U.S. DEPARTMENT OF COMMERCE
                               National Technical Information Service
                                PB-257 793
Determination  of Harmful Quantities and
Rates of Penalty for  Hazardous
Substances.  Volume  I. Executive Summary

Battelle-Northwest, Richland, Wash  Pacific Northwest Lab
Prepared for
Environmental Protection Agency, Washington, D C Office of Water Planning
and Standards
Oct 74

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EPA-44)/9-75-005-a
                            FINAL REPORT
                     VOLUME I - EXECUTIVE SUMMARY
                             OF  HARMFUL QUANTITIES AND
            RATES OF PEl!All',' FOR HAZARDOUS SUBSTANCES
  •'BQNMENTAL PROTECTION AGISHCY & OFFICE OF WATER PLANNING AND STANDARDS

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 BIBLIOGRAPHIC DATA
 SHEET
                     1. Report No.
            S.^ecipient's Accession No.
4. Title anu Subtitle
 Determination  of Harmful Quantities and  Rates of Penalty for
 Hazardous Substances.  Volume I.  Executive Summary
            3. Report Date
              Oct  74
            6.
7. Author(s)
 Gaynor W. Dawson, Michael  W.  Stradley,  and Alan J. Shuckrow.
            8. Performing Organization Kept.
              No.
9. Performing Orgafllfiation Name and Address

 Battelle-Northwest, Richland,  Wash.  Pacific Northwest Lab.
            10. Ptoject/Task/Work Unit No.
                                                                      11. Contract/Grant No.
                                                                         EPA-68-01-2268
12. Sponsoring Organization Name and Address

 Environmental  Protection Agency, Washington, D. C.
 Office of Water  Planning and  Standards
            13. Type of Report & Period
               Covered
                                                                      14.
15. Supplementary Notes
16. Abstracts

 U.S.  legislation  requires the  formulation  of regulations designating specific
 hazardous substances and the delineation of harmful quantities for  these substances.
 Penalty rates are to be established for spillage of non-removable hazardous sub-
 stances to motivate greater efforts in the area of spill prevention.   The objective
 of  the subject  study was to examine several  technical  alternatives  for developing
 harmful quantity  and penalty rate regulations.   Four  such methodologies are reported.
17. Key Words and Document Analysis.  17o. Descriptors

 *Water pollution
 *Waterways (Transportati on),
 *Hazardous materials,
 *Law enforcement,
  Regulations,
  Identification,
  Penalties,"
  Policies,
  Management,
  Methodology.
17b. Identifiers/Open-Ended Terms
  Hazardous materials  spills,
  Alternatives,
  *Fines.
17c. COSATI Field/Group  13 B
18. Availability Statement
  National  Technical  Information  Service

  Springfield, Virginia  22161
19.. Security Class (This
   Report)
     UNCLASSIFIED
I 21. No. of Pages
20. Security Class (This
   Page
     UNCLASSIFIED
FORM NTIS-35 (REV. 3-72)
                                  THIS FORM MAY BE REPRODUCED
                                                                                USCOMM-DC M952-P72

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EPA-440/9-75-005-a
                            FINAL REPORT
                    VOLUME I - EXECUTIVE  SUMMARY

              DETERMINATION OF HARMFUL  QUANTITIES AND
             RATES OF PENALTY FOR HAZARDOUS SUBSTANCES
                                 by
                          Gaynor W. Dawson
                         Michael W. Stradley
                          Alan J. Shuckrow
                        CONTRACT  68-01-2268
                           Project  Officer
                          C.  Hucrh Thompson


                            OCTOBER 1974
                            Prepared for >


                       HAZARDOUS SUBSTANCES BRANCH
               OFFICE OF WATEK  PLANNING AND STANDARDS
               U.  S. ENVIRONMENTAL PROTECTION AGENCY
                      WASHINGTON,  D.  C.  20460

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                     TABLE OF CONTENTS
                                                         Page
INTRODUCTION 	      1-1
UNDERLYING CONCEPTS COMMON TO THE
DEVELOPMENT OF ALL APPROACH METHODOLOGIES	      1-3
     THE PRACTICALITY OF IMPLEMENTATION AND
     ENFORCEMENT OF THE METHODOLOGIES  	      1-3
     USE OF PURE COMPOUNDS .	      1-3
     DESIGNATION OF UNITS OF MEASUREMENT 	      1-3
     SELECTION CRITERIA FOR ESTABLISHING
     CRITICAL CONCENTRATION  ... 	      1-4
THE RESOURCE VALUE METHODOLOGY ......	      1-5
   .  'BRIEF	      1-5
     VALUE THRESHOLD	      1-5
     SELECTION OF THE CRITICAL
     VOLUME FOR LAKES	 .  .	      1-5
     SELECTION OF THE CRITICAL
     VOLUME FOR ESTUARIES  .............      1-7
     SELECTION OF THE CRITICAL
     VOLUME FOR RIVERS 	  ...........      1-7
     SELECTION OF THE CRITICAL
     VOLUME FOR COASTAL WATERS 	      1-7
     CALCULATION OF HARMFUL QUANTITY ........      1-8
     INITIAL RATE OF PENALTY ............      1-8
     ADJUSTMENT FACTOR .........'	      1-8
THE MODIFIED IMCO/GESAMP METHODOLOGY 	      1-11
     BRIEF ............ 	      1-11
     PROFILING AND CATEGORIZING
     HAZARDOUS MATERIALS ......  	      1-11
     DETERMINATION OF HARMFUL QUANTITY 	      1-14

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TABLE OF CONTENTS (Cont'd.)
     DETERMINING THE BASE
     RATE OF PENALTY	    1-15
     FINE DETERMINATION	    1-15
THE UNIT OF MEASUREMENT METHODOLOGY	    1-17
     BRIEF	    1-17
     GENERAL CONCEPTS .  .	    1-17
     UNIT OF MEASUREMENT AND HARMFUL
     QUANTITY DETERMINATION  	  ....    1-17
     COMPUTING THE BASE
     RATE OF PENALTY	    1-19
THE DOHM METHODOLOGY	    1-21
     BRIEF	    1-21
     HARMFUL QUANTITY DETERMINATION  	    1-23
          Stream Model   	    1-23
          Lake Model	    1-24
          Estuarine Model  	    1-24
          Ocean Model	    1-25
          Locational Factor  	    1-25
     RATE OF PENALTY DETERMINATION	    1-25
          Stationary Sources   	    1-25
          Barges	    1-26
          Railroads	    1-26
          Trucking	    1-26
          Determination  of the    '
          Final Rate of  Penalty	    1-26
                              11

