
available in your State allotment
(most States maintain a reserve for
grant increases), your grant should be
amended by the State and EPA.
14.1.2
GRANT DECREASES If your building
costs are lower than
estimated in your grant application,
the State agency may initiate
action to reduce your grant to the
appropriate level. By doing so, the
State may recover sufficient funds
from your project and others allowing
additional projects to be funded. A
grant amendment agreement will be sent
to you.
14.2
PRECONSTRUCTION It is recommended
CONFERENCE that after construc-
tion contract
award you arrange a preconstruction
conference. If deemed necessary a
separate preconstruction conference
may also be arranged by the Equal
Employment Opportunity Office
(EEO), U.S. Department of Labor
(generally where building costs exceed
$1 million) to insure that contractors
comply with the equal employment
opportunity provisions of applicable
statutes and executive orders.
The preconstruction conference
attendees should include you, your
A/E, construction manager, project
observer, all prime contractors,
subcontractors, and representatives of
your reviewing agency. The purpose
of the preconstruction conference
should to coordinate schedules, review
and emphasize regulatory requirements,
resolve questions, and set the
groundrules for working together
during construction.
If representatives of your reviewing
agency are present, they will
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generally have a checklist of items
they feel should be discussed at the
conference. Listed below are some of
the more common items.
o Responsibilities and authority of
each party;
o Schedules for completion of
project and coordination between
contractors;
o Payment requests from contractors
- form, timing, documentation,
retainage;
o Change orders - requests, docu-
mentation, approval levels;
o Minimum wage - posting of wage
rate determination;
o Compliance with local, State
and Federal laws such as OSHA,
EEO, minority, women's, and small
businesses, etc.
The project reviewer may also want to
meet separately with you to discuss
other items not directly affecting the
construction contractors. Discussions
may include items such as:
o Adequate engineering supervision
during construction;
o Reviewing agency onsite reviews;
o Management and processing of
change orders;
o Processing of payment requests;
o Maintenance of adequate records
for subsequent audit;
o Schedule for;._sewer system reha-
bilitation, Tf"necessary;
o Enactment of sewer use ordinance
and user charge system before the
treatment works is placed in
operation;
o Development, approval and
implementation of the final plan of
operation;
o Continuing A/E services during
the first year of operation;
o Preparation and records for
project closeout.
14.3
MONITORING
CONSTRUCTION
Your grant
application included
an assurance
that you will provide and maintain
competent and adequate engineering
supervision and observation of
the project to ensure that the
construction conforms with the
approved construction drawings and
specifications. The supervision
and observation may be provided
by municipal employees (force account
Section 15.3), your A/E or a construc-
tion management firm. The observation
services should provide technical
assistance in the preparation and
negotiation of change orders,
processing of contractors' payment
requests, preparation for regulatory
agency onsite reviews and assure
that the project is constructed
in accordance with the approved
construction drawings and specifica-
Itions. The responsibility for
monitoring construction activities and
resolving problems rests with you.
14.3.1
CHANGE ORDERS A change order is a
written order by
you to the construction contractor
authorizing an addition, deletion or
revision in the work or time of
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completion within the general scope of
the contract. A change order is
necessary to increase or decrease
the contract work or cost, interrupt
or terminate the project, revise the
completion date, alter the design or
to implement any other deviation from
the original contract documents.
A change order normally originates
as a proposal by the construction
contractor or from your request for a
change to the existing contract
documents. A bilateral change, as
distinct from a unilateral change, is
more desirable since it minimizes
disputes and claims at a later date.
Responsibilities
The successful completion of the
change order management procedure
depends on the successful execution of
responsibilities by each participant.
You should be responsible for
financing and managing the project
to completion and determining that
a change is both necessary and
reasonable in cost regardless of grant
participation.
o Owner
You as the owner of the project should
be responsible for:
o Ensuring that the construction
contractor has a clear understanding
of the scope and extent of the work;
o Assuring that the construction
contractor has or will obtain the
necessary personnel, equipment and
materials to accomplish the work
within the required time;
o Assuring a fair and reasonable
price for the required work;
o Maintaining current and accurate
fiscal projections of project and
completion costs;
o Resolving disputes arising as a
result of a proposed change;
o Notifying the reviewing agency of
proposed changes which may require a
grant amendment such as differing
site conditions or change in the time
of completion.
o Architect/Engineer (A/E) or Con-
struction Manager
The A/E or construction manager
represents you and normally acts as
a technical advisor. The A/E or
construction manager should perform
the duties contained in his
subagreement and is generally expected
to:
o Act as a technical advisor during
construction and on proposed changes;
o Provide expert opinion on whether
a change is appropriate or not, and if
so, why;
o Prepare an independent estimate
of the proposed change to verify the
estimate prepared by the construction
contractor.
o Construction Contractor
The construction contractor should
be responsible for preparing and
submitting the proposed change order
along with supporting documentation.
In order to expedite the development
of the change order, the construction
contractor is expected to:
o Submit sufficient cost and
pricing data to enable a determination
of the necessity and reasonableness of
cost and amounts proposed and the
allowability of proposed costs;
o Certify that the proposed costs
are complete, current and accurate
when required;
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o Maintain costing records for
audit as required;
o Submit cost proposals in a timely
manner and enter into meaningful
negotiations on a necessary contract
change;
o Comply with recordkeeping and
accounting requirements for change
orders costing in excess of $100,000.
Prior Approval
Prior approval of change orders is not
required for changes to correct minor
errors or to make minor or emergency
changes. Other change orders require
prior reviewing agency approval and
grant amendment and include those
which:
o Alter the project performance
standards;
o Alter the type of treatment to be
provided;
o Delay or accelerate the project
schedule; or
o Substantially alter the
facilities plan, construction drawings
and specifications or the location,
size, capacity or quality of any major
part of the project.
Approval of a change order does not
obligate the reviewing agency to an
increase in grant amount beyond that
which may have been provided in the
construction contingency. Change
orders are subject to the allow-
ability determinations discussed in
Section 15.0.
Contractor Claims
This section concerns the allowability
for grant participation of contractor
make an
and thus
know some
be used.
claims asserted against you and the
allowability of costs incurred in
defending against claims. Contractor
claims should be resolved as equitably
and expeditiously as possible in
accordance with the facts of the
situation, the provisions of the
contract and sound business judgement.
Even though the reviewing agency is
not a party to, and thus not bound by
the settlement, arbitration award or
court judgement, it will
allowability determination,
it is important for you to
of the criteria that will
Initially, the reviewing agency must
be assured that the claim cannot be
reasonably settled without arbitration
or litigation. This means that claims
or portions of claims that have merit
should be negotiated and settled
promptly, in accordance with the
change order procedure which follows
this section. Reasonable costs
incurred to assess the authenticity of
a claim related to the eligible
portion of the project are allowable
for grant participation, provided they
are approved in advance by the
reviewing agency. After agreement has
been reached between you and the
contractor on a claim and a change
order has been submitted, the
reviewing agency will evalute it for
grant participation. All claims or
portions of claims
the result of your
for which you are
or vicariously, will
which are either
mismangement, or
liable, directly
be unallowable.
For claims which cannot be settled
without arbitration or litigation,
reasonable and necessary claim defense
costs (e.g., legal, technical and
administrative) incurred by you are
allowable for grant participation to
the extent that they are related
to the grant eligible portion of the
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project and receive prior approval by
the reviewing agency. The agency
will be guided by evidence of your
diligence and prudence in conducting
negotiations in accordance with your
certified procurement system or
EPA's procurement regulations (40 CFR
Part 33) and experience developed by
the reviewing agency with similar
claim defense costs.
Conditions Warranting a Change
Order
A need for change orders generally
arises from one of the six common
categories of conditions discussed
below. However, some change order
requests may fall outside of these
categories but have characteristics
similar to them. Therefore, they can
be related to the reasoning process
developed in one or more of the six
categories.
In contrast to the mutually recognized
need for a change, certain acts or
failure to act which increase the
construction contractor's costs or
time of performance may also be
considered grounds for a change order.
This is termed a constructive change
and is claimed by the construction
contractor within a reasonable time
in order to be considered. Evaluate
constructive changes using the
reasoning process discussed below.
o Differing Site Conditions
Differing site conditions are
described as:
o Subsurface or latent physical
conditions at the site differing
materially from those indicated in the
contract; or
o Unknown physical conditions at
the site, of an unusual nature,
differing materially from those
ordinarily encountered and generally
recognized as being a normal part of
the work provided for in the contract.
The premises on which the differing
site conditions clause rests may
be described as:
o The bidder is not expected to
perform a complete subsurface site
investigation prior to a submission of
a bid;
o The contract bid price is propor-
tional to the degree of risk that the
bidder must provide in his competitive
bid;
o The most cost-effective construc-
tion is obtained by accepting certain
risks for latent or subsurface
site conditions.
When encountered, the contractor will
promptly notify you of differing site
conditions before such conditions are
disturbed.
In evaluating the need for a change
order based upon differing site
considerations you should review the
contract documents, the instructions
to bidders and the results of subsur-
face investigations (including the
method of presenting the results to
prospective bidders) carried out
prior to preparation of the contract
documents. Once the information is
evaluated, make a judgement as to
whether the site conditions differ
materially from those indicated in
the contract or those ordinarily
encountered and advise the construc-
tion contractor accordingly.
Contractor claims based on differing
site conditions are not allowable
for grant participation if the
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contractor fails to notify you before
the conditions are disturbed or if
asserted after final payment.
o Errors and Omissions in Construc-
tion Drawings and Specifications
Errors and omissions in the construc-
tion drawings and specifications
are usually design or drafting
deficiencies and may occur on any
project but particularly on large
complex projects. They may be
discovered by the A/E, project
observer or construction contractor
and may require a change order. The
evaluation and resolution of change
orders resulting from errors and
omissions may be difficult to make,
and you may wish to seek opinions
from a third party experienced in
design practices to aid in making
a determination.
Not all errors and omissions
necessitate an increase to the
contract price or time, and the
construction contractor may not have a
right to a claim even though an error
or omission has occurred. Contractor
claims based upon errors and omissions
are allowable for grant participation
only to the extent that the costs
would have been incurred and allowable
if the work had been properly included
in the construction drawings and
specifications originally supplied to
the contractor. If justified, a
change order is negotiated and you may
need to seek redress from the A/E in
accordance with the terms of the A/E's
subagreement.
o Changes Instituted by Regulatory
Requirements
Compliance with applicable law or
changes in law may necessitate a
change order. Examples include
the discovery of historical or
archaeological objects, revisions to
building codes or revised road
construction plans. These changes
should be well documented with
sources, dates, correspondence,
records and notes demonstrating that
the requirements could not have
been incorporated into the bidding
documents prior to the bid date
nor foreseen by either the A/E or
construction contractor by means
of a reasonably thorough prebid
investigation.
o Design Changes
A design change is a modification to
an existing adequate design and
in order to be considered it should
be cost effective and offer a net
savings (including future O&M costs).
Design changes usually originate
as proposals volunteered by the
construction contractor based on the
construction incentive program
(Section 11.1.2). Special care is
exercised if the design change
represents a substitution of
equipment, material or construction
technique to ensure that the non-
restrictive specifications or sole
source procurement provisons are not
violated.
Design changes may also result from a
proposal to relocate the project
site. This is a highly undesirable
circumstance since it may result in
construction contractor claims
especially when done hastily in
response to an unforeseen conflict.
Addition or deletion proposals should
not be accepted at face value as a
careful review often reveals extensive
costs and secondary effects.
Design changes must be carefully
reviewed recognizing that consider-
able effort was expended in
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preparation and review of the existing
adequate construction drawings and
specifications. Careful evaluation of
the implications surrounding such
changes will eliminate proposals which
lack merit.
o Overruns/Underruns in Quantities
Overruns/underruns result from a
difference between the estimated bid
quantity and the actual quantity
required to complete the bid item.
These differences occur only in unit
price (cubic yard, ligear foot,
etc.) items. Your project observer or
A/E should carefully note these items
as the work progresses and, where
appropriate, consider alternatives to
preclude excessive overruns.
While not specifically required in
the procurement regulations, most
subagreements contain a provision for
significant differences between the
estimated bid and as-built quantities.
Often a variation clause will allow
negotiations and equitable adjustment
in unit price where the difference is
more than 15 percent. The negotiated
change order may result in an
equitable adjustment to either the
contractor or you.
o Factors Affecting Time of
Completion
Four actions affect the time of
completion: termination for
convenience, termination for default,
suspension of work and time exten-
sions. The conditions appropriate to
termination for convenience or default
are clearly stated in the contract
documents. "Convenience" may require
an equitable adjustment to the
contractor while "default" may require
enforcement of the performance
bond provisions of the contract in
accordance with the terms of the
subagreement. In both cases, the
assistance of legal counsel will be
required in order to minimize or
preclude 1itigation.
Conditions may arise which require you
to temporarily suspend or interrupt
work. These conditions are generally
described in the specifications and
may result in an equitable adjustment
of costs to the contractor.
A time extension may be requested by
the contractor and if justified,
granted by you subject to approval of
your reviewing agency and a formal
grant amendment. Otherwise, the
construction contractor is liable
for changes resulting from the failure
to perform the work within the
allotted time. A commonly used
mechanism for controlling unjustified
time extensions is the insertion of
the liquidated damages clause in the
contract. The clause generally
assesses a dollar amount paid by the
contractor for each day that the time
required to complete the project
exceeds the contract time.
You should not ignore a justifiable
request for a time extension as
disapproval can result in a condition
of constructive acceleration by the
contractor to meet the specified
deadlines. This occurs when a
construction contractor incurs
additional costs by increasing
forces to overcome lost time (which
occurred through no fault of his own)
in order to avoid assessment of
liquidated damages. The constructive
acceleration costs may be recovered by
the contractor in court action if the
contractor's request for a time
extension is judged justifiable.
Contractor claims resulting from
delay or acceleration in the time
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of completion are allowable for
grant participation if they (1) were
incurred in the best interests of
completing the project, and (2) were
not caused by events within your
control or events within risk properly
placed on the contractor.
Preparation for Negotiations
Before entering negotiations for a
change order you should become
totally familiar with the options and
incentives provided in the contract
documents. Application of these tools
will stimulate the construction
contractor to negotiate meaningfully.
The bilateral change, rather than the
unilateral change, is one agreed to by
both parties and is more desirable
since it minimizes cause for disputes
and claims at a later date. Should
meaningful negotiations fail, you may
exercise the authority to issue a
unilateral change. For a unilateral
change the construction contractor,
whose concurrence is not required, is
entitled to an equitable adjustment
for any differences in cost resulting
from that change.
In preparing for change order negotia-
tions you should consider the
following:
o Quality control - Quality of
materials and workmanship may be a
negotiable item in some change orders.
A change order proposal is to include
a detailed description of the work
plus a specification clearly defining
quality of materials and workmanship.
o Cost - Most change clauses
specify an equitable adjustment
to be agreed upon. The goal of the
equitable adjustment would leave the
construction contractor in the same
profit or loss position on the basic
contract after the change order as if
there had been no need to change the
contract. You should establish
the cost of the change, insofar as
possible, before the start of work.
Retroactive pricing is undesirable.
Your A/E may prepare an independent
cost estimate which can be compared
with the contractor's proposal and
form a basis for negotiation.
o Alternative methods - There are
generally a number of alternative
methods of meeting the objective of
the proposed change. The construction
contractor can often suggest economies
in methods or materials not apparent
to you. The cost effectiveness of the
alternatives presented are compared
taking into account capital costs and
future O&M costs.
o Secondary effects - A seemingly
minor contract change may have
secondary effects which are many times
more costly than the original change
order amount. Assessment of secondary
effects requires a thorough under-
standing of the project design,
bidding documents, construction
contractor's schedule and construction
techniques.
An example of a secondary effect
could be a proposal to increase the
size and capacity of a pump. The
proposed pump may no longer be
compatible with intake or discharge
piping, housing, power source,
mounting hangers or electrical
controls. A second example may be a
change that could result in additional
A/E fees for design modifications, and
if the change results in an extension
of time, additional observation costs.
o Time - Time affects price and it
is unlikely that a realistic price
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can be negotiated without agreeing
to the time adjustment required.
