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^7^ I UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
tj»_ .j WASHINGTON. D.C. 20460
;P- XV A fER -\NO
M A D *•? 1Q7R HAZARDOUS MATERIALS
W1AK 0 I3/O Construction Grants
Program Requirements Memorandum
PRM s 78-9
SUBJECT: Funding of Sewage Collection System Projects
FROM: John T. Rhett, Deputy Assistant Administrator
for Water Program Operations (WH-546) f
TO: Regional Administrators
Attn: V/ater Division Directors
I. PURPOSE
This memorandum supersedes Program Requirements Memorandum (PRM)
No. 77-8, on construction grant funding of sewage collection system
projects «nd amends that policy in accordance with P.L. 35--217. This
memorandum sets forth guidance for rigorous review of grant applications
to ensure that proposed projects meet the established requirements of
both P.L. 92-500 and P.L. 95-217, plus the construction grant regulations.
II. DISCUSSION
Sev/age collection system projects may be grant eligible projects
under P.L. 92-500 (the Act). Eligibility is limited, however, by
Section 211 of the Act which provides for funding cf collection systems
only (1) for the replacement or major rehabilitation of an existing
collection system or (2) for new collection systems in existing communities.
Sewage collection systems are defined in 40 CFR S35.905-19 as:
For the purpose of S35.925-13, each, and all, of the common
lateral sewers, within a publicly-owned treatment system, which are
primarily installed to receive wastewaters directly from facilities
which convey wastewater from individual structures or from private
property, and which include service connection "Y" fittings designed
for connection with those facilities. The facilities which convey
Wastewater from individual structures or from private property to
the public lateral sewer, or its equivalent, are specifically
excluded from the definition, with the exception of pumping units,
and pressurized lines, for individual structures or groups of
structures when such units are cost-effective and are owned and
maintained bv the crantee.
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Th«j eligib.'lity of sewage collect-ion system projects is further
defined in 40 CFR 535.925-13, which reads:
That, if the project is for, or includes sev/age collection
system work, such work (a) is for replacement or major rehabilitation
of an existing sewer system pursuant to S35.927-3(a) and is necessary
to the total integrity and performance of the waste treatment works
servicing such cor.nunity, or (b) is for a new sewer systen in a
community in existence on October 13, 1972, with sufficient existing
or planned capacity to adequately treat such collected sev/age.
Replacement or major rehabilitation of an existing sewer system may
be approved only if cost-effective and must result in a sewer
system design capacity equivalent only to that of the existing
system plus a reasonable amount for future growth. A community,
for purposes of this section, would include any area with substantial
human habitation on October 18, 1972. No award may be made for a
new sewer system in "a community in existence on October 18, 1972,
unless it is further determined by the Regional Administrator that
the bulk (generally two-thirds) of the flow design capacity through
the sewer system will be for waste waters originating frcm the
community (habitation) in existence on October 18, 1972.
The above sections of the EPA regulations implement Section 211 of
P.L. 92-500.
Section 36 of p.L. 95-217 amends. Section 211 of P.L. 92-500 to
pjrecJkLde_us.e._of_the_popu,la.tion densii:y..cr.lter_ion_in_BRM_77r8_as_a_tes.t
'qf_ grant jeligiblity for collector sewer projects_ but pennits_use_of_the.
crTtje>'io'n.f_6r""evaluating_.a.lternatives. A one household per two acre
density criterion may be used only for identifying less closely populated
areas where individual or other small wastewater treatment systems are
.likely to be more cost-effective than collector sewers and thus must
be evaluated in detail if collector sewers are proposed for such areas.
Such use of the population density criterion should assist with and
simpltfy the cost-effectiveness analysis for collector sewer projects.
All treatment works funded under the Construction Grants Program
must be cost-effective to comply with the requirements of the Acts.
Treatment works are defined in Section 212 to include sewage collection
systems. EPA cost-effectiveness requirements are found in 40 CFR
S35.925-and in Appendix A to 40 CFR, Part .35.
Public disclosure of costs is a fundamental prerequisite for all
grants projects, including collection systems. Program Requirements
Memorandum 76-3, "Presentation of Local Government Costs of Wastewater
Treatment Works in Facility Plans," August 16, 1976, requires that cost
information-be presented at all public hearings held on facility plans
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after January 2, 1977. However, public hearings were held on many
collection systsn projects prior to this date. Special measures
are necessary to ensure the public is aware of the cost implications
of collection systens prior to their approval.
The following policy is to be followed in preparing future
grant applications for collection system projects. This policy
supplements all existing Agency regulations and policy statements.
It provides guidance for more rigorous review of grant applications
to ensure that proposed orojects meet the established requirements
of the lav/ and regulations. Compliance with this policy will help
to assure that only grant eligible and cost-effective collection
system projects are funded by EPA.
