U.S.
6th
ENVIRONMENTAL PROTECTION AGENCY
REGION III
& Walnut Sts., Philadelphia, Pennsylvania 19106
Office December 22, 19 7 2
of the
Regional .
\dministrator
iward W. Furia
Lt, Col. Robert E. Ayers
District Engineer
Norfolk District
Corps of Engineers
803 Front Street
Norfolk, Virginia 23510
Dear Colonel Ayers:
Enclosed are the comments prepared by EPA on the
Impact•Statement for the Gathright project. Briefly, we
find that the older evaluation of the value of water
quality storage embodied in the Design Memorandum No. 4
can no longer be accepted as valid. We advise that no'
non-zero value can be assigned to.water quality storage
until EPA has determined the need for, the value of,
and the impact of such storage ,'\and until the necessity
of such storage has been affirmatively demonstrated.
Furthermore, we feel that a significant loss of economic
efficiency and social well-being will occur unless ¦
provision is made for reimbursement by 'private industrial
firms, notably Westvaco, for costs allocated to benefits
which accrue to them. We -regard the water quality
storage benefits as accruing primarily to such firms in
the form of reduced treatment costs. Water quality
standards will be met in any case. Finally, we find the
environmental costs associated with this project to be
severe and its economic benefits subject to recalculation
to significantly smaller values.than those stated here-
tofore. We recommend that the possibility of restoring
the area affected by construction activities to date be
investigated and cost estimates prepared.
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Because of the need for development of further data and
for project modification, wc have classified the impact
statement for this project in EPA Category 3. We recommend
that no further construction be initiated until questions
of water quality storage benefits and cost reimbursement have
been resolved. We hope that you will feel free to contact
us for further discussion and clarification of these
comments.
Sincerely yours^
Edward V. Furia
Regional Administrator
Enclosure
cc: Council on Environmental Quality
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Comments by EPA Region III
on the
Draft Environmental Impact Statement for
Gathright Lake, Virginia
prepared by the
U.S. Army Corps of Engineers, Norfolk District
June, 1972
Contents Page
Introduction
1
1.
Environmental Impact
1
2.
Water Quality
5
3.
Flood Control
21
4.
Recreation
23
~
5.
Economics of Benefits and Costs
25
6.
Alternative
27
7.
Conclus ions
28
U.S. EPA Region III
Regional Center for Environmental
Information
1650 Arch Street (3PM52)
Philadelphia. PA 19103
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Introduction
Gathright Dam is a Corps of Engineers project on the upper Jackson
River which is intended to benefit water quality and provide flood control
and recreation. It is presently about 29% completed. The amendments to
the Federal Water Pollution Control Act recently enacted into law impose
on EPA the duty of evaluating "the need for, the value of, and the impact
of storage for. water quality control." For that reason, we felt compelled
to analyze the project with great care in commenting on its Impact State-
ment, focusing on the Corps' Statement itself but bringing our own knowledge
and viewpoint to bear. We rapidly became convinced that the economic
justification of the project hinges on the water quality benefits - this
is true even allowing for the substantial investment which has already
occurred. Thus the "impact of" water quality storage is nothing less than
the impact of the project as a whole. That impact is analyzed in section 1
and found to be quite severe. The "need for" and "value of" water quality
storage are studied in section 2. The conclusion is reached that the desired
water quality benefits can be achieved by a higher level of treatment
without flow augmentation. In the context of the amended law, treatment
proves to be the less expensive alternative' by a substantial margin. A
procedure by which the need and value questions can be resolved is
suggested, Proponents of water
quality storage will be required to establish its necessity.
Furthermore,
we regard the benefits of water quality storage as accruing to the affected
waste dischargers. Flow augmentation will permit them to meet water standards
with a lesser level of treatment. We believe that stream standards will
have to be met ¦ regardless} high water quality is not itself contingent on
the project. The flood control and recreation benefits will have to be foregone
if a higher treatment level is employed to meet standards and the dam is
not completed. These benefits are analyzed in sections 3 and 4- The
question of whether environmental benefits might accrue to abandonment. of
the project is considered in section 6, and our recommendations are summarized
in the final section.
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1. Environmental Impact
The Gathright Project entails a severe environmental impact.
It is notable that this is so even though all three project pur-
poses - water quality, flood control and recreation - are related
to environmental quality. The basic environmental effect of the
Gathright Project is to replace a unique and highly valuable
resource, protected by public ownership, by a resource which is
not in short .supply and is distinctly less valuable on environ-
mental grounds. make no claims to special insight into these
environmental effects. However, because of the project's
relation to water quality storage, U is necessary for us to
consider such questions and to evaluate for ourselves their merit
The uniqueness and value of the area to be flooded by Gathright
reservoir stems from the presence in one and the same publicly
owned tract of land and water of: (1) a highly scenic stream
which supports an unusually productive warm and cold water fishery
and is also uniquely suitable for recreational canoeing, (2)
the juxtaposition of scenic mountains, gorges and river bottom,
lands, and (3) unusually productive gamelands which can pro-
bably not be duplicated elsewhere in the state. The range of
people who find these lands unusually appealing and important is
impressive. It ranges from the Corps itself, to professional fish
and game managers, and recreationists of many sorts. The follow-
ing excerpts from evaluations by others^representing both official
and private concerns, will illustrate these points:
"The Entire area is picturesque, isolated, and has a
rugged semi-wilderness character." (Corps, EIS P. 2-5)
"The Jackson River above the Gorge J^darasite} is consi-
dered 'an unusually beautiful Whitewater trip1 for canoeists."
(Corps, EIS P. 2-16)
"The Bureau of Outdoor Recreation states that there is
no substitute for a Whitewater stream - a lake is not com-
parable in any way - and because of the paucity of opportunity
for this recreational pursuit in this region, there is no
known area which might mitigate this loss." (Corps, Design
Memorandum No. 4, P. 19 - See Reference (1) below)
"The portion of the Jackson River to be destroyed is
the only free-flowing river of comparable size and quality
in public ownership within many miles. There is no comparable
recreational or aesthetic resource in the Commonwealth.of
Virginia. The nearest comparable resource...is the Chatooga.
on South Carolina's northwest border with Georgia. It is
300 miles as the crow flies from the Gathright area and con-
siderably further from the populous eastern part of Virginia."
(R. H. Skeppstrom, Reference (3) below, P. 3)
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"The Jackson River above Covington supports a quality
stream fishery which features such indigenous sport fish as
smallmouth "bass, sunfish, pickerel, catfish, fallfish and
sucker. In addition, the river above the Gathright dam site
is stocked annually with catchable size rainbow and brook
trout to maintain a high quality put-and-take trout fishery.
Since this important Jackson River fishery is located within
the Gathright Wildlife Mana^ment Area, public access >is assured.
This tends to magnify the universal appeal of trout and small-
mouth bass as sport fish." (Corps, EIS P. 2-12)
"The aesthetic appeal and high natural productivity of
these streams combine to afford sport fishing opportunities
of significant value." (Corps, Design Memorandum No. 4,
P. 20)
"The esthetic appeal of white water, unrestricted access,
high angling success, and good natural stream productivity
all combine to afford sport fishing of outstanding value."
(Bureau of Sports Fishery and Wildlife, Design Memorandum
No. 4, Appendix D,- P. D-20) v-
"The T„ M. Gathright Wildlife Management Area (18,392
acres) is regarded by State Wildlife officials as probably
one of the best such management areas in Virginia. The
highly productive wildlife area is essentially the result of
a diversity of habitat together with good management." (Corps
EIS P. 2-12)
"The importance of the wildlife area as wild turkey
range is considerable, more than any other State-managed
area, since Gathright serves as a pool whereby trapped birds
are utilized to stock other regions in Virginia." (Corps,
EIS P. 3-31)
"The area affected by the Gathright Project comprises
an important portion of the Gathright Wildlife Management
Area...The juxtaposition of agricultural crops in the fer-
tile bottomland and wooded uplands combines with topography
and water courses to provide excellent habitat for a variety
of wildlife species. In.addition to sustaining a high annual
wildlife harvest, the wildlife productivity of the area is
sufficiently great to yield substantial numbers of wild-
trapped turkeys for transplanting to other locations in
the State." (Corps, Design Memorandum No. 4, P. 22)
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"The unusually high wildlife productivity of the Gathright
area is a result of diversity and juxtaposition of these four
habitat types. The game production of the four types managed
as a single unit is much greater than the total production of
the same habitat types if they were isolated and managed as
separate entities." (BSFW, Design Memorandum 4, P. D-22)
"The exceptionally high populations of wild turkeys and
favorable trapping conditions found on the Gathright unit
make it an invaluable source of wild birds for restocking
other areas. ...The success of such a restoration program is
dependant on a source of wild bird^ since artifically reared
birds have proved unsuitable for this purpose. At present,
the Gathright area is the only source from which wild turkeys
are being obtained for Virginia's restoration program."
