SPECIAL FUND FOR ABATEMENT OF
COMBINED SEWER OVERFLOW POLLUTION
IN MARINE BAYS AND ESTUARIES
(The Marine CSO Fund)
Guidance for the Preparation
and Review of Applications
January 1984
Office of Water Program Operations
Office of Water
U.S. Environmental Protection Agency
Washington, D.C.
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Table of Contents
I. Purpose 3
II. Discussion 3
A. Statutory Basis and Legislative History 3
B. Regulatory Requirements 3
1. Applicable Requirements of the Construction
Grants Program 3
2. Application Contents 4
3. Costs and Financial Capability 4
4. Phased or Segmented Treatment Works 5
5. "Marine Bays and Estuaries" 5
6. Project Evaluation Criteria 6
III. Procedural Guidance
A. Availability of Applicant Materials
and Applicant Actions 6
B. State Actions 6
C. EPA Regional Office Actions 6
D. Due Date for Applications 7
E. EPA Headquarter's Actions 7
F. Grant Agreement Preparation and Overview 7
IV. Technical Guidance
A. Water Quality Demonstration 8
B. Assessment of Swimming and Shellfishing Benefits .... 9
C. Comparison of Benefits and Costs 10
D. Statement of Regional and National Significance .... 11
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I. PURPOSE
JThis guidance?]describes the special fund for abatement of combined sewer
overflow pollution in marine bays and estuaries. It[provides]the applicant,
State and Environmental Protection Agency (EPA) personnel with ja description
of: the contents of a complete application, the procedure for State and EPA
review and evaluation of an application, the evaluation and priority criteria,
and technical guidance for the preparation of an application^
II. DISCUSSION
A. Statutory Basis and Legislative History
1. Section 201(n)(2) of the Federal Water Pollution Control Act, enacted
as a part of the Municipal Wastewater Treatment Construction Grants
Amendments of 1981, authorizes a special fund for abatement of
combined sewer overflow pollution in marine bays and estuaries (The
Marine CSO Fund). Section 201(n)(2) states in part that:
...the Administrator shall have available...funds...to address water
quality problems of marine bays and estuaries subject to lower levels
of water quality due to the impacts of discharges from combined storm
water and sanitary sewer overflows from adjacent urban complexes...
2. The HUD - Independent Agency Appropriations Acts for fiscal years
1983 and 1984 provided $30 million each (for a total of $60 million)
to fund projects under Section 201(n)(2).
3. The 1984 Appropriations Act (P.L. 98-45) appropriates $30 million
"...for projects under section 201(n)(2), subject to the approval of
the Committees on Appropriations..." The Conference Report to the
1984 Appropriations Act (Conf. Rpt. 98-264, p.11) states that the
committees "... will consider only ... project segments which can be
fully funded and which will provide significant near-term water
quality and public health improvements."
B. Regulatory Requirements
1. Applicable Requirements of the Construction Grants Program
Potential marine CSO projects must satisfy most of the same requirements
as CSO projects funded under the final construction grants program regulation
(Title 40 of the Code of Federal Regulations (CFR), 35.2000 et seq.).
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These requirements include all applicable limitations on award and grant
conditions,, as well as Federal share and allowable cost provisions; but
exclude §§35=2010 (Allotment; reallotment), 35=2015 (State priority system)s
35,2020 (Reserves), 35=2021 (Reallotment of reserves), 35.2025(b) (Advance of
allowance), 35=2042 (Review of grant applications)s 35.2103 (Priority
determination), 35=2109 (Step 2+3)9 and 35=2202 (Step 2+3 projects), A
discussion of application procedures and criteria for setting priorities for
marine CSO projects is provided below.