III. Policy
EPA policy on the funding of sewage collection systems is as
follows:
A. Substantial human habitation
New collector sewer projects are eligible for funding only in
a community in existence on October 18, 1972, with sufficient
existing or planned capacity to adequately treat such collected
sewage. A community qualifying for Federal grant assistance
to construct a collector sewer system may be a geographic or
jurisdictional area that is smaller than the jurisdiction of the
municipality applying for the treatment facility grant. The
Tttle II regulation states in Section 35.925-13 that a community
would include any area with substantial human habitation on
October 18, 1972. The bulk (generally two-thirds) of the flow
design capacity through the sewer system is to be for wastewaters
originating from the habitation exsting on October 18, 1972.
The Agency policy is that areas to be served by new collector
sewer projects must meet the requirement for "substantial human
habitation." Habitation existing as of October 18, 1972, should
be evaluated block by block or, where typical city blocks do not
exist, by areas of five acres or less to determine if it is substan-
tial. Collector pipes designed primarily to serve blocks or five
acre areas without substantial human' habitation as of October 18,
1972, would not be eligible for grant assistance.
B. Cost-effectiveness
New collector sewers must be proven in the facility plan to be
necessary and cost-effective in addition to being eligible under
the "substantial human habitation" and the two-thirds rule require-
ments.
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New collector sev/ers should be fundsd only when the systsr.s in use
(e.g., septic tanks or raw discharges from homes) for disposal of wastes
from the existing population are creating a public health probl«n,
contann'natirg groundwater, or violating the point source discharge
requirements of the Act. Specific documentation of the nature and
extent of health, groundwater and discharge problems must be provided in
the facility plan, Where site characteristics are considered to restrict
the use of on-sita systems, such characteristics, (e.g., groundwater
levels, soil pennability, topography, geology, etc.) must be documented
by soil maps, historical data and other pertinent information.
The facility plan must also document the nature, number and location
of existing disposal systems (e.g., septic tanks) which are malfunction-
ing. A community survey of individual disposal -systems is recommended
for this purpose, and is grant eligible.
Where the population density within the collection system area is
less than 1.7 persons per acre (one household per two acres), collector
sewer projects shall be considered non-cost-effective unless a severe
pollution or public health problem is specifically documented and
collector sewers are shown to be clearly less costly than any of the
alternatives for sparsely populated areas as cited below.
In addition, the facility plan must demonstrate, where population
density is less than ten persons per acre, that alternatives are less
cost-effective than new gravity collector sewer construction and
centralized treatment. Such alternatives are cited in the previous
Administrator's memorandum of December 30, 1976, subject: "Encouraging
Less Costly Wastev/ater Facilities for Small Communities."
The alternatives to be evaluated include the following:
—measures to improve operation and maintenance of existing septic
tanks, including more frequent inspections, timely purnpouts and prohibi-
tion of garbage grinders.
—new septic tanks.
—holding tanks and "honey wagons."
—various means of upgrading septic tanks, including mounds, alternate
leaching fields and pressure sewers plus ponds or other small treatment
facilities.
—other systems to serve individual households or a cluster of households.
Such systens include, for example, v/astewater separation, water conservetion
and recycle systems where feasible.
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The facility plan, whc:r applicable, must examine alternatives
such as limited sewer service for a portion of a community. For
example, septic systt-is wcrk very well in n^ny small tov/ns except
in one isolated area such -is a business district where open space
for adequate en-site disposal is not available.
The collection system shall not afford capacity for new habitations
or other establishments to be located on environmentally sensitive
lands such as wetlands, floodplains or prime agricultural lands.
Moreover, the proposed collection system must conform with approved
208 plans and air quality plans, Executive Orders on Wetlands and
Floodplains, and Agency policy on wetlands.
C. Public disclosure of costs
All projects, including collection systems, on which public
hearings were held after January 2, 1977, must corcply fully with
the requirements of Program Requirements Memorandum 76-3 prior to
approval.
Agency policy is to ensure public disclosure of the costs of
any collection system projects where a public hearing was held on
or before January 2, 1977. Such disclosures snail take the form of.
a prominently published notice in a local newspaper, and the cost
is grant eligible.
The notice shall include the estimated monthly charge for
operation and maintenance, the estimated monthly debt service
charge, the estimated connection charge and the total monthly
charge to a typical residential customer for the new collection
system being funded and any other associated wastewater facilities
required. Such associated facilities would include new treatment
capacity needed to handle the flows from the new collection system.
The charges may only be rough estimates, and may be presented
as a range of possible costs when major unknowns exist, such as
whether or not substantial parts of the project are grant eligible.
IV. Implementation
The States are to be advised of the issuance of this amended policy
at once. All pending and future grant applications for collection
system projects or projects containing collection systems are to be
reviewed for compliance with this policy.
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V. References
A. Sections 201, 211, 212, P.L. 92-500 and Section 36 of P.L. 95-
217.
B. 40 CFR SS35.905-19, 925-7, 925-13, Appendix 8.
C. PRM 76-3, "Presentation of Local Government Costs of Wastewater
Treatment Works in Facility Plans," August 16, 1976,
D, Memorandum to Regional Administrators from Russell E. Train,
"Encouraging Less Costly Wastewater Facilities for Small
Communities," December 30, 1976.
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