United States
Environmental Protection
Agency
Office of Water
Program Operations (WH-547)
Washington, DC 20460
January 1980
Water
Program Requirements
Memoranda

Municipal Wastewater
Treatment Works
Construction Grants Program
                       MCD-02.9

-------
             UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
                  OFFICE OF WATER PROGRAM OPERATIONS
                         WASHINGTON, D.C.  20460
                   NOTICE TO ALL HOLDERS OF THE EPA
                 MUNICIPAL WASTEWATER TREATMENT WORKS
       CONSTRUCTION GRANTS PROGRAM MANUAL OF REFERENCES (MCD-02)
     Because the material  contained in the "Manual  of References"  is
obsolete, further printing and distribution will  cease.   However,  the
program policy documents incorporated in that manual, and subsequently
updated by the publication of supplemental issuances  of  new and revised
Program Requirements Memoranda (PRMs), will continue  to  be made available
to that segment of the public involved in various aspects of the
Construction Grants Program.   Hence, holders of the MCD-02 will  continue
to receive copies of Program Requirements Memoranda (MCD-02.00) as  they
are printed.  So that PRM recipients are kept apprised of the completeness
of their policy document library,  a full index of PRMs issued will  be
included with each printing.

-------
MCD 02.1
                  Municipal Wastewater Treatment Works
                     Construction Grants Program

                     PROGRAM REQUIREMENTS MEMORANDA

                           Table of Contents
PRM 75-1


PRM 75-2

PRM 75-3

PRM 75-4

PRM 75-5

PRM 75-6

PRM 75-7

PRM 75-8

PRM 75-9


PRM 75-10

PRM 75-11


PRM 75-12


PRM 75-13

PRM 75-14

PRM 75-15


PRM 75-16


PRM 75-17
Use of Revenue Sharing Funds for Waste               6/25/73
Treatment Projects

Experience Clauses for Equipment Suppliers           7/11/73

Waste Stabilization Ponds                            9/11/73

Standardized Construction Contract Documents         4/15/75

Non-Restrictive Specifications                        8/8/75

Adequacy of Treatment Certification                  11/8/73

Sewer System Evaluation and Rehabilitation            2/7/74

Flood Disaster Protection Act of 1973                 3/1/74

Supplement to PG No. 25; Flood Disaster              11/4/74
Protection Act of 1973 (PL 93-234)

User Charges and Industrial Cost Recovery System      4/5/74

Approval of Reimbursement Projects Not               4/17/74
Previously Serviced by EPA

Obligation, Recovery and Reallotment of Contract     5/13/74
Authority Funds

Management of Construction Grants Funds              4/19/74

Grant Funds and Project Segmenting                   5/10/74

Class Deviation—Use of Force Account Work            5/7/74
on Construction Grant Projects

Title II Regulations, Section 35.915(1)--             6/3/74
Reserve for Step 1 and Step 2 Projects

Construction of Pretreatment or Treatment             6/5/74
Facilities for Municipal Utilities

-------
PRM 75-18



PRM 75-19


PRM 75-20

PRM 75-21

PRM 75-22

PRM 75-23


PRM 75-24

PRM 75-25


PRM 75-26


PRM 75-27


PRM 75-28


PRM 75-29


PRM 75-30

PRM 75-31


PRM 75-32


PRM 75-33

PRM 75-34


PRM 75-35



PRM 75-36
Eligibility of Wastewater Treatment Facilities       9/17/74
at Municipally Owned Water Treatment Works for
Construction Grants

Cancelling PG-28 - User Charges and Industrial        7/9/74
Cost Recovery System

User Charge Systems                                  7/16/74

Overruns, Reserves and Priority Lists               10/16/74

Policy Re Retention of Payments                     11/18/74

Escalation Clauses in Construction Grant             12/9/74
Projects

Large City Problems in State Priority Lists           1/9/75

Eligibility of Land Acquisition Costs for Land
Treatment Processes

Consideration of Secondary Environmental Effects      6/6/75
in the Construction Grants Process

Field Surveys to Identify Cultural Resources          7/2/75
Affected by EPA Construction Grants Projects

Flood Insurance Requirements Effective                7/8/75
July 1, 1975

EPA Procedures in  Initiating Debarment Actions        8/5/75
Against Grantee Contractors

Cost Control                                          9/8/75

Facilitating  EIS Preparation with  Joint                 9/75
EIS/Assessments (Piggybacking)

Compliance with Title VI  in the Construction         2/11/76
Grants  Program

Discount Rate                                       8/11/75

Grants  for Treatment and  Control  of Combined        12/16/75
Sewer Overflows and Stormwater Discharges

Allowable Costs for Construction  of Treatment       12/29/75
Works that Jointly Serve  Municipalities and
Federal  Facilities

Value Engineering  in the  EPA Construction            1/20/75
Grants  Program

-------
PRM 75-37

PRM 75-38


PRM 75-39



PRM 75-40


PRM 76-1

PRM 76-2
User Charge System: Plan and Schedule

Relationship Between 201 Facility Planning
and Water Quality Management (WQM) Planning

Eligibility of Land Acquisition Costs for the
Ultimate Disposal of Residues from Wastewater
Treatment Processes

Priority List Supplement to FY 1977
Construction Grants Guidance

Construction Grants Program Issuances

Cancellation of Certain Program Guidance
Memoranda (PGM)
 3/17/76

  2/9/76


  4/2/76



  5/7/76


 7/25/76

 7/26/76
MCD 02.2
PRM 76-3


PRM 75-4



PRM 76-5
Presentation of Local Government Costs of
Wastewater Treatment Works in Facility Plans

Coordination of Construction Grants Program
with EPA-Corps of Engineers Section 404/
Section 10 Permit Programs

Flood Insurance Requirements
 8/16/76


10/14/76



 8/16/76
MCD 02.3
PRM 77-1


PRM 77-2

PRM 77-3


PRM 77-4

PRM 77-5
Treatment Works for Recreational Parks, Industrial  11/23/75
Parks and Institutions

Grant Eligibility of Start-up Services              11/29/76

Plan of Operation for Municipal Wastewater          11/29/76
Treatment Facilities

Cost Allocations for Multiple Purpose Projects       12/3/76

Grant Eligibility of Land Acquisition by Lease-     12/15/76
holds or Easements for Use in Land Treatment
and Ultimate Disposal of Residues

-------
MCD 02.4
PRM 77-6

PRM 77-7

PRM 77-8
Easements

Management of State Project Priority Lists

Funding of Sewage Collection System Projects
 5/4/77

5/13/77

6/21/77
MCD 02.5
 PRM  77-9

 PRM  78-1


 PRM  78-2

 PRM  78-3

 PRM  78-4


 PRM  78-5


 PRM  78-6

 PRM  78-7


 PRM  78-8


 PRM  78-9

 PRM  78-10
Reallotment of Recovered Funds                        8/5/77

Erosion and Sediment Control in the Construction    12/29/77
Grants Program

Discount Rate                                        1/26/78

Buy American                                         2/17/78

Grant Eligibility of Land Acquired for Storage       2/17/78
in Land Treatment Systems

Interim Management of FY 1978 State Priority         2/17/78
Lists Under the 1977 Amendments

Industrial Cost Recovery—Interim Guidance           2/17/78

Combined Step 2 and Step 3 Construction Grant        2/17/78
Awards (Step 2+3)

Rejection of All Bids: Guidance for EPA              2/13/78
Concurrence Function

Funding of Sewage Collection System Projects          3/3/78

Infiltration/Inflow Program Guidance                 3/17/78
MCD  02.6
 PRM  78-11


 PRM  78-12
Toxicity of Chemical Grouts for Sewer
Rehabilitation

Preconstruction Lag Management
5/11/78


6/12/78

-------
 MCD 02.7
 PRM 78-13



 PRM 79-1


 PRM 79-2

 PRM 79-3



 PRM 79-4

 PRM 79-5

 PRM 79-6
 Interim Priority List Guidance for the               6/29/78
 Development and Management of FY 1979 State
 Priority Lists

 Safety Requirements for the Design and Operation    10/23/78
 of Chlorination Facilities Using Gaseous Chlorine

 Royalties for Use of or for Rights in Patents       11/13/78

 Revision of Agency Guidance for Evaluation of       11/15/78
 Land Treatment Alternatives Employing Surface
 Application

 Discount Rates                                      11/17/78

 Construction  Incentive  Program                      12/28/78

 Priority  List  Guidance  for the Development            1/8/79
 and Management of  FY  1980  State  Project
 Priority  Lists
MCD 02.8

PRM 79-7


PRM 79-8

PRM 79-9
Grant Funding of Projects Requiring Treatment
More Stringent than Secondary

Small Wastewater Systems

Outlay Management in the Construction Grants
Program
3/9/79


5/9/79

5/11/79
MCD 02.9

PRM 79-10

PRM 79-11


PRM 80-1

PRM 80-2
Qualification of Major Items of Equipment            7/12/79

Funding of Waste Load Allocations and Water           9/6/79
Quality Analyses for POTW Decisions

Discount Rate                                       11/26/79

Step 2 and Step 3 Architect/Engineer Level of       12/20/79
Effort Study
                                                  U.S. EPA Headquarters Library
                                                         Mail code 3201
                                                  1200 Pennsylvania Avenue NW
                                                     Washington DC 20460

-------
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
                     SHINGTON, D.