(BSFW, Design Memorandum No. 4, P. D-23)
Virtually all of the uniquely valuable features would be
destroyed by the reservoir. The white water canoeing would cer-
tainly be eliminated, together with the outstanding fishing which
exists at present. Attempts to mitigate the loss through flow
regulation of the stream segment downstream of the dam site cannot
reproduce the outstanding quality of the existing resource. Loss
of the fertile bottom lands will drastically reduce the carrying
capacity of the surrounding game lands as well as eliminating the
nucleus of the wildlife preserve. The Bureau of Sports Fishery
and Wildlife concludes "the existing source of wild turkeys for
the State's long-range turkey restoration program will be virtually
eliminated," (Design Memorandum No. 4, P. D-6) with incalculable
effects on the program itself. The State Commission of Game and
Inland Fisheries has repeatedly expressed firm opposition to the
project. (Design Memorandum No. 4, P. D-7).
The attempt to mitigate the loss of the T.M. Gathright Wild-
life Management Area as a major wildlife resource of the Common-
wealth of Virginia has apparently broken down or been abandoned.
The status of this effort should be described by the Corps in
the BIS. There is a need to: (1) identify a tract of land
capable of replacing the wildlife production potential of the
Gathright Area - if indeed any such alternative exists anywhere
in the State; (2) determine its cost and make provision to secure
it for the State. In meetings held to discuss such mitigation
involving the Corps, the State Game and Inland Fisheries Commission
and the Bureau of Sport Fishery and Wildlife, it was initially
recognized that Gathright could not be replaced on an acre by acre
basis, and that as much as 20,000 acres might be required to make
up for its loss. (see Design Memorandum No. 4, Appendix D).
This insight seems to have been eroded, however, since the Corps
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has paid only "fair market price" $620,000 for the 5415.5 acres actually-
required for project use. This sum is almost certain to prove far too
small to provide for replacement, especially since replacement lands
may well be more costly than those given up. Furthermore, since Federal
funds under the Pittman-Robertson Act were among those employed to acquire
the Gathright unit, it must be replaced, otherwise State eligibility to
receive such funds will be lost. Regulations of the Federal Department
of Interior provide that when gameland acquired with Federal aid under
the Pittman-Robertson Act is diverted to other uses, eligibility to
receive further such aid is withheld until "a property of equal value
at current market price and with commensurate benefits to fish and wildlif
is acquired with non-Federal funds to replace it." The State is thus in
the unenviable position of either losing all Federal aid to acquire and
develop game resources or else spending perhaps several million dollars of
its own funds to replace the game management resources lost.
The flooded segment of the Jackson River and the associated gamelands
would, of course, be replaced by an open water expanse. This would
provide Covington area-residents with convenient access to broad water
recreational pursuits. The Corps states that there are no other such
reservoirs within 50 miles of Gathright. This is a rather misleading
observation. Smith Mountain Reservoir and Summit Lake are each approxi-
mately 50 miles from Covington - the nearest population center to the
proposed reservoir. Other lakes and reservoirs lie at distances" of
approximately 65, 70,. 70, SO and 80 miles from Covington in virtually
every compass direction. Furthermore, the proposed Hipes reservoir would
be approximately as close to Covington as Gathright - but in the opposite
direction. Major regional population centers .such as Roanoke and
Lynchburg already have reservoirs and other recreational water surfaces
much closer to them than Gathright would be. Furthermore, Gathright
Reservoir would represent basically a "State Park" type of development.
Other State Parks exist in the immediate area. Opportunities to develop
public recreational facilities for swimming could be found much closer
to Covington if desired.
Other adverse effects which would result- from the Gathright Project,
as presently formulated, are mentioned in the sections on Water Quality
and Flood Control. These include loss of national economic welfare and
violation of standards of social equity; possibly, perpetuation of flood
risk through unwise use of the flood plains; and encouragement of
environmentally harmful "external" effects of the pulp and fa per industry
such as air pollution, aggravation of the solid waste problem, and promo-
tion of single purpose use of the nation's forests.
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2. Water Quality
A major purpose of the Gathright Project is improvement of
water quality in the Jackson and James River Basins. EPA has a
specific responsibility in this area. The justification for
inclusion of water quality storage in the project formulation was
originally provided by a study carried out by the Corps in collabora-
tion with EPA's predecessor agency in the Public Health Service.v1)
Furthermore, the Federal Water Pollution Control Act Amendments of
1972 provide that: "The need for, the value of, and the impact
of, storage for water quality control shall be determined by the
Administrator, and his views on these matters shall be set forth
in any report or presentation to Congress proposing authorization
or construction of any reservoir including such storage." This
determination is a heavy responsibility since, as
i-w. iSeoti-CfWS I a«itl-5, the environmental impact of this project
is quite severe and the project is not economically justifiable -
even 29% completed - without substantial water quality benefits. .
This conclusion holds both in economic theory and in the real,
political world. On the other hand, there undoubtedly exist
real water quality problems in the Jackson and James River Basins.
The questions which must be answered hinge on the feasibility of
achieving good water quality by treatment of polluting discharges
at their sources without the aid of flow augmentation, the
economics of the alternative strategies^and their relative com-
patibility with EPA's goals and legislative mandates, including
the Federal Water Pollution Control Act Amendments of 1972.
A. Water Quality Problems in the Jackson and James River
Basins
The Gathright Project is intended to assist in overcoming
several specific water quality problems. These are identified
in the Impact Statement and in the project document, Design
Memorandum No. 4, especially Appendix C. This latter work, pre-
pared with the aid of the Public Health Service, is cited in
the Impact Statement as defining the water quality problems to be
addressed. The major water quality problem which Gathright will
substantially affect is the poor stream quality produced in the 10-15 mile
reach below Covington by discharges from the Westvaco Pulp and
Paper Mill at Covington. Covington is 19 miles beloxv the Gathright
damsite, and the low values of dissolved oxygen (DO) found in this
stream segment were the critical factor in determining the amount
of water quality storage to be provided. Furthermore, it is only
the streamflows in this segment which could not be augmented equally
well by releases from other reservoirs orv other tributaries of the
(1) Water Supply and Water Quality Control Study, Gathright
Reservoir, James River Basin, Virginia, by the Norfolk
District, COE and the Public Health Service, Charlottesville,
Virginia, May, 1965. This study appears as Appendix C in
the Design Memorandum No. 4 for the Gathright Reservoir.
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James. Thus, for example, flows at Lynchburg or Richmond would also be
augmented by releases from the proposed Hipes reservoir.
EPA has refilled its water quality model of the James and Jackson
Rivers. Recent work confirms that the stream segment below Covington
is the critical reach affected by the Gathright Project, and that flow
augmentation or improved waste treatment will be required to meet stream
standards.
Another water quality problem which was identified in the earlier
work and in the EIS is found slightly above Lynchburg below the Owens-
Illinois Pulp and Paper Mill discharge at Big Island Dam, and extends
down to the Lynchburg Dam. This was stated to be due to power generation
at the intervening Reusen Dam, which results in storage of river flows
and "results in a virtually dry stream bed for a 2-3 mile stretch, causing
nuisance conditions and sporadic fish kills."
The problem in this reach is clarifed by EPA's more recent stream
quality modeling. Model results, which describe only steady state con-
ditions, show low dissolved oxygen levels in this stream reach, primarily
behind Coleman's Falls Dam above Reusens Dam. The above problem is believed
to be caused by the retention of waste laden waters behind this dam and
may also be affected by slow aeration rates through the slack water sur-
face. Intermittent streamflow is not depicted by the model. Such inter-
ruptions in the flow are undesirable on environmental grounds and may
well cause fish kills or other nuisance conditions in their own right.