Deferment of time negotiations to a
later date is undesirable. Approval
of a time extension obligates you to
fund the extended A/E services and
observation costs. However, approval
of a time extension does not relieve
you of any obligations imposed by your
NPDES permit or the reviewing agency.
Memorandum of Negotiations
As part of the preparation for project
audit, it is good construction
management practice to keep a
memorandum of the negotiations
pertaining to a change order. A
record of negotiations documents that
you and the contractor have a clear
understanding of the proposed
changes and jointly evaluated the
reasonableness of the proposal.
The negotiations and record should
specifically address quality, cost,
alternatives, secondary effects and
time. The memorandum should be
prepared at the negotiating table and
signed by all parties attending.
Agreement may not be reached on all or
any items discussed and may result in
the preparation of a unilateral change
order followed by a contractor claim.
The reasons for disagreement are
clearly documented in the memorandum.
Suggested information to be included
in the memorandum of negotiations
includes project name, number and
location, date, parties in attendance,
description of proposed change
(including drawings, sketches, etc.),
alternatives evaluated, contractor's
price proposal, A/E's cost estimate,
explanation of disagreement, summary
of total costs (including secondary
costs), time changes, and signatures
of parties attending.
The memorandum of negotiations is not
a notice to proceed with the work but
forms the basis for preparation of a
change order.
Preparation of Change Order
The change order is the formal
document which alters some terms
of the contract documents. It
summarizes, from the memorandum of
negotiations, the agreed upon change
and includes: an identification
number of other convenient reference,
description of change, contract or
unit price changes, and change to
contract time. The change order is
signed by both parties, submitted to
the reviewing agency for approval
where required, and a notice to
proceed issued to the contractor
after approval.
14.3.2
ONSITE
OBSERVATION
Provide adequate
engineering and
observation during
the course of construction. Depending
on the size and complexity of the
project, your observations may require
periodic site visits or a full-time
onsite observer. During construction
the reviewing agency or COE may make
periodic onsite reviews to ensure
that the project is being managed
properly, is on schedule, and is
being constructed in accordance with
approved construction drawings,
specifications and change orders.
The reviewing agency may make both
interim and final onsite reviews. In
most cases, the reviewing agency will
send you a sample form to be completed
during the onsite review. You
should notify your project team and
contractors of the pending review and
gather documents and other necessary
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data. Items typically observed at
the time of an interim onsite review
include:
o Adequacy of engineering super-
vision and observation;
o Availability of approved
construction drawings, specifica-
tions and change orders at the project
site;
o Conformance of construction to
approved drawings, specifications and
change orders;
o Comparison of latest estimate of
work-in-place with the actual observed
construction;
o Review of test reports for
materials and equipment;
o Protect!on and
delivered equipment;
storage of
o Display of appropriate project
sign and posting of appropriate
wage rate determination;
o Review of project accounting
records noting if they distinguish
between allowable and unallowable
costs, and are supported by receipts
or invoices;
o Implementation of special
construction techniques including
erosion and sediment control measures
and other measures to protect the
environment;
o Hiring and training of opera-
tional staff in accordance with the
plan of operation;
o Progress on the
the O&M manual;
preparation of
o Progress toward enacting the user
charge system and sewer use ordinance
before beginning operation of the
treatment works;
o Maintenance of schedule for sewer
system rehabilitation if appropriate;
o Adequacy of treatment (no
bypassing) during construction;
Final onsite reviews will be made
within 60 days after your request.
The final onsite review should include
the above items and a determination
that :
o Facilities are complete,
operating and meet effluent limita-
tions contained in the NPDES permit
including pretreatment requirements;
o Facilities conform to the
approved construction drawings,
specifications and change orders;
o Equipment is operational and
performing satisfactorily;
o Operation and maintenance staff
is hired and trained in start-up and
operational procedures;
o Laboratory facilities are
complete and appropriate tests
are being performed;
o O&M manual is onsite and
operators are trained in its use and
application;
o Accounting records are adequate
and available for audit;
o Sewer system rehabilitation is on
schedule, if appropriate;
o User charge systems and sewer use
ordinances have been enacted and being
enforced;
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o Provision for continuation of
engineering services during the first
year of operation;
o Flood insurance is provided
for the useful life of the project;
o Property management procedures
and property inventory is
satisfactory.
The onsite reviewer will discuss
any deficiencies, furnish you a
copy of his completed report and
confirm in writing agreements
resulting from your discussions.
14.4
PAYMENT REQUESTS Interim and final
AND LIMITATIONS grant payment
requests are
prepared and processed in accordance
with the procedures outlined in
Section 15.4. At the time of
onsite review, payments will be
compared with the actual construc-
tion completed. Construction
contractor payment requests are
based on the work completed or equip-
ment delivered to the site and
are generally supported by your
contractor's estimate of work-in-place
as approved by the A/E. Grant
payments are limited to 50 percent
unless a satisfactory final plan
of operation has been furnished
to the revewing agency and
90 percent until a satisfactory
O&M manual has been submitted.
14.5
PLAN OF
OPERATION
The plan of opera-
tion (Section 12.4)
is important to
ensure successful start-up of your
treatment works and to ensure
continued compliance with your NPDES
permit. Initially, the plan of
operation focuses on staffing,
training and operation of the
treatment works. However, equally
important are the administrative
aspects of protecting your investment.
Each year an adequate budget is
prepared indentifying the basis
for determining the annual O&M cost
and the cost of personnel. You, as
the project owner, will establish
salary levels which should be
commensurate with the complexity
of operating your treatment works
and adequate enough to attract
and retain competent, dedicated
employees.
14.6
PROJECT
PERFORMANCE
It is common
practice for most
municipalities to
procure an A/E firm or construction
management firm to supervise building
of the project (the alternative is
using qualified municipal employees).
The firm may be the A/E who prepared
the project design, a different firm
specializing in construction manage-
ment or a combination of both. The
traditional engineering services
provided during the building of a
project include: technical observa-
tion of the building to ensure
completion and conformance with
the construction drawings and
specifications; providing expert
opinion on changes to the project
including the preparation of
independent cost estimates; and in
general, acting as a technical
advisor. The specific scope of work
including duties and responsibilities
is enumerated in the A/E subagreement.
The 1981 amendments to the CWA
recognize the need for continuing the
professional engineering services
beyond the completion of construction
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and initial startup of the project.
Specifically, the amendments require
that you continue your relationship
with the prime engineer, i.e., the
engineer principally responsible for
providing design services or the
engineer principally responsible for
providing A/E services during building
of the project, during the first year
following the initiation of operation.
For the purposes of this requirement,
initiation of operation of the
treatment works may take place any
time when the entire treatment
facility, including all plant
coponents and unit processes or
projects such as interceptor sewers
or sewer rehabilitation, have become
fully operational. The first year
of operation may include the time
necessary for acceptance, beneficial
occupancy or performance testing
of major equipment items, wet testing
of plant components or final
inspection. However, you should
select a specific date within this
time period to officially start
the first year of operation. You
may also start the first year of
operation for project segments or
operable components which have
performance specifications or
measurable outputs clearly defined.
In either case, the initial operation
should be followed by sustained
operation of the project or group of
projects which are under performance
evaluation.
The services to be provided by the
prime engineer during the first year
following initiation of operation
include the following:
o Supervise the operation of the
project and revise the O&M manual as
necessary to accommodate actual
operating experience;
o Train operating personnel and
prepare curricula and training
material for operating personnel;
o Observe and periodicelly report
on the performance of the project;
and
o Provide advice as to whether the
project is capable of meeting the
performance standards.
On the date one year after initiation
of operation certify to your reviewing
agency whether or not your project
is capable of meeting the project
performance standards. If you cannot
certify that the project is capable of
meeting the performance standards,
provide a corrective action report
which includes an analysis of the
cause of the problem (including I/I
reduction) and an estimate of the
nature, scope and cost of corrective
action necessary to bring the project
into compliance. The report should
also include a schedule for the timely
correction of the problem(s) and the
estimated date by which you will be
able to certify that the project does
meet the performance standards. The
cost of corrective action necessary to
bring the project into compliance will
be at other than Federal expense
except in the case of innovative or
alternative technology projects
meeting the qualifying criteria for
repair, modification or replacement
grants. Failure to bring the project
into compliance may result in remedial
action by EPA and may also result
in an audit of your user charge and
financial management system.
Recognizing that you are responsible
for submission of the certification
above and the costs for any corrective
action required, you may wish to
consider including guarantees or other
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protections in your subagreements with
your engineer, contractors, equipment
suppliers or others. In so doing, you
should examine the timing of coverage
for insurance, warranties and bonds
in relation to the initiation of
operation. In this way, you can
carefully consider the timing of the
project, the date for initiation of
operation and the various forms of
coverage such that problems associated
with engineering, construction and
equipment can be resolved promptly.
As you consider possible ways of
assuring project performance, note
that:
o The prime engineer is not a
municipal employee;
o Engineering costs associated with
extended one year guarantees are
allowable for grant participation;
o The level of engineering services
for interceptor sewers or sewer
rehabilitation projects will be
proportionately less than that
required for a treatment facility.
The following diagram illustrates
functional relationships between the
various parties associated with the
construction and performance of the
project.
Nothing in this section is to be
construed to prohibit you from
requiring more assurances, guarantees
or indemnity or other contractual
requirements from any of your
contractors.
PART IV. FINANCIAL AND PROCUREMENT
CONSIDERATIONS
CHAPTER 15
FINANCIAL CONSIDERATIONS
15.0
ALLOWABLE AND
UNALLOWABLE
COSTS
Not all costs
associated with your
wastewater treat-
ment project are
allowable for grant participation.
Appendix A to 40 CFR Part 35 Subpart I
provides a specific list of allowable
and unallowable costs based on the CWA
and Federal cost principles. The list
should be consulted as you prepare a
grant application, a payment request
or during audit as appropriate.
Questions of clarification or requests
for inclusion of costs as allowable
and not otherwise determined are
to be made through your reviewing
agency. Final decision concerning
allowability of costs will be made by
the Administrator of EPA if necessary.
Resolve questions of allowable costs
as early as possible to preclude
potential adverse financial impacts
upon your community from decisions
made after Federal audit.
15.1
REPLACEMENT
COSTS
Grant assistance is
authorized for
treatment works
including new facilities or exten-
sions, improvements, remodeling,
additions and alterations to existing
facilities. Grant assistance is
not provided to replace, through
reconstruction or substitution,
treatment works that fail prior to
initiation of operation or fail to
meet project performance standards
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o
10
Responsible
Party
Functions
Responsibility
Needs
Municipality
Manage project
Procure services
Operate facility
Certify compliance
Obtain A/E
assistance
Obtain legal
assistance
Obtain construc-
tion management
A/E
Design project
Prepare drawings
and specifications
Process compati-
bility
I Let design
standards
Insurance for
error and omis-
sions
Construction
Contractor
Build facility
Install equipment
Performance
Reliability
Guarantees and
bonds for equip-
ment and perform-
ance
Equipment
Supplier
Fabricate and
deliver equipment
Performance
Reliability
Warranties for
bonds for equip-
ment and perform-
ance
TABLE 4. GRANTEE AND CONTRACTOR RESPONSIBILITES
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and which were constructed with
Federal grant assistance after
October 18, 1972 (except innovative or
alternative (I or A) projects).
15.2
INNOVATIVE AND During facilities
ALTERNATIVE (I&A) planning you
TECHNOLOGY evaluated I&A
REPLACEMENT t technology projects
GRANT as a potential
cost-effective
solution to your wastewater problem.
In addition to the cost or energy
savings which I&A projects realize, an
additional incentive authorized by the
CWA is a 100 percent modification or
replacement (M/R) grant if the project
fails within two years following final
onsite review.
The key to implementation of I&A
projects is the acceptance of an
acceptable level of risk by you that
the I or A project may not work as
predictably as a more conventional
treatment process.
For the purpose of 100 percent M/R
funding, failure is defined as the
inability of the entire system or
significant components to meet design
performance specifications, where
such failure is due to higher risk
elements of design as determined in
the original design documents. M/R
100 percent funding is not available
where the failure of an I or A system
or component is covered by a warranty
or caused by negligence.
Where failure occurs, you are
encouraged to pursue independent
corrective actions as part of the
procedures to establish a firm basis
for requesting M/R grant assistance.
Evaluation of requests for 100 percent
M/R grants involves a determination
that: (a) design performance
specifications have not been met;
(b) the failure results in a signifi-
cant increase in O&M costs and/or
requires additional significant
capital expenditures to correct the
problem; and (c) the failure is not
attributable to negligence on the part
of any person. Negligence should be
evaluated as the last item since the
determination is based upon both
technical analysis and legal findings.
Initial screening will reject from
further consideration projects which
do not qualify for obvious reasons
and, therefore, do not require a
detailed evaluation. Such reasons may
include expiration of the two-year
period, hydraulic or organic over-
loading of the system or lack of an
adequate O&M program.
A performance evaluation should be
made in those cases where it is
initially determined that a legitimate
problem exists and failure of an I or
A technology is the probable cause.
The performance evaluation should
address the following areas:
o Description of the failure
including date of occurrence, manner
of failure, and effects of failure;
o Evaluation of the current O&M
program;
o Evaluation of system design,
including analysis of process theory
and identification of potential design
deficiencies which may impact system
performance operation;
o Identification and evaluation of
potential construction deficiencies
contributing to the failure;
o Evaluation of equipment
performance and warranties;
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o Identification of impact of
climate on overall performance;
o Evaluation of process warranties
and performance guarantees; and
o Description of outstanding claims
and issues of negligence, where
appropriate.
15.3
FORCE ACCOUNT As a matter of
public policy, use
of private firms for project work is
encouraged. However, some of your
project work may be performed more
efficiently and economically using
municipal employees. This procedure
is termed "force account." You may
use this procedure if costs are
properly documented for Step 3 work
only. The costs for force account
work, if any, during facilities
planning and project design are not
allowable for grant participation.
Where it is proposed to use force
account during Step 3, certain
restrictions and limitations are
imposed to ensure the proper use of
public funds.
15.3.1
PRIOR APPROVAL Prior written
approv al by the
reviewing agency is needed for the use
of force account. Approval is based
on overriding reasons for force
account rather than private firms and
can be given only if one of two
criteria is met:
o The work can be accomplished more
economically by the use of this method
compared with competitive bidding
procurement;
To satisfy the criteria of improved
economy you should substantiate:
o That all anticipated project
administrative costs including
salaries of administrative employees
and travel expenses have been
included and are allowable for grant
participation;
o The proposed method of time-
keeping and timechecking;
o The method of establishing wage
scales for laborers, mechanics,
and supervisory employees;
o The indirect cost rate and its
method of allocation to the project;
o The method for computing allow-
ances for use, repair and overhaul of
municipal equipment, rental rates and
period of use for rental equipment;
o The method of computing deprecia-
tion costs of small tools and other
expendable items or equipment;
o The method of disposing of
unused materials and tools and any
appropriate cost adjustments.
15.3.2
OTHER FORCE
ACCOUNT
CONSIDERATIONS
are needed, such
In addition to
substantiation of
improved economy,
additional controls
as:
o Emergency
its use.
circumstances dictate
o Adequate cost accounting records
substantiating direct and indirect
costs;
o Employee time sheets approved and
signed by a supervisor accounting for
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all hours worked in a day or week by
project (whether or not the project is
Federally funded);
o Control procedures ensuring that
all materials, supplies, equipment and
labor cost charged to the project are
actually used in connection with the
project;
o Assurance that the Copeland
Anti-Kickback Act provision will be
enforced;
o Adequate insurance including fire
and extended coverage, workmen's
compensation, public liability and
property damage, and "all risk" in
accordance with local or State law.
The force account method of performing
small portions of project work
requires careful analysis and planning
beforehand and management and cost
control after work is initiated.
15.4
PAYMENTS Three needs arise
with regard to grant
payments: (1) your need for timely
payments to contractors, (2) your need
for timely payments from EPA, and
(3) EPA's need to project outlays for
financial management control. These
needs can best be met when there is
agreement initially as to amount and
timing of payment requests. At the
time of grant application you should
prepare a schedule of anticipated
grant payments indicating months from
grant award and estimated amount of
each payment. Include in your first
construction payment request the
allowance for facilities planning and
project design. For Step 2+3 projects
30 percent of the Federal share of the
allowance will be paid as soon as
requested after grant award, an
additional 35 percent when the design
is 50 percent complete and the final
portion after award of building
subagreements. Payment schedules may
be modified in consultation with the
project reviewer. Your requirements
are combined with those of other
projects and used for forecast Federal
outlay requirements for the fiscal
year.