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                     LIST OF FIGURES
Number                                                    Paqe
 1-1      FLOW DIAGRAM FOR RESOURCE
          VALUE METHODOLOGY	1-6

 1-2      FLOW DIAGRAM FOR IMCO METHODOLOGY	1-12

 1-3      FLOW DIAGRAM FOR UNIT OF
          MEASUREMENT METHODOLOGY  .  .  .  .  „	1-18

 1-4      FLOW DIAGRAM FOR DOHM - COST
          OF PREVENTION  METHODOLOGY  .	1-22
                              ill

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                        LIST OF TABLES

Number                                                    Page

 1-1      SUMMARY  OF CRITICAL CONCENTRATIONS
          AND  RESULTING HARMFUL QUANTITIES
          FOR  IMCO HAZARD CATEGORIES	   1-14

 1-2      UNITS OF MEASUREMENT AND HARMFUL
          QUANTITIES FOR UNIT OF MEASURE-
          MENT METHODOLOGY           	   1-19
                                             Preceding page blank

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                       ACKNOWLEDGMENTS
This report has been prepared by Battelle Memorial Institute,
Pacific Northwest Laboratories, for the Hazardous and Toxic
Substances Branch, Division of Technical Standards, Office of
Wate^ Planning and Standards of the U. S. Environmental Protec-
tion Agency under Contract 68-01-2268.

Dr. A. J. Shuckrow served as overall project director for this
study, with Mr. G. W. Dawson acting as technical project director,
Other Battelle staff participating in the program included
R. C. Arnett, R. S. Pardo, M. W. Stradley, and Ms. S. I. Thoreson,

The secretarial efforts of Ms. Dee Parks, Nancy Painter, and
Mr. Michael Mefford are gratefully acknowledged.

Special thanks must go to members of the staff of the Hazardous
and Toxic Substances Branch, Dr. C. Hugh Thompson and Dr. Allen
L= Jennings, who provided helpful guidance throughout the pro-
gram.

Appreciation is also extended to the Manufacturing Chemists
Association for their Cooperation and assistance during the
conduct of this study.
                            Vll
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This report was initiated by the Environmental Protection Agency
to gather additional information and to complete several con-
cepts developed by the technical staff of the Agency.  This
report is One of the series dealing with hazardous materials
and the prevention and/or removal of spills of these materials
into or upon the navigable waters of the United States.  The
methodologies were determined to be necessary to provide a
technical basis for the development of regulations under
Section 311 of Water Pollution Control Act as amended in 1972
(PL 92-500).  This report is a result of several man years of
work by the Government, industry, and the contractor.  It
should be understood that the methodologies explained here may
be used in some modified form in regulations to be developed
and/or revised as appropriate to implement Section 311.

This document should be regarded as a technical reference docu-
ment which may be used as appropriate by this Agency and others
primarily in the development of the regulatory control program
for hazardous substance spills.  The principal regulations for
which these methodologies were developed are required to be
promulgated under Section 311(b)(2)(B)(iv) and Section 311(b)(4)
which require that penalty rates for nonremovable hazardous
substances shall be prescribed and that quantities determined
to be harmful to public health and welfare be identified.  The
other regulations as required by Section 311 dealing with
hazardous substances involve:  the designation and determination
of removability; the determination of removal and mitigating
methods; the determination of procedures and equipment for
spill prevention; the determination of small facility spill
clean-up liabilities; the*, determination of nonharmful quantities;
and appropriate revision to the National Oil and Hazardous
Substance Pollution Contingency Plan.  This information is
thought to be of use of assessing the environmental benefits
and potential economic impacts in the development of regulations
dealing with methods for removal and mitigation of hazardous
substances and procedures and equipment for prevention of
hazardous substance spills from transportation, production and
use facilities.

At the time the project was conceived the Agency had participated
in international hazardous material control negotiations and
had gained considerable experience working with industry in the
production, distribution and use of materials which may be
designated as hazardous substances.  Late in 1972 and early in
1973, it became the concern of this Agency that several alter-
native methods should be examined in detail to allow equitable
regulatory development.  This concern was keyed to be pending
designation regulation which would list elements and compounds
as hazardous substances.
                             IX
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It is anticipated that the information that has been gathered
during this study which involved the National Hazardous Materials
Conference in San Francisco, August 1974, and the Regulation
Symposium in Washington, DC in October 1974 will be utilized
in part in the development of regulations to be published in
the Federal Register.  Once the regulations are promulgated,
going through the process of Advance Notice of Rule Making,
Proposed Rule Making, and Final Promulgation, the program
will be implemented nationwide.  This program implementation
is anticipated to be in conjunction with the United States
Coast Guard and to be implemented at the EPA Region and Coast
Guard District Level.  It is further anticipated that areas
for the Administrator's discretion in evaluating penalties may
be established as appropriate through EPA Guidelines and/or
Enforcement Regulations formulated by this Agency.

Particular thanks should be expressed to the primary authors
of this Report with special emphasis to acknowledge the coop-
eration provided by the chemical manufacturing industry, the
chemical transporting industry and others who supplied basic
information upon which this study is built.  An individual
appreciation is expressed to Dr. Allen L. Jennings of the
Hazardous and Toxic Substances Branch for his technical
participation and enthusiasm is seeing this  job completed.
Others who helped in the review and editing  for EPA included
Dr. Gregory Kew, Messrs. Robert Sanford, James Gating, and
Charles Gentry.  It should be recognized that this project
was possible due to the foresight in planning, funding, and
the staff assistance of Messrs. Walter Miguez, Robert Suzuki',
John Cox, and others of the Division of Oil  and Special
Materials, without whose help this project would have been
impossible.