In contrast, the proposed combined discharge of municipal wastes and paper
mill wastes below Lynchburg is not expected to cause violation of stream
quality standards for dissolved oxygen, assuming that secondary treatment
provides at least 85$ removal of BODy*
Additional problems exist at Richmond. Three have been suggested:
(1) Low flows above Richmond permit algae blooms to occur in the river
pools and cause taste and odor problems in the Richmond municipal water
supply; (2) Flows of up to 900 cfs are diverted through the Kanawha canal
at Richmond leaving "little or no flow in the natural channel from Bosher
Dam to 14th Street Bridge," (EIS, P. 2-10). This is stated to lead to
"nuisance conditions," (Ref. 1, P. 4); (3) The estuary below Richmond in
the Richmond-Hopewell area suffers from low dissolved oxygen. Increased
freshwater inflow would benefit water quality to some extent. However,
no such benefits are asserted in the Impact Statement, and in the Design
Memorandum it states explicitly that, "the flow from the reservoir is
such a small portion of the estuary volume that the benefits in this
portion of the river are unmeasurable."
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EPA has improved its capability of modeling estuarine water quality.
The level of treatment required of dischargers can now "be specified as a
function of freshwater inflow to the estuary. (The chemical industry in
the Hopewell area is the controlling waste source.) The total flow aug-
mentation necessary to reduce the required treatment level by a significant
amount is quite large - roughly 11 times the amount supplied by Gathright.
(Different strategies could be employed. The figure refers to the one
which requires least total water quality storage.) The contribution of
Gathright alone would be too insignificant to permit relaxed treatment
standards. Furthermore, construction of an effective system of reservoirs
would almost certainly take 15 to 20 years at a minimum. Nor is it likely
that such a system could be easily justified at this time, since as discussed
in the text, requirement of "best available treatment" will revolutionize
the water quality situation within a distinctly shorter time frame than this.
Thus, although a relatively small but non-zero value oould be attributed
to releases from Gathright as they affect estuarine water quality, we
believe the Corps is wise not to claim such benefits for this project.
We shall follow their example here and not attribute any monetary benefits
to Gathright for estuarine water quality improvement.
B. Technological Options for Meeting Water Quality Standards
with Little or no Flow Augmentation
(1) Westvaco-Covington. Secondary treatment of municipal wastes
.from Covington will effectively eliminate such wastes as a factor in the
water quality problem in the affected stream segment. The question is then,
what waste discharge by Westvaco is compatible with stream quality standards
and to what extent is it economically feasible to reduce discharges to that
level? Attention has focused on the dissolved oxygen in the stream segment
extending 10-15 miles below the plant. Virginia standards specify an average
DO of 5 mg/l and a minimum of 4. These conditions are not met at present
during much of the year. EPA has studied water quality in this stream
reach with the aid of a water quality model. The model parameters were
determined by field observations. The amount of waste loading which is
compatible with attaining stream standards in the absence of flow augmen-
tation can be specified with sufficient precision to meet all practical needs.
The precise value depends on the temperature and DO of the discharge itself.
Assuming that thermal standards are met (barely) and the DO of the discharge
is 5 mg/l) the stream can assimilate 8970 pounds per day of ultimate BOD.
This increases to 9270 pounds if the effluent DO is 6 mg/l. These numbers
are derived on the basis of the assumption that B0Du is 3 times BOD^, the
more commonly measured quantity, and assuming both a ma-sri mimi stream temper-
ature, 26°C, and a minimum flow, 87 cfs. This flow represents the 7 day
average flow recurring on the average once in 10 years. However, the 7
day-1Oyear low flow will typically occur in September, when stream temperatures
are likely to average no more than 22°C rather than 26°C. On the other .
hand, maximum stream temperatures are likely to occur in July and August.
The 10-year minimum of the 7 day average flow for these months exceeds that
of September by at least 15 cfs. The critical conditions occurilng, on the
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average, once in 10 years then represent the low flow encountered during
August and are compatible with a loading of about 10,200 lbs. per day
of BODu at an effluent DO of 5 mg/1.
It is adequate for purposes of discussion to suppose that a gross
loading of 10,000 lbs./day of BODu by Westvaco would meet stream standards
for DO without flow augmentation. The pennissable BOD5 discharge would be
about 1/3 of this BODu loading. From the discharge permit application,
we determine that present discharges average about 14,000 lbs./day of
BOD5. Of this, about 10,000 lbs./day are discharged from the treatment
plant proper, (These average values are believed to be the most relevant
quantities in considering the summer low flow conditions.) These dis-
charges are too high to attain stream standards even with Gathright. The
limiting conditions vwrtfc Gath right correspond to a summer flow of about
280 cfs, which allows a discharge of about 26,300 lbs./day of BODu or
8800 lbs,/day of BOD5. Thus, reduction of the BOD discharged by about
1/3 of the present amount can be taken as the "baseline condition" require
even if flow augmentation from Gathright is provided. (WesfviCo
•V© VicgtYMO* OJowW. CoaVoI "ihoar^ A ¦sc.Vici.uAe r^eet
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1) Other pulp mills have treatment efficiencies as high as 95$ and even
considerably higher; 2) The standard reference, "The Cost of Clean Water,
Volume III," indicates that as of its publication date, five years ago,
up to 95$ removal of BOD5 was "state of the art" for an activated sludge
treatment facility. This is the type possessed by Westvaco$ 3) The tech-
nology employed to treat pulp mill wastes is fundamentally the same as that
used in treating municipal wastes. Methods of upgrading municipal treat-
ment plants are well developed and permit much better even than 95$ BOD
removal. 4) It is the professional opinion of the appropriate technical
expert at EPA-Region III that upgrading the treatment facilities to 95$
removal is feasible. The required capital investment cost is estimated
to amount to 50$ of the value of the existing treatment facilities and
operating costs are expected to double.
This last observation permits the economics of the contemplated
treatment alternative to be addressed. Using standard figures for capital
and operating costs of treatment plants in the pulp and paper industry (2) ,
the estimate provided amounts to a capital investment of about $3 million
and increased operating costs of about $1 million per year. (1971 price
levels are employed throughout to facilitate comparison with the latest
available figures on reservoir construction costs.) Converting the operatii
costs to a capitalized present value using a 10$ interest rate, which
represents the typical rate of return on private capital investment and
approximates that appropriate to the pulp and paper industry, leads to a
total present value cost of about $13.2 million. (The "present value"
-incorporates the operating costs as an equivalent capital sum whose earnings
would just pay these costs.) This present value cost represents the savings
to Westvaco resulting from water releases from Gathright. Together with
the analogously defined quantity for Owens-Illinois, the other principal
beneficiary of this project function, it can be compared directly to the
capital value assigned by the Corps to such benefits, $26.9.*
(2) R. V. Thornann, Systems Analysis and Water Quality Management, 1972.
See, especially, Tables 9.2 and 9.6.
*After this work was completed, based on "state of the art" estimates,
additional data was obtained from Westvaco. Discharges of BOD^ from the
treatment plant have been reduced to about 8,700 lbs./day average at a
treatment efficiency of about 87.5$. Total present value of capital
invested in the plant was $3.5 million in 1971, less than the conservative
estimate we employed, and operating costs are slightly less than the $1
million which we allowed. Fourteen men are employed full time in pollution
abatement, including four whose duties relate to both air and water pollutii
We wish to express our thanks to the Westvaco Corporation for providing
this information.
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However, the $13.2H (Million) figure derived in this manner
seriously overestimates the net cost of meeting water quality standards
by enhanced treatment without flow augmentation. The Federal Water Pollution
Control Act Amendments of 1972 require that all industrial dischargers
employ, "the best available technology economically achievable," to abate
polluting discharges by July 1, 1983. There can be little doubt that the
reduction contemplated in the present context to meet water quality standards
is readily "available" even at today's level of technology, much less that
of 1983. This point was. documented in the last paragraph. Even higher
treatment levels may well be readily attainable. Sand filtration could
presumably be used—as in the analogous case of treating municipal wastes —
to remove another few percent BOD5* overall. Lime clarification, which
is discussed further below, can increase the efficiency of a subsequent
treatment process, as well as removing 30% or more of the BOD5* in its
own right. Thus, in requiring 95% removal of BOD5*, we would at most be
advancing by a few years measures which will have to be undertaken in any
case. Suppose the abatement schedule required of Westvaco specified 1977
instead of 1983 as the deadline for instituting these measures. The five-
year delay in making the contemplated expenditures would have a present
value (in 1977) to Westvaco of $4.9 million. It is this figure which will
contribute about 90% of the total which has to be compared to the cost of
flow augmentation, $26.9 million for a single-purpose reservoir. (As
discussed below, the allocated cost for the multi-purpose project gives a
very similar figure.)