EPA has a goal of 22 calendar days
from receipt of your payment request
to your receipt of a check from the
Department of the Treasury. This
presumes your payment request is
consistent with the work progress, is
not held up for a specific reason
(e.g., plan of operation), and is in
line with your payment schedule.
Grant payments are based on costs
incurred. You should consider payment
policies and procedures that will
reduce the cost of the contract.
These include payment discounts to
determine the low bid, progress
paymments to A/E's and construction
contractors, and minimum retainage
from progress payments.
Payment discounts are governed by EPA
procurement regulations. However,
progress payments and retainage from
progress payments may be governed by
your state law. You may make progress
payments for the amount and value of
work and services performed. You may
also make progress payments for
materials or equipment delivered to or
stocked near the construction site,
and undelivered specifically manu-
factured items or equipment, if
provisions regarding appropriate
insurance, security, and protection of
the federal and grantee interests in
progress payments are included in
your contract documents. If your
contractor is making satisfactory
progress, and there is no other
specific reason for withholding a
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portion of the progress payments,
you should retain only that amount
necessary to assure completion of your
project.
Care in preparing payment requests and
contact with the payment official will
expedite processing of your payments.
If payments are not made promptly by
you to your contractor, interest will
be recovered at audit.
15.4.1
PREAWARD COSTS Regulations appli-
cable to projects
receiving grant awards after December
29, 1981 do not allow grant partic-
ipation in costs incurred prior to
grant award with the exception of
Step 3 work required by emergencies,
instances where delay would result
in a significant cost increase, or for
acquisition of real property, and
only with prior approval and after
an environmental review has been
completed. Significant cost increases
may include such items as advance
acquisition of major equipment items
requiring long lead times, field
testing of I&A technologies, minor
sewer rehabilitation including
concurrent pressure testing and
sealing of sewer joints, inflow source
removal and other sewer repairs that
will not result in a need for public
meetings or upset the State project
priority system.
If you believe that work on your
project must begin before grant
award and if you meet this criterion,
contact your project reviewer for
additional guidance. Approval of
preaward costs does not obligate EPA
to subsequent payment unless a grant
award is made.
15.4.2
INTERIM PAYMENTS Procedures for
filing interim
payment requests (EPA Form SF-271,
Outlay Report and Request for Reim-
bursement for Construction Program)
vary from region to region or State to
State. The frequency and dollar
amounts should agree with the payment
schedule in your grant agreement and
any other special grant conditions.
One item needing clarification from
your project reviewer concerns
supporting documentation, if any,
which is to accompany a payment
request. For instance, such documen-
tation may include invoices from
your A/E or the A/E's estimate of
work-in-place.
15.4.3
FINAL PAYMENT Final grant payment
for building the
project will be made after satisfac-
tion of all applicable regulations and
any special grant conditions, and only
after completion of a final onsite
review. The final grant payment for
building the project is the balance of
the Federal share of the allowance and
the allowable project costs adjusted
to actual costs incurred. The last
Federal grant payment will be made
one year after initiation of operation
and include all allowable costs
associated with project performance
(Section 14.6).
The Federal share of refunds, rebates
or other amounts (including any
interest) that accrue to the project
are credited to the State allotment or
paid to EPA.
By accepting the final payment you
agree to release and discharge
the United States, its officers,
agents, and employees from all
liabilities, obligations and claims
arising out of the project work or
under the grant, subject only to
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exceptions previously specified in
writing between you and the reviewing
agency.
15.5
GRANT INCREASES/
DECREASES
Grant increases/
decreases are most
often associated
with construction and are discussed in
Section 14.1.
15.6
AUDITS By accepting the
grant you agree that
all project related books, documents,
records and papers and those of your
contractors are accessible to the
reviewing agency or its authorized
representatives for audit purposes.
The objective of the audit is to
determine whether financial operations
are conducted properly, the financial
statements are presented fairly, you
complied with laws and regulations
affecting the expenditure of Federal
funds, internal procedures were
established to meet the objectives of
the grants program and financial
reports contain accurate and reliable
information.
You will need financial records which
establish an audit trail substantiated
by receipts and disbursements. In
addition, the audit will ensure that
Step 3 or approved preaward procure-
ment procedures were properly
followed. For example, your records
may show that you purchased, received
and paid for a piece of equipment. If
the equipment price exceeded $10,000,
you should have received competitive
bids and purchased from the lowest
responsive, responsible bidder. If
you did not receive bids or don't
have records of your procurement
action, the cost of the equipment may
possibly be excluded from Federal
grant participation.
15.6.1
FINANCIAL Your grant
RECORDS assistance financial
record s should
be kept separate from your other
municipal financial records. Where
cross referencing is necessary, it
should be provided.
The accounting
include:
records typically
o Cash receipts register;
o Check disbursement ledger;
o Cost control ledger;
o Journal voucher;
o Payroll records, if applicable;
o Property record, if applicable.
The accounting system should be on a
double entry basis with a general
ledger. The financial management
system should include a series of
checks and balances and have a clear
separation of functions and approval
levels. Your accountant should be
familiar with these practices and may
obtain additional guidance from EPA's
"Accounting Guide for Construction
Grants," October 1977, prepared by
Office of Resources Management,
Financial Management Division.
15.6.2
AUDIT PROCEDURES
AND REPORTS
After final onsite
review by the
reviewing agency and
satisfactory resolution of any
deficiencies, your project is ready
for audit. Keep the project records
in a safe place and under your
control.
The audit will be performed by the
reviewing agency, other Federal
agencies or an accounting firm
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hired by the reviewing agency. The
auditors will contact you to arrange
an appointment for audit purposes.
Auditors will obtain preliminary
information from the project files.
During the audit of your records the
auditors will monitor your files for
further documentation and run spot
tests to verify specific items. The
audit may last from a few days to
weeks and you should provide adequate
work space and make available those
employees who may be able to respond
to questions raised by the auditor.
At the completion of the audit, the
auditors will prepare an audit
report and review it with you.
If exception is taken to some of
the items you claimed for grant
participation, you have an opportunity
to discuss it with the auditor and
provide additional information or
documentation which could reverse the
initial decision.
The draft audit report is sent to the
reviewing agency for action. The
respective staffs discuss with the
auditors any exceptions and try to
resolve differences. During this time
you may provide further clarifying
documentation or explanations. You
will be advised of the findings and
decisions on all exceptions. If you
disagree with the findings, appeal
procedures are available to you
as discussed in the regulations
(40 CFR Part 30 Subpart J).
CHAPTER 16
PROCUREMENT
16.0
INTRODUCTION
The purchase of
goods and services
is procurement. The objective of a
procurement system is to obtain needed
goods and services at a fair and
reasonable price through the use of
free and open competition appropriate
to the type of project work to
be performed. When tax dollars are
involved, it is necessary to impose
safeguards in public procurement to
protect against potential fraud and
irregularities.
In Chapter 11 aspects of procurement
related to project design and the
preparation of construction drawings
and specifications (e.g., buy
American, bonding, single material,
etc.) are discussed. Procurement
actions related to management of
change orders are discussed in Chapter
14. This chapter, however, provides
guidance from an overall perspective
to assist you in understanding and
satisfying the Federal minimum
requirements for procurement.
This guidance is not regulation, and
you may follow other procedures
which satisfy the minimum requirements
of EPA's procurement regulations.
The EPA procurement regulations
entitled (40 CFR) "Part 33 - Procure-
ment Under Assistance Agreements"
reflect changes to and a consolidation
of earlier procurement regulations and
became effective on May 12, 1982.
These regulations when combined
with the 1981 amendments to the CWA,
shift most of the responsibility for
conducting procurement to you, the
grantee. For example, you may certify
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that your procurement system meets the
Federal minimum requirements and,
therefore, your procurement actions
will not normally be reviewed by your
reviewing agency. Also, since grant
assistance will be provided only at
the time you are prepared to initiate
construction, there will be no Federal
oversight of your procurement action
for goods and services required in
preparing your facilities plan and
project design. The full responsi-
bility for procurements prior to grant
award and possibly thereafter rests
solely with you. In order to protect
your interests you should give careful
consideration to the procurement
procedures you use and particularly to
cost or price analyses.
In the discussions which follow the
term "grant agreement" refers to the
agreement and amendments between you
and EPA. The term "subagreement"
refers to the agreement between you
and a contractor (A/E, construction
contractor, etc.). The term "lower
tier subagreement" refers to the
agreement between your contractor
and a subcontractor.
16.1
PROCUREMENT
CERTIFICATION
At the time of grant
application you
will complete and
submit to your reviewing agency
"Procurement System Certification Form
for Applicants For EPA Assistance"
(EPA Form 5700-48). The information
in the form will assist you in
determining and certifying whether or
not your procurement system meets
the Federal minimum requirements.
Wherever possible, you are encouraged
to use your own procurement system if
your system meets the Federal minimum
requirements. You may also wish to
consider modifying your system as
appropriate to include some of the
Federal requirements which may
not presently be in your system
(e.g., cost and price analysis).
Intentional misrepresentation on the
certification form may jeopardize your
grant or require other remedial action
by EPA.
The principal advantage to using your
procurement system (assuming it meets
the Federal minimum requirements)
is that once you have certified
affirmatively you need not submit
documentation for each and every
procurement action to your reviewing
agency and await their approval before
awarding a subagreement. This, in
turn, saves both time and paperwork
for you and your reviewing agency. A
second advantage is that your
procurement system will probably
satisfy the procurement require-
ments of other Federal agencies from
whom you may obtain loans or grants.
Adoption of a new system or modifica-
tion of your existing system to meet
Federal minimum requirements results
in a procurement system which will
serve you well for all municipal
procurements regardless of whether or
not Federal funds are involved.
If you are unable to make an affirma-
tive certification or do not wish to
adopt a procurement system which meets
the Federal requirements, certify that
you will follow the requirements of
40 CFR Part 33 including reviewing
agency preaward approval of proposed
procurement actions.
16.2
PROCUREMENT
MANAGEMENT
This and the
following sections
describe good
procurement management practices
based on the EPA regulations. While
following these practices is not
mandatory, you are encouraged to
consider their use.
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It is recommended that a public
official, preferably a full-time
municipal employee, be assigned
responsibility to coordinate all
procurement actions. This person may
be titled "purchasing agent,"
"procurement officer," "procurement
manager," or other similar title which
conveys job responsibility. The
purchasing agent (PA) should be
or become very familiar with the
procurement system you will use and
act as a clearinghouse for all matters
concerning procurement.
The PA should maintain detailed
documentation of all procurement
actions. The documentation should
include:
o Correspondence;
o Logs of telephone and personal
conversations;
o Minutes of meetings;
o Basis for contractor selection;
o Justification for the selection
of the procurement method;
o Selection of type of sub-agree-
ment;
o Basis for award cost or price,
including a copy of the cost or price
analysis and minutes of negotiations;
o Basis and justification for
rejection of any or all bids;
o Bid tabulations and contract
documents;
o Payment files;
o Protest files.
As a general policy the PA should
document in writing anything that has
to do with procurement and maintain
the records for review at the time of
Federal audit. The PA should also
duplicate or summarize the section of
your procurement system concerning
a code or standards of conduct in
public contracting and distribute
it by memorandum to every municipal
official and employee. The intent of
the distribution is to alert employees
that a code of conduct exists and to
preclude conflicts of interest before
they arise.
16.3
METHODS OF
PROCUREMENT
The following are
four different
methods of procure-
ment which may be used depending upon
the circumstances: (1) formal
advertising, (2) competitive negotia-
tion, (3) noncompetitive negotiation,
and (4) small purchase. For all
subagreements expected to exceed
$10,000, the use of the formal
advertising is preferred although
there are instances when you cannot
draft an adequate or realistic
purchase description to meet the
elements of formal advertising.
In those circumstances you are
encouraged to use the competitive
negotiation method. The least favored
procurement method is noncompetitive
(i.e., sole source) negotiation. For
purchases which are anticipated not to
exceed $10,000, follow the small
purchase rules.
It should be noted that EPA
procurement regulations prohibit
practices which unduly restrict or
eliminate competition. Examples of
practices considered to be unduly
restrictive include:
o Placing unreasonable requirements
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on firms in order for them to qualify
to do business;
o Noncompetitive practices between
firms;
o Organizational conflicts of
i nterest;
procurements will follow essentially
the same procedure.
o Unnecessary experience
bonding requirements; and
and
o State or local laws, ordinances,
regulations or procedures which give
local or in-State bidders or proposers
preference over other bidders or
proposers in evaluating bids or
proposals.
16.4
FORMAL
ADVERTISING
Formal advertising
is the preferred
method of procure-
ment for subagreements in excess of
$10,000 and is the most common
method used to procure construction
contractors. Formal advertising
includes competitive bidding proce-
dures and, in general, follows the
following steps:
o Solicitation for bids - a formal
public announcment that sealed bids
will be received for the specified
work;
o Bid receipt and opening - public
opening of bids;
o Bid evaluation - evaluation to
determine the lowest responsive,
responsible bidder;
o Subagreement award.
The following sections describe
each of these steps as related to
the procurement of construction
contractors. Other formal advertising
16.4.1
SOLICITATION
FOR BIDS
A formal public
notice, more
commonly called an
"Invitation for Bids," is placed in
newspapers, trade journals, and
generally in the case of large
projects, in publications with nation-
wide distribution. The public notice
describes your project, indicates
where bidding documents including
construction drawings and specifica-
tions may be obtained and specifies a
time, date and location for opening of
bids. Adequate time (generally a
minimum of 30 days) is allowed
between the date of public notice and
the date of bid opening.
16.4.2
BID RECEIPT AND
OPENING
Bids are received in
sealed envelopes
from prospective
contractors and publicly opened at
the date and time specified in the
public notice. Bids are briefly
reviewed for completeness and the name
and amount of each bid is read aloud.
Obvious discrepancies are noted and
announced. After all bids have been
opened, you announce the name and
price of the apparent low bid or
bidders.
During bid receipt and opening it is
possible that a problem may arise
(late bidder, incomplete submission,
etc.). You may wish to have your A/E
or attorney present at bid opening
since the procedures you follow may
require their advice.
16.4.3
BID EVALUATION Your A/E and
attorney will review
bids, check arithmetic computations,
check references, insurance coverage,
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bid bonds, minority and women's
business goal compliance, etc. Bids
are evaluated in accordance with
the criteria described in the bidding
documents (Section 11.1). All bids
may be rejected only when there are
sound, documented business reasons to
do so. Subagreements are to be
awarded to the lowest responsive,
responsible bidder.
If you are using a certified procure-
ment system (Section 16.1) and
assuming bids are within your estimate
and therefore do not require a grant
amendment, you may award subagreements
as soon as desired after bid opening.
If a grant increase is necessary,
contact your reviewing agency before
contract award (Section 14.1).
If your procurement system is not
certified, submit the following
information for approval to your
reviewing agency:
o A certified tabulation of all
bids received;
o Copies of the proposal form
and bonds from the successful
bidder(s);
o A statement from your authorized
official giving the names of
bidders to whom you wish to award
subagreements and the amount of each
subagreement;
o Proof of public notice indicating
the circulation dates and the time for
receipt of bids;
o A copy of each addendum issued
during the bidding period and acknow-
ledgement of its receipt by the
successful bidder;
o Signed copies of the certifica-
tion by the contractors regarding
compliance with Equal Employment
Opportunity requirements;
o A justification indicating why
the low bidder is not responsive
or responsible if award is to be made
to other than the low bidder;
o A revised project cost estimate
as necessary.
If the bids differ from your A/E's
estimate, it may be necessary to
adjust your grant in accordance with
the procedures in Section 14.1. Upon
approval by your reviewing agency
of your construction procurement
procedures, and after adjustment of
your grant if required, you may award
subagreements.
16.5
COMPETITIVE
NEGOTIATION
In most cases,
procurement of
services (other than
construction contractors) related to
the construction of treatment works
employs the competitive negotiation
method. This method, applicable to
all subagreements in excess of
$10,000, includes the following steps:
o Public notice - advertising your
need for services and requesting
proposals;
o Evaluation of proposals - a
determination of the qualified
offerers and proposed prices;
o Negotiation and award.