                    20 DEC 19/9
,   ,0                       WASHINGTON, D.C.  20460
    °
                                               Construction Grants
                                               Program Requirements Memorandum
                                               PRM 80-2
  SUBJECT:  Step 2 and Step 3 Architect/Engineer
            Level of Effort Study            r
  FROM:     Henry L. Longest II
            Deputy Assistant Administrator
            for Water Program Operations (V/H-546)

  TO:       Regional Administrators
            Attention:   Water Division Directors
  PURPOSE

       The purpose of this memorandum is to initiate a multi-phase approach
  to establishing final Agency policy and guidance for evaluating the price
  for architect/engineer (A/E) services during Step 2 and Step 3 projects
  funded under the Construction Grants Program.  In addition, it provides
  interim guidance for this evaluation which is to be used until the final
  policy and guidance are promulgated.  For the purpose of this memorandum,
  the terms cost, price and profit have the meanings conveyed in 40 CFR
  35.936 and 35.937.

       The specific phases are as follows:

       Phase 1.  Pending development of final Agency policy and guidance
                 discussed below, "Exhibit II" of the EPA Region VI publication
                 entitled Engineering Costs and Fees for Municipal Wastewater
                 Treatment Works, An_ Estimating Technique for Design ojF
                 Treatment Plants, Publication No.  EPA 906/9-78-003, may be
                 utilized as an additional tool in analyzing the cost segment
                 of A/E services to design treatment plants funded under the
                 construction grants program.  Profit should continue to be
                 analyzed in accordance with specific policies or guidelines
                 you currently use.  These reviews of cost and profit should
                 be initiated only when the grantee employed Brooks-bill type
                 negotiations or otherwise did not consider price (the sum of
                 cost and profit) as the prime criterion in selection of the
                 engineer.

       Phase 2.  A computer model will be developed to provide estimates
                 of the level of effort (work-hours) required to design
                 treatment facilities (including sewers) of varying sizes
                 and types.  The model will also provide estimates of the
                 level of A/E effort required during the Step 3 phase of
                 a project.

-------
                                   -2-
     Phase  3.
     Phase  4.
     Phase 5.
Each Regional Office will accumulate level of effort
and related information on recently completed Step 2
and Step 3 projects in its Region.  This phase will
be done simultaneously with Phase 2.

The information obtained from Phase 3 will be used to
verify and "fine tune" the computer model being developed
during Phase 2.  It will also be used to develop a family
of curves or charts relating work-hours, and perhaps price,
for elements of Step 2 and Step 3 services to the size
and type of treatment works.  These curves or charts
can be used separately or in addition to the computer
model when it becomes available.  These curves or charts
will be prepared by an EPA task force which includes
Headquarters and Regional Office personnel.  The exact
nature and format of the guidance documents has not
yet been determined.

The curves or charts and computer model, when fully
operational, will be used by Regional Office personnel,
State Agency personnel and grantees in conjunction with
appropriate cost, overhead and profit data, to determine
if the price proposed by the engineer is reasonable.
DISCUSSION
     Since publication of EPA regulations governing procurement of A/E
services in December 1975 which prohibited A/E contracts based upon a
percentage of construction cost or cost plus a percentage of cost, EPA
Regional Offices have had a difficult time determining if the proposed
price of A/E services was fair and reasonable.  Most of the attention
has focused on review of the profit segment of the engineers price and
the State of California and several Regional Offices have developed
policies and guidance for evaluating profit.  This has led to numerous
complaints about the lack of a uniform policy and the disparity in
application of similar guidelines among the ten EPA Regions.

     Based on data accumulated from firms and projects in its Region,
Region VI developed the publication referenced above as a guide for reviewing
the cost segment of A/E services to design treatment works.  The cost data is
probably not applicable to other Regions, but we believe that the estimate of
work-hours required to design various type of treatment plants, which is shown
in Exhibit II of that publication, may be a useful additional tool in analyzing
the work effort required to design plants in other Regions.  However, in
utilizing the Region VI publication for this purpose, consideration must be
given to regional differences in design due to climate and other factors,
established State or local practice as to the number of construction contracts
required, level of detail shown on plans, an individual firm's approach to
design  and changes in Agency Regulations since the Region VI data was
collected.  By applying an engineer's salary scale to the work-hour estimate,
as modified by the previously cited considerations, adding other direct
expenses and applying the appropriate overhead rate, a reasonable estimate
of the cost segment of A/E services for design can be determined.

-------
                                  -3-
     Our objective is to expand the Region VI study to incorporate data
from all other Regions.  To accomplish this, we are requesting that
members of your construction grants staff extract required information
from your files and visit A/E firms in your Region to collect level of
effort and other data related to activities such as preparation of plans
and specifications, preparation of UC/ICR systems, preparation of plans
of operation, including O&M Manuals, resident engineering services during
construction and other Step 2 and Step 3 engineering services.  The visits
may be combined with your other activities such as review of financial
systems and records or consultation on other matters.   To assist in this
effort, Mr. Le Young of Region VI and a cost/price analyst will  spend a
week to ten days with your staff to explain the methodology and procedures
to be used in collecting the required data and may accompany them on some
of the field visits.

     The cooperation of the consulting engineers is essential  to the success
of this effort.  Therefore, it should be explained at the outset, that as a
result of this study, more emphasis will be placed on the fairness and
reasonableness of the price of A/E services and less on level  of profit.
Also, experience in Region VI showed that it is helpful to seek the
cooperation and assistance of the professional societies such  as the
American Consulting Engineers Council, American Society of Civil Engineers,
National Society of Professional Engineers or similar professional organizations.
Representatives of these organizations at the national level  are acting as
advisors to the EPA task force.

     The Corps of Engineers, in cooperation with EPA,  has developed a computer
model, known as CAPDET, which, when given certain basic information, provides
preliminary designs and construction cost estimates for treatment facilities
of various types.  This system is to be expanded to provide an estimate of the
level of A/E effort (work-hours) required to design and construct treatment
facilities.  It has been decided to estimate "level of effort" rather than
cost so that the model will be applicable nationwide and will  not be quickly
outdated by inflation.  However, the model will be capable of  translating
level of effort information into dollar values when the appropriate cost
information (labor rates, indirect costs, other direct costs)  and profit
levels are entered into the computer system.

     The computer model will be developed by consultants under contract
to the Corps of Engineers operating under an Interagency Agreement with EPA.
The initial contract for this work is expected to be executed  in the near
future and the development of the computer model will  be done  concurrently
with the Regional data gathering.

IMPLEMENTATION

     When the grantee employed Brooks-bill type negotiations,  or otherwise
did not consider price (the sum of cost and profit) as the prime consideration
in selection of the engineer, Exhibit II of the Region VI publication may be
used as an additional tool in determining whether the cost segment of A/E
services is reasonable.  Profit should continue to be analyzed in accordance

-------
                                  -4-
with specific policies or guidelines you currently use until such time as a
decision is made as to the advisability of establishing National Guidelines.
Further guidance for review of profits will be provided in the near future.

     It is requested that an appropriate person be designated to coordinate
your participation in this study.  Please advise James R. Murphy, Chief
Eastern Construction Branch at (FTS) 426-8945 as to the name and telephone
number of the person so designated.  Mr. Murphy can also answer any questions
you may have regarding this PRM.