A great deal of attention has been focused on the dissolved oxygen
problem downstream from Westvaco. However, there are several other respects
-in which Westvaco is in apparent violation of steam standards which are
amenable only to treatment and are not eliminated by dilution. These include
discharges of colored substances and toxic compounds. Virginia water quality
standards forbid for all waters and all times "...substances attributable
to...industrial wastes...which...interfere directly or indirectly with
beneficial uses of such waters." Uses of the upper Jackson are defined to
include "secondary contact recreation, propagation of fish and other aquatic
life, and other beneficial uses." The effect of the Westvaco Mill on the
color of the Jackson River has been described in the following terms,
"The Jackson River enters one side of the plant crystal clear, sparkling,
and colorless and emerges from the other side a black, foaming abomination."^)
Photographs of the river have conveyed to us the appropriateness of
this description. A biological survey
* Removal efficiency is stated in terms of BOD^, which is the quantity
usually measured. However, B0Du is actually the more relevant quantity.
We are implicity assuming that at the treatment levels under consideration,
the ratio of B0Du to BOD5 remains nearly constant.
^3)r. H. Skeppstrom, Comments on the Draft 102 Statement on the Gathright
Project, prepared fot- Citizens Against Pollution, Inc.
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of the affected stream reaches by VMI Research Laboratories, Inc.
presents the same picture.(4) The color itself has a strong impact
on recreational and scenic enjoyment of the river. It also can
be expected to adversely affect primary production by algae and
periphyton.
(4) The following summarizes observations by this group immediately
above and below the Westvaco outfall:
"Station #2 - Jackson River at the riffle approximately 100
yards upstream from tfie Covington, Virginia, Water Filtration
Plant
Numerous smallmouth bass and darters were observed in
the clear water at this station. A small group of children
were seen swimming downstream from the water filtration
plant. High water quality was again indicated by the 38
kinds (genera) of bottom organisms which included such
clean-water forms as mayflies (eight genera), caddisflies
(eight genera), stoneflies (one genera), riffle beetles
(two genera), and hellgrammites. A total of 426 bottom
organisms were collected in the square foot sample which
included 95 mayflies, 51 caddisflies, and 94 riffle beetle
larvae. Clean-water organisms made up 56 percent of the
total in the quantitative sample. High diversification and
numerous clean-water forms indicated excellent water quality.
"Station #3 - Jackson River at the Covington, Virginia,
Playground Park
This station was located approximately 0.7 of a mile down-
stream from the pulp and paper company and adjacent to the
Covington Municipal Playground. Virtually all of the rocks
were coated with a heavy, black slime believed to be
Sphaerotilus sp. The water was a dark, coffee color at
this station.
The water temperature was elevated, and foam was observed.
In addition, a strong odor characteristic of a mill opera-
tion was noted. The air-breathing snail Physa was present
in fair numbers, but these snails were all at the waterline
and on the rocks. For this reason, a quantitative sample
was not taken. Only a few sludgeworms and another bristle-
worm (Nais sp.) were found in addition to the Physa snails.
Severe biological degradation is indicated at this.station
when compared with the upstream station. The enormous drop
in genera from 38 (upstream station) to three at this station,
plus the complete absence of clean-water forms, indicated
heavy industrial pollution. All three kinds of bottom
organisms found at this station were pollution-tolprant forms.
The low dissolved oxygen and high water temperatures found
by VMI sampling during this period further substantiate the
poor biological conditions."
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-12-
Westvaco's treatment plant discharges about 37 cfs with a color
intensity of 1500 ppm color units. The natural color in the stream is
quite low, of the order of 15 ppm. Reduction of the color of the discharge
to that of the stream would require a dilution factor of about 100. The
dilutions actually available with and without Gathright under various flow
conditions are tabulated belowJ
7-day - 10-year minimum
7-d ay " annual"1 minimum
Mean discharge
With
Flow
160*
280
600
Dilution
4
7.5
16
Without
Flow
83*
115"'
600
Dilution
2
3
16.
* The minimum "without" occurs during the late summer or fall, the minimum
"with" occurs during winter.
Evidently Gathright produces about a factor of two increase in dilution
under low flow conditions, but nowhere near enough to avoid the very
dramatic and obvious "color pollution" described above. Under more typical
flow conditions, the presence of Gathright has no effect at all, as the final
row illustrates.
Color can be substantially reduced by lime clarification. This
process has been demonstrated as being economically feasible in full scale
operation (5). It has operated consistently at 90% color removal and
better. This is the equivalent of a "dilution" factor of 10. The effect
of such treatment is thus equivalent to multiplying the factors tabulated
above by 10. Clearly flow augmentation is far less effective than treatment
in reducing color levels. It can be safely assumed that color removal will
be required within a few years when the technology has been more fully
demonstrated. It is also reasonably clear that color removal could be required
even today. This is exactly what was done for the International Paper Company
Mill in Riceboro, Georgia, described in Reference 5.
Lignins, which are responsible for the color of the wastes, are also
the cause of its tendency to foam. The foam is eliminated by the lime
clarification together with the color. Just as with color, the effect of
treatment on foaming is greater than the effect of flow augmentation, and
the advantage is especially pronounced under typical flow conditions, as
contrasted to unusual ones. As mentioned above, removal of the lignins by
lime clarification improves the efficiency of biological treatment. Removal
of these surface active agents can also be expected to increase the
re-aeration rate in the Jackson River (6). This could assist in meeting
stream standards for dissolved oxygen.
(5) "Color Removal from Kraft Pulping Effluent by Lime Addition," prepared
for EPA by Interstate Paper Corporation, Riceboro, Georgia, Water
Pollution Control' Research Series 12040ENC12/71
(6) M. Waldichuk, "Some Water Pollution Problems Connected with the Disposal
of Pulp Mill Wastes," The Canadian Fish Culturist, No. 31, Oct. 1962,
PP. 3-34
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-13-
Pulp Hill wastes are known to contain toxic constituents which are
harmful to fish.(6) Among these are probably, "resin and fatty acid Soaps"(6)
and terpenes (7). These compounds are very stable in the aquatic environment
and would be expected to persist for a period of many weeks or even months
as the water proceeds downstream. Demonstrated effects on fish include
decreased ability to utilize food resources for growth (7) and increased
requirements of oxygen for respiration and survival in the presence of
stabilized Kraft effluent. (8) The increased oxygen requirement amounted to
a factor of two increase (from 2 mg/1 to 4 mg/1) on introducing 6% Kraft
effluent. (8) This low a concentration would require a dilution factor of
18. The decreased growth caused by Krafct effluent is especially interesting
because: (1) the effect was primarily encountered during the colder seasons
of the year—the period during which flow augmentation actually decreases the
flows; (2) the effect was detected at a concentration of 1% stabilized Kraft
effluent and was prominent at a concentration of 4%, corresponding to
dilution factors of 100 and 25, respectively; (3) the effect was evidently
due in large part to terpenes; and (4) addition of a terpene recovery system
to the mill in question markedly reduced the toxicity of the effluent.
EvidfcO-tly flow augmentation as provided by Gathright is largely irrelevant
to toxic effects from any such constituents of the Westvaco effluent, and
recovery of them might well be economically feasible at the present time.