An optional procedure is available for
the procurement of A/E services. It
differs from the above steps in
evaluation criteria, negotiation, and
use of the prequalified list. The
following sections briefly describe
each of these steps.
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16.5.1
PUBLIC NOTICE The objective of the
public notice is to
announce your need for services and
request proposals from qualified
firms. Your public notice should
receive wide circulation and include a
notice in journals, newspapers or
publications of general circulation
over a reasonable area. Reviewing
agencies may be of assistance and
provide you with a list of qualified
firms.
The public notice describes the
scope of services required, the method
by which associated documents may be
examined, the evaluation criteria
(including the relative importance
attached to each criterion), and the
deadline and place for•submitting
proposals.
16.5.2
EVALUATION OF
PROPOSALS
Proposals are to
be uniformly and
objectively eval-
uated in accordance with the criteria
stated in the public notice. The
objective of the evaluation process is
to identify the best qualified
and qualified proposers. If the
criteria in the public notice states
that award will be made solely on the
basis of the initial proposals, a
subagreement is awarded to the best
qualified offerer.
16.5.3
NEGOTIATION
AND AWARD OF
SUBAGREEMENT
If award of a
subagreement is not
based solely on
evaluation of
initial proposals, you may conduct
negotiations with all of the best
qualified firms. Each of the best
qualified firms is given the same
opportunity to negotiate or revise
their proposals. A subagreement is
awarded to the firm whose proposal is
determined to be the most advantageous
to you, taking into consideration
price and other evaluation factors
stated in the public notice.
16.5.4
OPTIONAL A/E If the subagreement
NEGOTIATION to be awarded is for
PROCEDURE A/E services and if
price is not an evaluation factor set
forth in the request for proposals,
the following procedure may be used
for A/E selection.
Prequalified List
Proposals may be requested and a
subagreement awarded to a firm on a
prequalified list provided:
o The prequalified list was
developed using public notice
(Section 16.5.1) procedures;
o The prequalified list is updated
at least every six months;
o A decision is made concerning an
A/E's qualifications within 30 days of
receipt of a request from the A/E to
be placed on the prequalified list.
Request for Qualifications
While not required nor prohibited by
the EPA procurement regulations, a
convenient mechanism used by many
municipalities for initially screening
candidate firms is the use of a
request for qualifications (RFQ). The
RFQ is included in your public
notice (Section 16.5.1) and requests
firms to express their interest in
working with you on a specific
project. The RFQ provides candidate
firms an opportunity to present in
writing their qualifications and
related experience. The RFQ generally
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does not request prices and is
followed by a request for proposals
to those candidate firms judged
qualified. After receipt of the
qualification statements either the
purchasing agent or a committee of
municipal officials reviews them and
selects several firms which are found
to be the best qualified. Often, in
evaluating firms it is helpful to
contact past clients to determine
how well the firm performed. Documen-
tation of the RFQ responses and
the criteria used to select the
qualified firms is essential. Notify
unsuccessful firms of your decision
and request proposals from the firms
selected.
Request for Proposals
The following description of a request
for proposals (RFP) is particularly
applicable to the procurement of
A/E services and provides additional
details of information to be contained
in a public notice (Section 16.5.1),
for use with the prequalified list, or
following the optional RFQ procedure
described above. In general, the RFP
should describe in detail your project
requirements including such items as:
o Existing facilities;
o Time requirements for RFP
submission and completion of the
project work;
o Unique problems;
o Previous studies;
o Persons to contact if the firm
has questions or wishes to visit the
project site;
o Criteria to be used in evaluating
proposals and relative importance of
each criterion;
o A notice that the firm will be
subject to Federal cost principles and
that municipal, State of Federal
officials may require access to the
firm's records.
Request that firms prepare a detailed
technical proposal of how they would
undertake your project work. You
may also want to require that the
firms specify by name their project
officer and, if desired, make that
person available for an interview
during negotiations. The PA should
document all telephone conversations,
correspondence or other communications
with candidate firms. If clarifying
or additional information is provided
to one firm, provide the same informa-
tion to all other candidate firms.
After receipt of proposals either
the PA or a committee of municipal
officials reviews them and initially
ranks the firms in the order of
preference. Criteria which could be
used in ranking include:
o Specialized experience
technical competence;
and
o Past record of performance
(possibly contact previous clients);
o Ability to perform work in the
time you require;
o Familiarity with your type of
pollution problems;
o No personal or organizational
conflict of interest.
The decision as to how much weight is
given each of these and other criteria
is yours (assuming that you do not
show prejudice or bias based on
frivolous criteria) but it must be set
forth in the RFP.
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You may wish to consider conducting
interviews with the firms judged
qualified. If so, you should allow
approximately one and one-half hours
for each interview. You may wish to
require the firms to have the project
officer they will assign to your
project present at the interview.
Most often firms will have a
15 to 20 minute presentation prepared.
Thereafter, you will ask questions and
evaluate responses. Ideally, you
should have prepared in advance a
series of questions which you will ask
of all firms to use as a common basis
for comparison. Should the interview
result in a need for a revised
proposal, request that the revision be
submitted as soon as possible.
Negotiation and Award of Subagreement
After evaluating proposals and
possibly conducting interviews,
determine the best qualified firm
based on your evaluation criteria.
Negotiate the scope of work and
corresponding compensation with that
firm. If you are unable to reach
agreement, formally terminate negotia-
tions and begin negotiations with the
next most qualified firm. Continue
this procedure with each succeeding
firm until you are able to reach
agreement. A subagreement is awarded
to the firm whose proposal is
determined in writing to be the best
qualified based upon the evaluation
criteria in the RFP and after
negotiation of fair and reasonable
compensation.
16.5.5
OPTIONAL A/E
CONTINUATION
EPA procurement
regulations appli-
cable to projects
receiving grants before December 29,
1981 provided for the continuation
of A/E services from one grant step to
another without further advertising or
competition. EPA no longer provides
Step 1 nor Step 2 grants nor must
you follow the EPA procurement
regulations in procuring A/E services
for facilities planning and design.
However, EPA wishes to continue the
earlier policy of A/E continuation
provided that certain conditions are
met.
o If you received a Step 1 or
Step 2 grant prior to December 29,
1981 and procured A/E services in
accordance with the then applicable
procurement regulations (40 CFR
35.936, .937, .939), you may negotiate
with the same A/E firm for Step 3 A/E
services without further advertisement
or competition.
o If during facilities planning and
design conducted without the benefit
of EPA grant assistance you procured
A/E services in accordance with the
following provisions of 40 CFR Part 33
- Competition (33.230)
- Small purchase (33.305-33.
315); formal advertising
(33.405-33.435); competitive
negotiation (33.505-33.525)
- Documentation (33.250)
- Code of conduct (33.270 (a)
and (c)
you may negotiate with the same A/E
firm for Step 3 A/E services without
further advertisement or competition.
16.5.6
COST AND PRICE
CONSIDERATIONS
In competitive
negotiation procure-
ment, price should
be one of the evaluation factors or
criteria used in the selection
process. In the optional A/E negotia-
tion procedure, qualifications of the
firm are the most important criteria
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and compensation is negotiated after
initial selection. However, price is
important and you should conduct a
cost or price analysis. You need not
obtain detailed cost and price data
from a prospective firm but it is your
responsibility to determine the
reasonableness and necessity of the
proposed cost. To establish the
reasonableness and necessity of costs
you should consider prices charged in
the surrounding geographical areas for
similar work, the complexity of the
tasks involved in the work and the
risk to the candidate firm. While
there are no specific Federal
guidelines for grant assisted
wastewater treatment projects, in all
cases of procurement exceeding
$10,000 where there is no price
competition, profit shall be
negotiated as a separate element of
price.
Recognizing that the Federal cost
principles are applicable to your
grant and all subagreements under your
grant, a brief, simplified description
of the basic elements of cost is
provided below.
o Direct Costs - These are costs
specifically incurred for your project
and will generally include labor,
travel, materials and supplies, and
reproduction costs (for example,
printing of multiple copies of
construction drawings and specifica-
tions). Generally, the largest direct
cost is labor.
o Indirect Costs - These are actual
costs the firm incurs by providing the
services you need and include rent,
utilities, telephone, employee
insurance and benefits, accounting
functions, and other costs of running
a business. Usually indirect costs
are lumped together either as over-
head, general and administrative
burden, or a combination of both.
Firms will generally apply the
same indirect cost rate to all their
projects. Indirect costs vary among
firms with ranges between 100 and
200 percent. Most often indirect
costs are shown as a percentage of
direct labor. For example, if the
direct labor is $100, the indirect
cost may be $130 for a total cost
less profit of $230. Indirect cost
accounting systems vary widely and you
are likely to encounter various
methods.
One aspect of the Federal cost
principles with which you should be
aware concerns unallowable costs.
Unallowable costs as used in this
context are costs which many firms
generally consider as overhead but
which may not be included in computing
the indirect cost rate on Federally
financed projects. A few of the more
clearly defined unallowable costs are:
interest on borrowed capital, bad
debts, advertisements or promotional
materials, and entertainment. These
costs may not be included in computing
indirect cost rates where Federal
funds are involved.
o Profit - This is the net proceeds
to the owners of the business after
all allowable costs have been deducted
from sales. Because this definition
of profit is based on Federal cost
principles, it may vary from a firm's
definition of profit. Profits
are to be reasonable and reflect
the complexity of the work and the
elements of risk associated with it.
16.6
NONCOMPETITIVE
NEGOTIATION
Noncompetitive
negotiation is the
least favored method
of procurement and may only be used
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when the other procurement methods are
not feasible.
Specifically, award of a subagreement
on grant assisted projects employing
noncompetitive negotiation may
only be done under the following
circumstances:
o An item is available only from a
single source;
o Public exigency or emergency
requires immediate action;
o Authorization by your reviewing
agency;
o After solicitation from a number
of sources, competition is determined
to be inadequate.
16.7
SMALL PURCHASES Most procurement
systems recognize
that there are times when the proce-
dures used could cost more than the
savings they are intended to realize.
Therefore, provisions are made in
Federal Law for small purchases,
i.e., purchases under $10,000. Your
existing procurement system or State
requirements may set a lower figure.
When you need to make a small
purchase, contact suppliers and obtain
a telephone price quotation or a brief
written proposal. Try to obtain a
reasonable number of quotations
(ideally 3 or more) and make the most
advantageous selection. Document
your files to demonstrate that you
consulted more than one source for the
item but you need not advertise,
negotiate, nor follow the other
detailed procurement procedures.
16.8
SUBAGREEMENTS Some types of
subagreements are
preferable in certain instances and
some are not allowed.
o Fixed Price - Where a scope of
work can be clearly defined (such as
in the procurement of construction
contractors using bidding documents
including construction drawings and
specifications), a fixed price or lump
sum subagreement is awarded. In
the case of other services, where the
scope of work can be clearly defined,
a fixed price subagreement may be
negotiated. This type of subagreement
has a fixed price no matter what the
final costs are unless a change in the
scope of work (change order) is
negotiated.
For services other than construction
contractors, this type of subagreement
is not used as extensively as the
cost-plus-fixed-fee type for waste-
water treatment projects primarily
because of the difficulty of clearly
defining the scope and limitations of
work. Where applicable, however, the
fixed price subagreement is the
easiest to administer.
o Cost-Plus-Fixed-Fee (CPFF) - The
most commonly used type of subagree-
ment for services on grant assisted
projects (other than construction) is
the CPFF. With a CPFF subagreement
a cost ceiling and fixed fee are
established for the work. The ceiling
cost is made up of direct costs and
indirect costs. If, for example, the
ceiling is $200 consisting of $100
direct costs, $100 indirect costs
plus $30 fixed fee, but the project
actually costs less (say $80 direct,
$80 indirect), you pay only $190 ($80
direct, $80 indirect, but full fixed
profit of $30). On the other hand, if
the project costs are expected to
exceed the ceiling, the contractor
must advise you in advance and you
either approve of the increased
cost if justified or terminate the
contract. The contractor is not
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required to incur costs in excess of
the ceiling nor even complete the
project unless you negotiate and
authorize a new cost ceiling.
If the increased costs are for
additional work within the original
scope of services, the contractor does
not receive any increase in fixed fee.
If the additional work is beyond the
scope of original subagreement, the
contractor may be authorized to
do the additional work but also may
claim an additional fixed fee.
CPFF subagreements are used most often
when it is difficult to accurately and
clearly define all of the work.
o Percentage of Construction Cost -
This type of subagreement is not
allowed. Used many years ago, this
type of subagreement established the
price as a percentage of the construc-
tion costs. This is no longer
acceptable when Federal funds are
involved.
o Cost Plus Percentage of Cost -
This type of contract applies a
multiplier, including profit, to
direct costs and
when EPA funds are
is not acceptable
involved.
o Other Subagreement Types - Other
types of subagreements exist, some
acceptable, some less desirable.
If you are dealing with an experienced
firm that has previously done
Federally assisted work, the firm will
be familiar with acceptable forms
of subagreements. Contact your
reviewing agency if you have addi-
tional questions concerning the
form of subagreements.
o Lower Tier
tier
Subagreements - Lower
subagreements may employ the
appropriate type of agreement des-
cribed above. In addition, all
lower tier subagreements must include
provision for compliance with:
minority and women's businesses
(Section 16.9), cost and price con-
siderations (Section 16.5.5), Federal
cost principles (Section 16.5.5), and
applicable subagreement clauses
(Section 16.10).
16.9
MINORITY,
WOMEN'S, SMALL
AND LABOR
SURPLUS AREA
BUSINESSES
The Federal govern-
ment has identified
four groups for
special considera-
tion where Federal
funds are involved.
o Minority business enterprises.
o Women's business enterprises.
o Small businesses.
o Labor surplus area businesses.
Each of these types of businesses
should be afforded an opportunity to
compete for the work you will under-
take and you and your contractors have
to fulfill specific responsibilities.
EPA, working with other Federal
agencies, has established a policy to
award a fair share of EPA financed
work to small, women, and minority
businesses.
Other Federal agencies, namely, Small
Business Administration, Office of
Minority Business Enterprise, and
Department of Commerce have estab-
lished lists of qualified small or
minority firms. In addition, other
trade or professional associations,
such as the American Consulting
Engineers Council or Associated
General Contractors, also have
compiled lists of small and dis-
125
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advantaged firms. Each of these
agencies will provide assistance to
you as necessary.
You should take affirmative steps to
assure that these businesses are used
when possible. Affirmative steps
include the following:
o Including qualified small,
minority and women's businesses
on solicitation lists;
o Assuring that these businesses
are solicited whenever they are
potential sources;
o Dividing total requirements, when
economically feasible, into small
tasks or quantities to permit maximum
participation of these businesses;
o Establishing delivery schedules,
where the work permits, which
will encourage these businesses to
participate;
o Using the services of the Federal
agencies cited above;
o Requiring your contractors to
comply with the affirmative steps
above.
16.10
SUBAGREEMENT
CLAUSES
Subagreements
awarded under a
grant assisted
project should comply with the
provisions of Subpart F to EPA's
procurement regulations (40 CFR Part
33) or their equivalent as contained
in your certified procurement system.
Nothing in the EPA procurement regula-
tions, however, prohibits you from
requiring more assurances, guarantees
or indemnity or other contractual
requirements.
The EPA procurement regulations
include subagreement clauses that:
o Describe subagreement clauses
or their equivalent which are to
be included in each subagreement
(e.g., equal employment opportunity,
anti-kickback, minimum wage, etc.);
o Describe 14 model clauses
or their equivalent which are to
be included in each subagreement
(e.g., supersession, privity of
subagreement, changes, differing site
conditions, etc.).
The required (or equivalent) clauses,
taken together, are intended only to
provide a minimum level of protection
to safeguard the reviewing agency's
interests and, therefore, alone do
not constitute a complete subagreement
document.
You should consider additional clauses
you feel appropriate to define a sound
and complete subagreement.
16.11
PROTESTS Protests of procure-
ment actions may be
lodged by construction contractors,
A/E firms, equipment suppliers or
anyone else with a direct financial
interest adversely affected by your
procurement action. Protests are
filed with you, and it is your
responsibility to resolve the protest
in accordance with your procurement
system procedures, Federal or State
law or local ordinance.
