CJ OOOR78107
5656 UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON. DC 20460 OFFICE OF WATER AND
•<«»" WASTE MANAGEMENT
FROM: Thomas C. Jorling, Assistant Administrator QCT 2 7 1978
S^tate/EPA Agreement
Concept Paper on Regulations
FY 1980 will mark the start of a new era in planning, implementing,
and managing environmental programs at the Regional and State levels.
Beginning in FY 1980, State/EPA Agreements will present integrated
approaches to solving water supply, solid waste, and water pollution
control problems. The integration of these program areas will be a
major step toward the objective of overall environmental planning and
management versus an approach which tries to solve interrelated
environmental problems in a piecemeal fashion, program by program.
The idea of an integrated approach to solving env-ironmental problems
is not new. A number of Regions and States have had an integrated
orientation to problem-solving for years. EPA requires all Regions and
States to develop State/EPA Agreements for FY 1979 covering Clean Water
Act programs. By FY 1980, State/EPA Agreements will drive the integration
and coordination of environmental programs under the Safe Drinking Water Act,
Resource Conservation and Recovery Act, and Clean Water Act for all States.
Agreement requirements are contained in 40 CFR 35.1016 of the Construction
Management Assistance Grant regulations, 35.1507 of the proposed Water
Quality Management regulation and 35.738-6 of the Interim Grant regulations
for the Resource Conservation and Recovery Act.
We now need to develop a central regulation for OWWM programs which
will clarify Agreement requirements and ensure consistency between programs.
The attached Concept Paper contains preliminary regulatory language, public
participation announcements, and explanatory material. I am very interested
in receiving your comments and suggestions on the proposal. When reviewing
the Concept Paper, please keep in mind that the regulatory language is flexible
enough to accomodate the differences in EPA programs covered and State/local
needs. Comments should be submitted by December 8, 1978.
In addition, there will be further opportunities to participate in
the development of regulations. A public meeting will be held December 4,
1978, in Washington to discuss the proposal and receive comments. Additional
meetings in other areas of the country are being scheduled. The time
and location of meetings will be announced in the Federal Register.
Please refer to the Concept Paper for further information.
I appreciate your time and attention to this effort, and request
you send your comments to Peter L. Wise (WH-554), Water Planning Division,
U.S. Environmental Protection Agency, 401 M Street, S.W., Washington, D.C.
20460. Comments received will be considered in the development of the
regulations.
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TITLE 40 -- PROTECTION OF ENVIRONMENT
CHAPTER I — ENVIRONMENTAL
PROTECTION AGENCY
SUBCHAPTER B — GRANTS AND OTHER FEDERAL ASSISTANCE
PART 35 — STATE AND LOCAL ASSISTANCE
SUBPART A — STATE/EPA AGREEMENTS
INTERIM REGULATIONS
SUMMARY: These regulations would establish basic policies and procedures
for developing and implementing State/EPA Agreements under the Clean Water
Act, the Resource Conservation and Recovery Act, and the Safe Drinking
Water Act. They are scheduled for publication as interim final regulations
by February 1979, because OWWM policy and other regulations recently
issued under the above-mentioned Acts require State/EPA Agreements in
Fiscal Year 1980. The regulations will clarify requirements and ensure
consistency between programs. Public meetings to receive comments on
this Concept Paper are discussed below.
Final regulations will accommodate experience gained during development
of the Fiscal Year 1980 Agreements. Comments on the interim regulations
received by October, 1979, would be considered in development of final
regulations. One or more public meetings for purposes of receiving
comments will be held prior to expiration of the comment period for
developing final regulations. Notice of these meetings will be published
in the Federal Register and otherwise appropriately publicized.
DATES: Public Meeting:
December 4, 1978 from 9 a.m. to 12 noon; afternoon
optional; (Additional meetings in other areas
of the country will be announced in the Federal
Register. Contact Patti Morris (see below) for
for further details.)
Comments must be received on or before December 8, 1978.
ADDRESSES: Public Meeting inj Washington, D.C.:
Environmental Protection
Agency
401 M Street, SW, Room 3906
Washington, D.C.
Send requests to speak to:
Patti Morris, Environmental Protection
Agency, WH-554, 401 M Street, SW,
Washington, D.C. 20460 (For additional
information regarding requests to speak
and the agenda for the .meeting see
Public Meeting below)
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Send written comments to: Peter L. Wise, Environmental Protection
Agency, WH-554, 401 M Street, SW,
Washington, D.C. 20460
Telephone Service: EPA will provide, during the hours and on
the days specified below, a toll-free telephone number to
assist the public in making comments or requesting
clarification regarding the Concept Paper. The toll-free
number is 800-424-9304. The toll-free line will be open
only from 1 p.m. to 4:30 p.m. Eastern Daylight Time from
November 13 thru 16, 1978 and December 5 thru 8, 1978.