No toxic effects on human beings from stabilized Kraft effluent have
been established. However, no systematic effort has been made to screen
the constituents of stabilized Kraft effluent for possible toxic effects
which could result from low doses over a long period of time. Note that
flow augmentation leading to dilution of wastes by a itotfe at
Covington would increase the dilution at Richmond by only about 102 (.5neA\&* 1®^
jlow-) (Richmond is the only major town on the James which obtains its
municipal supply directly from the river.) In contrast, a comparable decrease
In concentration at Covington produced by treatment would lead to a fold
(400%) decrease in concentration of the toxic substance at Richmond. This
proportional reduction, moreover, would continue in force throughout the
year, whereas that from flow augmentation would be nonexistent for much of
the time and would only develop its full potential during
(2) Owens-Illinois at Big- Island-Lynchburg. Discharges from the
Owens-Illinois Pulp and Paper Mill at Big Island are responsible for low DO
conditions found behind Coleman's Falls Dam. In contrast to earlier impression
the water quality problem is highly localized and Is almost Confined to this
pool. By a combination of in-plant changes and primary treatment, Owens-
Illinois has evidently reduced its discharges to about 16,000 lbs/day of
BOD5. (9) EPA's water quality model indicates that meeting water quality
standards above Coleman's Falls Dam requires a waste loading of only 2200
lbs/day of -ultimate BOD without Gathright and, only 5800 lbs/day with
Gathright. Assuming that the present treatment level amounts to 50% BOD5
removal and postulating a 3 to 1 ratio of B0Du to BOD5, the required treatment
level is 97.7% without and 94% with Gathright. In the course of studying
water quality conditions in this reach, we have become convinced that retention
(7) "Laboratory and Controlled Experimental Stream Studies of the Effects of
Kraft Effluents on Growth and Production of Fish," Stream Improvement
Technical Bulletin No. 259, Oct. 1972 of the National Council of the Paper
Industry for Air and Stream Improvement, Inc.
(8) D. F. Alderdice 3rd J. R. Brett, 19571 "Some Effects of Kraft Mill Effluen
on Young Pacific Salmon," Fish, Res. Bd. Canada, XIV(5), PP. 783-795,
cited by Waldichuk, Ref. (6)
(9) "clean Water: Affluence, Influence, Effluents,"ed. by
Albert E. Millar, 'Jr., 1971. Report of a Summer Program
Sponsored by ASEE-NASA Langley Research Center and Old
Dominion University Research Foundation. f
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-14-
of flows behind the Coleman's Falls Dam is largely responsible for the
intractible character of this problem. We ^vessfrxnarte that if the flows
were passed directly through this reach, the permissable loadings would
be about 9000 lbs/day without and perhaps 14,000 lbs/day ultimate BOD
with Gathright. These loadings correspond to treatment efficiencies of
91% and 85%, respectively. We conclude that removal of this dam or its
modification to preclude storage and retention of flows during low flow
periods is certainly a part of the most efficient method of meeting stream
standards in this reach. That such removal or modification is eminently
practical is clear from the fact that this dam has been abandoned and
unused for about 25 years and that it has been purchased within the past
year by Owens-Illinois itself.
Assuming that the Coleman's Falls Dam is demolished or modified,
the incremental treatment costs associated with foregoing the increased
flow provided by Gathright can be calculated approximately. We assume
(1) the capital cost of installing a secondary treatment plant having
85% efficiency is $1.73 million (9); (2) the capital cost of operating
the plant is about $400,000 per year; (3) the fractional increase in
capital and operating costs to reach 95% efficiency resemble those estimated
earlier for Westvacojand (.4) in interpolating costs to intermediate
treatment levels, the geometric ratios of BOD fractions remaining should
be employed. The estimated costs for reaching the higher treatment level
are then $290,000 for the capital investment and $120,000 per year for
operating costs. The present value cost of achieving the higher level
five years earlier than would otherwise be required is $.56 million. This
is about 10% of the comparable value calculated for Westvaco.
The EPA water quality model does not depict the fact that flows
are intermittent in the reaches near Lynchburg^which results from use
of the hydroelectric dams for peaking. These intermittent flows cause
fish kills in their own right (Ref. (1), P. 4). The requirement that,
conservation releases be maintained through the hydro-dams at all times
would eliminate this condition of nearly dry stream segments and resulting
"nuisance" conditions, including fish kills. In preparing these comments
on the Gathright EIS, EPA contacted the staff of the Federal Power Commissic
to determine the status of the affected dams and the nature of regulatory
authority over them. Proceeding downstream, five dams are involved as
follows:
NAME
OWNER
STATUS
Big Island
Owens-Illinois
Unlicensed, but presumably
subject to FPC regulation
Colemans Falls
Owens-Illinois
No hydro-electric generators—
No FPC authority
Holcombs Rock
Owens-Illinois
Unlicensed, but presumably
subject to FPC regulation
Reusens
Appalachian Power Under FPC License
Company
Lynchburg
Glamorgan Pipe and No hydro-electric generators—
VnnnHrv f.nmnsnv No FPC authoritv
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The following standard provisions of the licensing agreement apply
to the Reusens Dam and potentially to licenses to operate the Big
Island and Holcombs Rock Dams' generating facilities: "Article
6...the operations of the Licensee, so far as they affect the
use, storage and discharge from storage of waters affected by
the license, shall at all times be controlled by such reasonable
rules and regulations as...the Commission may prescribe for the
protection of life, health and, property, and in the interest of
the fullest practicable conservation and utilization of such
waters for power and for other beneficial public uses, including
recreational purposes;" and "Article 15. The Licensee shall, for
the conservation, and development of fish and wildlife resources,
construct, maintain, and operate...and comply with such reasonable
modifications of the project structures and operation as may
be ordered by the Commission... ." In cases such as the Lynchburg
Dam in which no generating facilities are present, the FPC has
no regulatory authority. In this case, however, the existence
of the structure in a navigable river ^ «.gaU-
tion by the Corps of Engineers. In either case, it is quite
l\^e.lvj that the U. S. Federal Government retains adequate authority
to require necessary conservation releases or other modifications
of the structures and their operation which might be necessary
to maintain satisfactory water quality and conditions for aquatic life.
We recommend that the FPC and Corps of Engineers look into this situation
and exercise their regulatory authority.
(3) Richmond. Taste and odor problems at Richmond are
at present combated on an as needed basis with additional water
-treatment. In 1965, the added treatment cost 5 to 6 thousand dollar;
per year.(^) It should be emphasized that taste and odor pro-
blems associated with algae blooms can be corrected completely
by proper treatment of the drinking water supply with activated
charcoal, which is the method employed at Richmond. It is stated
that no taste and odor problems exist when the flow at Richmond
exceeds 900 cfs. The question, however, is not really one of
taste and odor problems or their absence but of treatment costs
since an effect comparable^ to flow augmentation could be obtained
by routinely giving extra treatment to the water supply when
the flow in the James falls below 900 cfs. Furthermore, it has
been claimed that algae blooms are associated with river pools
which are unexpectedly flushed under low. flow conditions by
flow irregularities thus leading to taste and odor incidents.
If this is so, the conservation releases, from the .dams in the
Lynchburg area and the de-emphasis of the present prevalence of
.peaking releases-intended to benefit v/ater quality .upstream-might
well aid in correcting the taste and odor problem at (above) Richmond
Finally, it seems clear that this taste and odor problem would
rightly be called a problem of water supply since the presence
of algae is a natural phenomenon which is apparently not in the
present- c.ase associated with harmful conditions for aquatic life
or degradation of the aquatic environment. Therefore, if such
benefits are to be counted toward project justification, they
should be represented as "water supply benefits." As sucih, they
are re-imbursable. Project reauthorization would have to be
obtained to permit reimbursement for such benefits by the city
of Richmond. '
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-16-
The nuisance conditions below the Bosher -Dam site could
clearly be avoided by providing conservation releases through
the dam. This could presumably be required by the Corps of
Engineers under their authority to regulate navigable waterways.
Low flows at Richmond are adequate to meet projected municipal
and industrial needs to 2020 while still providing substantial
conservation releases. We recommend that the Corps investigate the
possibility of requiring such releases.
C. Policy Considerations Involved in Water Quality Issue
EPA has not yet formulated policy guidelines to govern
its new responsibility to determine, "the need for, the value
of, and the impact of, storage for water quality control." It
must balance an appraisal of the technology available for waste
treatment against the requirements of the
law that, "[jflow regulation) storage and water releases shall
not be provided as a substitute for adequate treatment or other
methods of controlling waste at the source." (FWPCAA-1972,
Section 102.b.l). Furthermore, adequacy must now be considered
in the light of the Congressional declaration that, "it is the
national goal that the discharge of pollutants into the navigable
waters be eliminated by 1985" (FWPCAA-1972, Section 101.a.1.)
and the specific requirement that the, "best available technology,
be employed by 1983. The thrust of these developments is that
flow augmentation, except under very unusual circumstances, will probably
be at most an interim measure.