     In the near future, the appropriate Area Program Manager will contact
your designee to arrange for Mr. Young's visit to your Region.

     The methodology, work plan and schedule, and appropriate guidance for  the
conduct of this study are being developed by Headquarters and will be mailed
to you as soon as the material is  completed.  Should you need additional copies
of any document referenced in this memorandum, they are available from the
Municipal Construction Division, EPA Headquarters.

-------
     UNITED STATES ENVIRONMENTAL PROTECTION AGENCY

                    WASHINGTON, D.C.  20460
                                               OFFICE OF WATER AND
                                               HAZARDOUS MATERIALS
                                   Program Requirements Memorandum
                                   PRM No. 80-1
SUBJECT:      Discount  Rate

FROM:       A^-Henry  L.  Longest  II
            '  Deputy Assistant  AdmTn'istratXr""
              for Water Program Operations (WH-546)

TO:           Water  Division Directors
              Regions I -  X
    Attached  is  a copy  of  the  notice published by the
Water Resources  Council of the new discount rate of
7 1/8 percent.   The  new rate was effective as of
October 1, 1979.  Cost-effectiveness analyses in new
facility planning starts are to be based upon the rate of
7 1/8 percent.

    We have arranged  to distribute the attached
information to consulting  engineers through the newsletter
of the Consulting Engineers Council.  Please distribute
copies of this information to  the States for use in their
programs.
Attachment

-------
1, No. 210 / Monday, October 29,  1979  /  Notices
                                                                       Federal Register  /  Vol. 44.  No. 21
hursday, November 8,1979, if the
> drawn on a bank in another
' Reserve District.
ks received after the dates set
 the preceding sentence will not
 pled unless they are payable  at
 'icable Federal Reserve Bank.
 t  will not be considered
 •„> where registered securities  are
 •d if the appropriate identifying
  is required on tax returns and
 ouments submitted to the
 Revenue Service (an
  il's social security number or an
 r identification number) is not
  1. When payment is made in
   a cash adjustment will be
  >r required of the bidder for
   ••nee between the face amount
   • s  presented and the amount
   n the securities allotted.
   very case where full payment
   pleted on time, the deposit
  I with the tender, up to 5
   the face amount of securities
   ."••all. at the discretion of the
   of the Treasury, be forfeited to
   ' States.
   •'ered securities tendered as
   .id in payment for allotted
   •re not required  to be
    ihe new securities are to be
  • n the same names and forms
   n the registrations or
   resentative, must
    ie securities presented.
     Jered  in payment should
     •I to the Federal Reserve
     h or to the Bureau of the
     Vashington, D.C. 20226.
      must be delivered at the
     •sk of the holder.
     • securities are not ready
      the settlement date,
     y elect to receive interim
      ?se certificates shall be
      .- form and shall be
     "or definitive securities of
       such securities are
      y Federal Reserve Bank
      ihe Bureau of the Public
       m, D.C, 20226. The
   interim certificates must be returned at
   the risk and expense of the holder.
     5.5. Delivery of securities in registered
   form will be made after the requested
   form of registration ha^ been validated,
   the registered interest account has been
   established, and the the securities have
   been inscribed.

   6. General Provisions

     6.1. As fiscal agents of the United
   States, Federal Reserve Banks are
   authorized and requested to receive
   tenders, to make allotments as directed
   by the Secretary of the Treasury, to
   issue such notices as may be necessary,
   to receive payment for and make
   delivery of securities on full-paid
   allotments, and to issue interim
   certificates pending delivery of the
   definitive securities.
    6.2. The Secretary of the Treasury
   may at any time issue supplemental or
   amendatory rules and regulations
   governing the offering. Public
   announcement of such change will be
   promptly provided.
   Supplementary Statement
    The annoucement set forth above does not
  meet the Department's criteria for significant
  regulations and, accordingly, may be
  published without compliance with Ihe
  Departmental procedures applicable to such
  regulation.
  Paul H. Taylor.
  fiscal Assistant Secretary.
  |FR Doc. 79-33577 Filed 10-25-79; 4:02 pm|
  BILLING CODE 4810-40-M
  WATER RESOURCES COUNCIL

  Principles and Standards for Planning
  Water and Related Land Resources,
  Change In Discount Rate
   Notice is hereby given that the
  interest rate to be used by Federal
  agencies in the formulation and
  evaluation of plans for water and
  related land resources in 7'/s percent for
  the period October 1,1979, through and
  including September 30,1980.
   The rate has-been computed in
 accordance with Chapter IV, D.. "The
 Discount Rate" in the "Standards for
 Planning Water and Related Land
 Resources" of the Water Resources
 Council, as amended (39 FR 29242), and
 is to be used by all Federal agencies in
 plan formulation and evaluation of
 water and related land resources
 projects for the purpose of discounting
 future benefits and computing costs, or
 otherwise converting benefits and costs
 to a  common time basis.
  The Department of the Treasury on
October 18,1979, informed the Water
Resources Council pursuant to Chapter
IV, D., (b) that the interest rate would be
fl'/t percent based upon the formula set
forth in Chapter IV, D., (a): "*  *  *  the
average yield during the preceding
Fiscal Year on interest-bearing
marketable securities  of the United
Stiites which, at the time the
compulation is made,  have  terms of 15
years or more remaining to maturity
• ' "." However, Chapter IV, D., (a)
further provides "*  *  * that in no
even! shall the rate be raised or lowered
more than one-quarter of one percent for
any year." Since the rate in Fiscal Year
1979 was 6Vs percent  (42 FR 58232), the
rate for Fiscal Year 1900 is 7Vs percent.

  Dalod: October 24,1979.
Gerald D. Seinwill,
Acting Director.
|KR !)„(. 7SI-33200 Filed 10-26-79;8:45am)
BILLING CODE 8410-01-M
 INTERSTATE COMMERCE
 COMMISSION

 Directly Related Motor Carrier
 Applications
 AGENCY: Interstate Commerce
 Commission.
 ACTION: Notice for proper filing of motor
 carrier applications directly related to
 finance applications.

 SUMMARY: Persons filing motor carrier
 applications [for instance, related
 gateway elimination or conversion
 applications under 49 U.S.C. 10922 or
 related securities applications under 49
 U.S.C. 11301] which are directly related
 to motor finance applications filed under
 49 U.S.C. 1343-11344 are instructed to
 write in bold print at the top of page one
 of the directly related application the
 words: "Directly Related." Also, persons
 are instructed that one copy of all such
 directly related motor applications must
 be mailed to the Supervisor of the
 Finance Support Unit, Room 5414,
 Interstate Commerce Commission,
 Washington. D.C. This will improve the
 ability of the Commission to consolidate
 and process together all motor
 applications which are directly related
 to finance transactions.
 DATES: These instructions will apply to
 all directly related motor applications
 filed with the Commission on and after
 November 1,1979.
 FOR FURTHER INFORMATION CONTACT:
 Michael Erenberg, 202-275-7245; Frank
 Buane; 202-275-7643 or 7615.
 SUPPLEMENTARY INFORMATION: On July
 16.1979, the Commission's final decision
  in !• x Parte No. 55 (Sub-No. 35),
 Summary Grant Procedures (Finance).
  44 FR 41203-41205 (1979). was issued.
That rulemaking
for quicker grant
applications, as
applications whi
to these flnancp .
instructions we i
these directly re!
(whether they ai
finance applic'iti
therefrom) are Ir
coordination ami
Too often, a diriv
application (for L.
conversion, seen'
applicants or Civ
in delays In the p
applications whi<
and decided t'/gis
   The instruction
applicants filing c
applications (for ;
OR-9 for convors
elimination or ' >•
securities issuam
bold  print at '•"<" t
application thy li
 "Directly Related
application nnH<"
purchase, control
operating rights o
 instructions .iUo i
 of each such
 application b
 of the Financ<  <;i
 Interstate {Jomrm
 Street and Cor^i
 Washington, U-.
   Dai d: October Z'.i
   By the Commiesc
 Dirucinr. Office of I'
 Agatha L. Mergenov
 Secretary.
 |FR !)»•. 70-33241 Filed 10
 BILLING CODE 703-, 1!-
  Fourth Section Ar

  October 24,1979.
   This applicat-' n
  haul relief has bfi(
   Protests are t)>''
  days from the dati
  notice.
   FSA No. 43760.1
  intei modal rates o.
  commodities in CO'
  carriers' terminals
  Pacific Coast to po
  by way of Atlantic
  points, in itsTcriff
  No. 2'» Rates beca'
  7,1979.
  competition.