This line will be open for the sole purpose of hearing
comments and providing information on the State/EPA
Agreement Concept Paper.
Comments submitted may be inspected at the Public Information
Reference Unit, EPA Headquarters, Room 2922, Waterside Mall,
401 M Street, S.W., Washington, D.C.
FOR FURTHER INFORMATION CONTACT: Linda Eichmiller, Environmental
Protection Agency, WH-554,
401 M St., SW, Washington, D.C.
20460 (202) 755-6965
Washington Public Meeting
A meeting to receive comments on the Concept Paper will be held at the
Environmental Protection Agency, 401 M Street, S.W., Room 3906, Washington, D.C.,
from 9 a.m. to 12 p.m. on December 4, 1978. If there is sufficient public
interest, an afternoon session will be held.
Individuals wishing to comment are requested to submit their names,
addresses, and telephone numbers to Patti Morris, Environmental Protection
Agency WH-554, 401 M Street SW, Washington, D.C. 20460 (202-755-2117).
Requests should indicate the length of time each individual wishes to
comment and any preference as to time. Statements will be limited to a
maximum of 10 minutes. Individuals who request to comment will be notified
in advance of the time scheduled for their statement. Time will be re-
served for unscheduled comments. Each individual who plans to comment is
requested to submit one typewritten copy of his or her statement at the
meeting. The record will be closed at the end of the meeting; however,
as indicated above, written and telephone comments on the Concept Paper
will be accepted by EPA if they are received no later than December 8, 1978.
The agenda for the hearing is as follows: Introductory Presentation: Question
and Answer Session; Scheduled Presentations; Unscheduled Testimony. Any
afternoon session scheduled will follow this agenda.
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Discussion
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As EPA's legislative authority to deal with environmental problems
has expanded, it has become apparent that solutions to such problems
frequently are interrelated. This has led to recognition of a need for
better coordination and integration of EPA assistance programs under
the Clean Water Act, the Safe Drinking Water Act, and the Resource
Conservation and Recovery Act. The State/EPA Agreement represents a
flexible management tool which can be used to meet this need.
The idea of an integrated approach is not new. Some States and
Regions have been using an integrated approach to environmental
problem-solving for years, and EPA began implementation of the State/EPA
Agreement concept in Fiscal Year 1979. What is new is that EPA now is
emphasizing nationally the need for coordination and integration of
covered programs in all States, through published procedures designed to
lead to development of an efficient management tool in the form of a
State/EPA Agreement.
The Agreement will be a decision document reflecting important
decisions of the States and EPA on environmental problems, priorities,
timing of solutions, responsibilities, and allocation of resources. It
will focus top management attention in EPA regional offices and the
States on these decisions, and on evaluation of how the decisions are
carried out. The Agreement will also be an information document useful
to local governments, areawide agencies, and other affected and interested
organizations and individuals.
It should be emphasized that EPA views the State/EPA Agreement as a
genuinely bilateral agreement in the full sense of the term. To be
successful, the Agreement must reflect a sense of partnership between
the State and EPA concerning a mutual undertaking to achieve environ-
mental goals, through means which both agree are best.
If the State/EPA Agreement is to fulfill expectations, EPA may have
to adjust the way it does business with the States. EPA is interested
in exploring any innovations which may enhance administration of the
provisions below. For example, EPA plans to examine the feasibility of
using a mechanism like the "one-stop" permit issuance procedure recently
undertaken by Regional Offices, perhaps by establishing a single person
or small group in the EPA Regional Office to act as a focal point for
each State's contact. EPA also needs to examine ways to better coordinate
development of annual Headquarters guidance related to the covered programs.
The experience of EPA and the States in developing the 1980 Agreements
will be used as the primary basis for modification of the provisions below
when final regulations are issued. EPA will closely observe implementation
of these regulations (and supplementary guidance) over the next six months,
and will be particularly interested in the comments of State and Regional
Office representatives concerning ways in which the process can be improved.
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While the State/EPA Agreement has among Its purposes the simplific-
ation of management, this does not mean that there will be any re-
laxation of the requirements of underlying program regulations. The States
must continue to meet the requirements published for each of the
categorical programs. The State/EPA Agreement will enable EPA and the
States to meet these requirements in a better coordinated and more
efficient manner.
While the regulation below is specifically applicable to only certain
programs, the Regional Administrator is in no way precluded from including
other EPA programs in the State/EPA Agreement.