In the absence of policy guidelines, it is not now
possible to assign a value to flow augmentation for water quality
improvement. Earlier assignments of value, such as that embodied
in the work of the Public Health Service in 1965C1), can no longer
be accepted as valid.
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-17-
In the present case, • (1) EPA
withholds endorsement of the project and does not at this time assign
a non-zero value to water quality storage; (2) in the present case, the
question of the value of water quality storage cannot be severed from
those of the economic feasibility of the project as a whole and of the
desirability of proceeding with construction; (3) therefore, proponents
of water quality storage will be required to establish by ..
substantial evidence the necessity of such storage. This must
be in the context of the current law which forbids such storage
as a substitute for control of pollution at its source.
Questions or economics,
equity and "external" costs and benefits of alternative strategies should also
be thoroughly explored. These questions have policy implications in
their own right.
(1) Economics: Efficiency and Equity. As discussed in Part B,
above, it is quite feasible to meet water quality standards without benefit
of flow augmentation. Meeting such standards is required by law and the
environmental quality benefit of higher water quality is not a consequence "of
the Gathright Project. Rather, the monetary savings enjoyed by Westvaco and
perhaps, Owens-Illinois are the true benefits accruing from water quality
storage in this project. The Federal Water Pollution Control Act
Amendments of 1972 require that the beneficiaries of water quality
storage be identified and provides that, "if the benefits are widespread
or national in scope, the costs of such features shall be non-reimbursable."
By implication, if these conditions are not met, the costs allocated
to water quality storage are reimbursable.' In the present case, by far
the largest part of such benefits would accrue to one—perhaps two—
private firms. Reimbursement should be required. The failure to require
such reimbursement would have serious adverse effects on economic
efficiency and on equity.
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-10-
As determined above, treatment costs are only a frac-
tion of water storage costs. To provide flow augmentation in
the amount and manner presently proposed would be economically
inefficient from a national point of view, and would be, "paid
for," by a net decrease in National Economic Development.(H)
However, only the treatment costs are paid for by the private
firm^while the water storage costs are traditionally assumed by
the public. Thus, it cannot be expected that the firm will seek
the most efficient combination when flow augmentation comes
free of charge. The conclusion that subsidized flow augmentation
leads to increased cost and decreased public welfare is not new
or unique to the present case. The following material from a
recent economic analysis of the value of dilution water can be
taken to illustrate the point: "j^DavisJ made the important ob-
servation that where Federal subsidies are provided, the local
cost of augmentation can be zero; therefore, regional decision
makers might argue strongly in favor of this method even though
its total cost in achieving a desired water quality were many
times that of the lowest cost alternative. From the standpoint
of national welfare, the choice of low flow augmentation in
these circumstances would of course be incorrect."(This
problem is eliminated by requiring reimbursement (provided that
an interest rate comparable to the typical rate of return on
investment by the industry in question is employed in setting
annual charges.) This would then permit the industry in ques-
tion to make use of the knowledge which it alone possesses as
to the cost of the least expensive technological^pptions for
treatment or process change5and to balance thatAagainst the cost
of water quality storage, allowing for any advantages implicit
in multiple purpose project formulation, to arrive at the most
economically efficient means of reaching the water quality
objective.
(11) See the proposed Principles and Standards of the Water
Resources Council for a icJiscussion of this concept.
(12) L. B. Merritt and B. W. Mar, "Marginal Values of Dilution
Waters," Water Resources Research 5, 1186 (1969).
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-19-
If reimbursement is not required equity—fairness—is sacrificed
as well as efficiency. Why should the people of the United States
subsidize the profits of the shareholders in these firms? (If Westvaco
were likely to close down its Covington Mill as an alternative to making
the required expenditures, the well-being of its employees would
obviously have to be considered in depth. Even in this case, it would
be more efficient from a national point of view to subsidize treatment
than to augment streamflows. It is worth noting in this context that
the largest part of the treatment costs are for"operation and maintenance.n
Part of this cost is for labor. This means jobs for Covington. The
"treatment" option may well provide a more lasting contribution to
"Area Redevelopment" than short-term expenditures for public works
construction.) Citizens who perceive that such a project as Gathright
provides a very substantial subsidy from the public treasury to a
profit-making enterprise typically and quite justifiably react with
shock and outrage. (3) Such subsidies are not compatible with our
social goals and sense of justice. This is a point which should be
recognized by decisionmakers in Federal agencies and other public
servants.
(2) Externalities: Certain industries are deliberately subsidized
because it is felt that increasing their output is in the national
interest. No doubt inexpensive paper contributes to our standard of
living. The possibility of a "paper shortage" is sometimes raised.
Furthermore, Covington is on the fringes of Appalachia. Expansion of
its major industry might be considered worthy of encourgement even
though the Covington area is not as depressed as other parts of this
region. However, it is very important that these arguments be analyzed
-with care instead of being accepted uncritically.
The U.S. paper industry has recently been suffering from excess
capacity and over-production. Profit margins have suffered in conse-
quence (13). A "Shortage" is not likely in such a competitive market.
At worst prices would rise. Production of paper entails significant
environmental cos+s u/hid* have not been reflected in the market cost. Even
aside from air and water pollution, paper is a major constituent of
the solid waste problem which plagues American cities. Excess capacity
has led paper manufacturers to attempt to promote new disposable products,
which would tend to further exascerbate this solid waste problem.
Furthermore, excessive paper consumption places a heavy burden on our
nation's forests. Clearcutting and other intensive management measures
are necessitated, and the replacement of mixed aged forests by even-
aged plantations is encouraged. The latter are¦typically less
productive of wildlife, less attractive and less ecologically stable,
so that increased pesticide applications are required. Thus higher
paper prices which led to reduced use and waste of this commodity might
on balance be a desirable result.
(13) "The Water Lords," James M. Fallows, 1971
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-21-
3. Flood Control
Flood control is a major function of the Gathright project.
Yet no systematic program is described which would preclude project
induced stimulation of flood plain occupancy, leading in turn to
increased flood hazard. Past experience has shown that this is the
typical result of reliance on structural flood protection without
simultaneous enactment of effective land use controls. Abundant
literature exists to document this observation. (15) Structural
flood protection, such as that provided by Gathright, is almost
never totally effective. Below the mouth of Dunlap Creek in
Covington, just 19 miles below Gathright, only 45 percent of the
peak discharge would be controlled. '1~ The significance of
"partial flood protection" was grimly illustrated by the Rapid
City disaster in South Dakota. In that case, 261 people were
killed in Rapid City just 14 miles downstream from a modern,
multipurpose flood control reservoir, Pactola Reservoir. The
reason was that the rain fell on the watershed downstream of the
reservoir.(16)
Because of the danger of increased flood hazard resulting
from over-confidence in the degree of flood protection accorded by
an upstream reservoir, we believe that construction of such a
project should not take place until all affected downstream county
. or municipal bodies have undertaken definite programs to regulate
flood plain use. Ideally these should include qualification for
Federal Flood Insurance.vl7) Following Hurricane Agnes, there has
developed considerable interest in the affected area in flood plain
zoning. (18) The Corps has been providing assistance by mapping the
1^ See, for example, L. B. Leopold and T. Maddox, Jr., The Flood
Control Controversy, 1954; Tennessee Valley Authority, A Program
for Reducing the National Flood Damage Potential, 1959; and Task
Force on Federal Flood Control Policy, A Unified Program for
Managing Flood Losses, 1966.
16 Flood Control - A Field Investigation, Environmental Defence
Fund, 1972.
17 42 U.S.C. 4001 "The Federal Insurance Administration (HUD) requires
a connrunity to adopt certain land use and control measures in order
to qualify for flood insurance coverage." Ref. (16). See this
reference for additional information.
1® Robert M. Shannon, Executive Director, Fifth Planning District
Commission. Botetourt and Roanoke Counties, have already adopted
flood plain zoning regulations.
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-2.2-
flood hazard zones. The Corps should employ this favorable opportunity
to secure definite coirniitments to institute flood plain land use controls.