   ......                        Dr. C. Hugh Thompson
                                     Chief
                            HAZARDOUS  SUBSTANCES  BRANCH
                        Environmental Protection Agency

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                        INTRODUCTION


Section 311 of Public Law 92-500 requires the formulation of
regulations designating specific elements and compounds as
hazardous substances and the -subsequent delineation of harmful
quantities for these substances.  In addition, penalty rates
are to be established for spillage of non-removable hazardous
substances to motivate greater efforts in the area of spill
preventiono

The objective of the subject study was to examine several
technical alternatives for developing harmful quantity and
penalty rate regulations.-  A minimum of three distinct method-
ologies were to be developed for defining harmful quantities
of designated hazardous substances and for establishing penalty
rates.  Four such methodologies were formulated.

Each methodology is characterized by three identifiable segments:
1) a mechanism for deriving harmful quantities, 2) a rationale
for the base rate of penalty, and 3) a scaling function to vary
rates of penalty on the basis of the physical, chemical, and
toxicological properties of individual materials.  Additionally,
two approaches offer locational variables which further refine
penalty assessments based on the actual water uses and dispersive
capacity of the receiving body.  Each of these segments has been
designed in modular fashion to allow the intermixing of preferred
segments to form cohesive hybrid methodologies.

This volume is parallel to Volume II where one can find the
specifics of the methodologies developed.  Detailed data and
background information are appended in Volume III.
                               j:-

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        UNDERLYING CONCEPTS  COMMON TO THE DEVELOPMENT
                 OF ALL  APPROACH METHODOLOGIES


Although  the  intent of  the  work reported herein has  been  the
development of  diverse  methodologies for quantitatively defining
harmful quantities and  setting  rates of  penalty for  the spillage
of  non-removable hazardous  substances, there are many  underlying
concepts  common to all  of the approaches.   Four of these  merit
discussion  prior to presentation of the  individual methodologies:
1)  the  practicality of  implementation and enforcement  of  the
methodologies;  2)  the use of pure compound data and  the subsequent
need  for  adjustment when spills involve  solutions or mixtures;
3)  the  manner of dealing with units of measurement;  and 4)  the
selection criteria for  assigning critical  concentrations.

THE PRACTICALITY OF IMPLEMENTATION  AND
ENFORCEMENT OF  THE METHODOLOGIES

Regulatory mechanisms must  typically strike a balance  between
features  which  add resolution and those  which enhance  the pract-
icality of implementing and enforcing a  regulation.  With respect
to regulations  designating  harmful  quantities and penalty rates
for hazardous material  spills,  the  former  features would be those
aimed ,at ppst-spill investigations  and damage assessment, while
the latter would be encompassed in  a single standard for all
circumstances.

Neither extreme  is  deemed appropriate.   However,  it  was assumed
that approaches  must be designed to  be workable  both for the
regulatory agency  and those being regulated.  This led  to a
certain degree of  simplification such as the grouping of potential
receiving waters  into four classifications  based on  hydrodynamic
differences:  lakes, rivers, estuaries,  and coastal  waters.

USE OF PURE COMPOUNDS

All methpdologies  have been designed to  function on  a pure com-
pound basis.  Additionally, each can deal with mixtures, some
more readily than  others.  Output and input data requirements
hcive .been focused  on the elements and compounds designated as
non-removable hazardous substances.

DESIGNATION OF UNITS OF MEASUREMENT

It was determined  that for most  hazardous materials,  there is no
single unit of measurement upon  which rates  of penalty can be
founded.  Consequently,  rather  than  derive  a unit independently
for each  substance, for three of  the four methodologies developed,
the unit of measurement was derived  after a  base rate of penalty
was determined.   Typically,  this  unit was a multiple of common
mass units.
                              1-3
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SELECTION CRITERIA FOR ESTABLISHING
CRITICAL CONCENTRATIONS

There is no clear threshold such that spillage of more than a
given amount of a contaminant constitutes harm at all locations
and at all times while lesser amounts of the contaminant are
tofe&lly harmless at all locations and at all times.  Rather,
the harm produced by the introduction of any pollutant into
water is a continuous function dependent upon receiving water
characteristics and measured in degrees of severity.  The concen-
tration at which the severity of resulting harm is deemed sub-
stantial is defined as the critical concentration.  This concert^
tration is subsequently employed as a measure of the relative
toxicity of each material for the purpose of determining harmful
quantities and rates of penalty by any of the four methodologies
developed.

There are multiple types of harm that can be produced by hazardous
materials as a result of the material's intrinsic properties
and the extrinsic circumstances surrounding the spill itself, as
well as the water uses associated with the receiving water.  The
authors chose to focus attention on acute toxicity to aquatic
life as the major type of harm of concern for selecting critical
concentrations.  Whenever possible, the concentration of choice
was the. 96 hour LCso to median sensitive receptors.  The latter
were defined as Lepomis macrochirus  (Bluegill sunfish) or
Pimephales promelas  (fathead minnow) for freshwater.  For saline
waters, preference was given to 96 LCso data f°r species of
commercial and recreational value:  Ostrea  (oysters), Mercenia
mercenia  (hard clams), and Penaeus  (shrimp).  Other species commonly
employed for bioassay work were ranked in order of preference.
When data were available on species of similar sensitivity, highest
priority was given to test results in hard waters with an ambient
pH range of 6.5-8.0.
                             1-4

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               THE RESOURCE VALUE METHODOLOGY
BRIEF

The methodology developed in the following discussion directs
attention to the economic value of environmental resources and
the potential loss as a result of the spillage of hazardous
materials.  Harm is defined as a threshold dollar value such
that damage in excess of that amount is considered substantial.
The threshold itself is selected through a decision analysis
process with the intent of keeping the threshold in a reasonable
range without encouraging the discharger to gamble by failing to
report spills of quantities equal to or greater than the harmful
quantity.

Rates of penalty are derived to be commensurate with the value
of resources damaged.  This provides for the internal!zation of
the costs to society of individual spills.  Whereas post-spill,
site specific damage assessment studies generally are deemed
unnecessarily expensive, adjustment factors are developed which
may be used to modify penalties on the basis of key environmental
parameters in the area of the spill.  The information flow
required for the Resource Value Methodology is illustrated in
Figure 1-1.