The provisions below contain several approaches which the Regional
Administrators and the States may use in simplifying financial auditing
procedures. When less fiscal auditing is undertaken, more "program"
auditing should be undertaken to assure that program objectives are met.
Regional Administrators may request the assistance of the EPA Office of
Audit in performing "program" audit functions as well as the more narrow
fiscal auditing.
EPA cannot emphasize too strongly that the requirements below are
meant to result in less paperwork and effort, not more. The Agreement
should incorporate other documents by reference whenever possible to avoid
duplication and volume. Public participation and evaluation efforts should
be combined with existing requirements of the covered programs. The
regulations specify that the objectives statement and the summary portion
of the Agreement are to be brief. The Agreement must be used by States
and EPA to consolidate, integrate and simplify, not to add further
paperwork or red-tape.
[FURTHER PREAMBLE LANGUAGE WILL BE ADDED AS APPROPRIATE]
Part 35 is amended by adding the following new Subpart:
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Subpart A - State/EPA Agreements
35.100 Purpose
This subpart establishes basic policies and procedures for
developing and implementing State/EPA Agreements to integrate and
coordinate environmental problem-solving and program management.
35.101 Scope and applicability.
This subpart is applicable to all State/EPA Agreements covering
activities in Fiscal Year ]980 and subsequent years which are associated
with EPA technical and financial assistance to States under Sections 106,
205(g), 208, and 314 of the Clean Water Act; Sections 3011, 4008 and
4009 of the Resource Conservation and Recovery Act; Sections 1442(b) (3)
(C), 1443(a) and 1443(b) of the Safe Drinking Water Act; and any other
provisions of the latter laws under which assistance is provided through
EPA regional offices to States. These programs are referred to in this
subpart as "covered programs". This subpart supplements the general
grant regulations in Part 30 of this chapter. There are other regulations
in this chapter establishing additional or modified requirements for the
State/EPA Agreement in relation to particular covered programs (for
example, §35.1016 concerning construction management assistance grants
and §35.1507 for water quality management).
35.102 General policy.
The primary purpose of the State/EPA Agreement is to facilitate
environmental problem-solving by coordinating and to the maximum extent
feasible, integrating the planning, management, and implementation of all
covered programs. The provisions in this subpart are intended (and shall
be administered by both States and EPA) to lead to development and
implementation of State/EPA Agreements which provide:
(a) maximum feasible coordination and integration in program
planning, priority-setting, reporting, and accountability
mechanisms;
(b) the least possible red tape, delay and paperwork;
(c) elimination of duplication among programs;
(d) efficient use of each program's resources;
(e) easily understood and accessible information concerning
respective obligations, priorities and resource use;
(f) resolution of conflicts and use of opportunities presented by
the impact of one program's activities on others;
(g) effective management of and coordination with EPA, State
substate programs.
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35.103 Definitions.
(a) Covered programs. See definition set forth in §35.101.
(b) State. Any of the fifty States, the District of Columbia, the
Commonwealth of Puerto Rico, the Virgin Islands, Guam, American
Samoa, the Commonwealth of the Northern Mariana Islands,
and the Trust Territory of the Pacific Islands.
(c) State/EPA Agreement. A document signed by the Regional Ad-
ministrator and the Governor of the affected State (or, if the
Regional Administrator and the Governor agree, by one or more
heads of State executive agencies) which meets the policies and
requirements of this subpart and any modified or additional
requirements of regulations elsewhere in this chapter.
(d) Substate entity. Any public regional, local, county, municipal,
or intermumcipal general or special purpose governmental entity
(including an interstate agency).
(e) Work program; work plan.
A portion of the State/EPA Agreement (which may be incorporated
by reference to reduce the volume of the Agreement) which
specifies in detail the work to be performed by the State
under the covered programs; EPA's obligations; the costs approved
by EPA for assistance for each element of work; the associated
federal and non-federal funding (and sources); technical and
other non-fiscal assistance to be provided by EPA to the State;
and other information required by the Regional Administrator in
accordance with applicable program regulations elsewhere in this
chapter and other EPA guidance.
35.105 Prerequisite requirement.
(a) Beginning in Fiscal Year 1980, all covered programs snail be part of
the State/EPA Agreement. The State/EPA Agreement must be completed and
signed before award of grants under any covered program. For the program
of construction management assistance grants authorized by Section 205(g)
of the Clean Water Act, the State/EPA Agreement must be completed and signed
before execution of the delegation agreement (see §35.1030).