It would be desirable to hold further construction on Gathright in abeyance
till these commitments are obtained. No less would be fully consistent
with the directive to Federal agencies embodied in Executive Order No. 11296,
August 10, 1966: "...the heads of the executive agencies shall provide
leadership in encouraging a broad and unified effort to prevent uneconomic
use and development of the Nation's flood plains (.)"
In the absence of Gathright, one may anticipate that the local
progress toward flood plain zoning will continue. Thus in the absence
of Gathright, a gradual decline in the value of structures in the flood
plain should be anticipated as non-confarming structures depreciate and ay~e
not replaced. If Federal Flood Insurance were widely adopted, then costs
of flood damage would be borne in part by the Nation as a whole—in
complete analogy, to public financing of a structure to prevent such
individual losses. Each "alternative," structure or insurance, distributes
the burden of financing flood losses onto the Nation as a whole. Each
should be supplemented with a varning system to prevent loss -of life, since
flash floods remain a possibility in either case. One important virtue
of the flood insurance program is its educational aspect. It has been
shown that the people inhabiting the highest risk areas of the flood hazard
zone are often those least aware of the danger involved.(19) Another
virtue is that it is "self-liquidating." Ultimately, structures are
removed from the hazard zone except those for which high economic returns
justify location there. Thus, personal danger and property loss are
eliminated. A major potential adverse effect of structural flood control
measures is simply that they tend to discourage this much more effective,
desirable, and permanent long-term solution. Every effort should be made
to avoid this consequence.
In contrast to occupancy by individuals and small businesses,
major industrial plants locate in flood hazard areas knowingly for the sake
of the economic advantage which such locations my confer. They thus accept
the periodic flood losses for the sake of economic gains. The cost of
doing business in the flood plain should not be subsidized by the public
at large. Criteria both of social equity and of economic efficiency would
be violated by such a subsidy to the detriment of public welfare. Therefore,
costs of providing Federal flood protection to WESTVACO, in particular,
should be passed on to this corporation. The flood control benefits to
this one plant represent almost halt, 40%, of the total project flood control
benefits. The corresponding fraction of project cost allocated to flood
control should be reimbursed by WESTVACO. Annual costs to be reimbursed
should be calculated using the rate of return on private capital investment,
10%, to property reflect the cost to the Nation and WESTVACO's gain. The
amount of this payment, as calculated below in the "economics" section, is
00(ooo
19 D. L. James, E. A. Laurent, D. W. Hill "The Flood Plain as a Residential
Choice," Atlanta Institute of Technology, 1971.
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-23-
4. Recreation
EPA has no special responsibility for evaluatiag^benefits. Howev~~
they are closely related to the environmental impact of the project,
which we must consider in evaluating the impact of water quality storage.
Moreover, these are among the "benefits" which the project is designed
to provide and which must be foregone if a higher level of treatment is
employed to meet water quality goals in place of flow augmentation.
We feel that the recreation benefits claimed for the Gathright
project are not credible. The methods usually employed by government
agencies appear to systematically overstate the value of high" density
recreation. If recreational values were accurately reflected by the "
calculational tools employed, National Parks and Wildlife Refuges would
not be worth their cost to the American people. Through the political
process, it has been made abundantly clear that such resources are
valued by the public—enough to preclude other apparently more remunerative
economic uses. That such values are not reflected in calculated "benefits"
and "costs" impeaches the accounting procedures employed.
A possible conceptual alternative to the scheme usually employed
is the following: the public at large, in this case the people of
Virginia, receive a value each year from the existence and "preservation
of a major, unique natural resource such as the upper Jackson and the
Gathright Wildlife Management Area. The mere existence of such areas
and the knowledge that they exist and can be enjoyed at some time in
the future, enhances the scope of the affected person's existence and
provides real and valuable rewards. Because many people are affected,
this benefit is a major factor even though the returns to individuals
may be small. If the average value of the typical return was $1.00
per year and accrued to several million people, it would dramatically
change the relative value of the recreation resource with and without
the project. In view of the widespread opposition to the Gathright '
project such an estimate does not seem unrealistic.
Even within the confines of the traditional accounting scheme,
the value of recreation without the project appears to be underestimated
in comparison to that with the project. Thus, although total man-days
of trout fishing are about 20,000 per year in each case (thanks to the
inclusion of mitigation measures) -the superior access, more "outstanding"
fishing, and scenic surroundings under the"existing, no project
circumstances have been neglected. If these factors serve to double
the enjoyment of the fishermen, they might represent a value of $120,000
each year. Similarly, though only half of the annual 20,000 man-days
of hunting are lost as a result of project implementation, because of
the unusual productivity of Gathright, the hunting which goes on today
is of higher value per man-day than that which would remain after
construction of the dam. If the extra value associated with greater
hunter success is assigned a value $5.00 per man-day, this project induced
cost would amount to an additional $100,000 per year. In a similar
fashion, the potential value of white-water canoeing without the project—
a potential which is by no means fully developed today—can be reasonably
assigned a value of $50,000 per annum (10 parties per day of 10 individuals
each - 5 canoes - over a recreational season of 50 days, effective length.
The actual total length of the season would be longer but the use non-
Tnorot-hoT chosp neelected or underestimated recreational
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-24-
dis-benefits would decrease the net recreational benelits attrioutable
to the project from $381,000 to $111,000 per annum. The possibility of
compatible development of opportunities to sight-see, birdwatch, or
indulge in other outdoor activities at the Gathright area in the absence
of the dam would add further value to the "without" total recreational
benefits and further decrease the net yield from project implementation.
The possibility has been suggested (3) that provision of public
swimming in the Gathright reservoir would result in swimmers contracting
acute primary amoebic meningoencephalitis (PAM). This is a disease which
is contracted through swimming and is invariably fatal. There is no
known cure. The disease is endemic in several recreational lakes in the
Richmond area. A review of the available data conducted with the aid
of Dr. S. L. Chang of EPA's Cincinnati Laboratory, one of the leading
authorities on this disease, leads to the following conclusions: (1) The
disease seems to be endemic in some, but not all, apparently comparable
recreational lakes in various areas; (2) The disease is definitely present
in parts of Virginia; because of the unfamiliarity of the disease to
most physicians, it may be more widespread than is presently recognized; and
(3) The causal factors which make the disease endemic to some lakes and
not to others are not known. "The natural reservoir of N. Fowleri [the
tentatively identified pathogenic organism} has not been defined. It may
well be that some animal could act as a reservoir or vector..."(20) We
conclude that there is a possibility that the unknown causal factors would
lead to acute PAM becoming endemic to Gathright Lake. The probability
of a given swimmer contracting the disease is very small, however. A
study-of- PAM- i» the- Rachnxmd- area- cit-ed- in reference (20) diagnosed 16
cases {retrospectively) extending over a 15-year period. Presumably not
all cases were found. We may postulate the rate of incidence in this area
to be 4 per year. Total swimming in the Richmond-Lynchburg central James
area has been estimated at 8,000,000 man-days per year.(9) If half was
in bodies of water in which PAM might occur, the incidence of the disease
would be about 1 case per million'man-days of swimming activity. For a
lake in which the disease was known to be endemic, the incidence rate
would be much higher. If the Gathright reservoir were neither more nor
less likely to harbor PAM than the central Virginia waters for which the
data is available, one case of PAM would result every 10 years, assuming
that one in four man-days of recreation involved swimming. It must be
recognized that people.are quite willing to run risks for the sake of
enjoyment or convenience; the risk involved in traveling to and from the
•reservoir would certainly exceed that involved in swimming in it. However,
it would be desirable,, if PAM turned out to be endemic in Gahtright, to
insure that prospective swimmers were fully informed as to the potential
danger. This would probably tend to decrease their fenjoyment of the
experience. It might be worthwhile to attempt to further elucidate causal
factors involved in transmission of this disease before further promoting
extensive" participation in "swimming in recreational water bodies.
(20) R. J. Duma, "Primary Amoebic Meningoencephalitis," CRC Critical
Reviews in Clinical Laboratory Sciences, June 1972,jpp. 163-192.