When a protest is received, you may
wish to contact your municipal
attorney or your A/E as appropriate
and arrange a meeting to determine
how best to proceed. You may also
consider whether it is appropriate to
defer the protested procurement
126
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action. Document your files
carefully and use registered mail for
correspondence concerning the protest.
In general, most protest resolution
procedures begin with an initial
determination of whether the protest
has a basis in fact, i.e., the
protestor should state the alleged
violation, cite the local, State or
Federal law violated, and indicate
how the protestor was financially
harmed. If the protest appears valid,
an investigation is conducted to
determine the facts. If the protest
is frivolous or without a basis in
fact, the protestor is so notified.
In addition, most procurement proce-
dures address time limitations or
other administrative constraints
which, if violated, form a basis for
protest denial.
In the simplest case you may be able
to dispense with a frivolous protest
quickly. More complex cases may
involve court action. Therefore, act
promptly and with advice from legal
counsel.
The EPA procurement regulations only
address the informal administration
process that EPA will use for the
rapid resolution of appeals of your
protest resolution, filed with EPA.
Appeals may only be filed with and
accepted by EPA when the protestor
has exhausted all administrative
remedies with you first. Thereafter,
certain limitations (timing, notifica-
tion, etc.) will determine whether EPA
will accept or act on an appeal. If
you are aware of an appeal being filed
with EPA, you may wish to review the
EPA regulations (Subpart G to 40 CFR
Part 33) in order to understand the
procedures EPA will follow.
One requirement of the EPA protest
regulations should be noted however.
Upon receipt by EPA of a protest
appeal, EPA will promptly notify you
and request that you defer award of
the subagreement or subitem under
protest. If you do not defer award,
you bear the risk that the cost of the
subagreement or subitem may not be
allowable for grant participation if
the protest appeal is upheld. If a
protestor does not agree to a request
from you for a reasonable extension of
the bid or bid bond period during this
time, either you or EPA can summarily
dismiss the protest or appeal.
127
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APPENDIX A
PRMs and POMs Discontinued or Cancelled Upon Publication of
"Construction Grants 1982" (CG-82)
PRMs Cancelled;
The following PRMs are cancelled as they are included in
40 CFR Part 35 Subpart I, CG-82 or for the reasons specified.
75-25 Eligibility of Land Acquisition Costs for Land
Treatment Processes.
75-39 Eligibility of Land Acquisition Costs for the Ultimate
Disposal of Residues for Wastewater Treatment Processes.
77-5 Grant Eligibility of Land Acquisition by Leaseholds
or Easements for Use in Land Treatment and Ultimate
Disposal of Residues.
78-4 Grant Eligibility of Land Acquired for Storage in
Land Treatment Systems.
75-35 Allowable Costs for Construction of Treatment Works
that Jointly Serve Municipalities and Federal Facilities.
75-36 Value Engineering in the EPA Construction Grants Program.
75-37 User Charge System: Plan and Schedule.
76-5 Flood Insurance Requirements.
77-2 Grant Eligibility of Startup Services.
77-3 Plan of Operation for Municipal Wastewater Treatment
Facilities.
78-1 Erosion and Sediment Control in the Construction Grants
Program (as relates to Step 1 and Step 2 grants).
78-8 Rejection of Bids: Guidance for EPA Concurrence Function,
78-11 Toxicity of Chemical Grouts for Sewer Rehabilitation.
No longer applicable.
78-12 Preconstruction Lag Management.
79-1 Safety Requirements for the Design and Operation of
Chlorination Facilities Using Gaseous Chlorine.
A-l
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Appendix A (continued)
PRMs and PQMs Discontinued or Cancelled, etc.
PRMs Cancelled (continued)
79-1 Safety Requirements for the Design and Operation of
Chlorination Facilities Using Gaseous Chlorine. Included in
"Municipal Construction 1982."
79-2 Royalties for Use of or for Rights in Patents. Included in
"Municipal Construction 1982."
79-5 Construction Incentive Program. Included in "Municipal
Construction 1982."
79-9 Outlay Management in the Construction Grants Program.
Included in "Municipal Construction 1982."
79-10 Qualification of Major Items of Equipment. Included in
"Municipal Construction 1982."
79-11 Funding of Waste Load Allocations and Water Quality Analyses
for POTW Decisions. Included in Appendix A to 40 CFR Part 35,
Subpart I.
80-3 Management Reforms to Reduce the Time Interval Between Step 3
Grant Award and Initiation of Construction (Property
Acquisition, Local Share Funding, Service Agreements and
Cultural Resource Investigations). Included in "Municipal
Construction 1982."
80-4 Implementation of Women's Business Enterprise Support Program.
Included in "Municipal Construction 1982."
80-5 Buy American. Included in "Municipal Construction 1982."
80-7 Grant Eligibility of Minority Business Enterprise and Women's
Business Enterprise Liaison Services. Included in Appendix A
to 40 CFR Part 35, Subpart I.
81-2 Discount Rate. Included in "Facilities Planning 1982."
POMs Cancelled
The following POMs are cancelled for the reasons specified.
77-5 Agreements for Engineering Services. Included in "Municipal
Construction 1982."
Note: All PRM's and POM's discontinued or cancelled by Facilities
Planning 1981 (FP-81) have been incorporated into this document.
A-2
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APPENDIX B
LIST OF SELECTED PUBLICATIONS
1. Analysis of Operations and
Maintenance Costs for Municipal
Wastewater Treatment Systems.
FRD - 22, EPA 430/9-81-004
Construction Costs for Municipal
Wastewater Conveyance Systems.
1973 - 1979, FRD-21, EPA 430/9-81-003
Ordering Source & Number
U.S. Department of Commerce
Nat. Technical Infor. Serv
(NTIS)
5285 Port Royal Road
Springfield, VA 22161
Ordering No. PB 81-203713
(703) 487-4650
NTIS (address above)
Composting Processes to Stabilize
and Disinfect Municipal Sewage Sludge
June 1981. EPA 430/9-81-011
NTIS (address above)
4. Financial Capability Guidebook
April 1982.
5. Facilities Planning for Small
Alternative Wastewater Treatment
Systems
6. Flow Reduction Handbook.
EPA, March 1981, FRD -15.
7. Generic Facilities Plan for a
Small Community: Stabilization
Pond and Oxidation Ditch.
EPA 430/9-81-007
February 1981, FRD-18.
8. Handbook for Sewer System Evaluation
and Rehabilitation, December 1975,
EPA 430/9-75-021.
9. Innovative and Alternative Technology
- Case Studies, January 1981,
EPA 430/9-81-010.
Government Finance
Research Center
1750 K St., NW
Suite 650
Washington, D.C. 20006
(202) 466-2473
USEPA - WH595
401 M Street, SW
Washington, D.C. 20460
NTIS (address above)
NTIS (address above)
Ordering No. PB 81172710
NTIS (address above)
NTIS (address above)
B-l
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10. Manual of Practice - Sewer System
Evaluation, Rehabilitation and New
Construction, (EPA-600/2-77-017d).
11. Management of Small Waste Flows.
EPA 600/2-78-173,
September 1980.
12. Municipal Pretreatment Program
Guidance Package. September 1980.
13.
14.
15.
16.
17.
NPDES Compliance Evaluation Inspection
Manual, January 1981
Operation/Maintenance/Management
Program Requirements and Guidance
for the Construction Grants Program
Fiscal Year 1982. (draft)
Primer for Wastewater Treatment,
July 1980
Process Design Manual for Onsite
Systems. EPA 625/1-80-012,
Wastewater Treatment and Disposal
October 1980.
Process Design Manual for Land
Treatment of Municipal
Wastewater.
EPA 625/1-81-013,
October 1981
18. Process Design Manual for Sludge
Treatment and Disposal.
EPA 625/1-79-011,
September 1979.
19. Sludge Treatment and Disposal.
EPA 625/4-78-012,
2 volumes, October 1978.
NTIS (address above)
NTIS (address above)
Ordering No. PB 286560
USEPA - WH547
401 M Street, SW
Washington, D.C. 20460
NTIS (address above)
US EPA - WH 547
Municipal Operation Branch
401 M Street, SW
Washington, D.C. 20460
US EPA
Instruction Resource Center
1200 Chambers Road
Room 310
Columbus, Ohio 43212
(614) 422-6717
USEPA - CERI
Cincinnati, Ohio 45268
Telephone (513) 684-7562
USEPA-CERI (address above)
NTIS (address above)
Ordering number PB 80200546
NTIS (address above)
Volume 1 - "Sludge Treatment"
Ordering number PB 299593/AS
Volume 2 - "Sludge Disposal"
Ordering number PB 299594/2BE
B-2
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20. Uniform Appraisal Standards
for Federal Land Acquisition.
Superintendent of Documents
U.S. Government Printing Office
Washington, D.C. 20402
Telephone (202) 783-3238
Ordering number 052-059-000020
Other information is available from:
CAPDET Clearinghouse
Mississippi State University
EPA Small Wastewater Flows
Clearinghouse
West Virgina University
Morgantown, WV 26506 (800) 624-8301
Innovative and Alternative
Technology Clearinghouse
Municipal Research Laboratory
26 W. St. Clair
Cincinnati, OH 45268
(513) 684-7611
A Planning and Design Guidebook for
Combined Sewer Overflow Control and
Treatment.
September 1981 (DRAFT)
Combined Sewer Overflow Analysis
EPA 68-01-6148
July 1981 (DRAFT)
Handbook
US EPA - CERI
(address above)
US EPA - (WH-595)
Policy and Guidance Branch
401 M Street, SW
Washington, DC 20460
B-3
-------
Available from:
U.S. Dept. of Commerce
National Technical Information
Service (NTIS)
5285 Port Royal Road
Springfield, Virginia 22161
Call for prices: (703) 487-4650
or 1f asterisked (*):
U.S. EPA
Instruction Resource Center
1200 Chambers Road
Room 310
Columbus, Ohio 43212
(614) 422-6717
Municipal Construction Division Series (MCD)
D MCD-05 Design Criteria for Mechanical, Electric,
and Fluid System and Component Reliability,
(EPA 430/99-74-010), July 1974.
D MCD-06 Protection of Shellfish Waters, (EPA
430/9-74-010), July 1974.
D MCD-10 Technical Report: Costs of Wastewater
Treatment by Land Application, (EPA 430/
9-75-003), revised September 1979.
D MCD-13 Alternative Waste Management Tech-
niques for Best Practicable Waste Treatment,
(EPA 430/9-75-013), October 1975.
D MCD-14 Wastewater Treatment Ponds, (EPA 430/
9-74-011), March 1976.
D MCD-17 Technical Report: Cost-Effective Comp-
arison of Land Application and Advanced
Wastewater Treatment, (EPA 430/9-75-016),
November 1975.
D MCD-20 Technical Report: Direct Environmental
Factors at Municipal Wastewater Treatment
Works, (EPA 430/9-76-003), January 1976.
D MCD-21 Disinfection of Wastewater Task Force
Report, (EPA 430/9-75-012), March 1976.
O MCD-23 Construction Inspection Guide, printed
in three volumes, (EPA 430/9-76-005), July
1976.
D MCD-26 Environmental Changes From Long-
Term Application of Sewage Effluent on Land,
(EPA 430/9-78-003), March 1978.
D MCD-27 V E Formats and Case Studies, (EPA
430/9-77-029). June 1977.
O MCD-28 Municipal Sludge Management Environ-
mental Factors, (EPA 430/9-77-004), October
1977.
D MCD-29 Value Engineering Workbook for Con-
struction Grants Projects, (EPA 430/9-76-008),
July 1976.
D MCD-30 Municipal Sludge Management: EPA
Construction Grants Program, an Overview of
the Sludge Management Situation, (EPA 430/9-
76-009), April 1976.
D MCD-32 Energy Conservation in Municipal Waste-
water Treatment, (EPA 430/9-77-011), October
1977.
D MCD-33 Application of Sewage Sludge to Crop-
land: Appraisal of Potential Hazards of the
Heavy Metals to Plants and Animals, (EPA
9-76-013), November 1976.
O MCD-34 * Wastewater: Is Muskegon's Solution
Your Solution?, (EPA 905/2-76-004), Septem-
ber 1976.
D MCD-35 Application of Sludges and Wastewater
on Agricultural Land: A Planning and Educa-
tional Guide, reprinted with permission of
Ohio State University, March 1978.
D MCD-36 Sludge Handling and Disposal Practices
at Selected Municipal Wastewater Treatment
Plants, (EPA 430/9-77-007), April 1977.
D MCD-40 A History of Land Application as a
Treatment Alternative, (EPA 430/9-79-012),
April 1979.
D MCD-41 An Approach for Comparing Health
Risks of Wastewater Treatment Alternatives:
A Limited Comparison of Health Risks Be-
tween Slow Rate Land Treatment and Acti-
vated Sludge Treatment and Discharge, (EPA
430/9-79-009), September 1979.
D MCD-42 Upgrading Trickling Filters, (EPA 430/9-
78-004), June 1978.
D MCD-43 Federal Guidelines: State and Local
Pretreatment Programs, three volumes, (EPA
430/9-76-017a, b, c), January 1977.
D MCD-44 'Construction Grants Program Informa-
tion—Industrial Cost Recovery Systems, No-
vember 1976.
D MCD-53 Innovative and Alternative Technology
Assessment Manual, (EPA 430/9-78-009), Feb-
ruary 1980.
This manual has been designed to aid Federal
and State review authorities in the administra-
tion of the innovative and alternative require-
ments of the Construction Grants Program as
well as providing the same basic methodologi-
cal information to the engineering and planning
personnel preparing facilities plans.
D MCD-54 Wastewater Stabilization Pond Linings,
(reprint of USA CRREL, SR 78-28), November
1978.
D MCD-60 Energy Requirements for Small Flow
Wastewater Treatment Systems, (reprinted with
permission of USA CRREL, SR 79-7), April
1979.
D MCD-61 Evaluation of Sludge Management Sys-
tems: Evaluation Checklist and Supporting
Commentary, (EPA 430/9-80-001), October
1979.
DMCD-62 NPDES Compliance Biomonitonng In-
spection Manual, October 1979.
D MCD-66 Assessment of Current Information on
Over/and Flow Treatment of Municipal Waste-
water, (EPA/9-80-002), May 1980.
D MCD-67 Aquaculture Systems for Wastewater
Treatment: Seminar Proceedings and Engine-
ering Assessment, (EPA 430/9-80-006), Sep-
tember 1979.
This publication contains an engineering assess-
ment and the proceedings of a seminar held at
the University of California-Davis on September
11-12, 1979, on the use of various aquaculture
systems (wetland processes, aquatic processes)
for the treatment of municipal wastewater.
D MCD-68 Aquaculture Systems for Wastewater
Treatment: An Engineering Assessment, (EPA
430/9-80-007), June 1980.
This report contains the results of an engineer-
ing assessment of the current status of aqua-
culture technologies for wastewater treatment.
D MCD-69 Recommendations from Value Engineer-
ing Studies in Wastewater Treatment Works,
(EPA 430/9-80-010), September 1980.
This publication summarizes the best ideas/
recommendations from 93 value engineering
(VE) reports which were completed under the
EPA mandatory VE program.
D MCD-72 A Guide to Regulations and Guidance
for the Utilization and Disposal of Municipal
Sludge (EPA 430/9-80-015), September 1980.
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Management and Operation Series (MO)
The Municipal Construction Division. Office of Water
Programs wishes to announce the availability of the
following publications This material, although widely
D MO-1 * Estimating Staffing for Municipal Waste-
water Treatment Facilities, March 1973.
O MO-5 Considerations for preparation of Opera-
tion and Maintenance Manuals (EPA 430/9-
74-001).
D MO-7 » Maintenance Management Systems for
Municipal Wastewater Facilities (EPA 430/9-
74-004), October 1973.
D MO-8 * Start-up for Municipal Wastewater Treat-
ment Facilities, (EPA 430/9-74-008) Decem-
ber 1973.
D MO-9 * Emergency Planning for Municipal
Wastewater Treatment Facilities, (EPA 430/9-
74-013), February 1974.
DMO-10* Aspects of State-wide Emergency Re-
sponse Programs for Municipal Wastewater
Treatment Facilities, (EPA 430/9-74-014)
March 1974.