(b) The Regional Administrator may permit grant award in advance of
completion of the State/EPA Agreement if he or she determines that delay
would not be in the best interests of sound environmental management and
that the activities for which funding would be awarded have been adequately
coordinated with other elements of the State's covered programs.
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35.107 Content and development of the State/EPA Agreement.
(a) General. The State/EPA Agreement shall coordinate and, to the
maximum extent feasible, integrate planning, management and implementation
of all covered programs. In addition, the State and EPA shall coordinate
in developing the Agreement with other Federal, State, regional and local
planning programs affecting or affected by activities under the State/EPA
Agreement.
(b) Content. The State/EPA Agreement consists of the following:
(1) A brief statement of the environmental problems and objectives
to be met through activities under the State/EPA Agreement, based on the
State's problem assessments, strategies or other identification of needed
activities under the covered programs, and on EPA guidance. To the extent
feasible, the State should prepare an integrated five year strategy to
be updated annually.
(2) A detailed work program meeting the requirements of the
regulations which govern each of the covered programs. Generally, the State/
EPA Agreement shall contain only one work program which integrates the
various outputs which would otherwise be funded under each of the covered
programs. Where the Regional Administrator determines that this is not
feasible, more than one work program may be prepared, provided that the
State/EPA Agreement contains evidence satisfactory to the Regional Administrator
that the multiple work programs have been coordinated consistent with the
policies and requirements of this subchapter. The State/EPA Agreement may
incorporate the work program(s) by reference, rather than actually including
the documents, provided that the work program(s) are readily available to EPA
and for public inspection.
(3) Other information and coordination requirements which the
Regional Administrator determines are necessary to meet the policies of this
subpart.
(4) A summary of the Agreement contents, generally not exceeding
5 pages. The summary shall be a separable document usable by State and EPA
managers, and the public, as an overview of the State/EPA Agreement and
work to be performed during the coming year. It shall briefly describe how
covered programs have been and will be coordinated and integrated, and
shall summarize major work program outputs, associated funding (and sources)
and agency responsibilities for completing the outputs.
(c) Development. The State and EPA regional personnel should begin
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development of the State/EPA Agreement as early as possible each year. A
draft Agreement shall be completed and submitted to the Regional Administrator
no later than June 1 of each year. The Regional Administrator shall review
the draft for compliance with the requirements of this chapter and provide
comments to the State within 30 days. The final Agreement shall be submitted
to the Regional Administrator not later than September 1 of each year.
Authority to sign the Agreement on behalf of EPA shall not be delegated
below the Deputy Regional Administrator.
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(d) Relationship to grant agreements. To avoid duplication, the
State/EPA Agreement may constititute the narrative portion of a single
application for grant funds under the covered programs. Where a single
application containing the State/EPA Agreement has been submitted and
approved, and funds are available for obligation, the Regional Administrator's
signature on the grant agreement shall constitute his or her execution of
the State/EPA Agreement and award of grant funds. If the Regional
Administrator must provide separate grant awards, he or she shall incorporate
by reference the executed State/EPA Agreement in each such grant agreement.
(e) Fund recipients. Consistent with the terms of the State/EPA
Agreement, the Regional Administrator may award a grant to one agency, a
grant which directs funds to more than one agency, or separate grants to the
various agencies which will be performing under the State/EPA Agreement.
(f) Emergencies. The State/EPA Agreement should provide authority to deal
quickly in environmental emergencies. As part of such authority, abbreviated
review and approval procedures may be included.
35.109 Term of State/EPA Agreement.
The term of the State/EPA Agreement shall be for the Federal fiscal
year. The Agreement shall require execution each year by the Regional
Administrator and the State; however, unchanged provisions may be incorporated
by reference to avoid the need for voluminous duplication. The Agreement
may include outputs which will be funded over a shorter or longer period of
time than the Federal fiscal year. Where an output will be funded over a
period which extends beyond one year, the subsequent Agreement(s) generally
will carry forward the remaining balance of funding and the obligations
related to uncompleted work.
35.111 Public and substate participation.
(a) Public participation. Early in the process of development of
the draft Agreement under §35.107(c), the State shall notify the public
about the goals and scope of the Agreement (including the work program) and
shall schedule opportunities for consultation with the public. Prior to
submission of the draft Agreement to EPA, the State shall distribute to the
public a fact sheet which explains in layman's terms the contents of the
proposed Agreement, and shall
with Part 25 of this chapter.
Agreement a summary of public
comments from the hearing and
thereafter hold a public hearing in accordance
The State shall submit with the draft
participation; summary of significant public
other sources, such as advisory committees
required under regulations of the covered programs; and the State's
responses. To avoid duplication, all public participation activities should
be combined with such activities required under the covered programs.