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5. Economics of Benefits and Costs
It is a primary function of the Impact Statement to explain not
only what environmental costs are incurred but why they are necessary
to meet valuable social or economic goals. This means that the project
purposes, including their economic returns, should be carefully discussed
in the Impact Statement. This information was not provided in the Impact
Statement. Furthermore, EPA had great difficulty securing needed
information which would permit us to address such questions, notably
data concerning current benefits assigned to individual project purposes.
These were eventually located in Congressional hearing records. (22)
Average Annual Benefits are given as follows:
Flood Control
Water Quality Control
Recreation
Area Redevelopment
TOTAL
$ 720,000
$ 884,000
$ 381,000
$ 226,000
$2,211,000
The importance of such data is that it provides a quantitative description
of the formulation of the project. We, as reviewers, need it to
quantitatively comment on our own reassessment of the project. Witness
the fact that every one of these numbers is employed for some purpose
in these comments.
The EIS states that the project is 29 percent completed, and that
its total cost is $39.4 million. Major cost increases of 20 and 30 percent
have occurred during each of the last two fiscal years. The benefit/cost
ratio is said to.be 1.2 calculated using an interest rate of 3 1/8% and
a project life of 100 years.
Benefits from specific project functions have been presented in
the sections on those functions. It remains to study the benefit/cost
ratio and the costs allocated to water quality under different alternative
assumptions.
A. The B/C Ratio Used In Project Authorization
If EPA finds the assignment of non-zero water quality
benefits incompatible with its interpretation of the requirements of the
Federal Water Pollution Control Act Amendments of 1972, the benefit/cost
ratio for the project as a whole would drop to .72. Furthermore, when
Area Redevelopment benefits are excluded as being not National Economic
Development benefits, the ratio drops to .61. Even with 29% of project
costs omitted, completion of the project has a benefit/cost ratio of
.86 in the latter case and 1.01 in the former, using the Corps' estimates
of the other benefits and costs. Furthermore, with water quality storage
needs eliminated, it is obvious that less storage would be needed to meet
remaining project functions at least cost. This means that there is a
less expensive alternative which provides the same benefits. By the rules
under which the Corps operates, the B/C ratio is then (cost of completing
reduced storage project)/(cost of completing presently authorized
project), which would be markedly less than unity.
(22) Public Works Appropriations Hearings Record, Fiscal 1973, 92nd
Congress, Second Session, Part 1, Volume 1.
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It is our understanding that this situation would require
re-authorization of the project. This authorization would presumably
employ the current interest rate, 5.5%. Under these circumstances, the
B/C ratio is calculated at $1.33 M/Sl.96 M = 0.68. The saving resulting
from the permissable lowering of the conservation pool has been taken
into account using the data in Table 11 of DM4.
We conclude that Gathright is not economically feasible without
water quality storage benefits. Therefore, EPA must accept a moral
responsibility for the environmental impact of the project as a whole.
B. True National Benefits and Coses
As discussed in the proposed Principles and Standards
of the Water Resources Council, the effect of public investment on
National economic development is properly calculated by use of an interest
rate which represents the rate of return on private capital investment.
This interest rate approximates 10%. Since the major part of the project
functions of Gathright can be achieved by alternative means which amount
to private capital investment for private returns, it is clear that the
use of the rate of return on private capital investment will permit the
comparison of alternative social strategies on the basis of their economic
efficiencies without distortions produced by regulated interest rates,
transfer payments or outdated public investment criteria.
1. Corps of Engineers' Benefit Stream. Let us first
calculate the benefit/cost ratio based on the Corps' values of the benefits,
including that for water quality. These last are calculated as the cost
of an alternative single purpose reservoir which would provide the same
flow augmentation. This alternative reservoir would cost $26.9M. When the
interest rate is changed, the benefits for such an alternative capital
investment change in parallel to those of the authorized project. The
new water quality benefits have annual value of $2.69M. The annual
national economic development benefits and costs are then, respectively,
$3.791M and $3.94M. Note that annual returns are $150,000 less valuable
than expenditures. The regional benefits have annualized value, according
to the Corps, of $226,000.* From this should be substracted the incremental
wages paid out according to the alternative plan. Recall that this
involves relatively high "operating and maintenance" costs, a major share
of which is wages. It is likely that these wages would come close to
equaling the figure $226,000 per year. For this reason, the Corps "Area
Redevelopment" benefits will be dropped from the discussion, since they
will probably not much exceed the Area Redevelopment benefits of the
"no-action" alternative. Thus, even with the Corps' large benefits, the
benefit/cost ratio is less than one when analyzed: with regard to true
economic costs and returns. It is useful to calculate the costs allocated
to the different project functions using the separable costs (as fractions
of total project cost) given in Table 11 of DM4. The separable cost of
* Use of a low interest rate is appropriate in calculating the value to
individuals of wages as opposed to a capital sum, since the earnings on
their savings will be low in real terms. In short, to tiie individual
wage earner continued long-term employment is much more valuable than
a short-term bonanza.
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the recreation function turns out to exceed recreation benefits by a
substantial margin. However, this does not mean that recreation can be
deleted as a project function since in part it represents mitigation
for the loss of existing recreation resources. Assigning an allocated
cost to recreation equal' to"its numerical benefits, "we then calculate
the following allocated annual costs.
Water Quality $2.81M
Flood Control" $ .75M
Recreation $ .38M
The water quality costs and at least 40% of the flood control costs should
be reimbursed to the government—as discussed above. These charges would
apply primarily to Westvaco.
2. Re-estimated Benefits. Let us calculate the benefit/
cost ratio derived from the benefits for water quality and recreation
re-estimated above. The annualized benefits for water quality are then
at most^.55M. Total national economic benefits then become $1.41Musing
recalculated recreation benefits of $110,000 per year. (The very large
correction for the Value of the unique scenic and recreational resource
lost-discussed in the Recreation Section above—has not been included.
It might easily cut the total project benefits in half.) The national
costs are $3.94M. Thus the belief it/cost ratio is 0.36. Even when the
fact that 29% of project expenditures have already occurred is taken into
account, the ratio is still only 0.51.
6. Alternative
Alternative strategies to achieve the individual project functions
were discussed in detail in earlier sections. It has also' been established
that even 29% completed, the project is still economically a poor
investment. The question remains, to what extent have the"scenic values
of the project area been adversely affected by construction to-date? Is
there anything worth saving left? The answer is definitely yes in our
opinion. The major impact to date has been localized in the Kincaid
Gorge region where the dam itself would be located. The major scenic
impact results from stripping the overburden from the area where the
embarkment will rest. We have seen photographs of this area and believe
that with or without human assistance the area will recover its natural
appearance in time and will have a reasonably naturalistic appearance in
a few years. The other major construction effects, building the concrete
intake tower and the outlet tunnel, could readily be demolished and
concealed. The Corps should develop a program for scenic restoration,
and should give cost estimates in the Impact Statement.
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7. Conclusions
We find the impact of this project to be severe. An essentially
unique and very valuable resource would be lost. The resulting reservoir
would be one of many within the general area. Its economic returns,
moreover, would be less than its costs, even taking into account the
fact that 29% of the total cost has already been spent.
We recommend that the following actions be taken:
1. No non-zero value can be assigned to water quaiicy scorage
until proponents of such storage have established its necessity. This
should include proof that water quality storage will not be provided
"as a substitute for adequate treatment or other methods of controlling
waste at the source." (FWPCAA-1972, Section 102.b.l)
2. Private firms, notably Westvaco, should reimburse the Federal
government for the allocated costs of water quality and flood control
benefits which accrue to them. True national costs should be reflected
in the charges. Modification of project authorization should be sought
from Congress if that is necessary to secure such reimbursement.
3. The Corps is requested to investigate how the disturbed area
at the dam site may best be restored and the cost of such restoration.
4. Further construction or administrative action leading
thereto *-s inadvisable until ' che need for, the value of, and the
impact of storage for water quality control have been established
the Federal Water Pollution Control Act as amendec
ixA until provision has been made for reimbursement, and commitments
to pay secured from the beneficiaries. in particular, further
commitment of funds which would ter.d to preclude termination
of the project should be avoided.
5. The Federal Power Commission and the Corps of Engineers shou
examine the feasibility and desirability of requiring conservation
releases through the various dams on the main stem of the James. Such
releases should be used to avoid depleting downstream flows to the poin
where harm is done to aesthetic values and the maintenance of fish and
wildlife.
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