-------
USB,
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
                  WASHINGTON. D.C.  20460
                                           Construction  Grants
                                           Program  Requirements  Memorandum
                                           PRM  No.  79-11
                                          SAM  38
      Subject:


      From:
      TO:
                                                              OFFICE OF WATER AND
                                                              HAZARDOUS MATERIALS
    Funding of Waste Load Allocations
    and Water Quality Analyses for POTW D

    Swep T. Davis, Deputy Assistant
    for Water Planning & Standards

    Henry L. Longest II, Acting Deputy Assistan/dmiXistrator
    for Water Program Operations

    Regional Administrators
    ATTN:  Regional Water Division Directors
      Purpose

           This memorandum  establishes policy and procedures for the funding
      of  waste  load  allocations and water quality analyses required for publicly-
      owned treatment works (POTWs) decisions.

      Background

           EPA, recognizing  the costs and energy requirements of publicly-
      owned treatment works (POTWs) providing treatment greater than secondary
      (AST/AUT),  has taken  several steps to  insure that such facilities are
      only Federally funded when based upon  technically adequate effluent
      limitations.   In  June 1978 a joint OWPS/OWPO guidance memorandum was
      issued which contained a checklist to  be completed before a project
      providing AST/AWT could receive construction grant funding.  On November 2,
      1978, SAM 37 was  issued by OWPS which  established policy and procedures
      for the use of Section 208 funds to review and revise waste load allocations
      for POTWs   subject to permit limitations requiring AST/AWT.  On March 9,
      1979, PRM 79-7 was issued by OWPO which established policy and procedures
      for the review and funding of proposed AST/AWT projects.  Reduced
      Section 106 and 208 FY 80 appropriations coupled with increasing demands
      on  Section  106 funds  to support the issuance of second round NPDES
      permits and expanded  monitoring programs may result in some states being
      unable to provide adequate funding for the timely review and revision of
      waste load  allocations.  It is therefore necessary to provide additional

-------
                                 - 2 -

policy and procedures for FY'80 on the use of Section 201 and 205(g)
funding to augment Section 106 funds to support these tasks.

Policy

     Nothing in this memorandum is to affect the responsibility and right
established by Sections 303 and 510 of the Clean Water Act for each State
to develop water quality standards and waste load allocations.  The State
water quality management program will continue to exercise overall manage-
ment responsibility for assuring that water quality analyses and waste
load allocations are conducted in a satisfactory manner.  The primary
sources of funding for these activities are program grants and State funds.
The amount of Section 106 and State funds currently expended for POTM-related
waste load allocations should not be reduced because Section 201 and
205(g) funds may be used, on a case-by-case basis and subject to require-
ments in this memorandum, to augment State and Section 106 funds to provide
for the development of POTW-related waste load allocations and supporting
water quality analyses.  Except where EPA and the State have determined
that existing limitations should be revised, Section 201 and 205(g) funds
may not be used to review effluent limitations or to develop alternative
effluent limitations; e.g., costs associated with the development of data
in support of Section 301(h) permit modification request are solely the
responsibility of the requesting municipality and are not grant eligible.
Where Section 201 or 205(g) funds are used, the areal extent of waste
load allocation and water quality data collection activities must relate
directly to needed waste load allocations for projects that are on the
State 5-year construction grant priority list.

     The priority for use of Section 201 and 205(g) funds to conduct
waste load allocations and water quality analyses is:

     1.  POTWs which have been determined by EPA and the State, as a
result of a PRM 79-7 review, to require a revised waste load allocation.

     2.  POTWs on the State 5-year construction grant priority list for
which the State and Regional Administrator have determined, through the
State/EPA agreement process, that existing waste load allocations are
probably insufficient to support AST/AWT requirements.

     SAM 37 continues to apply to the use of FY'78 and 79 Section 208
funds for waste load allocations and water quality analyses.  FY'80
Section 208 funds may not be used to initiate POTW-related waste load
allocations.

-------
                                    - 3 -

Procedures

     1.  FY 80 State/EPA Agreement:  If Section 201 or 205(g) funds are
to be used for waste load allocations, the FY 80 State/EPA Agreement
(SEA) must contain or provide for the development of a detailed State
review of the 5year construction grant priority list.  Specific provision
for the review may be contained in the SEA itself or in the Section 106
program plan or the 205(g) delegation agreement.  Wherever a POTW has
effluent limitations potentially requiring AST/AWT and Section 201 and
205(g) funds may be used, the SEA, Section 106 program plan or 205(g)
delegation agreement shall provide for:

     0  an informal review of applicable water quality standards to
        determine whether they contain unsupported requirements or
        criteria; e.g., blanket discharge prohibitions or criteria
        substantially more stringent than contained in Quality Criteria
        for Water or any subsequent criteria documents published by EPA.

     0  the review of existing waste load allocations, if any, to
        determine whether they are technically valid and sufficient to
        support AST/AKT effluent limitations.

     0  the review of any other water-quality based permit limitations
        not derived from water quality standards or waste load
        allocations to determine whether they are valid.

Wherever the State and EPA determine that an effluent limitation is not
valid or supportable, the State shall  provide a program to rectify the
inadequacy.  One component of this program shall be a list of projects
for which it is necessary to substantiate inadequate AST/AWT effluent
limitations.  This list should subdivide these projects into those
requiring new or revised waste load allocations and those requiring
other work.  Projects requiring new or revised waste load allocations
should be subdivided into the two priority classes described above.
Until this listing is complete, Section 201 and 205(g) funds may not be
used to fund waste load allocations.

     For all cases where the State has determined that effluent limitations
are unsupported for reasons unrelated to waste load allocations, the
priority of resolution shall be determined by the State and Regional
Administrator.

     2.  Funding:  The SEA shall allocate costs to produce valid effluent
limitations as follows:

     0  Section 106 funds may be used in any situation.
     0  where tasks relate to the basin-wide revision of waste load
        allocations, or to waste load allocations/water quality analyses
        not directly related to a POTW on the SEA needs list, only
        Section 106 or State funds may be used.

                                                    U.S. EPA Headquarters Library
                                                          Mail code 3201
                                                    1200 Pennsylvania Avenue NW
                                                       Washington DC 20*60

-------
                                 - 4 -


     Section 201 and 205(g) funds may be used to augment Section 106
funds for priority one projects upon issuance of this memorandum.
Section 201 and 205(g) funds may be used to augment Section 106 funds
for priority two projects upon EPA approval of the State waste load
allocation program.

     3.  Headquarters Assistance:  PRM 79-7 provides for OWPO and OWPS
review of the adequacy of effluent limitations and facility planning for
certain proposed AWT facilities.  Upon request, OWPS will provide technical
assistance and advice on the review of existing water quality standards
and waste load allocations, the development of work programs, and on
draft work products.

     4.  Relationships:  The use of Section 201 and 205(g) funds for
waste load allocations and the involvement of 201 grantees is new so
that additional guidance is necessary:

     0  responsibility for the validity of waste load allocations lies
        with each State in accordance with Section 303(d)(l)(C) and
        303(e)(3) of the Clean Water Act.

     0  accountability for Section 201 funds used for waste load
        allocations and supporting water quality analyses will rest
        with the Section 201 grantee even though the grantee may
        execute a contract or intergovernmental agreement with the
        State or the State and an areawide 208 agency to perform the
        work.

     0  in order to prevent a conflict of interest, it is recommended
        that waste load allocations and supporting water quality analyses
        not be conducted directly by the Section 201 grantee.  It is
        recommended that the Section 201 grantee instead execute a
        contract or intergovernmental agreement with either the State
        or the State and an areawide 208 agency, which may subcontract
        the work, if necessary.

     0  wherever Section 201 funds are to be used for waste load allocations/
        and water quality analyses, the scope and schedule of work and
        the consultant contract shall be approved by the State and EPA.
        The terms of this approval shall be made a condition of the
        grant and shall be contained in a memorandum of understanding
        entered into by EPA, the State, the 201 grantee, and, when
        appropriate, the areawide 208 agency.  EPA and the State should
        be intimately involved in all phases of the work as discussed in
        the attached management guidance.