Guidance on the construction grants program is provided in an EPA
publication series "Construction Grants," This guidance is being updated and
will be republished as "Construction Grants 1984," The current guidances
"Construction Grants 198.2 9" is available from the National Technical
Information Service9 5258 Port Royal Road9 Springfield9 VA, 22161 (ordering
number PB 82 263666),
2, Application Contents
Section 35=2040(f)9 35,2040(b) and 35=2024(b)(l) of the construction
grants regulation describe the contents of an application for Step 3 grant
assistance for building a treatment works to address marine CSOs, The
regulation requires an application (EPA Form 5700=32) accompanied by;
(a) A facilities plans including environmental documents^ prepared in
accordance with 35,900 et seq, or 35,2000 et seq. as appropriate;
(b) Certification Trom the State that there has been adequate public
participation based on State and local statutes;
(c) Evidence of compliance with all applicable limitations on award
(§§ 35,2100 through 35,21279 except 35=2103 and 35.2109), Certain
requirements are discussed further in sections 3 and 4 below;
(d) Final design drawings and specifications; or a commitment to provide
them by a date set by the Regional Administrator;
(e) The project schedule;
(f) In the case of an application for Step 3 assistance that is solely
for the acquisition of eligible real propertys a plat which shows the legal
description of the property to be acquired,, a preliminary layout of the
distribution and drainage systemss and an explanation of the intended method
of acquiring the real property (see 40 CFR Part 4); and
(g) A demonstration by the State of the water quality benefits of the
proposed project. The demonstration shall at a minimum prove that significant
usage of the water for shellfish ing and swimming will not be possible without
the proposed project for correction of combined sewer overflows9 and that the
proposed project will result in substantial restoration of an existing
impaired use. Section IV of this guidance presents ways to demonstrate
benefits and costs,
3, Costs and Financial Capability
(a) The applicant should give particular attention to the limitation on
award found in Section 35,2104(b). This section requires that the applicant
demonstrate the Iegal9 institutional9 managerial and financial capability to
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ensure adequate building and operation and maintenance of the treatment
works. This demonstration must include an explanation of the roles and
responsibilities of the local governments involved and how construction and
operation of the facilities will be financed; a current estimate of the cost
of the facilities; and a calculation of the annual costs per household. It
must also include a written certification, signed by the applicant, that the
applicant has analyzed the costs and financial impacts of the proposed
facilities. Where the application is for a phase or segment (see section 4),
this information must be for the treatment works of which the phase or segment
is a part.
Detailed guidance on the demonstration of financial capability is provided
in the Agency's Financial Capability Policy effective upon publication in the
Federal Register and the supporting "Financial Capability Guidebook". The
guidebook is available from the State water pollution control agency or the
National Technical Information Service, 5258 Port Royal Road, Springfield, VA
22161.
4. Phased or Segmented Treatment Works
If the application is for a project that is a phase or segment of the
proposed treatment works described in the facilities plan, the description of
benefits and costs should be for the treatment works and the segment applied
for as described in the facilities plan because the criteria applied by EPA in
setting priority (section 6 below) will be applied to the entire facility plan
proposal and each segment proposed for funding.
The conditions that any project must meet to be funded as a phase or
segment are described in Sections 35.2108 and 35.2005(b)(49). Of particular
importance is the requirement that the applicant agree to make the treatment
works of which the phase or segment is a part operational and comply with the
enforceable requirements of the Act regardless of whether grant funding is
available for the remaining phases or segments.
Section 35.2108 also requires that the grant agreement for a phased or
segmented treatment works include a schedule of actions to make the treatment
works operational and comply with the enforceable requirements of the Act.
5. "Marine Bay or Estuary"
For the purpose of this fund "marine bay or estuary" is defined in
Section 35.2005(b)(26) as "semi-enclosed coastal waters which have a free
connection to the territoral sea."
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6. Project Evaluation Process
All eligible applications will be evaluated and priorities established by
Headquarters using the criteria specified in Sections 35.2024(b)(2)&(3) of the
construction grants regulation. These sections specify that the Administrator
shall establish priorities for projects with demonstrated water quality
benefits based upon the following criteria:
(1) Extent of water use benefits that would result, including swimming
and shellfishing;
(2) Relationship of water quality improvements to project costs; and
(3) National and regional significance.
If the application is for a project that is a phase or segment of the
proposed treatment works described in the facilities plan, these criteria will
be applied to the treatment works described in the facilities plan and each
segment proposed for funding. In applying criterion (1), EPA will consider
the total benefits resulting from project or segment completion relative to
the prospective commitment of Federal funds.
III. PROCEDURAL GUIDANCE
A. The general regulations that pertain to processing applications for EPA
Grants are found in 40 CFR Part 30. The applicant may obtain application
materials from the State agency designated by the Governor .as having the
responsibility for administration of the construction grants program under
Section 205(b) of the Clean Water Act. The applicant should send the
completed application to the State agency.
B. The State agency should (1) review and approve: (a) the application, (b)
the facilities plan, and (c) the project design; (2) determine compliance with
other State and Federal requirements; (3) prepare the water quality
demonstration described in section II B 2 above; and (4) send the approved
application, and water quality demonstration, to the Regional Administrator.
C. The Regional Administrator shall (1) determine whether all Federal
requirements have been met, including completion of environmental review, (2)
prepare a statement of regional and national significance, and (3) determine
eligibility of the project for consideration for funding.