D MO-11 * Anaerobic Sludge Digestion-Operations
Manual, (EPA 430/9-76-001), February 1976.
distributed from the Municipal Operations Branch is
considered timely and worthy of your consideration
D MO-12 * Package Treatment Plants-Operations
Manual, (EPA 430/9-77-005), April 1977.
D MO-14 - Process Control Manual for Aerobic Bio-
logical Wastewater Treatment Facilities (EPA
430/9-77-006), March 1977.
O MO-15 Operations Ponds Stabilization Manual
(EPA 430/9-77-012), August 1977.
a MO-16 Field Manual for Performance Evalua-
tion and Troubleshooting at Municipal Waste-
water Treatment Facilities. (EPA 430/9-78-
001), January 1978.
D MO-19 Sludge Handling and Conditioning (EPA
430/9-78-002), February 1978.
D MO-21 * Inspector's Guide for Evaluation of Mun-
icipal Wastewater Treatment Plants (EPA
430/9-79-010), April 1979.
Q MO-22 Management of Small-to-Medium Waste-
water Treatment Plants, (EPA 430/9-79-013)
July 1979.
D MO-23 A Planned Maintenance Management
System for Municipal Wastewater Treatment
Plant. (EPA 600/2-73-004), November 1973.
D MO-24 Evaluation of Flow Equalization in Mun-
icipal Wastewater Treatment, (EPA 600/2-79-
096), May 1979.
DMO-25,* Chemical Aids Manual for Wastewater
Treatment Facilities, (EPA 430/9-79-018) De-
cember 1979.
Facility Requirements Series (FRD)
D FRD-8 Proceedings-National Conference on
Water Construction and Municipal Wastewater
Flow Reduction, November 28 & 29 1978—
Chicago, III. (EPA 430/9-79-015),August 1979.
D FRD-9 Determining Wastewater Treatment
Costs for Your Community, October 1979.
D FRD-10* Small Wastewater Systems-Alternative
Systems for Small Communities and Rural
Areas, January 1980. (foldout)
O FRD-11 Construction Costs for Municipal Waste-
water Treatment Plants: 1973-1978 (EPA
430/9-80-003), April 1980
D FRD-12 The Alternative is Conservation.
This handbook demonstrates water conserva-
tion techniques and devices; copies of an ac-
companying film or video cassette are avail-
able for loan or purchase from the following
address: *
User
30 Bates Road
Watertown, MA 02172
D FRD-19 1978 Needs Survey-Cost Estimates for
Construction of Publicly-Owned Wastewater
Treatment Facilities, (EPA 430/9-81-001) Feb-
ruary 1980.
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Appendix D
Fuel Cost Escalation Factors - Example Calculation
Town A, N.J. decided to build an 8 MGD activated sludge process plant.
The following data are provided:
Capital Cost $ 15,539,800
Interest during construction 1,184,900
(0 7 5/8% for 2 years)
Total investment cost $ 16,724,700
Electricity $200,000/yr.
Natural Gas $150,000/yr. (mainly for sludge
incineration)
Other O&M Costs $700,000/yr.
Interest Rate 7 5/8 %
Planning Period 20 yrs.
All the costs are at average 1980 price levels. The procedure for
present worth analysis follows:
1. From Table 1, the uniform present worth factors for energy cost
escalation for electricity and natural gas for Town A, N.J. were
obtained from Region II data; they are 10.99 and 12.19
respectively.
2. Present Worth Analysis:
Capital Cost $16,724,700
Salvage Value (Assumed) 0
Other O&M Costs:
$700,000 X 10.098 (PWF)1 $ 7,068,600
Electricity: $200,000 X 10.99 $ 2,198,000
Natural Gas: $150,000 X 12.19 $ 1,828,500
Total Present Worth Value $27,819,800
1 PWF = Present Worth Factor
D-l
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TABLE 1
UNIFORM PRESENT WORTH DISCOUNT FACTORS ADJUSTED FOR ENERGY COST ESCALATION
(DISCOUNT RATE + 7-5/8%, PLANNING PERIOD = 20 YEARS AND NO INFLATION INCLUDED)
Region Region Region Region Region Region Region Region Region Region National
I II III IV V VI VII VIII TY v «.,«..„,„
Electricity
Distillate Oil
Residual Oil
Natural Gas
(liquid)
Natural Gas
Coal
11.23
12.40
12.30
12.79
12.11
11.78
10.99
12.38
12.30
12.79
12.19
11.84
11.64
12.38
12.30
12.70
13.82
11.82
12.25
12.38
12.42
14.47
14.87
11.93
11.84
12.46
12.38
12.70
14.17
11.89
12.15
12.47
12.43
12.79
14.20
11.80
11.00
12.46
12.43
12.76
16.97
11.93
10.10
12.38
12.37
12.70
13.78
11.32
11.46
12.52
12.49
12.79
12.39
11.78
14.91
13.25
12.61
12.79
12.39
10.10
nvci aye
11.84
12.38
12.37
12.79
14.05
11.87
Sources used for compilation of this table:
1. DOE: EIA "Short-Term Energy Outlook", May 1980
2. DOE: EIA "Annual Report to Congress" DOE/EIA - 0173 (79-3). May 1979
3. DOE: EIA "Preliminary 1985, 1990 and 1995 Energy Forecast for the Annual Report to Congress 1979"
Service Report SR/IA/80-01, April 1980
4. Grant, E.L., W.G. Ireson and R.S. Levenworth: "Principles of Engineering Economy:, The Ronald Press Co. N Y
6th Edition, 1976 '
D-2
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APPENDIX E
PRESENT WORTH AND COST PREFERENCE EXAMPLES
Example 1: Varying O&M Cost. Staged Construction, and Salvage Value
Given:
sewage treatment plant
capacity: year 1-10, 5 mgd; years 11-20, 10 mgd;
average flow through plant: increase linearly from 2 mgd to 10 mgd over
20 years;
planning period: 20 years;
salvage value at end of 20 years: $750,000;
capital cost of plant (5 mgd): $2,000,000;
future capital cost at year 10 to expand to 10 mgd: $1,500,000;
O&M costs:
a. constant annual O&M cost, years 1-10: $84,000;
b. variable annual O&M cost, years 1-10; increases linearly from
$0-$29,000 in year 10;
c. constant annual O&M cost, years 11-20: $165,000;
d. variable annual O&M cost, years 11-20: increases linearly from
$0-$29,000 in year 20.
discount rate: 7 5/8 %.
Determine: Present worth and annual equivalent uniform cost of plant
over 20 years.
Method: Present worth equals capital cost plus present worth of the operating
and maintenance costs. Calculate O&M costs from year 10 and O&M costs for 11
years 11 through 20 separately. Also add present worth of expansion and
subtract present worth of salvage value from present worth of other costs.
Equivalent uniform annual costs equals the present worth times the appropriate
capital recovery factor.
Step 1:
Initial capital cost $2,000,000
Step 2:
Present worth of expansion cost which occurs at year 10, times single payment
present worth factor @ 7 5/8% for 10 years. Thus:
$1,500,000 (.480) $ 719,400
E-l
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Example 1: Varying O&M Costs. Etc, (continued)
Step 3:
Calculate present worth of O&M costs as follows:
a. Present worth of constant annual cost years 1-10 equals given cost times
uniform series present worth factors @ 7 5/8% for 10 years. Thus:
$84,000 (6.825) $ 573,300
b. Present worth of variable O&M costs years 1-10 equals gradient series
($2,900) times present worth factor of a gradient series @ 7 5/8% for 10
years. Thus:
$2,900 (26.612) $ 77,200
c. Present worth of constant O&M costs year 11-20 are first calculated as in
(a) above using given cost for years 11-20. This, however, yields present
worth in year 11 which must be converted to present worth in year 1. This
is accomplished by multiplying present worth (year 11) times single payment
present worth factor @ 7 5/8% for 10 years (.480). Thus, present worth in
year 1 equals:
$165,000 (6.825M.480) $ 540,100
d. Present worth of variable O&M costs years 11-20 are first calculated as in
(b) above using gradient series for years 11-20 which is $2,900. This
yields present worth in year 11 which again must be converted to present
worth in year 1 by multiplying present worth (year 11) times single payment
present worth factor 7 5/8% for 10 years (.480). Thus:
$2,900 (26.612M.480) $ 37,000
Step 4:
Present worth of salvage value at end of 20 years equals that value times
single payment present worth factor @ 7 5/8% for 20 years. Thus:
$750,000 (.230) $ 172,500
Step 5:
The sums of values obtained in steps 1, 2, and 3 minus value obtained in
step 4 equals present worth of plant. Thus:
initial capital cost $2,000,000
present worth of expansion at year 10. ... $ 719,400
present worth of constant O&M years
1-10 $ 573,300
E-2
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Example 1: Varying O&M Costs, Etc, (continued)
present worth of variable O&M years
1-10 $ 77,200
present worth of constant O&M years
11-20 $ 540,100
present worth of variable O&M years
11-20 $ 37.000
Total $3,947,000
Subtract from total the present worth of salvage value:
present worth of salvage value $ 172,500
PRESENT WORTH of plant $3,774,500
Step 6:
Multiply present worth of plant 5 times the capital recovery factor @ 7 5/8%
for 20 years will yield equivalent uniform annual equivalent cost. Thus:
$3,774,500 (.099) $ 373,700
E-3
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Example 2; Present Worth Analysis of Onsite System Alternative
Given :
individual onsite treatment systems consisting of:
a. rehabilitation, upgrading or replacement of onsite systems for 200
existing homes;
b. major rehabilitation of 10 onsite systems per year;
c. construction of 100 onsite systems for new homes.
planning period: 20 years
salvage value at end of 20 years: $120,000
capital costs:
a. rehabilitation, upgrading, replacement of 200 existing systems: $400,000
b. rehabilitation of 10 systems per year: $20,000 per year
c. construction of 100 new systems (5 per year for 20 years) : $13,000 per
year
?verr^e annual operation and maintenance cost (onsite management program
for 500 systems): $25,000 per year
discount rate: 7-5/8 percent
Determine: Present worth and equivalent uniform annual cost over 20 years.
Method: Present worth equals initial capital cost plus present worth of future
capital costs plus present worth of operation and maintenance costs. Subtract
present worth of salvage value. Equivalent uniform annual cost equals the present
worth times the appropriate capital recovery factor.
Step I:
Initial capital cost $400,000
Step 2:
Calculate present worth of annual capital costs as follows:
a. annual capital costs equal $20,000 per year plus $13,000 per year equals
$33,000 per year.
b. present worth of annual capital cost equals given cost times the uniform
series present worth factor at 7-5/8%for 20 years. Thus:
$33,000 (10.098) $333,200
*Not eligible for EPA grant funding
E-4
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Example 2: Present Worth Analysis of OnSite System (continued)
Step 3:
Present worth of annual O&M cost equals annual O&M costs times the uniform
series present worth factor at 7 5/8 percent for 20 years. Thus:
$25,000 (10.098) $252,500
Step 4:
Present worth of salvage value at end of 20 years equals that value times
the single payment present worth factor at 7 5/8 percent for 20 years. Thus:
$120,000 (0.2300) $ 27,600
Step 5:
The sums of values obtained in Steps 1, 2, and 3 minus the value obtained in
Step 4 equal present worth of alternative. Thus:
initial capital cost $400,000
present worth of future capital costs 333,200
present worth of O&M 252.500
Total $985,200
Subtract from total the present worth of salvage
value: present worth salvage value 27,600
PRESENT WORTH of alternative $958,100
Step 6:
The present worth just derived times the capital recovery factor at. 7 5/8
percent for 20 years will yield average annual equivalent cost. Thus:
$958,100 (0.099) $94,900
Note:
When comparing conventional systems with alternative systems all costs,
eligible and ineligible, must be considered, including service lines and
hookup fees.
E-5
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Example 3: Land Application
Given:
sewage treatment plant
capacity: 4.0 mgd
planning period: 20 years
capital cost: $7,300,000 Including land cost of $137 000
average annual operation and maintenance cost: $246 200
average annual crop yield $20,000
discount rate: 7-5/8 percent
salvage value excluding land: $2,236,000
Determine: Present worth over 20 years.
Method: Present worth equals the sum of capital cost plus present worth of
the annual O/M minus the present worth of the average annua? croS yieTd
mmus the present worth of the salvage value (Note: Land values mil be
appreciated at 3 percent/year before a salvage value is computed)
Step 1:
CaP1tal cost ..................................... $7,300,000
Step 2:
worth °f o/M
O/M: $246,200 (10.098) ......................... $2486100
Crops: 80,000 (10.098) ..................... $ 807 800
PRESENT WORTH of annual costs ................. .'.'. ^, 678 ,.300
Step 3:
Si fUtUre !IalUe f°r the land by ^"Plying the present value of
land by the compound amount factor 0 3 percent for 20 years
Future value: $137,000 (1.806) .................. $ 247,400
Step 4:
Compute the total present worth of the salvage value by
Land: $247,400 (.230) ......................... * 56 900
Treatment plant 2,236,000 (.230) ................ .'..' $514,300
.............................................. $571 J200
E-6
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Example 3; Land Application (continued)
Step 5:
The sum of the value obtained in Step 1 and 2 minus the value obtained in
Step 4 equals present worth of the plant. Thus:
Initial capital cost $7,300,000
Present worth of annual costs $1,678,300
Total $8,978,300
Subtract from total the present worth of salvage
value: present worth of salvage value $ 571,200
PRESENT WORTH of plant $8,407,100
Note: If the land used for land application is purchased or leased by the
municipality, the land is considered a cost to the project and therefore
does enter into the present worth analysis. If a sharecropping arrangement
exists between the municipality and the farmer, only the profits/losses
realized by the municipality are used in the present worth analysis (section
7.0).
E-7
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EXAMPLE 4. Application of ISA Cost Preference
Given;
A proposed project includes portions which are classified as alternative
technology. The components which are considered alternative technology
are the primary and secondary processes (pretreatment and land appli-
cation) but sludge disposal is conventional technology (sanitary land-
fill) .
The present worth costs of the proposed system and the most cost-effective
conventional system are shown below.
Most Cost-Effective Proposed
Conventional Alternative Technology
System System
Capital
Cost
$ 100
720
873
Present
Worth *
$ 110
753
971
Capital
Cost
$ 31
830
873
Present
Worth *
$ 35
905
971
Primary
Secondary
Sludge Disposal
Total $1,693 $1,834 $1,734 $1,911
* Includes O&M
Determine; Whether the alternative technology system is cost effective
by application of cost-preference procedures described in
Section 7.0.3.
a. $971 (total present worth of conventional component of alternative
technology system)
$ 971
b" $1 911 = 51% (Percenta
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APPENDIX F
COST ADJUSTMENT FOR FINANCIAL CAPABILITY
Annual Median Household Income (AMHI)
Median income data should be from local sources if available. Otherwise,
1969 median family income data is available for all counties and many
cities from the Bureau of the Census, 1970 Census. Data for most States
will be available from the 1980 Census in mid 1982. Until then, HUD data
for median family income in Standard Metropolitan Statistical Areas
(SMSA's) and non-SMSA portions of States can be used. Note that family
income is not the same as household income. Household income is
approximately 0.854 times family income. (Also, per capita income
multiplied by family or household size does not equal median income.)
Consumer Price Index (CPI)
a. Select the CPI from the table below for the year for which AMHI is
known.
b. Divide the CPI for 1980 (246.8) by the CPI selected in "a."
c. Multiply the known AMHI by the number obtained in "b."
d. The result is the AMHI in 1980 dollars and is the number used in
determining if a project is considered expensive (Section 7.2).
Consumer Price Index
Year
1969
1970
1971
1972
1973
CPI
109.8
116.3
121.3
123.3
133.1
Year
1974
1975
1976
1977
1978
CPI
147.7
161.2
170.5
181.5
195.4
Year
1979
1980
1981
CPI
217.4
246.8
272.4
F-l
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APPENPIX 6
Supplemental Information for Land Acquisition
Applicable Regulations:
Any land acquired in conjunction with federally funded projects is subject
to the Uniform Relocation Assistance and Real Property Acquisition Policies
Act of 1970 (P.L. 91-646). EPA regulations implementing P.L. 91-646 are found
in 40 CFR Part 4. All appraisals setting the fair market value of land to be
acquired must be in conformance with "Uniform Appraisal Standards for Federal
Land Acquisition" prepared by the Interagency Land Acquisition Conference and
available through the Government Printing Office (GPO Stock Number
052-059-00002-01).