     0  the conduct of joint waste load allocations is encouraged.

     Some previous waste load allocations funded by EPA ultimately failed
to be valid because of inadequate data, inexperienced personnel and improper
use of mathematical models.  Consultant contracts should include specific
performance standards and a quality assurance program covering, where

-------
                                  - 5 -

applicable, model calibration and verification, sampling and analytical
methodologies, statistical adequacy of data, and personnel requirements
(see the attached management and technical guidance).

     5.  Municipal Enforcement Strategy:  The "Final National Municipal
Policy and Strategy for Construction~Srants, NPDES Permits, and Enforce-
ment Under the Clean Water Act" (August 1979} provides that for projects
undergoing an AWT review, NPDES permits should not generally be reissued
until this review is completed.  Procedures for modifying or reissuing
permits for these projects are detailed in this document.

Attachments:

  Management Guidance
  Technical Guidance

-------
             Management Guidance for Funding of WLA Studies
Background
In order to ensure that grant funds for WLAs are used in an effective and
efficient manner, OWPS will be working with the Regions to ensure that
all Regions using 106, 201, 205(g) or 208 funds for WLAs have at!east a
minimal technical capability in the WLA program area.  In addition, there
should be a strong State program in this area or a committment by the
Region to guide and take responsibility for WLA work done in States lacking
a strong WLA program.  This part of the guidance describes what factors
Headquarters will consider in evaluating the Region's technical capability
in the WLA area.  It also addresses what factors the Regions should use
in evaluating State WLA programs.

I.   Regional Management Guidance

     OWPS is presently conducting a study of the AWT/WLA program in each
     Region.  Each regional contact has received a copy of the draft
     report on their Region for their comment and review.  Our aim is
     to work with any Region needing assistance to ensure that all Regions
     develop the necessary minimal technical capability by FY 80.

Based upon our work thus far, the following factors appear to be critical:

     (a)  Regional Staffing Levels

          The Region should have an identifiable staff for guiding and
          reviewing:

               Work-plans for development of WLAs

               Contract Work Statement for WLAs

               Interim output of WLA Studies

               Final WLA

               State WLA effort

     (b)  Regional Staff Qualifications

          Staff responsible for overseeing WLA work must include individuals
          trained and experienced in all aspects of the development of
          WQ based effluent limits, e.g., planning and conduct of WQ
          intensive surveys, mathematical modeling of receiving waters
          including calibration/verification, etc.

-------
                                -2-

II.   State Management Controls for 201 and  205(g) Funded WLA Studies

     1.

     (a)  The State must have an identifiable staff which is qualified
          and capable of, developing  if necessary, or guiding and
          reviewing:

               Work Plans for development of WLAs

               Contract Work Statement for WLAs

               Interim outputs of the WLA Study

               Final WLA

     (b)  State Staff Qualifications

          Staff responsible for overseeing or developing WLA studies
          must include at least one individual trained and experienced
          in all  aspects of the development of WQ based effluent
          limitations, e.g., planning and conduct of WQ intensive
          surveys, mathematical modeling of receiving waters including
          calibration/verification, etc.

     2.   EPA approved State Procedures

          State technical procedures  and policies, (including math
          models  used, safety margins, data requirements, modeling
          assumptions, etc.), for WLA development must be documented
          by the  State and reviewed and approved by the Region.

     3.   EPA approved WQ Standards

          EPA approved WQ standards must be in place prior to
          commencement of the study.

     4.   Procedures for approval to  initiate a WLA Studies

          The State and Region must guide the development of WLA, and review
          and approve the following prior to initiation of the study:

     (a)  Remedies to previous deficiencies

          Deficiencies that caused the original WLA to be rejected must be
          identified and solutions or remedies proposed.

     (b)  Selection of contractor/consultant to perform the WLA

          This selection must be jointly made by the grantee, State and
          Region, and should be based largely on the contractor's
          previous performance in conducting such studies.

-------
                           -3-
5.    Work Plan for development of the WLA

     A detailed work-plan must be developed by the grantee (or
     contractor).  The work-plan must include details on all
     tasks necessary in the development of the WLA.  The major
     elements of the study will be (1) Data Needs and Collection
     (2) Water Quality Analyses/modeling and (3) Allocation of
     pollutant loads and determination of effluent limitations
     on the basis of the WQ analysis.  Tasks for each element
     must be described in detail, including description of
     work, cost, output of the task and projected date of
     completion.

(a)   Approval of Work-Plan

     The Work-plan must be reviewed and approved by the State and
     EPA prior to conduct of the study.  The plan will serve as
     the guiding document for development of the WLA.

(6)   State-EPA tracking of the Study

     The Region and State must closely scrutinize every major
     output of the study as it proceeds.  A review mechanism
     must be developed, which will provide for timely reviews
     with recommendations for any mid course changes necessary.

     The study should proceed in stages or phases that are
     designed to produce concrete reviewable outputs at the
     end of each phase.  EPA and the State must review each
     output prior to initiation of the next phase.  Errors
     or shortcomings must be flagged immediately, and steps
     taken to correct the situation before the study resumes.

-------
                    Preliminary Technical  Guidance  for  WLA  Studies
Objectives

     This package provides  technical  guidance  on  development  of  WLA's.
The guidance establishes the  basis  for  a  credible  procedure for  WLA
computations.  Experience concerning  what to emphasize  has come  from  EPA
water quality reviews of POTW projects  requiring  treatment more  stringent
than secondary.  EPA's concern  is that  all  future  WLA's  be sound,  reason-
able, and technically defensible.
     This preliminary guidance will
are encouraged.*
                                     be refined  and  improved.   Comments
It is EPA policy  (PRM 79-7) that: "That Agency will conduct a
rigorous review of projects designed for treatment more stringent than
secondary"; and, with respect to WLA, that:  "The waste load allocations
or other analyses resulting in the effluent limitations, along with the
assumptions on which the analysis is based, are scientifically supported
by intensive water quality surveys or appropriate field investigations
conducted on the water bodies in question, and calibrated and verified
models or other technically sound analyses".
on:
     2.
     This guidance seeks to aid these policies and presents  information

     1.   the typical level of analysis expected for most WLA studies
          to satisfy EPA review.  Exceptions, of course, are possible
          and should be justified.  Examples are simple cases needing
          only "desk top" computations or complex cases needing very
          specialized mathematical models.

          a "norm" for a scientifically defensible WLA procedures.  A
          justification process that follows the norm would not be
          expected to cause controversy in the EPA review.  Departures
          from the norm should be discussed and rational explanations
          presented.

     3.   the list of representations and presentations that a well
          documented WLA should have according to current EPA review
          procedures.

     4.   a checklist of problem areas that have stalled EPA WLA reviews
          or which are expected to cause difficulties in scoping future
          WLA studies; these areas will be further clarified as this
          guidance is refined.
*Comments should be directed to Dr. Tim Stuart (FTS-426-7766), Chief
 Monitoring Branch, Monitoring & Data Support Division  (WK-553)

-------
                                  -2-
EPA Expectations


     The typical situations are described in this section.  Unusual
situations, as they occur, will be judged as departures from the
following normal factors and criteria.  The logical core of typical
WLA analyses and water quality concerns can be summarized with three
main points.

1.   For most projects, EPA anticipates that the WLA will be based on
     dissolved oxygen and/or nutrient (N,P) water quality criteria.  Of
     course, other water quality criteria will be considered when rele-
     vant to the particular project being reviewed.  (A significant
     additional criterion is ammonia, in relation to fish toxicity).
     Within this context:

     a.   If D.O.-related WLA's are proposed (BOD, NH3/TKN, reaeration),
          specify the D.O. criterion in the WQS for the surface waters in
          question.  Are there minimum and average components in the D.O.
          criterion?

     b.   If nutrient (N or P) WLA's are proposed, are there numerical
          ambient criteria for these nutrients, if yes, specify.  If not,
          are there other provisions in the WQS that address nutrients,
          such as narrative criteria that water should be free from aquatic
          nuisances, algal counts, chlorophyll criteria?  Explain.

     c.   If WLA's are proposed for parameters other than those related to
          D.O. or eutrophication, are there provisions in the WQS for their
          control?