(b) Participation of substate entities. While substate entities shall
have the opportunity to participate in activities under paragraph (a) of
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this section, the affirmative role of these entities in environmental
management makes it mandatory that they have appropriate additional
opportunities for participation in development and implementation of the
State/EPA Agreement. In some cases, regulations for the covered programs
specify the particular involvement of substate entities which is required
or appropriate. Generally, interested substate entities must be involved
in development of all aspects of the Agreement which will affect them, and
the Agreement must provide evidence satisfactory to the Regional Administrator
of such involvement. Failure to involve substate entities may provide
a basis for disapproval of part or all of the State/EPA Agreement. Nothing
shall preclude the right of affected substate entities to submit comments
directly to EPA.
35.112 Indian Tribes.
Where an Indian tribe receives EPA assistance under two or more
covered programs, the Regional Administrator and the Indian tribe may
use the procedures in this subpart to integrate, coordinate and manage
the programs.
35.113 Evaluation and feedback.
Each covered program specifies in regulations or guidance the
particular evaluation criteria applicable to the objectives of the program.
Annual evaluation of implementation of the State/EPA Agreement shall take
into account these specific program evaluation criteria, and the extent
to which implementation of the State/EPA Agreement is meeting the policies
and requirements of this subchapter. The Regional Administrator shall
conduct a joint, on-site, mid-year evaluation meeting with each State to
review and evaluate the accomplishments of the current year arrd to review
activities projected for the coming year. The Regional Admirustrator
should hold this meeting in conjunction with other evaluation meetings
required by the regulations of the covered programs. The State and EPA
shall apply the findings of evaluations to development of the State/EPA
Agreement for the following year. The Regional Administrator shall prepare
a brief written report of the evaluation, forward a copy to the State,
and notify the public of the report's availability. The State/EPA
Agreement may be used to establish other agreed-upon evaluation and
feedback mechanisms. The State and EPA may also conduct such other
evaluations as each deems appropriate.
35.115 Grants and integrated work programs.
States and Regional Administrators generally will develop integrated
work programs (see §35.107(b)(2), which may include common work elements
drawing funding from more than one covered program. In such an event, the
work program shall specify the amount or percentage of funding attributable
to each covered program under which the work element is eligible. The
State's matching share for each work element need not rigidly track this
split of Federal funds, as long as overall the State's required matching
share level is met from allowable costs attributable to each covered program.
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35.117 Financial and program auditing.
35.117-1 Financial audit procedures.
(a) If the Regional Administrator has determined that the work
program has clearly and adequately established reasonable funding levels
for eligible work elements, he or she may request EPA auditors to audit
expenditures only back to the State/EPA Agreement to determine that funds
have been spent in accordance with the Agreement. The EPA Office of Audit,
after consultation with the Regional Administrator, may determine to
conserve State and EPA effort by accepting a written assurance from the
State that funds have been spent as specified in the Agreement (in such an
event the Regional Administrator shall assure, through the annual evaluation
or by use of other program reviews (see §35.117-2) that the agreed-upon
outputs have been produced). With the concurrence of the EPA Office of
Audit, the State and the Regional Administrator may agree to accept State
audit results in lieu of an EPA audit, in accordance with Office of
Management and Budget Circular 74-7. In the latter event, financial
assistance to support the State audit effort generally will be administered
through the EPA Office of Audit.
(b) Notwithstanding any provision of (a), EPA may determine to
conduct a complete review of expenditures of Federal grant funds and State
funds needed to meet applicable matching and maintenance-of-effort require-
ments to assure that funds have been expended in accordance with the
policies and intent of the covered programs. Each State shall afford EPA
auditors and representatives of the U.S. Comptroller General access to
records which the auditors or representatives need under this paragraph.
Any interagency or subagreement between the State and other entities using
grant funds must also provide for such access.
35.117-2 Program audits.
At the request of the Regional Administrator, and within the limits
of available resources as determined by the Director of the EPA Office of
Audit, the EPA Office of Audit shall (directly or through contract or
cooperative agreement) conduct program evaluation functions related to EPA
and State performance under the Agreement.
35.119 Funding flexibility.
Annual EPA appropriations legislation and Congressional committee
directives limit the amount of funds which may be reprogrammed by EPA
among the covered programs (except for construction grants and construction
management assistance grants, which may not be reprogrammed). Each year,
EPA annual guidance will contain advice concerning the availability of this
funding flexibility and the procedures for State funding transfers based
on EPA reprogramming. In no event may a State transfer funding between
covered programs without advance written approval of the Regional
Administrator, who will act in accordance with guidance of the Office of
Planning and Management.
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