The Regional Administrator must approve the price the grantee will offer
the property owner for real property determined allowable for grant assistance
(40 CFR, Part 35). The title to real property acquired with Federal grant
assistance must reflect the governments interest (40 CFR, Part 30).
Professional Land Acquisition Staff:
It is most advisable to have all land acquisition carried out by acqui-
sition professionals with experience in working with the Federal requirements
and eminent domain procedures. If the grantee does not have access to a
professional land acquisition staff with experience in working with
P.L. 91-646, arrangements should be made to consult or contract with outside
professionals.
The Federal Highway Administration has right-of-way offices in each
State's capital city and their staff can provide an overview of acquisition
expertise within the State, including State professionals and independent
contractors as well as advice on a land acquisition plan. Each State has
department of transportation or right-of-way offices located in the capital
city. Most of these State offices can provide acquisition assistance to
communities and local agencies and will usually contract for all or part of
the acquisition responsibility. Some States have other professional staff
available, such as State parks or State general services administrations.
Some counties or nearby cities may also be able to provide professional
assistance. Most Federal and State offices have lists of qualified appraisers
whom they employ when they require additional appraisals for their projects.
Appraisals:
The grantees should make every effort to ensure that the appraiser has
sufficient knowledge and experience in the type of appraisal problem to be
solved and is thoroughly familiar with local conditions and property values.
It is necessary to check credentials and experience of independent
professionals thoroughly. The use of city, county, State or Federal staff has
the advantage that they have met the requirements of their job descriptions
which increases the probability of getting qualified professionals.
6-1
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There are professional appraisal organizations which sponsor training,
publish guidance and information, require proof of attainment of expertise for
certification or professional designation in the organization and monitor work
perfqrmed by their members. Appraisers who are certified or designated
members of these organizations are required to follow the organization's Code
of Ethics and are subject to disciplinary actions and dismissal for failure to
perform according to the standards of the organization. A list of appraisers
for a given area can be obtained from the headquarters offices of each
appraisal organization:
American Institute of Real Estate Appraisers
400 N. Michigan Avenue
Chicago, Illinois 60611
American Society of Appraisers
P.O. Box 17265
Washington, D.C. 20041
American Society of Farm Managers and
Rural Appraisers
P.O. Box 6857
Denver, Colorado 80206
National Association of Independent Fee
Appraisers
7501 Murdoch
St. Louis, Missouri 63119
Society of Real Estate Appraisers
645 North Michigan Avenue
Chicago, Illinois 60611
Additionally, EPA headquarters staff can provide information and
recommendations concerning appraisers. Call Barbara Greenlee, 202/755-8056.
It is most desirable to select knowledgeable local appraisers who hold
memberships in one or more of these organizations and can demonstrate
expertise in the type of appraisal to be performed.
Appraisal Review:
If the grantee does not employ or affiliate with an agency that employs
qualified review appraisers on its staff, some other means of appraisal review
by appropriately qualified individuals should be found. Various methods such
as the use of independent fee appraisers (members of professional appraisal
organizations) or qualified appraisal review personnel from county, State or
Federal agencies could be used. If the estimated fair market value of the
land to be acquired is greater than $100,000, two appraisals should be
obtained. The reviewer would approve one of the appraisals or request
additional appraisals.
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Negotiation:
There should be no negotiation with the landowner prior to the
establishment of fair market value by appraisal and review and approval of the
price to be offered by the Regional Administrator. Some limited or modest
increase above the approved appraised value may be paid to avoid the cost,
time, and public relations problems involved with condemnation if approved by
the Regional Administrator. However, the grantee should be prepared to
initiate eminent domain proceedings if the required land cannot readily be
acquired for a reasonable price.
Options:
Options may be used to tie up land if purchase money is not readily
available. Land can be optioned or purchased as soon as all environmental
documents have been approved and the site has been determined to be suitable.
However, approval must be obtained from the regional administrator to acquire
grant eligible land prior to Step 3 award. A satisfactory argument for early
purchase can usually be based on an anticipated increase in land cost and on
difficulty in obtaining assurances that the land will remain available.
Eminent Domain:
The grantee should determine whether it has eminent domain authority
before proceeding with an alternative requiring land acquisition. The State
attorney general's (AG) office can be consulted for this determination and may
handle any required action.
The AG can also advise on time required to complete any condemnation
action, whether the State has quick-take enabling legislation, whether the
magnitude of the project or other considerations indicate that project-
specific quick-take legislation should be considered and how complicated these
procedures would be.
Relocation:
Title II, Uniform Relocation Assistance, of P.L. 91-646 contains specific
provisions regarding the Federal share for moving and related expenses,
replacement housing payments and relocation assistance advisory services. This
Act applies if an owner, tenant or business is to be relocated as a result of
real property acquisition. The Federal and State offices previously discussed
work with relocation under this Act and can provide necessary guidance.
Relocation eligibility and payments should be determined by or in consultation
with experienced relocation personnel.
Alternatives to Acquisition:
It is advisable to explore leasing or other arrangements for land
application as alternatives to fee simple acquisition. Some farmers may be
willing to take effluent or sludge at a nominal cost or no cost or even
provide payment for wastewater.
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Site Selection:
It is essential to complete all studies required to establish the
suitability of the contemplated site before any acquisition actions are
taken. If condemnation is anticipated, a court order may be required to
complete these studies. If the city's attorney is not familiar with
condemnation procedures, the State attorney general's office can usually
provide advice or handle any required action.
Records:
Grantees should maintain all of the requisite land acquisition background
information and documents in a readily accessable form.
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APPENDIX H
PROCEDURE FDR THE ELIMINATION OR MINIMIZATION
OF EXPLOSION RELATED PROBLEMS
The following guidance contains good engineering practices. Since
it is not the intent of this guidance to modify or replace any
appropriate safety requirements and regulations published by the
Occupational Safety and Health Administration (OSHA) or the National
Fire Protection Association (NFPA) , it is recommended that the
guidelines be used to supplement these and other appropriate safety
requirements and codes.
I. Classification.of Wet Wells and Dry Wells for Sewage Lift Stations
A. Wet wells and dry wells for sewage lift stations should be
classified in accordance with article 500 of the National
Electric Code (NEC)* as found in NFPA publication 70.
Classification is based principally on whether a flammable
mixture may be present: (a) under normal operating
conditions; or (b) only under abnormal operating conditions or
equipment breakdown (including lifting of submersible
equipment for inspection, maintenance or repair). The
classification of wet wells and dry wells for sewage lift
stations must be site specific and established by
investigation of the conditions for each installation.
1. Wet Wells; Wet wells should be classified on a
case-by-case basis depending on design, type, and
intended use. Guidance for classification of wet wells
is presented in Figure I. The following definitions
can be used in classifying wet wells:
(a) Wet Well: A wet well is a below ground structure
designed to accept and temporarily store wastewater
for the purpose of pumping. A wet well may or may
not contain electrical equipment such as pumps,
motors, wiring and wiring devices, controls, light
and other accessories.
(b) High Hazard Wet Well: A wet well which can be
expected to receive significant inflow of flammable
liquids including all wet wells serving combined
sewer systems or serving separate sewer systems that
receive flow from industrial sources or those
commercial sources such as paint or hardware stores
which regularly handle large quantities of volatile
flanmable liquids.
*A11 references to NEC found in this guidance means publication No. 70 -
1981 edition of the National Fire Protection Association (NFPA)
H-l
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-2-
(c) Low Hazard Wet Well: A wet well not reasonably
expected to receive significant inflow of flaninable
liquids. This includes wet wells serving separated
sewer systems for primarily residential sources
and/or those commercial sources not handling large
quantities of volatile flammable liquids.
(d) Closed Wet Well: A wet well lacking natural or
mechanical ventilation as defined below.
(e) Naturally Ventilated Wet Well: A wet well built
with at least one ventilator designed to effectively
utilize wind pressure and/or thermal convection to
remove gas from the wet well.
(f) Mechanically Ventilated Wet Well: A wet well
equipped with continuously or intermittent (time
clock) operating mechanical ventilation (totally
isolated from the dry well ventilation) providing at
least 10 air changes per hour and equipped with
failure alarm. Intermittent operations must have a
minimum of four (4) operations per hour.
FIGURE I
WET WELL CLASSIFICATION
TYPE WITHOUT VENTILATION* NATURAL VENTILATION MECHANICAL VENTILATION
High
Hazard Class 1.- Division 1 Class 1 - Division 1 Class 1 - Division 2
Wet Well group D group D group D
Low Class 1 - Division 1 Class 1 - Division 2 Class 1 - Division 2
Hazard group D group D group D
* Not permitted in most States
2. All electrical equipment in the wet well should comply
with Article 501 of the NEC for Class 1 - Division 1 or 2
locations as shown in Figure I. This includes pumps,
motors, controls and control wiring, lights, power wiring
and wiring devices and other accessories.
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3. Submersible equipment used in wet well classified as
Division 1 should be either explosion-proof or meet one
of the four (4) conditions of Article 501-8(a) of the
NEC. "Guaranteed Submergence" as interpreted, by EPA,
from paragraph (4) of this Article means that under
normal operating conditions the pumping equipment is a
minimum of 6 inches below low water level at all times
when the pump is operating. Double low water cut off
switches should be used to provide additional safety in
case of level switch failure. When "guaranteed
submergence" is used, sensors to automatically
de-energize the equipment when liquids falls below a set
level should be used. Lost of submergence should, in
addition to de-energizing the motor, generate an alarm
similar to that used for high water level. The motor can
be re-energized automatically when submergence is
regained, but the alarm should require manual reset.
When "guaranteed submergence" is used in place of
explosion-proof, the pump should have double or tandem
mechanical seals with outboard seal failure detectors and
the motors with terminal board connections which are
isolated from the motor windings by a separate 0-ring
gasketed chamber. The motor should also have thermal
sensors that limit the motor winding temperature in
accordance with Section 500-2(b) of the NBC Code.
Additional maintenance may be required for installation
utilizing "guaranteed submergence" because of solids
accumulation which may occur in these wet wells. O&M manuals
should address any additional requirements or procedures.
4. When oil filled submersible motors are used in Division 1
or 2 locations they should be equipped with thermal
detectors designed to de-energize the equipment before
internal motor temperature reach ignition levels. Over
temperature should also generate an alarm similar to that
used for high water level. The motor can be re-energized
automatically when cooled, but the alarm should require
manual reset.
5. Submersible equipment used in wet wells classified as
Division 2 may be, but are not required to be
explosion-proof. Motors may be squirrel cage induction
motors which have no brushes, switching mechanisms or
similar arc producing devices as described in Article
501-8(b) of the NEC code.
6. Flexible cords may be permitted in Division 1 or 2
locations for submersible punping equipment designed for
quick removal. The flexible cords should be classified
for use with portable utilization equipment and should
meet all the requirements of Article 501-11 of the NEC.
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-4-
Flexible cords used with submersible pumps should be
approved for extra-hard usage and shall have an oil
resident outer jacket.
7. Grinder pumps, septic tank effluent pumps and other
residential pumping units associated with onsite
wastewater treatment or used to convey wastewater from
individual dwelling units or clusters are exempt from
these requirements and are not covered by this guidance.
8. Non-sparking pumps and guide rail systems for submersable
equipment are not required for Division 1 or 2 locations
When non-sparking guide rails systems are not used however
special precaution may be required during abnormal
operating conditions. Wet well atmospheres should be
tested for explosive mixtures and forced air ventilated,
if necessary, before the pumping equipment is raised for
inspection, maintenance or repair. Any wet well alarm
signal should alert operating personnel of possible
hazardous gas conditions.
9. All wet wells classified as Division 1 locations should
be marked "Danger-Hazardous Gases". Operations and
maintenance manuals should indicate all wet well
classified as Division 1 locations and should outline
necessary normal and abnormal operating procedures.
B. Dry Wells: Dry wells should be classified on a case-by-case
basis depending on design, type and intended use. In general
dry wells may be classified one class lower than the
associated wet well. Guidance for classification of dry wells
is presented in Figure II.
1. The following definitions shall be used in classifying
dry wells:
(a) Dry Wells: A dry well is an above or below ground
structure designed to house personnel, controls or
equipment associated with pumping of wastewater.
The dry well should have no openings such as hatches
or odors, (except with gas tight seals or gaskets),
unpacked pipe sleeves, untrapped drain pipes (unless
equipped with ball valves or other dry environment
or seal device) etc., by which vapor might be
conveyed from the wet well. Dry wells should have
no open surfaces of wastewater except such channels
and sumps as are necessary to efficiently remove
seal leakage, condensation and building drainage. A
dry well may or may not contain electrical equipment
such as pumps, motors, wiring, controls lights and
associated wiring devices and other accessories.
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-5-
(b) High Hazard Dry Well: A drywell pumping water from
a high hazard wet well using pumps not equipped with
fresh water seal purging.
(c) Low Hazard Dry Well: Any drywell pumping from a low
hazard wet well or a dry well pumping from a high
hazard wet well using pumps equipped with fresh
water flushing of shaft packings or seals.
(d) Closed Dry Well: A dry well lacking natural or
mechanical ventilation as defined below.
(e) Naturally Ventilated Dry Well: A dry well built
with at least two widely separated ventilators
designed to effectively utilize wind pressure and/or
thermal convection to move air through the dry well.
(f) Mechanically Ventilated Dry Well: A dry well
equipped with continuously or intermittent (time
clock) operating mechanical ventilation (totally
isolated from the wet well ventilation) providing at
least 5 air changes per hour and equipped with
failure alarm similar to that provided for wet well
high level alarm. Intermittent ventilator
operations must have a minimum of four (4)
operations per hour. The dry well must also have
adequate drainage or sump pumping to remove the
maximum expected leakage from the failure of the
shaft seal or packing of any one pump.
FIGURE II
DRY WELL CLASSIFICATION
WITHOUT VENTILATION* NATURAL VENTILATION MECHANIC VENTILATION
Hazard Class 1 - Division 1 Class 1 - Division 2 Unclassified
Dry Well group D group D
Low
Hazard Class 1 - Division 1 Unclassified Unclassified
Dry Well group D
* Not Permitted in Most States.
Note: All dry well ventilation must comply with all OSHA requirements
and all building and safety codes for personnel occupied working areas.
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-6-
2. All electrical equipment in dry wells should comply with
Article 501 of the NEC for Class 1 - Division 1, Division
2, or unclassified locations as shown in Figure II. This
includes pumps, motors, controls and control wiring,
lights, power wiring and wiring devices and other
accessories.
3. Pumping equipment used in dry wells classified as
Division 1 should be either explosion-proof or meet one
of the four (4) conditions of Article 501-8(a) of the
NBC.
4. Pumping equipment used in dry wells classified as
Division 2 may be, but is not required to be explosion
proof. Motors may be open enclosed motors, such as
squirrel-cage induction motors without brushes, switching
mechanisms or similar are producing devices in accordance
with Article 501-8(b) of the NEC. Other types of motors
and controls may also be used in Division 2 locations as
also described in this article.
5. Flexible cords should not be used in dry wells classified
as Division 1 or Division 2 except as specified by the
IN J—A-w •
6. Non-sparking pumps and accessories may be used, but are
not required for Division 1 or Division 2 dry wells.
7. In case of dry well ventilator failure alarm, the
atmospheres should be tested for explosive mixture before
entering the dry well and/or before any electrical
equipment including non-explosion proof lights are
energized. Continuous/volatile hydrocarbon analysers are
recommended for all dry wells.
8. O&M manuals should indicate all dry wells classified as
Division 1 locations and should outline necessary normal
and abnormal operating procedures.
C. Explosion-Proof Equipment: Explosion-proof equipment means
any equipment acceptable under the following conditions:
1. If it is accepted, or certified, or listed, or labeled,
or otherwise determined to be safe by a nationally
recognized testing laboratory, such as, but not limited
to, Underwriters' Laboratories, Inc., and Factory Mutual
Engineering Corporation, or
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-7-
2. With respect to an installation or equipment of a kind
which no nationally recognized testing laboratory
accepts, certifies, lists, labels or determines to be
safe, if it is inspected or tested by a Federal agency,
or by a State, municipal, or other local authority
responsible for enforcing occupational safety provisions
of the NBC, or
3. With respect to custom-made equipment or related
installations which are designed, fabricated for, and
intended for use by, a particular customer, if it is
determined to be safe for its intended use by its
manufacturer on the basis of test data which the employer
keeps and makes available for inspection to Federal,
State an/or local authorities.