2.   EPA will use the following criteria when evaluating WLA's related to
     dissolved oxygen (BOD, TKN, reaeration.)

     a.   A steady-state, Streeter-Phelps-type analysis or model (considering
          both carbonaceous and nitrogenous wastes) at the critical flow
          condition is acceptable, unless existing water quality data or
          the hydraulic setting clearly indicates significant time and
          flow varying D.O. problems.

     b.   The predictive capabilities of the analysis/model must be adequately
          demonstrated.  This can be accomplished through calibration and
          verification using two independent sets of water quality data
          for the receiving water in question.  If calibration and verifi-
          cation are not done, the WLA documentation must explicitly describe
          how the predictive accuracy of the analysis was established.

-------
                                     -3-
     c.   Weather-related nonpoint sources  (NFS) loadings do not have to be
          considered directly  in low-flow situations; however, the analyses
          should make reasonable allowances for any leachates, benthic
          oxygen demands, and  background D.O., BOD, and ammonia.

     d.   An analysis based on historical data should have been made to
          determine the critical conditions for streamflow and temperature
          if not prescribed by State WQS.

     e.   If the critical flow situation is not a low flow, then it must
          be indicated how NPS loadings were considered; this is particularly
          true for combined-sewer situations.

3.   EPA will use the following criteria when evaluating WLA's for nutrients
     (P, N):

     a.   The analysis must demonstrate why a nutrient/eutrophication
          problem is anticipated based on existing ambient water
          quality data and field observation.

     b.   Sources and loadings of nutrients from both point sources
          and NPS must be evaluated, including estimates of the
          relative contributions from each.  Annual mass balances
          should be presented.

     c.   The analysis must indicate how the limiting nutrient was
          identified and evaluated for the water body in question.

     d.   The analysis must indicate how the decision criteria for
          maximum nutrient loadings were established for the water
          body in question.

     e.   If NPS loadings will be the major source of nutrients after
          the proposed plant is operating, the justification must
          describe what BMP's were considered and selected or rejected.
          How and when will the BMP's be implemented?

Scientifically Accepted Procedures

     The objective of this section is to define an approach to the
methodology of wasteload allocation.  The approach anticipates
linkages to coordinate complex analysis techniques.  Analysis and
the related policy problems are complicated by a large number of
interacting factors.  Among these factors are included:   point
source (PS) wasteloads, nonpoint source (NPS) loads contained in
land washoff, possible combined sewer overflows (CSO) and inter-
actions of meteorologic conditions that effect pollutional stress
including streamflow, rainfall and water temperature.

     Within this framework there exist mathematical computer models
with which the environmental impacts to water quality can be studied.
These models range from simple to complex.  Models are tools for esti-
mation of water quality impacts for constant or steady pollutant loads.
The intent of EPA is that when one uses complex models to handle a
complex situation, the margin of safety for load allocation can be
reduced.

-------
                                   -4-


Water Quality Standards

     The WLA approach assumes that stream standards are given, and are
consistent with the designated use classification of the receiving stream.
In this regard, it should be noted that all waters, including intermittent
streams, regulated by State water quality standards must be classified and
meet the criteria applicable to that classification.  These standards may
provide for time-limited variances for specific dischargers, as long as
existing uses are protected.  In general, a specific variance proceeding
is preferred to a general downgrading.

     Where intermittent streams do not currently meet designated uses and
cannot attain these designated uses due to 1) natural background features;
2) irretrievable man-induced conditions; or 3) widespread adverse econo-
mic and social impact (See 40 CFR 35.1550 (c)(2) ), a downgrading is
warranted.  However, no downgrading may impair or preclude existing water
uses.  EPA is developing guidance on downgrading of use classification
based on widespread adverse economic and social impact (item #3
above).

     Wholesale downgradings are not permitted, and would violate EPA regu-
lations 40 CFR 35.1550* Also, intermittent streams often serve an impor-
tant role in stream ecology as spawning and feeding grounds.  Therefore, to
determine whether a downgrading from the "fishable" classification is
warranted, a site-specified investigation of the particular inter-
mittent stream segment by qualified engineers or scientists is required.
For downgrading to be approved based on natural background or irretrievable
man-induced conditions, this field survey would have to show that the
site does not support fish survival or propagation, and even with dis-
charges at normal levels meeting existing water quality standards would
not support a fishable use.

     The link between wasteload allocations and stream standards is a
mathematical model to predict water quality as a function of waste
discharges.  Such models exist and are integral parts of the methodo-
logy.  For such a method, the wasteloads are one of a set of required
input data.  Other members of the set include:  geometric definition,
upstream and tributary streamflows, water quality of streamflows, quan-
tification of forces other than gravity that influence the water move-
ment including tides and radiation, and parameters that define the
transformations of the water quality.

     The WLA methodology has the following elements, any of which may
be greatly simplified given technical justification:

     1.   Based on a preliminary review of the discharge site and the
          expected impact of the pollution load, selection of a model
          is required.  This model should be calibrated and verified
          for use in the WLA.  For DO, the normal model will be a
          Streeter-Phelps type (Considering both carbonaceous and
          nitrogenous waste) unless circumstances dictate otherwise.
          For nutrients, a rational and defensible approach should
          be defined; a typical acceptable method for a lake is an
          annual mass balance linked  to a Vollenweider assessment.

*Refer to OGC #58 dated March 29, 1977-

-------
                             -5-
2.  A determination of the magnitudes  of  the  wasteloads  as  a
    function of  location  and  future  population  and  land  use.

    a.  The point source  loads are subjected  to various  treatment
        levels in accordance  with current  policy and  may be trans-
        ported to various points according to different  local
        and regional collection schemes.   The array of these
        possibilities becomes the alternative set for allocation
        analysis.

    b.  The NPS  loads may or  may not be a  factor in the  final WLA.
        At the beginning of a WLA analysis, NPS  loads must  be
        evaluated to determine if they should be directly consid-
        ered in  situations involving nutrients  and eutrophication.

3.  A determination of what constitutes the "design event"  or critical
    conditions is required.   The design event,  expressed in terms of
    such variables as streamflow, temperature and waste  discharges,
    describes a  specific condition under which  water  quality standards
    must be met.  One allocates waste  loads for  the design  event but
    should, if appropriate, make allowances for  seasonal variability.
    This design  event takes into consideration  discharger exemptions
    from portions of WQS, when natural background conditions, such as
    flow, naturally high pollutant concentrations, etc.  preclude
    attainment of some existing or designated uses.  However, all
    WQS required to support uses that  exist under low flow  conditions
    must be met.  Furthermore, effluent must  not cause a nuisance, due
    to objectionable deposits, floating debris,  or objectionable color,
    odor, taste, or contain toxic pollutants  in  toxic concentrations.

    For point source loadings, low summertime flows are  usually used.
    For nonpoint source loadings no usual  condition or standard of
    practice exists.  In some cases, the problem of defining the
    "design event" can be avoided by using continuous simulations
    with a mathematical  model.  A continuous  simulation  continuously
    translates a time series  of hydrologic, meteorologic and waste-
    load conditions into a continuous representation of water quality.
    The results  of continuous simulations  can be inspected  and the
    failure frequency can be  evaluated more directly.

4.  The acquisition of data pertaining to how the waters respond
    to wastes is necessary.  Either existing data may be assembled,
    or a field program is needed.   Such field programs should be
    of short, intense duration and should measure waste  inputs and
    water quality responses simultaneously for  at least  two separate
    situations (high and low flows or warm and cold water or two
    other events for which water quality responses are different
    for the same receiving waters).

-------
                                    -6-

     5.    EPA recognizes the concept of tranferability of water quality
          data from one discharge site to another similar discharge
          site.  However, it should be emphasized that transferability,
          although an acceptable concept, is not applicable in every
          situation and calls for considerable judgment on the part of
          the water quality analyst to determine whether a situation is
          amenable to modeling based on transferred water quality data.
          EPA is currently developing detailed guidance on the use of
          transferred water quality data, and the criteria and constraints
          within which such transference may be attempted.

     6.    The fitting of the forecasting method (mathematical model) to the
          data is necessary.  A two data set approach is the standard practice:

          a.  The first data set is used to adjust the transformation
              parameters of the model until observed water quality
              agrees with forecasted water quality.  This process is
              called calibration.

          b.  The second data set is used in the calibrated model to
              independently check the forecast.  If the model can
              forecast the second data set the model is verified.