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The Region will send the facility plan including environmental documents,
the water quality demonstration, statement of regional and national
significance, and summaries of any other relevant material available to
support the technical review of the application to the Office of the Director;
Facility Requirements Division (WH-595), 401 M Street, SW, Washington, D.C.,
20460. The Region should retain the balance of the application unless
otherwise advised by Headquarters.
D. The information described above should be received in the Office of the
Director within 120 days of the publication of the final construction grants
regulation (40 CFR, Part 35, Subpart I) in the Federal Register to ensure
consideration for funding from the fiscal year 1983 and 1984 appropriations.
If funds are appropriated for future fiscal years, applications should be
received by September 30 (the end of the fiscal year) to ensure consideration
under that year's appropriation.
Generally within 30 days of receipt of an application, EPA headquarters
will advise the applicant whether additional information is required.
Additional information should be submitted through the above procedures and
should be received within 180 days of the publication of the final
construction grants regulation in the Federal/Register (or November 30 of
future years as appropriate) to ensure consideration. Early submittal of
applications is strongly encouraged.
The Region should schedule the submission of State approved final design
drawings and specifications to allow sufficient time for Regional review,
approval, and notification of the Office of the Director within 210 days of
the final construction grants regulation in the Federal/Register (or
January 31 of future years as appropriate).
E. All eligible applications will be evaluated and priorities established by
Headquarters using the criteria specified in section II.B.6. Headquarters
will prepare project summaries and funding recommendations for transmittal by
the Administrator to the House and Senate Appropriations Committees for review
in accordance with Public Law 98-45 (the fiscal year 1984 Appropriations Act)
and the associated Conference Committee Report. After completion of this
process and final project approval, Headquarters will provide obligating
authority to the appropriate Regional Administrators.
F. Generally 45 days after receipt of obligating authority, the Regional
office will prepare the grant agreement and transmit it to the applicant for
execution. The Region, or State, to the extent it is delegated responsibility
to administer the marine CSO program, will monitor the grant and project
completion.
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IV. TECHNICAL GUIDANCE
A. Water Quality Demonstration
Section 35.2024(b)U) requires the State to demonstrate the water quality
benefits of the proposed project. The demonstration shall at a minimum prove
that:
1. Significant usage of the water for shellfishing and swimming will not
be possible without the proposed project for correction of combined
sewer overflows; and
2. The proposed project will result in substantial restoration of an
existing impaired use.
The first requirement involves a demonstration that the proposed project
is essential for significant usage of the water for shellfishing and
swimming. Other point and nonpoint source controls may also be necessary in
addition to the proposed project. The second requirement is a demonstration
that the project alone will result in a substantial restoration of use.
The purpose of the first requirement is to consider the marine CSO within
a context of the overall water quality conditions. Swimming and shellfishing
use potentials should be assessed in terms of all significant point and
nonpoint sources. The grant application should compare the severity and
extent of water quality problems which can be attributed to the different
pollution sources. The analysis of these different point and nonpoint source
related water quality problems may have been conducted as part of Statewide or
areawide planning under Section 208, State Basin Plans, or other special
studies.
To assess whether significant usage for swimming and shellfishing would
result without the proposed project, the grant application should present an
analysis of expected future water quality conditions with and without
additional CSO controls. The alternative of no additional CSO control should
assume that all current requirements for point source treatment are satisfied,
and all proposed nonpoint source controls, as identified in the adopted water
quality management plan, are operational. Projected water quality conditions
with no CSO controls should be compared to those likely to result from the
proposed project.
The application should discuss nonpoint source problems including urban
runoff and their effect on shellfishing and swimming. Where nonpoint source
controls are identified, the application should discuss their status, and
plans for implementation, if any.
The grant application should identify Federal, State and local health
requirements governing swimming and shellfishing. These requirements will
have a bearing on whether improved water quality will actually result in
improved uses. The applicant should coordinate with responsible health or
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recreation authorities and indicate their willingness to lift swimming and
shellfishing prohibitions as a result of improved water quality due to the
proposed project when implemented with other necessary point and nonpoint
controls. The application may also discuss the extent to which use impairment
is likely to be prevented by the project.
The second requirement concerns a demonstration that the project alone
will result in substantial restoration of an existing impaired use. This
demonstration is likely to involve an analysis relating the combined sewer
overflows and the resulting water quality. The demonstration is not limited
solely to shellfishing and swimming and includes additional uses such as
boating and fishing as well as aesthetics. The analysis should show how the
proposed project alone will substantially restore prior or currently impaired
water uses. The analysis may also discuss the prevention of future use
impairment.
The demonstrations for these two requirements will involve a cause and
effect analysis relating pollution loads to resulting water quality.