VALUE THRESHOLD

The Resource Value Methodology employs an economic standard for
determining when harm is considered substantial.  A threshold
value is selected for this purpose such that the ability to
contaminate, to the critical concentration, a quantity of water
with a value equal to or greater than this threshold value
qualifies the harm as substantial.  The minimum quantity of
hazardous material capable of that degree of contamination is
the harmful quantity.

The threshold value was set at $10,000 since it was concluded
that this amount was sufficient to justify the costs associated
with processing and responding to a spill report but was not
so excessive that it would provide incentive for the discharger
to gamble by failing to report a spill of a harmful quantity.
The $10,000 value threshold was converted into critical volumes
for each of the water body types after correlation of economic
values of representative receiving waters in the United States
with water volume.

SELECTION OF THE CRITICAL VOLUME FOR LAKES

Data valuing lakes as a resource were collected for various regions
of the country.  In the past several basic valuation techniques
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        SElfCT A DOLLAR
       VALUE THRESHOLD
           ($10.000)
         DETERMINE PRESENT
          WORTH OF WATER
          BODY TYPES (PW)
  CHARACTERIZE MATERIALS
   BY PHYSICAL-CHEMICAL
   PROPERTIES (rkint) AND
 CRITICAL CONCENTRATION (cc)
     POST SPILL EVALUATION
       OF RECEIVING WATER
    CHARACTERISTICS (rkext)
                                     (HQ
                                       DERIVE HARMFUL
                                         QUANTITY
                                          (10,000)
                                            PW
            x (cc) )
  DERIVE RATES OF
  PENALTY R OF PQ <
    ($10,000/HQ)
                                             1
                                 DERIVE BASE RATES OF PENALTY
                                 (ROFPB) = (R OF P0)x (rkint)
                                             1
DERIVE FINAL RATES OF
 PENALTY (ROF Pp) =
(R OF PF) = (R OF PB) x
      (rkext)
FIGURE  1-1.   FLOW DIAGRAM FOR RESOURCE VALUE  METHODOLOGY
                              1-6

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have typically been employed.  These yield a family of relations
with increasing marginal values per unit volume as the size of
the lake diminishes.  Values based on recreational income (i.e.,
swimming, boating, fishing) were deemed the most appropriate
since these water uses are those most commonly damaged by spill
incidences.

Correlation analysis revealed that a lake with a present value
of $5,000 would be  74,277  cubic meters  (60 acre-feet) in size.
This corresponds to an annual income value of $0.004 per cubic
meter ($5 per acre-foot).

SELECTION OF THE CRITICAL VOLUME FOR ESTUARIES

Estuaries were valued on the basis of the income from commercial
and sport fishing per unit of surface area obtained in represen-
tative estuarine locations.  Values obtained described a well
defined relation corresponding to the association of  1.6 hectare
(3.9 acre) with a present worth of $5,000.  An  average depth  of
3 meters  (10 feet) was then assumed to yield a critical volume
of 49,212 cubic meters (39 acre-feet) of estuarine water.  Thus
harmful quantities for materials with equivalent freshwater and
saltwater toxicities will be twice as large for spills in lakes
as for spills in estuaries.

SELECTION OF THE CRITICAL VOLUME FOR RIVERS

No valuation technique was deemed appropriate for correlating
river size and value with data presently available.  Consequently,
the critical volume for rivers was taken as that derived for
lakes.  This results in a single harmful quantity for all fresh-
water systems.

SELECTION OF THE CRITICAL VOLUME FOR COASTAL WATERS

Coastal waters were valued as the sum of two unit values:  one
related to intrinsic values, and one related to the influence
of coastal waters on the estuarine system.  The intrinsic value
was derived by summing the present worth of total annual income
from commercial fishing, limited sport fishing, and recreational
marine swimming, and dividing by the estimated volume of water
contained in the 12 mile contiguous zone.  This resulted in a
present worth of $973 per million cubic meters  ($1.20 per acre-
foot) .

The estuarine-related value was derived by estimating the potential
for a spill in coastal waters to lead to estuarine contamination.
An average tidal interchange of 50 percent was assumed.  At the
same time, it was determined that estuaries constitute one percent
of the volume of water contained in the contiguous zone.  Therefore,
                             1-7

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coastal waters were given an estuarine-relat.ed value equal to 0.005
that of the estuaries themselves, or $508 per million cubic meters
(0.64 per acre-foot).

Summing the two components yields a present worth of $1511 per
million cubic meters  ($1.84 per acre-foot).  in turn, this
corresponds to a critical volume of 3,310,000 cubic meters
(2,717 acre-feet).

CALCULATION OF HARMFUL QUANTITY

Harmful quantities have been defined as that amount of hazardous
material required to bring the critical volume to the critical
concentration level.  Therefore, each hazardous material is
associated with  three harmful quantities:  Freshwater  (rivers
and lakes), estuaries, and coastal waters.  Harmful quantities
can be calculated by taking the product of the critical volume
of the water body type of interest, and the critical concentration
for the hazardous material of interest.

INITIAL RATE OF  PENALTY

The Resource Value Methodology is built around the rationale that
penalties for spills of non-removable hazardous substances should
be equivalent in value to the damages to  the environment caused
by the spill.  Since  the various water bodies have been valued,
and a harmful quantity  (HQ) has been defined as an amount
sufficient to contaminate water with a present value of $5,000,
the initial rate of penalty  (R of pQ) is  simply defined as:
                    R of  PQ =  $5,000/HQ
ADJUSTMENT FACTOR
The.initial rate  of penalty  (R of  Po) was designed to recover
the .value of potential damages to  the environment.  The underlying
rationale for  Resource Value Methodology rates of penalty,
however, was to recover  the  value  of actual or probable damages.
Hence, adjustment factors, are  necessary to reflect the fact that
degradability  and dispersibility characteristics can mitigate the
effects of a spill.   The overall adjustment factor is composed
of four individual multiplicative  components:  two related to
intrinsic properties, and two  related to extrinsic parameters.