     7-   The forecasting of water  quality for the "design event" using alternative
          WLA's  is conducted in order to prescribe the WLA.  Two strategies
          are possible in the implementation of this element, each of which
          is oriented to determining whether or not carrying capacity is
          sufficient to  prevent violation of water quality standards.*

          a.  The alternative projected  loadings can be individually
              analyzed and the water quality forecast.  Degree of
              treatment  levels are  gradually increased until the
              water  quality standards are satisfied.

          b.   It  is  possible to work directly with the carrying capacity.
              The maximum amount of wasteload that can be introduced into
              the water  and still satisfy the water quality standards is
              determined.  This amount is allocated to the dischargers.

     8.   An analysis of the impacts of  errors, or changes in parameters, forecasts,
          and modeling assumptions  upon  the wasteload allocation is desirable.
          This sensitivity analysis is useful for the WLA review process.


*Note that Section 303(d) of the Clean Water Act and EPA regulations require
that an margin of safety be included in  the WLA.  Also, note that nondegradation
requirements apply for the National Resources Water listed on page 6 of PRM-79-7.

-------
                                   -7-
     The methodology of wasteload allocation studies is complex and the
normal mathematical model is a Streeter-Phelps type that handles carbon-
aceous and nitrogenous components.  Other methods exist and all methods,
from simple hand calculations to computer models, require a detailed
data base describing the quality and the hydrology of the receiving
waters. Water quality data should, if possible, quantify and qualify the
following physical, chemical, and biological parameters:  BOD, dissolved
oxygen, nitrogen, phosphorus, total dissolved solids, pH, coliforms,
chlorophyl-a, biomass information, eutrophication evidence, temperature,
suspended solids, turbidity, and sediment.  Other parameters related to
domestic wastewater may be needed in specific cases.

     The hydrologic description of the receiving waters generally requires
stream flow data, velocity data, location of tributaries and point
source discharges, nonpoint source contribution rates,  water withdrawal
rates and other alteration of natural  stream flow.  Stormwater discharges
are also of importance to many models  as are meteorological data and
stream channel geometry.

     Modeling the impact of nonpoint source pollution requires additional
input concerning land use, topography, and soil types.

     The particular emphasis and specifics of each method and site
determine the level of detail as well  as the specific categories of data
required for an analysis.  Current thinking is that two intensive surveys
of a one to two weeks duration be conducted to support  such studies.
One survey supports model calibration  and the other supports model
verification.  A rule-of-thumb for effort expended in field activities
is that they should be budgeted to the same or higher levels as the
modeling analyses.

Documentation _for_ Evaluation

     An EPA WLA review is thorough and detailed.  The information needs
for the review cover the water quality management field:  Water uses,
water classifications, benefits of cleaner water, standards, data,
modeling and WLA.  A list of twelve information areas is presented here
to specify the detailed documentation  necessary to thoroughly justify  a
WLA:

     1.   Definition of receiving water, its uses and possible health
          issues (maps with demographic features) and the general  hydraulic/physical
          setting (velocity of waters, gradient, lake or estuary, dimensions
          of impact or recovery zone,  nature of bottom  such as sandy or
          rocky and similar details).

     2.   Specification of impact zone, existing water  quality (show
          data and evidence of problems) and of future  water quality
          with proposed facility (for  examples give modeling results)
          and of existing aquatic growth problems if nutrients influence
          level  of treatment.

     3.   Justification and defense of design condition (low flow, water
          temperature).

     4.   Presentation of numerical standards, their relation to uses
          and stream classifications and their consistency with Red Book
          criteria.

-------
                                -8-

 5.    Statement  that existing water quality meets adopted WQS, or where
      disparities exists, indicate whether downgradings or upgradings
      are warranted.  (Since most classified streams are designated for
      fishable/swimmable uses, proposed downgradings will probably pre-
      dominate.)  Downgradings must be justified on one of
      the three  grounds described on p. 3, as specified in the WQS
      regulation 40 CFR 35.1550.


 6.    Specifications of previous field surveys and data used to support
      the analysis (quality versus time and quality versus distance
      graphs are very useful as well as details of measurements of waste
      inputs, instream quality and hydraulic variables) including, if
      possible,  biological surveys and findings.

 7.    Tables of annual nutrient loads by category, PS, NFS, background
      and by limiting factor (if nutrient problem impairs water use).

 8.    Details of determination of an allowable nutrient loading with
      linkages to nutrient removal requirements (permissible area loading
      to lakes and National Eutrophication Survey procedures are typical
      level of detail).


 9.    Technically sound and detailed analysis of NPS and their relationship
      to treatment requirements (pull together Basin Plan, 208 and any
      EIS studies and tie it into presentation).

10.    Presentation, specification, and discussion of methods (models or
      otherwise used to analyze field data, calibration and verification)
      and give the projections and waste load allocations.

11.    Tabulation of calibrated model parameters (carbonaceous decay,
      nitrogenous decay, aeration, benthic uptake, temperature cor-
      rection factors, logarithmic base (10 or e), and related para-
      meters with justifications of their selection).

12.    Tabulation of existing and proposed effluent flow and strength;
      include nearby PS and NPS data to show relative importance
      of proposed project.

-------
                                      -9-
Checklist of Problem Area

     This list identifies typical "flaws" observed in materials  presented
in support of WLA justifications:

     1.   Hard data are not presented.  Observed data from  instream sampling
          and effluent sampling both in graphical and tabular form are
          desirable to enhance WLA justifications.  The data should be
          matched by descriptions of how samples were obtained; e.g., grab
          samples, composite samples, diurnal effects, etc.  In addition,
          the standards should be stated numerically.  NPDES permits,
          existing and proposed, should be included.

     2.   Modeling results presented have not shown demonstrated calibration
          and/or verification.  Also needed is the rationale for rates used
          and for model inputs, particularly where these differ from field
          measurements or particulars presented elsewhere in supporting docu-
          ments.  The modeled results should demonstrate consistency with
          other project justification presented.

     3.   Benefits of stream clean-up as the result of project implementation
          have not been well presented.  Typically absent from materials pre-
          sented have been details of instream water quality standards vio-
          lations or public health problems that the project, as implemented,
          would alleviate.  Administrator approval of projects is ultimately
          based upon such justification.

     4.   Maps are not detailed enough or are absent.  "A picture is worth a
          thousand words" is a dictum relevant to WLA justifications.

     5.   Regional Context and the role of NPS and BMP's have been downplayed.
          The project as implemented should result in significant improvements
          to water quality and/or the public health.  Beneficial results of
          the project should not be negated by NPS problems that are not
          addressed.

     6.   Blanket effluent discharge limitations often appear unjustified.
          They often do not show thoughtful application to the specific situation.

     7.   Design treatment flows, population and flow projections often seem
          overstated.

     8.   Critical design conditions are too stringent based on expected
          probabilities.  In particular, it may not be reasonable to use
          the highest one-day temperature of record for any time of year,
          with a criterion such as 7Q10 low flow.  Temperatures used in
          steady-state low-flow analyses should be weekly averages that
          would occur during the same calendar period as the low-flow
          event.

     In addition to these "short run" flaws that will disappear as this
methodology is standardized, there is the major question of model selec-
tion.  This issue is expected to dominate the efforts to enhance and
refine this guidance.

-------
           UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
^7.7*0*°                      WASHINGTON. D.C. 20460


                                 1 2 JUL 1979
                                                             OFFICE OF WATER AND
                                                             HAZARDOUS MATERIALS

                                             Construction Grants
                                             Program  Requirements  Memorandum
                                             PRM No. 79-10


 SUBJECT:  Qualification of Major  Items of  Equipment

 FROM:     John T. Rhett, Deputy Assistant  Administrator O
           for Water Program Operations (WH-546)          T

 TO:       Regional Administrator
           Regions I-X


 Purpose

      This memorandum sets forth guidance for the qualification of major
 items of equipment for construction grant  projects.  This guidance is appro-
 priate for  use during either Step 2 or Step 3 phases of construction.

 Discussion

      The following qualification  procedures are for  optional use  by
 Environmental Protection Agency (EPA) grantees who desire to qualify major
 items of equipment for construction grant  projects with the approval of the
 EPA  regional offices.  Under 40 CFR 35.935-2,(43 FR  44071, September 27,  1978)
 the  Regional Administrator may review grantee procurements including equip-
 ment qualification and may request additional grantee actions consistent
 with applicable  statutes and regulations.