Mathematical models are often used for this purpose, however, they are not
necessary in all circumstances. Different levels of sophistication may be
justified depending on the complexity of the receiving water and combined
sewer collection system. Relatively complex situations may require models to
make reasonable and justified predictions of future water quality conditions
for different CSO control alternatives.
For less complex situations, a relationship between CSO's and beneficial
uses could be established from field data and professional judgement. This
may occur where the overflows are in the immediate vicinity of swimming and
shellfishing areas and where receiving water flow and transport patterns
clearly show the impact of CSO's on these areas. The cause and effect
relationship should be demonstrated with an analysis of field data showing
bacteria levels and standards violations as an empirical function of overflows.
It is of primary importance for an applicant to demonstrate a strong
relationship between the CSO's and resulting beneficial use impairment. The
Headquarter's review will consider the strength of this technical
demonstration. Some situations, therefore, may justify more sophisticated
techniques and more data than others in order to minimize uncertanity in the
loading functions. In such a situation, projects that base benefits on
receiving water models may receive higher ranking than those which claim
greater benefits based on arbitrary assumptions or unverified analyses.
B. Assessment of Swimming and Shellfish ing Benefits
Benefits resulting from proposed marine CSO facilities may be expressed in
terms of use factors such as the expected change in the number of days beaches
or shellfish beds are open or closed. Determination of an absolute benefit in
terms of a single monetary figure is not required and projects will not be
ranked by benefit-cost ratios. However, studies which monetize benefits will
be reviewed and could provide valuable background and supporting information.
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Although it is not necessary to quantify benefits into a single number, grant
applications should discuss the value and significance of improved uses. For
example, the application could cite the following for the area affected by the
CSO:
Assessment of current water quality conditions
Requirements of a NPDES permit, EPA administrative order, or a consent
decree
Recreational surveys, studies, or plans
Historical water uses and existing recreational facilities
- Area! extent of commercial or recreational shellfishing and estimated
yields including State requirements affecting allowable yields
Uniqueness and availability of alternative swimming and shellfishing sites
Physical characteristics affecting use such as water temperature, bottom
characteristics, current, tides, salinity, etc.
Chemical characteristics affecting shellfishing; for example, potential
problems from heavy metals or other pollutants
Population adjacent to the site, potential for use, transportation and
access to the site, boat access, etc.
Potential benefits for existing and future water supplies
Other specific attributes of the area affected by the CSO which will
influence use.
C. Comparison of Benefits and Costs
To evaluate different CSO control alternatives, the costs and relative
benefits should be compared to the baseline alternative of no additional CSO
control. Benefits may be expressed in terms of use factors such as number of
days beaches are closed, as previously discussed. Costs and benefits for
different alternatives may be plotted and displayed graphically to help
determine a cost-effective range where marginal costs are not large compared
to incremental benefits. Systematic evaluation of alternatives may have been
undertaken as part of previous planning efforts and is required for facilities
planning under section 35.2030. The application should list the structural
and non-structural CSO control alternatives considered. Documentation of this
analysis will help in the review and evaluation of the grant application.
Applications should display the following costs along with the benefits
discussed above for each proposed alternative including all phases or segments
of the treatment works of which the proposed project is a part:
Capital cost
Yearly operation and maintenance cost
Average annual equivalent cost for the project alone
Annual household charges for the project alone and total including
existing system charges.
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D. Statement of Regional and National Significance
The statement of regional and national significance prepared by the
Regional Administrator should be broad in scope and not necessarily limited to
swimming and shellfishing. Discussions should focus on the area of immediate
CSO impact but may also address the receiving water as it relates to larger
ecosystems of which it is a part. For example, the following subjects should
be discussed as appropriate:
Additional shellfishing yields resulting from the project and relation to
regional and national production
Additional swimming opportunities related to other opportunities in the
region
Effect on marine life other than shellfish
Enhancement of wetlands or habitats of threatened, rare, or endangered
species
Historical significance of the area and proximity to historical and
archeological sites
Enhancement of the aesthetic quality of the waters
Proximity to parks and recreation areas
Significance of additional recreational benefits provided by the project
such as boating and fishing
Location of waters with special national, State, or local resource
designation
Other unique features of the area and their relationship to the project
Statements on national and regional significance should relate the
measures of project benefit to comparable measures (qualitative or quantitive)
presented in reports on the region or nation as appropriate, for example:
State Comprehensive Outdoor Recreation Plans
National surveys of outdoor recreation activities (published periodically
by the U.S. Department of Interior)
State shellfish harvest, production, or closure reports
National reports of shellfish production (published periodically by the
U.S. Department of Interior).
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