The intrinsic  components are employed to convert the initial rate
of penalty to  a base  rate of penalty for each substance, a priori.
One component  reflects the likely  duration of effects stemming
from a spill.  The second modifies the base rate of penalty
further as a function of the solubility, volatility, and specific
gravity of the substance which will enhance or inhibit the move-
ment of the material  through the environment.  The combined effect
                              1-8

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of these factors is sufficient to change the initial $5,000/HQ
penalty rate by a factor of 0.016 - 0.36.

Extrinsic components in the adjustment factor are designed to be
applied after a spill has occurred.  The first component adjusts
the base rate of penalty as a function of the relative recreational
value of the receiving water compared to that used to derive the
critical volumes.  The second component takes into account the
actual dispersive capability of the receiving water in comparison
to the instantaneous mixing assumption made to derive the initial
rate of penalty.  These components are optional and may modify
the penalty either upward or downward.

Final rates of penalty can be calculated as t.\e produce of the
initial rate of penalty and the adjustment factor with or without
inclusion of the extrinsic components.
                            1-9

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            THE MODIFIED IMCO/GESAMP METHODOLOGY
BRIEF
In this approach, hereafter referred as the IMCO Methodology,
a procedure is developed for designating harmful quantities
and rates of penalty based on a proposed international hazardous
material rating/classification system which has been submitted
under the  auspices of the United Nations to its member nations
for adoption.  When adopted, this system will be used to regulate
the operation of ships transporting hazardous materials in bulk.
Because the proposed shipping regulations do not embrace the
concepts of harmful quantity and rate of penalty, it was
necessary, during the course of this study, to introduce a number
of modifications to the basic IMCO rating/classification system
in order to comply with the requirements of Section 311.

As an overview, the IMCO Methodology first utilizes the rating/
classification system developed by an ad hoc committee of experts
from the Inter-Governmental Maritime Consultative Organization  (IMCO)
and the Joint Group of Experts on the Scientific Aspects of Marine
Pollution  (GESAMP) to profile hazardous materials on the basis
of their relative hazard potentials.  These profiles are then
used to relegate the hazardous materials to hazard categories
depending upon the degree to which they are expected to exert
their various hazard potentials.  Next, a critical concentration
is determined for each category.  The Resource Value Methodology
rationale is then used to derive a harmful quantity and base rate
of penalty for each category.  The base rate of penalty is then
modified for individual hazardous materials by an adjustment
factor which considers the ability of the material to exert its
full hazard potential(s) in a given water body type when con-
sideration is given to the physical/chemical properties of the
hazardous material.  For reader convenience, the steps in develop-
ing the IMCO Methodology are shown schematically in Figure 1-2.

PROFILING AND CATEGORIZING HAZARDOUS MATERIALS

The IMCO Methodology offers simplification of the basic harmful
quantity/rate of penalty regulatory mechanism by addressing
groups of materials with similar properties and hazard rather
than individual hazardous substances.  To facilitate this,
materials are profiled and categorized in two separate ways:

     9  On the basis of their relative hazard potentials
        using the rating/classification system developed
        by the ad hoc committee of experts from the
        Inter-governmental Maritime Consultative Organization
        (IMCO) and the Joint Group of Experts on the Scientific
        Aspects of Marine Pollution  (GESAMP); and
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                                     DESIGNATED
                                     HAZARDOUS
                                     MATERIALS
             PROFILED USING
               IMCO/GESAMP
                SYSTEM
                                                 PROFILED ON BASIS
                                               OF PHYSICAL/CHEMICAL
                                                   PROPERTIES
           CATEGORIZED ON BASIS
            OF HAZARD PROFILE
                          RESOURCE VALUE
                            RATIONALE
                            DEVELOPED
CRITICAL CONCENTRATION
    DETERMINED FOR
    EACH CATEGORY
                                       CRITICAL VOLUME
                                        DETERMINED FOR
                                       FOUR WATER BODY
                                            TYPES
   WATER BODY
      TYPE
PHYSICAL/CHEMICAL
 PROPERTY GROUP
   HAZARD TYPE
                ADJUSTMENT
                 FACTORS
             DETERMINED FROM
                  DELPHI
                             FINAL RATES
                             OF PENALTY
                             DETERMINED
           FIGURE 1-2.    FLOW  DIAGRAM FOR  IMCO  METHODOLOGY
                              1-12

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     ®  On the basis of their physical/chemical properties
        using a  system developed by the authors.

The first categorization scheme generates  four hazard categories,
while the second generates  fourteen physical/chemical categories.
Conceptually, each hazardous material is a member of each of the
two types of categories.  Procedures for deriving harmful quantities
and rates of penalty utilize these groups  as  the basic working
unit rather than the individual materials.

The first profiling operation considered five potential hazards:

     •  Bioaccumulation,

     •  Damage to living resources,

     •  Hazards  to human health  (oral intake),

     •  Hazards  to human health  (external  exposure), and

     •  Reduction of amenities.

Each material was given a rating relative  to  its hazard potential
in each of the five hazard  areas.  The aggregate of these ratings
then determined  in which of the four hazard categories the material
will be grouped.

In general, Category A includes those materials which are oio-
accumulative to  toxic levels or toxic to aquatic life below
1 ppm, as flesh.  Category  B includes materials which concentrated
in organisms over a short period of time,  capable of tainting
fish flesh, or toxic "to aquatic life at levels of 1-1.0 ppm.
Category C materials on toxic to aquatic life at levels of 10-100
ppm and Category D materials are toxic to  aquatic life at levels
of 100-1,000 ppm.

The second profiling operation was based on the physical/chemical
properties of the hazardous materials.  The purpose of this second
profile was that of determining, at least  in  a general manner, the
predicted behavior of a material when it is spilled into water.

.Four properties  were selected as being the most meaningful in  •
terms of predicting general action patterns:                     -

     •  Persistence,

     •  Density  classification  (float, mix, sink),

     «  Volatility, and

     9  Solubility.
                             1-13

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The fourteen physical/chemical categories consist of the meaning-
ful combinations of these four properties.