II. Classification For Other Pumping Equipment Installations
In general, pumping equipment and all other electrical devices
installed in other areas of a wastewater treatment plant should be
reviewed during the design phase in order to determine if any
explosion hazards may exist. It is the responsibility of the
designer to evaluate these spaces under the rules outlined in NFPA
documents 70, 70C and 497 and API document RP500A for electrical
equipment classification. Pumping installations where explosion
hazards may exist and that can not be eliminated, should be
equipped with continuous/volatile hydrocarbon analysers with
appropriate alarms.
III. Explosion Hazards From Volatile Compounds
All sewer use ordinance should include a clause that prohibits
the discharge of volatile compounds that may cause explosion
hazards. Experience has demonstrated, however, that in spite of
sewer use ordinances, illegal discharges or accidental spills
occur. Therefore, specific contingency plans are encouraged for
all pumping stations serving sewer systems where volatile compounds
may be discharged accidentally or illegally.
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.•Q 1 part No. 15180 i
XV '
«o^° i
TROL PROJECT "^T .•"•'"" i
_.^ N« ISIBO |
C-011234-03 I
ion for Fairfax County — Łek17BJ,
aste Treatment Works
$ State Dollars
t Jl
Lfii ooiioi "< r.nAii_ 111 of Tf r»/iNi r> USING
THE LONGEST LINE CENTERED ON THE SIGN
PMOVIDING EQUAL BORDERS
EASE ALL EDGES
pnovior ADEQUATE SUPPORTS FOR SIGN AS SITE CONDITIONS
MAV REQUIRE AND KEEP SIGN A PROPER DISTANCE ABOVE
PRTVAILING GRADE TO PERMIT PUBLIC VIEWING
COLOR NUMBERS REFER TO FEDERAL COLOR STANDARD NO SISa (1-68) WHICH ARE AVAILABLE FROM GSA SUPPLIES.
PROJECT SIGN DETAILS
INVIRONMENTAl PROTICTION AGINCT
SECTION A-A'
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APPENDIX K
Wastewater Facilities Financial
Information Sheet
Applicant
Name
Address.
City
Zip-
Contact.
Telephone.
Instructions for completing the Financial Information
Sheet can be found in the Financial Capability
Guidebook, which is available from the Government
Finance Research Center, 1750 K St., N.W., Suite 650,
Washington, D.C. 202/466-2494.
What Is Proposed In The Facilities Plan?
• The proposed facilities will be:
(check more than one if applicable)
New
An expansion
An upgrade
• If treatment facilities are proposed, do they
feature low 0 + M Cost Technology such as ponds,
trickling filters, overland flow? If yes, please identify.
D Yes
D No
The facilities will benefit:
Indicate the appropriate percentage of the plant's
capacity that will be devoted to each group.
Population
on sewers
D Anticipated
growth
CD Area served,
by on-slte
systems
Entities to be served:
Flow contributions
from each entity:
County
1st year
5th year
D Municipality D Sewer district D Industry
Design population
K-l
(Year
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Wastewater Facilities Financial
Information Sheet
What Roles And Responsibilities Will Local Governments Have?
Cooperative arrangements between various entities may be required to meet the management needs of wastewater treatment facilities.
fromlln*
• What agency will:
• Will there be financial contributions by:
• Have participating agencies been asked
to review:
• Have agreements been sought between
the operating agency and:
D Own the facilities
O Other agencies
n Wastewater
facilities plan
Operate
Finance
Industry
Population
projections
Participating
agencies
Q Other agencies
How Much Will The Facilities Cost At Today's Prices?
Service area
boundaries
Industy
(101)
(103)
(105)
(107)
The following figures are estimated costs for construction,
uninflated and reflect today's prices.
A. Construction costs estimate
Wastewater treatment plant
Pump stations
Interceptor sewers
Collection sewers
On-site systems
Land acquisition
Other
Total construction costs
operation, and maintenance of the proposed facilities. Dollar amounts are
tiom«.»
(201)
(202)
(203)
(204)
(205)
(206)
(207)
(208)
B. Estimated annual operation, maintenance, and replacement
(O + M + R) costs for the proposed facilities
How Will The Facilities Be Financed?
. Labor
. Utilities
. Materials
. Outside services
. Misc. expenses
• Equipment replacement
. Total operation,
maintenance and
replacement costs
per
tromlln*
(209)
(210)
(211)
(212)
per year (213)
per year (214)
per year (215)
A. Amount to be borrowed
• Grantee share of construction costs
• Construction-related costs
• Grantee contributions
• Amount to be borrowed
from tin*
(309)
(315)
(320)
(321)
B. Methods of financing the amount to be borrowed
Financing
method
General
obligation
bond
Revenue
bond
Loan
Total
Amount
borrowed
Interest
rate
-. -. . -•"'' •
Term of
maturity
• : \'V '•
Annual
debt service
payment
(322)
(323)
(324)
(325)
C. Total estimated annual wastewater facilities costs
• Net existing O + M + R
• Existing annual debt service
• O + M + R for proposed facilities
• Debt service for proposed facilities
• Total estimated annual wastewater
facilities costs
from lin*
(328)
(329)
(330)
(331)
(332)
D. Sources of funding for total annual wastewater
facilities costs
• Sewer service charges
• Surcharge
• Special assessments and fees
— connection fee
— betterment assessments
— other
• Transfers from other funds
• Other
• Total funding
from Una
(333)
(334)
(335)
(336)
(337)
(338)
(339)
(340)
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Wastewater Facilities Financial
Information Sheet
What Are The Annual Costs Per Household?
tromlin*
_
• Total estimated annual wastewater —. • Total annual costs per househo.d ^^^^ (406)
f.c..,t,e, charges - «°°> • Median househo.d income - (407)
.Presidential share of total annua. charges - (401) • Total annual costs per household _
• Residential share of tota.annua. charges - (402) as a % of median househo.d income - (408)
• Number of households - <403)
• Annual costs per household for
— wastewater collection and treatment . -- - (404)
-other - «05>
Can Your Community Afford The Proposed Wastewater Treatment Facilities?
posed facility.
. Over the past five years, has your community's population been stable, growing or falling?
. What is the current outstanding indebtedness of your community?
• How much additional debt can your community legally Incur?
. What are your community's property tax revenues relative to the fu* market va.ue of real property .n your community?
. If your community proceeds with this project, can It still afford other proposed projects?
• What Is your community's bond rating? Has It changed within the last two years?
capability to undertake the proposed project.
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MODEL FOR IDENTIFICATION OF REGIONAL COST BASIS
Proposed Regional Facilities:
Local share of capital cost of new components proposed in
regional facilities plan.
• Contributed Capital Facilities:
Value of existing facilities which are to be incorporated into
regional system (based on an estimate of the replacement
value, fair market value, or undepreciated value of the
component).
SYSTEM-WIDE
CAPITAL
COST
BASIS
Estimated value of land on which existing contributed
facilities are located (calculated at fair market value or
other acceptable method).
• Periodic Capital Requirements:
Additions, expansion, or replacement of equipment of system
components (not included in initial facilities plan), as
required by regional use.
r» Direct Costs for Regional System O & M:
Annual costs directly attributable to regional operations and
maintenance, identified in appropriate budget categories of
SYSTEM-WIDE * ' re9i°na' SyStem °Perat0r'
OPERATIONS
AND
MAINTENANCE
COST BASIS
• Administrative Costs for Regional System:
Costs associated with management, administration, and
overhead of the regional operator. For example, if a
municipality operates the system, appropriate portions of
administrative time must be identified in the municipal
budget.
Source: Financial Planning for Wastewater Facilities: A Guide for Wyoming
Local Officials. Part 3, "Regional Wastewater Facilities: Cost
Sharing, Financing, and Intergovernmental Relations," (Wyoming
Department of Environmental Quality), page 16.
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APPENDIX L
1981 AMENDMENTS TO THE CLEAN WATER ACT
Analysis of sections of the 1981 amendments as related to EPA's
Municipal Construction Grants Program:
Section 1
Short Title
"Municipal Wastewater Treatment Construction
Grant Amendments of 1981f" P.L. 97-117,
enacted December 29, 1981
Section 2 Eligible Categories
After October 1, 1984 grants only for secondary
or more stringent treatment, new interceptors
and appurtenances and infiltration/inflow
corrections, except
Governor of a state may elect to use up to
20 percent of a state's allotment to fund other
types of projects previously eligible.
Section 3 Grants for Steps 1 and 2
After December 29, 1981 no grants solely for
facilities planning and design (formerly Step 1
and Step 2).
Grants for construction (Step 3) shall include
an allowance for facilities planning and
design based on the percentage of total project
costs which EPA determines is the general
experience for such projects.
Each state shall use a portion of its funds,
not to exceed 10 percent, to advance funds to
potential grant applicants for facilities
planning and design; advances are for small
communities which in the judgement of the state
would be unable to complete an application
(i.e., facilities plan and design) without
such advance; the allowance in a subsequent
grant will be reduced by the amount of the
advance; if no subsequent grant, state to seek
repayment of advance under terms and conditions
it may determine.
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Section 6
Section 7
Section 8
Capital Financing
Grant applicants are encouraged to develop a
capital financing plan which:
addresses future wastewater treatment
requirements over at least 10 years,
projects the nature, extent, timing and
cost of the future requirements,
sets forth the manner for financing these
needs.
Federal Share
After October 1, 1984 grants to 55 percent except
subsequent segments of projects receiving a
Step 3 grant before October 1, 1984 will receive
75 percent; possibly does not apply to collection
systems and CSO's.
Innovative and Alternative Processes
I or A grant funding to be additional 20 percent
but in no case exceed 85 percent.
Reserve for I or A to be minimum of 4 percent
and maximum of 7-1/2 percent of annual state's
allotment of which 1/2 percent must be used for
innovative projects.
Extends the I and A program through FY 1984.
Allows field testing of I or A processes or
techniques as a grant eligible cost.
Section 9 Combined Step 2 and 3 Grants
Raises the dollar ceiling for combined Step 2+3
projects to $8,000,000.
Section 10 Reserve Capacity
After October 1, 1984 grant only for capacity
needs on date of grant award and in no case
exceed needs on October 1, 1990; grantees to
pay incremental cost of additional reserve
capacity except
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Sec Lion 11
Subsequent segments of projects receiving a
Step 3 grant before October 1, 1984 shall be
based on a 20 year reserve capacity and sub-
sequent segments of interceptors receiving a
Step 3 grant before December 29, 1981 shall
include reserve capacity not to exceed 40 years.
Industrial cost exclusion is eliminated.
Brand Name
When in grantee's judgement it is impractical
or uneconomical to describe technical require-
ments for equipment, a brand name or equal may
be used and grantee need not establish the
existence of any other source.
Section 12 Engineering Performance
Engineering services shall continue for one year
after completion of construction and include
supervision of operation, training of operating
personnel, and preparing training materials and
curriculum for operating personnel, all of which
are allowable for grant participation. After
one year grantee must certify whether or not
the treatment works meets the design specifica-
tions and effluent limitations.
If treatment works does not meet performance, it
must be corrected in a timely manner at other
than federal expense.
State Administration Grants
States may use up to 4 percent of the state's
allotment^ based on the amount authorized to
be appropriated or $400,000, whichever is greater,
to administer the Construction Grants Program.
Section 15 Water Quality Management Planning
States shall use up to 1 percent of the state's
allotment or $100,000, whichever is greater, to
carry out water quality management planning.
Section 14
Section 17
Authorization
}
Authorizes $2.4 billion for FY 1982-85 for the
Construction Grants Program.
L-3
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Section 18 Water Quality Priority
Projects which receive priority are those pro-
jects which, in the estimation of the state,
are designed to achieve optimum water quality
management consistent with public health and
water quality goals and requirements of the CWA.
Section 19 Cost Effectiveness
Reemphasizes that projects receiving grants
shall be the "most economical and cost-effective
combination of devices and systems..." for waste
treatment over the life of the project.
Requires value engineering prior to grant award
for all projects which exceed $10 million and
which have not received a grant prior to
December 29, 1981.
Section 20 State Certification
States with sufficient delegated authority to
administer the Construction Grants Program may
certify projects to EPA and EPA has 45 days to
approve or disapprove the project. If EPA does
not act, project deemed approved.
Section 21 Municipal Compliance Deadline
Municipal compliance to achieve secondary or
more stringent treatment necessary to achieve
water quality standards is extended from July 1,
1983, to July 1, 1988, for those cases which have
not been able to move ahead due to limited
federal grant assistance.
Section 22 Ocean Discharge
Application for ocean discharges waiver extended
for one year from December 29, 1981 although new
applications cannot be approved for one year.
Does not apply to discharge of sludge through
outfall sewer.
Section 23 Secondary Treatment Definition
Biological treatment facilities such as oxida-
tion ponds, lagoons and ditches and trickling
filters shall be deemed to be the equivalent
of secondary treatment.
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Section 25
Section 24 Revised Water Quality Standards
States to review, revise or promulgate new water
quality standards by December 29, 1984 or no
grants may be awarded.
Needs Survey
EPA to prepare new needs survey by December 31,
1982.
Judicial Note
Where consent decrees have been established by
the courts, the courts are to take note of the
reduced funding levels and make appropriate
adjustments if necessary in schedules.
Section 26
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APPENDIX f*
May 12, 1982
Part III
Environmental
Protection Agency
Grants for Construction of Treatment
Works
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APPENDIX N
May 12, 1982
Part III
Environmental
Protection Agency
Procurement Under Assistance
Agreements
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APPENDIX 0
THE ALTERNATIVE JUSTIFIABLE EXPENDITURE METHOD OF COST ALLOCATION
The basic principle behind the Alternative Justifiable Expenditure
(AJE) method is to allocate costs of a multiple purpose project among its
purposes so that each purpose shares the cost savings resulting from the
multiple purpose approach. Grant funding is based on the cost of the
pollution control component plus a portion of the joint cost. This policy
assumes that achieving several purposes at the same time should be less
costly than achieving them separately and that all purposes should share in
the cost savings. The grant eligibility for multiple purpose projects of
this type will ordinarily be less than the eligibility of a single purpose
project with the same pollution-control objectives.
The cost allocation steps are:
1. Estimate the costs of the most cost-effective, single purpose
alternatives (E) & (G) to obtain the same objectives as those of the
multiple purpose project.
2. Determine the respective specific costs of each purpose in the
multiple purpose project (B) & (D). The specific costs of a purpose are the
sum of costs assignable to each project component exclusively serving that
single purpose. An example of a specific cost would be the cost of a
treatment plant included in a project designed to reuse water and reduce raw
water consumption.
3. Calculate remainders by deducting the specific cost of each purpose
in the multiple purpose project from the single purpose project cost (E-B=F)
and (G-D=H).
4. From total cost of multiple purpose project (A) deduct all specific
costs (B) & (D) to determine joint cost (C).
5. Distribute joint costs of the multiple purpose project among
purposes in direct proportion to the remainders found in step 3.
6. To obtain allocated costs for each purpose, add the specific and
the distributed joint costs for each purpose (J & K).
It should be noted that none of the purposes will be assigned costs
which are greater than the cost of the most cost-effective single purpose
project nor less than the specific cost of the purpose.
0-1
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ALTERNATIVE JUSTIFIABLE EXPENDITURE METHOD (continued)
Single Purpose
Pollution Control
Alternative
Multiple Purpose
Project
Single Purpose
Water Reuse
Alternative
Total Cost (E)
Remainder
(E-B) - F
I
Total Cost (A)
Specific Cost
Pollution Control
(B)
-m-
->
Joint I Specific Cost
Cost | Water Reuse
(C) | (D)
I
I
Total Cost (G)
Remainder
Cost
(G-D) = H
Pollution Control Allocation = B + / _F j X C - J
Water Reuse Allocation = D + ( -^— 1 X C • K
\ F+H /
Grant Eligible Fraction
0-2
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United States
Environmental Protection
Agency
Washington DC 20460
Official Business Special
Penalty for Private Use $300 Fourth-Class
Rate
Book
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