      Qualification is a system that may be used to ease the administrative
 burden of determining responsive, responsible bidders on equipment.  However,
 qualification is not a conclusive determination of responsibility and a
 qualified equipment bidder or offerer may  be rejected as nonresponsive on
 the  basis of subsequently introduced information e.g., shop drawings.  In  all
 cases the equipment furnished must comply  with the specifications.

-------
     There are a number of necessary minimum requirements for any quali-
fication system.  Whether the qualification procedure is to take place in
Step 2 or Step 3, all of these requirements must be met.  If the qualifica-
tion is to occur during Step 2 the qualification information package will
not contain plans and specifications.  Therefore a qualification information
package containing the relevant information must be prepared.  This package
must contain enough specific detail regarding performance and quality to
assure that equipment sources will thoroughly understand what is required
of the specified equipment.

     Adequate advertisement is critically important to assure that knowledge
of the project is widespread and so that new manufacturers, small firms and
minority businesses are provided an opportunity to compete. Adequate time
must be allowed for submission of the necessary information for qualification
review since an overly strict time frame would limit competition. This
should conform to 40 CFR 35.938-4(b) ,(43 FR 44080, September 27, 1978),
generally 30 days.  Adequate time mus't also be provided for the engineering
evaluation of the qualification packages submitted.


Policy

A.  Advertisement

    The grantee  is responsible for accomplishing adequate advertisement for
qualification. Whether qualification occurs during Step 2, or during Step 3,
the advertisement procedure shall conform to Section 35.938-4(a) of the EPA
regulations.  The advertisement procedure for qualification shall also conform
to the local regulations regarding advertisements for construction bids.
In addition to advertisements, private mailings to known equipment sources
may be made.  Mailing lists of equipment sources are available from trade
journals and technical associations.  The advertisement shall contain all
information needed by the  sources to properly submit information regarding
their equipment  for  consideration. The advertisement shall include the
following as a minimum:

     1.  Address and telephone number of grantee.

     2.  Name, size  and type of plant.

     3.  Name, address, and telephone number of the designer and
         name of contact for inquiries.

     4.  Location where qualification information package can be obtained.

     5.  Cost of qualification information package -- (this should not exceed
         the price that bidders must pay to obtain bidding documents).

-------
     6.  Brief schedule of equipment needed in the construction project
         that is to be qualified (e.g., filter press).

     7.  Locations of qualification information for review by interested
         individuals.  These locations should be the same as those used
         for additional information for contractors interested in bidding.

     8.  Deadline for submittal of qualification packages by equipment
         sources.  This should be a minimum of 30 days from date of
         advertisement to allow adequate time for equipment sources to
         prepare their qualification package.  Longer time periods should
         be provided for qualification submission for complex systems.

B.  Qualification Information Package

    The qualification information package, prepared by the design engineer,
shall include the construction bid package plans and specifications or
suitable extracts of this information if qualification occurs during Step 2.
These specifications shall be performance specifications where possible and
in all other cases conform to the two brand names or equal requirement.  In
addition to the plans and specifications, a description of the package the
equipment sources submit for qualification consideration should be included.

     The equipment sources should submit catalog cuts or readily available
specifications and drawings of their equipment and any supplementary information
that would be helpful in the evaluation.  It should be stressed that shop
drawing quality submittals are not required or wanted in this phase of the
project.

     All equipment manufacturers or distributors interested in supplying their
equipment for the project must submit a qualification package for approval,
including the suppliers who propose to furnish the equipment which may
have been preliminarily named to indicate the salient requirements of the
equipment desired.  This is required so that all equipment offerers have the
same opportunity to submit information for consideration, and to assure that
the equipment offered fully meets all requirements of the specifications.

    A time schedule of the qualification and bidding process must be
included in the qualification information package.

C.  Evaluation

     Evaluation of the qualification submission shall be completed by
the design engineer within 30 days from date of closing of submittals of
qualification packages.  At the end of the review period, the grantee
will notify all proposers of their status (by registered mail return

-------
receipt requested).  Such correspondence should contain notice consistent
with EPA protest regulations described below that any protest actions must
take place within the time limitations described in 40 CFR 35.939(b), (43
FR 44083, September 27, 1978).  By addendum to the specifications, the
grantee will notify the holders of the bid package of the equipment that
has been qualified for the specific project.

D.   Protest Procedures

     Protest procedures regarding qualification must conform to EPA reg-
ulations 40 CFR Section 35.939, (43 FR 44083, September 27, 1978).

     The proposer  of  any  equipment  qualified as  a result  of a protest
will be notified by the grantee and a further addendum to the specifications
will be sent to the bid package holders.

     In those  cases when  qualification takes place during Step 3  the
entire process (including protests  to the  grantee, if any) should take  place
within the  time frame of  the  advertisement for construction bids  and the  bid
opening.  When qualification  takes  place during  the Step  2 adequate time
must be allowed for submittals and  prompt  determination of qualified
equipment must be  made.   All  protests should be  resolved  before the bidding
process.   In order to satisfy this  requirement,  grantees must state in  the
qualification  information package and notification to proposers of their
status that any decision  on qualification  is final grantee action and the
time for protests  under 40 CFR 35.939(b),  (43 FR 44083, September 27, 1978),
begins to  run  from the date the proposers  receive notification of their
status from the grantee.   Failure to protest within one week of this time
period will result in finding the protest  untimely.  Consistent with the
procedures  of  this memorandum, after determination of the qualified equip-
ment  no other equipment  can  be considered.

     Qualification does not exempt  the supplier  from meeting the
specifications.  The  specifications are the final authority for acceptance
of equipment.  Approval of a  qualification package does not eliminate the
need for shop  drawing submittals and approvals during construction.


E.  Construction Delays

    If bidding is  significantly delayed, then the qualification process may
be reopened by the grantee with the EPA regional office approval  in order
to allow consideration of equipment sources that may then be interested in
supplying  equipment.   In  such cases the previously qualified equipment  need
not be reconsidered.

-------
F.  Other Qualification Procedures

    Qualification procedures consistent with state or local  law which
provide the same considerations in terms of competition may  be used
in lieu of these procedures.


G.  Public Inspection

    On the cut off date for submittal of qualification packages for evaluation
a list of all equipment sources that have submitted qualification packages
shall be published.  Whether the packages themselves become  available for
public inspection will be decided by local ordinances on the subject of
public disclosure.

H.  Costs

    The cost incurred by the grantee incidental  to qualification of
major items of equipment for inclusion in a construction grant project are
eligible for construction grant funding during the step in which they are
undertaken.
Attachments

-------
               GO
               O
               D.
               OJ
               3
               c:
                   -o -o m
                   OJ -S .0
                   n ID c:
                   QJ o>
                  ia -s
                   en
  3
.0 c-h
c:
01 co
—> o
-1- c:
-h -S
-"• O
O fD
                  Oi fD
               CO
               o
               CL
               Q>
                  O
                  3
                       CD
                       fD
                       CO
O 3
3 fD
  -S
OJ 10
3
CL O
  o
m 3
< to
OJ -i.
—' Q.
c:  i
                     Cb  fD
                     3  to
                        -a
                        fD
                        -s

                        o'
                        CL
-a

ro
                     Advertisement for Submittal
                     Qualification Packages
                                                                        of
                                          Submittal
                                         'Package
                                of  Qualification
                                          Notification of Equipment Sources
                                          of Outcome  of Evaluation
                                          Advertisement for Bid
                                                         Attachment 1

-------
               CO
               o
               Q.
               Q>
               to
o  -o m
O>  -S .Q
rt- CD C
-j.-o -••
o  o> -a
3  -s 3
   CD CD
T3   3
&>  -O H-
O  E
7 CO
a>  —' o
U3  -J. C
CD  -h -S
to  ->• n
   I  CD
              CO
              o
              Q.
              OJ
              00
 -o o> o
 cu rt- n>
 O -"•«/>
 7T O -••
 fll 3 tQ
ua   3
 CD O) CD
 to 3 -s
   Q. to

   m o
   < o
   fa 3
   	1 tO
   c —«•
   JU Q.
   r+ fD

   o'  i
   3	
O)
3
                     -a -o
                     fD -S
                     -S O
                     -•• 
-------