DETERMINATION OF HARMFUL QUANTITY

The XMCO Methodology defines substantial harm in the same mannet
as the Resource Value Methodology.  That is, substantial harm is
contamination to the critical concentration of waters with a

 present worth of $5,000  or  greater.   Consequently,  the  same
 Critical volumes were employed to derive harmful quantities:
 74,277 cubic meters (60  acre-feet)  for lakes and rivers;
 49,212 cubic meters (39  acre-feet)  for estuaries;  and 3,310,000
 cubic  meters (2,171 acre-feet)  for coastal waters.   At  this
 point, however,  individual  .critical co centrations  were not
 utilized to determine harmful  quantities.   Rather,  a critical
 concentration representative of each of the four hazard cate-
 gories was employed.   These critical concentrations and resulting
 harmful quantities are summarized in Table 1-1.
                           TABLE 1-1

       SUMMARY  OF CRITICAL CONCENTRATIONS AND RESULTING
        HARMFUL QUANTITIES FOR IMCO HAZARD CATEGORIES


               Critical     	Harmful Quantity, kg (Ibs)	
   IMCO     Concentration   Lakes &
 Category       (pprtp	   Rivers     Estuaries   Coastal Waters

    A       .     0.5             37         26           1,400
                                (83)       (54)      '    (3,100)

    B            5.5            410        270          15,000
                                (910)      (610)         (34,000)-

    C           55.0          4,100      2,700         150,000
                             (9,100)  .   (6,100)         (340,000)

    D          300JO         23,000      15,000         850,000
                            (49,000)   (32,000)      (1,900,000)
                             1-14

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DETERMINING THE BASE RATE OF PENALTY

The rationale for the base rate of penalty assessed by the IMCO
Methodology is the same as that developed for the Resource Value
Methodology:  the penalty is set at the value of the potential
damage resulting from a spill.  Therefore the base rate of
         R of PB, was calculated as:
                    R of PB = $5,000/HQ

where HQ is the harmful quantity.

FINE DETERMINATION

With the IMCO Methodology, the base rate of penalty is modified
by an adjustment factor to determine the actual fine rate.  The
adjustment factor is a function of the physical/chemical category
to which a material is assigned.  It serves to diminish the
penalty rate for those substances whose physical/chemical properties
decrease the volume of water affected by a given spill.  Since there
are fourteen physical/chemical categories and four hazard categories,
there are 56 rates of penalty possible for each water body type.
The penalty assessed for a given spill is calculated as the product
of the appropriate rate of penalty for the water body type and the
quantity of material spilled.
                            1-15

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            THE UNIT OF MEASUREMENT METHODOLOGY


BRIEF

The Unit of Measurement  (UM) Methodology addresses  the letter
Of th@ law whereas the other methodologies utilize  a  technical or
economical basis to satisfy the intent of the law.  To this end,
the derivation of this methodology is premised by the selection
of a unit of measurement common to the usual trade  practice.
Harmful quantities and rates of penalty are then derived  from
this unit of measurement whose prime selection criteria are that
it (1) be a unit common to usual trade practices, and (2) be
large enough so that spillage of this quantity leaves little doubt
that substantial harm will result.  Rates of penalty  are  also
derived from this unit of measurement through introduction of the
fixed monetary guidelines established by Congress in  Section
311(b)(2)(B)(iv) of Public Law 92-500.  Hence, the  UM Methodology
employs an independently derived unit of measurement.

Figure 1-3 provides a schematic representation of the UM  Methodology
which should facilitate reader understanding of ensuing sections.

GENERAL CONCEPTS

The Unit of Measurement Methodology stands apart from the other
three approaches developed in that no attempt is made to  estab-
lish a rationale for the penalty levels beyond their  compliance
with the mandate of Section 311(b)(2)(B)(iv) of Public Law 92-
500.  Indeed, the apprpach is designed as a literal interpretation
of the law itself whereby the unit of measurement is  derived
independently and base rates of penalty are fixed once the unit
is determined.

The UM Methodology is ideally suited for the grouping concept
developed with the IMCO Methodology.  Consequently, each  material
was dealt with as a member of a hazard category and a physical/
chemical category in the same manner as in the latter approach.

UNIT OF MEASUREMENT AND HARMFUL     '          .   . '    '
QUANTITY DETERMINATION

The UM Methodology requires the independent selection of  units of
measurement for each material.  Since a grouping concept  was
employed, only four units of measurement were required.   The
transportation frame of reference was selected as the most
appropriate for prospective units.

Container sizes commonly utilized for the shipment  of solid and
liquid chemicals were placed on a scale of relative size.  For
both types of substances, a significant break was found between
                             1-17
Preceding page blank

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      1
ofom
MM
PROFI LED US ING
IMCO/GESAMP
SYSTEM
4
CATEGORIZED
ON BASIS OF
HAZARD PROFILE
4

CRITICAL CONCENTRATION
DETERMINED FOR
EACH CATEGORY
4_

WATER BODY
TYPE

PHYSICAUCHEMIC
PROPERTY GROU


h FA

«w


HAZARD TYPE


4
HARMFUL QUANTITY
COMPUTED FOR
CATEGORY 'A"
THRU "C" MATERIALS
4
HARMFUL QUANTITIES
ROUNDED TO
COMMON TRADE
UNITS

FIXED MO
AMOUNT ($
FROM
AL 1
P 4

ADJUSTMENT
CTORS DETERMINED
FROM DELPHI
4

FINAI
OF PE(
DETER

PROFI LED ON BASIS
OF PHYSICAL/
CHEMICAL PROPERTIES

BASE UNIT
OF MEASUREMENT
AND HARMFUL
QUANTITY ASSIGNED
TO CATEGORY "D"
MATERIALS
4


UNIT OF MEASUREMENT
COMPUTED FOR
CATEGORY "A" THRU "C"
MATERIALS
•
METARY
LOO-1000)
LAW
1
1
BASE RATE
OF PENALTY
DETERMINED
4.

RATES
WLTY
MINED
r
' . . 1

F
FIGURE 1-3.  FLOW DIAGRAM  FOR  UNIT OF MEASUREMENT METHODOLOGY
                             1-18

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   the size of bulk shipment containers and individually packaged
   containers.  For the less hazardous materials (IMCO Category D
   substances), it was assumed that the smallest bulk containers
   would be capable of producing substantial harm, if spilled, while
   the largest individual container would not.  Consequently, a
   15,142 liter (4000 gallon) tank car was selected as the unit of
   measurement of Category D materials as well as the harmful quan-
   tity.  Units of measurement for Categories A through C were then
   assigned such that they formed the same ratio with the Category
   D unit of measurement as that formed by their respective critical
   concentrations.  Units of measurement were then rounded to the
   size of the nearest shipment container and equated to the harmful
   quantity.  This resulted in the harmful quantities given in
   Table 1-2.

                             TABLE 1-2

            UNITS OF MEASUREMENT AND HARMFUL QUANTITIES
                FOR UNIT OF MEASUREMENT METHODOLOGY

            Critical     Unit of Measurement   Unit of Measurement
          Concentration  and Harmful Quantity  and Harmful Quantity
Category      (ppm)	  	(volume)	  	(mass)	

   A          05                18.93£              22.68 kg
                                 5 gal              50 Ibs

   B          55              .288.203,             226.80 kg
                            ,55 gal             500 Ibs      ' '  ' =

   C          55              2081.982,            2721.55 kg
                               350 gal            5000 Ibs

   D         300                15.41 m3            14.51 MT
                              4000 gal              16 tons

   COMPUTING THE BASE RATE OF PENALTY

   With the units of measurement independently derived as outlined
   above, the base rate of penalty.is specified as $1000 per unit of
   measurement.  k

   As-in the IMCO Methodology, the penalty is adjusted downward as a
   function of the physical/chemical category to which the material
   is assigned.  Each category is assigned an adjustment factor in
   the range 0.1 - 1.0 which reflects the relative ability of
   materials in that category to disperse and exert their hazard
   potential.  Application of this factor to the base rate of penalty
   results in a minimum fine of $100/unit of measurement and a maximum
   fine of $1000/unit of measurement as prescribed by Section 311
   (b)(2)(B)(iv).
                                1-19

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                   . THE DOHM METHODOLOGY

BRIEF

The methodology developed within this portion of the study is an
extension of an approach formulated by the Division of Oil and
Hazardous Materials (DOHM), U. S. Environmental Protection Agency,
for assessing the impacts of hazardous material spills in streams.
This approach uses a simplified plug flow model to assess the
quantity of a hazardous material (harmful quantity) which when
spilled is capable of inflicting substantial harm to key aquatic
organisms in a stream.  The wide applicability of Section 311
requires that harmful quantities for other types of water bodies
such as lakes, estuaries, and coastal zones be determined.  To
this end, the basic DOHM plug flow model has been extended and
modified whenever possible to meet these requirements.

The objective of this approach is that of defining a critical
volume, the contamination of which results in substantial harm.
For the stream and estuary categories, statistical samples of
U. S. water bodies were analyzed to determine this critical
volume.  Simplified plug flow models of these water bodies were
then used to determine harmful quantities based on the amount of
hazardous substance required to bring the critical volume to the
critical concentration level.  Harmful quantities for lakes and
coastal zones were extrapolated from the stream and estuary harm-
ful quantities, respectively.

Determination of the rate of penalty is independent of that of
the harmful quantity in the DOHM Methodology.  For this approach,
the rate of penalty is equated to the cost which would have been
incurred by the discharger had he instituted measures to prevent
the spill.

Separate "costs of prevention" have been determined for both
stationary and mobile sources.  The latter includes transportation
by rail and barge.

A method is presented for employing the cost of prevention to
derive the rate of penalty.  The base level cost of prevention
can be utilized directly as the penalty rate or an adjustment
factor can be utilized to vary the cost of prevention as a
function of chemical characteristics of each substance.

Figure 1-4 represents the flow diagram of the procedure required
by the DOHM Methodology to develop a harmful quantity and rate
or penalty for any substance.
                                                Preceding page blank
                             1-21

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        ASSIGNMENT
        OF CRITERIA
         FOR WATER
       BODY QUANTITY
       DETERMINATION
                         IDENTIFICATION
                             OF THE
                           HAZARDOUS
                          MATERIAL'S
                         CHARACTERISTICS
                           (SOLUBILITY
                           DISPERSION,
                            TOXICITY)
ANALYSIS
OF
TIME-DOSE
MORTALITY
RELATIONS


*
APPLICATION
FACTOR
SELECTION
1
                             SELECTION OF
                             STATIONARY OR
                                MOBILE
                           SOURCE  PREVENTION
                                 COSTS
         INCLUSION OF
        CHARACTERISTICS
        INTO MODIFYING
       FUNCTION REFLECTING
        THE MATERIAL'S
       HAZARD POTENTIAL
                                  I
                           EQUATING BASE COST
                             OF PREVENTION
                               TO RATE
                              OF PENALTY
                                                   IS
                                               ADJUSTMENT
                                               FACTOR TO
                                                E  APPLIED
                                            APPLY ADJUSTMENT
                                                 FACTOR
                                                  LIST
                                                HAZARDOUS
                                                MATERIAL
                                                  AND
                                             CORRESPONDING
                                                PENALTY
                                                 RATE
FIGURE 1-4.
FLOW DIAGRAM  FOR  DOHM -  COST
OF  PREVENTION METHODOLOGY
                           1-22

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HARMFUL QUANTITY DETERMINATION

The DOHM Methodology defines substantial harm in a statistical
manner through use of an idealized plug flow model.  Significant
differences in the hydrodynamic characteristics with the water
body types considered requires that each be evaluated separately.

Stream Model

For flowing streams, an idealized plug flow model of the form

                         T = KM/CQ

was employed where

     T = time for the plug to pass a point in the; stream

     M = mass of hazardous substance spilled

     Q = stream flow rate

     C - concentration of hazardous substance, and

     K = conversion constant.

 If  the critical concentration  is  substituted  in  the  above  equation
 as  the C  term, the mass term,  M,  becomes .the  harmful quantity.
 Since the  critical concentration  was specified as  a  96  hour  LCso
 value for  a median receptor, T was  set as  96  hours.  A  review of
 fish kill  reports revealed  that these incidences are typically
 6-96 hours in duration.  When  time-dose mortality  relations  for
 hazardous  substances were studied,  it was  further  noted that
 greater harm could occur from  spills condensed to  a  6 hour-long
 plug than  the same spill diluted  to a 96 hour-long plug.   Conse-
 quently,  an application factor was  included in the constant  (K)
 to  convert T from 96 to 6 hours and the critical concentration  (C)
 to  the appropriate value for a 6  hour exposure period.

 The flow  rate  (Q) was determined  statistically from  data for
 streams throughout the United  States.  This was  done by calculat-
 ing, the volume of water flowing at  any one time  in streams in the
 United States and corresponding flow rate  of  the stream.   This
 data was accumulated and summed for the Nation as  a  whole.  It
 was determined that 95 percent of all stream  water in the  country
 flows in  streams with a median flow rate of 1 m3/sec pg cfs) or
 greater.   Therefore, 36 cfs was employed in the  plug flow  model.

 The model  was then solved for  M for each hazardous material  em-
 ploying the respective critical concentration, and M was designated
 the harmful quantity.
                             1-23

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Lake Model

No statistical data were available on lakes which would permit
determination of harmful quantities in a manner similar to that
employed for streams.  Consequently, harmful quantities for spills
into lakes were equated to those for rivers thus yielding a
single freshwater harmful quantity.  This is equivalent to
defining the critical volume for lakes as 21,600 cubic meters
(17.5 acre-feet) based on the 36 cfs flow over a six hour period
of time.

Estuarine Model

The plug flow model for the stream was modified for application
to estuaries yielding

                  C = M/(Qt + RP/D)  (T) K

where

     R = tidal exchange ratio

     P = tidal prism upstream from the spill discharge point

     D = duration of tidal cycle  (24 hours, 50 minutes)

    Qt = tributary discharge

     C = concentration of hazardous material in the combined flow

     M = quantity of material spilled

    ,.T == time for the plug to pass a point

  RP/D = effective flow of new ocean water passing the discharge
         point

     K = conversion constant including the application factor
         derived for the stream model.

Conservation of mass was  applied  and the  equation rearranged to
become
                  M  =  K  (sl=§e   Qt)
where

     So =  salinity  of  ocean water,  and

     Se =  salinity  of  water leaving the  estuary.
                               1-24

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Values of 34 ppt and 31 ppt were assumed for So and Se, respec-
tively.  A value of 96 hours was assumed for T since C was set
at the critical concentration.  A statistical analysis similar
to that performed for the streams was made for tributaries flowing
into estuaries.  It was determined for the United States that 95
percent of all estuarine inflows are carried by streams with a
median flow rate of 200 cfs or greater.  This value then was put
into the formulation as Qt, and M calculated for each hazardous
substance.  M was then designated as the harmful quantity for
spills into estuaries.

Ocean Model

It was assumed that the major threat from spills into ocean water
results from the potential for these materials to move into an
estuarine system.  Therefore, the harmful quantity for coastal
waters is equated to that for estuaries.  This is equivalent to
defining the critical volume of approximately 1,370,000 cubic
meters (1120 acre-feet).

Locational Factor

Two potential modifications were derived to better suit the
models to large water bodies.  The first involves the designation
of individual harmful quantities for specific stationary sources
through the use of the actual stream flow in the plug flow model.
The second recognizes the greater assimilative capacity of rivers
carrying barge traffic.  A statistical analysis on these rivers
revealed that 95 percent of them have a median flow of 172 m3/sec
 (6150 cfs) or greater.  Use of this flow in the harmful quantity
formulations yields harmful quantities for barges 172 times as
large as those for streams in general.

RATE OF PENALTY DETERMINATION

The rationale for rates of penalty in the DOHM Methodology is that
penalties should exceed the cost of spill prevention and thus
provide positive incentive for dischargers to maintain effective
spill prevention programs.  Since spill prevention is associated
with different base costs for various spill sources, rates of
penalty must be assigned individually to the various sources.

Stationary Sources

Data was collected from two major MCA member chemical producers
on the cost of spill-proofing a production facility.  Spill-
proofing was defined as containment with facilities to remove
the spilled material to storage or treatment areas.  These
measures were assumed to be 100 percent effective.  Costs were
then allocated over the total volume of product likely to have
been spilled over the life of the equipment had not the spill
                             1-25

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precautions been taken.  The numbers thus derived from the two
sources were in close agreement and were averaged to yield the
cost of prevention for stationary sources of $8.82/kg ($4.00/lb).

Barges

The cost of prevention estimate for spills from barges is based
on the cost of converting single-hulled Type III barges to
double-hulled Type III barges and the estimated spillage prevented
by this conversion over the life of the barge.  Data from an MCA
fttember firm and a twenty-two member survey conducted by the MCA
generated a cost of $11.39/kg  ($5.17/lb).

Railroads

The cost of prevention estimate for spills from rail transport
is based on the average cost increasing the integrity of tank
cars for shipping parathion and phenol.  For parathion, costs
reflected the addition of head shields and conversion to F
couplings.  Phenol car costs included an added expense for
conversion from internally coiled to externally coiled cars.
These measures were assumed to be 100 percent effective in
preventing leaks after derailments.  Therefore, costs were
allocated over the average per car spillage estimated from
historical data for the life of the car.  This yields an average
cost of prevention for rail of $0.84/kg  ($0.37/lb).

Trucking

Insufficient data were available to estimate the cost of prevention
for trucking based on improving the integrity of tank trucks.
At the same time, data that were reviewed indicated - that 95 per-
cent of all truck related spills occur at loading and unloading
facilities.  Consequently, the cost of prevention for spills  from
trucks was equated to that for stationary sources.

Determination of the Final Rate of Penalty

The base rate of penalty was equated to the cost of prevention
for the various spill sources.  An adjustment factor was then
derived to modify penalties upward for the more persistent and
toxic substances.  The adjustment factor is comprised of these
multiplicative factors:  a toxicity term, a dispersal term, and
a degradability term.  Each term was quantitatively derived from
physical/chemical data for the specific hazardous substance of
interest.  The adjustment factor can increase the rate of penalty
by a factor of two, which approximates the additional costs
required for spill prevention when substances are highly flam-
mable or corrosive.

                                       U-S- GOVERNMENT PRINTING OFFICE: 1975-582423:278
                              1-26

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